Macworld 2008 keynote: Initial thoughts

Note that these are initial thoughts only. I'm guessing there will be a lot more to say about this later.

Leopard update
Apple sold 5 million copies of Leopard in 2007, "the most successful year for Mac OS X ever." That is actually quite a feat. Microsoft sold just 100 million Vista licenses in 2007, so Leopard is already at 5 percent of the user base (or more, given Microsoft math) of Vista. Obviously, this will change going forward, but slowly. Clearly, Mac users are eager for an OS upgrade in ways that Windows users are not.

Grade: A
Leopard has issues but it's selling great and Apple has a history of getting things right over time.

Time Capsule
An Airport Extreme Base Station (AEBS) combined with a "server class" hard drive; in other words, a NAS backup device, but designed to be wireless via 802.11n. Jobs described it as "a companion product" for the Time Machine feature in Leopard. If that's all it does, it's a niche product. Pricing is decent: 500 GB for $299, 1 TB for $499. It's going to ship in February. (Which is Applespeak for February 28 at the earliest.)

Grade: B
NAS storage is a good idea, as is getting people to backup, but this isn't a volume product.

iPhone update
Apple sold 4 million iPhones in 2007, which is still phenomenal, though analysts expected the figure to be 5 million: Clearly, the price drop (and European expansion) was the right thing to do, as sales were dwindling in the US in August. Jobs claims that the iPhone garnered 19.5 percent of US smart phone market in its first 90 days on the market, second behind RIM with 39 percent. Which his interesting, since Windows Mobile actually outsells RIM: According to Apple's chart, Microsoft isn't even on the list (though "Other" is at 21.2 percent). Cute.

Grade: A
Despite serious flaws, the iPhone is off to a great start.

New iPhone features
Jobs demos new iPhone functionality: Maps with location (sort of a low-tech non-GPS version of GPS), Web clips (Add Web bookmarks to iPhone home screen; these remember where you were on the page as well), customizable home screen(s) (it now supports up to 9 of them), multi-person SMS, video chapters support, song lyric support. In short, everything that we already knew was coming in iPhone 1.1.3, but good news nonetheless.

Grade: B
These are very nice additions, but the iPhone could still be improved in innumerable ways.

New iPod touch features
Apple is adding Mail, Maps, Stocks, Notes, and Weather to the iPod touch! Nicely done, as this was unexpected and arguably unnecessary (and will certainly cause some potential iPhone buyers to just move to the touch). The bad news: While new iPod touch users get this for free, existing users have to pay $20 (!!!)

Grade: B
Would have been an "A" if it was just free.

iPhone SDK
The long-awaited iPhone SDK is due "in late February." And that was literally all that was said about this.

Grade: D
Come on, guys. We need more information.

iTunes update
As you might expect, Apple's iTunes Store has been doing phenomenally well. They've sold over 4 billion songs (20 million on Christmas Day 2007 alone), 125 million TV shows, and 7 million movies. Both are way above the competition (for now), but "did not meet expectations."

Grade: B
Apple has a great selection of content, but the movies are just too expensive.

iTunes Movie Rentals
As expected, Apple is getting into the movie rental business, a business Windows-based companies have been plying for almost a decade. Every major studio is on board, and Apple will offer 1000 movies at launch, with new movies arriving in the store 30 days after the initial DVD release. New releases are $3.99. "Library titles" are $2.99. As with Windows-based stores, you have to begin watching a rented movie within 30 days of downloading; once you start watching it, you have 24 hours to finish it. US only now, international later this year. Updates for the iPod and iTunes will be required to make this work. (Curiously, no mention of Apple TV, though I expect that will work too. After all, you want to watch movies on TV, right?)

Grade: A
And its about time. The pricing is right, and the viewing rules are identical to the Windows stores that have been around forever. However, Apple's movies will likely be of very high quality and of course they work with iPods, which makes them more interesting.

Apple TV update
As expected, Apple has significantly enhanced the Apple TV. The new version ("Apple TV Take 2") is fully independent of the PC and can rent HD and standard definition movies directly from the iTunes Store. It syncs with iTunes (optionally, I guess, and yes, with reverse sync), gets online photos from Flickr and .Mac (all six of you), and can subscribe to audio and video podcasts. New HD movies rent for $4.99, library titles for $3.99 (plus the regular "DVD-quality" movies). 100 titles "today." It features an entirely new and unnecessary UI but the box itself looks the same. More good news again: It's a free software update for existing Apple TV users, so the hardware isn't changing. It happens in two weeks, which is when the entry level Apple TV falls from $299 to $229.

Grade: A
What's interesting about this is that I use my own Apple TV almost exclusively for movies. And this new Apple TV is all about "movies, movies, movies," Jobs says. It's the right direction, and allowing people to do things (rent, etc.) from the couch with the remote is obviously the right thing to do (as myself and many others have noted over the years). Overdue, again, but welcome. The new price is right.

iTunes-compatible movies on DVD discs
As rumored, Fox (and presumably others) are going to be shipping iTunes/iPod/iPhone/Apple TV-compatible movies on the disc with certain DVDs. The first, as reported last week, is "Family Guy Blue Harvest," which comes out today. I've preordered it and will write this up later today. Fox calls this "Digital Copy," and says there's no added cost for these DVDs.

Grade: n/a
We need more information--and industry support--before any credible opinion can be formed.

Macbook Air
As expected, the biggest announcement at Macworld was the long-rumored Macbook Air, a silly name but a cool looking ultra-portable machine. It weighs about 3 pounds, is incredibly thin ("the world's thinnest notebook," of course), and doesn't compromise on keyboard, display, performance, or (?) thinness. It features a 13.3 inch widescreen display, a Macbook-like keyboard but with ambient light sensors, built-in iSight, and a magnetic latch. The big new feature is its large multi-touch trackpad: It lets you use iPhone-like manipulations and navigation in OS X. As expected, the Macbook Air uses an 80 GB 1.8-inch hard drive (like the iPod) or an optional but "pricey" 64 GB solid-state disk (SSD). The CPU is a new 1.6 or 1.86 GHz Intel Core 2 Duo (not ultra-low voltage), presumably the "Prenryn" versions which are smaller and cooler than last year's models. There's no internal optical drive, of course, but you can get an external USB model for $99 and Apple has a software feature called Remote Disk for "borrowing" the optical drive from another Mac. There's only one USB port (no Firewire), a micro-DVI port, and a headphone jack (all via an un-Apple-like flip down cover). There's 802.11n wireless, but no wired Ethernet. It gets 5 hours of battery life, which is great, but not quite as high as I had expected. (Plus Apple tends to exaggerate battery life estimates.) Pricing is expensive: It starts at $1799 and will ship in two weeks. Pre-orders can be taken today.

Grade: B
Apple's decision to go with Intel has paid off dramatically for both companies. Apple gets to make innovative products like this and Intel gets to use Apple as a show-off designer that uses its platforms. On the bad news front, Steve didn't tell anyone that the SSD version would cost over $3000. Yikes.

Final thoughts
Overall, it was a solid keynote. While this year's Macworld lacked the bonanza product introduction that was last year's iPhone, it more than made up for it by focusing a lot of it on the Mac. More important to Windows users, perhaps, there was a lot of non-Mac stuff as well. A big event, and one that, yes, easily eclipsed Bill Gates' final CES keynote from last week. Were there any disappointments? I'd have to point out the lack of any real surprises, no "one more thing" that no one saw coming. Maybe it's just a reflection of the age we live in: Even a company as secretive as Apple can't really keep secrets from its rabid fans anymore.