RSSYear in Review: Apple Continues to Wow
By Ed Oswald | Published December 31, 2005, 2:44 AM
Apple continued to build on its dominance of the digital music industry in 2005, and saw the successes slowly bleed into its personal computer business as industry analysts began to gauge the iPod's "halo effect."
The folks at Cupertino would also do the once unthinkable and admit that Apple was falling behind the rest of the industry by continuing with the PowerPC architecture, a decision that could shape the company in 2006 and beyond.
Apple started the year by opening an Irish version of the iTunes Music Store four days before Macworld. However, the biggest fireworks were yet to come.
At Macworld on January 11, Apple CEO Steve Jobs announced that the company was joining the low-price PC industry by introducing an entry level Mac Mini at $499. Jobs also unveiled the iPod Shuffle, a diminutive flash player that would now serve as the entry point to Apple's iPod line.
The products would prove popular, and by mid-month both would be backordered by three to four weeks.
Apple also announced iWork in January, featuring a new word processing application called Pages that was intended replace the company's aging AppleWorks suite, as well as an update to the iLife suite of programs.
Enthusiast site Think Secret would become more aggressive against Apple in its defense of newsgathering practices late in the month, hiring attorney Terry Gross, formerly of the EFF. Apple had accused Think Secret of revealing trade secrets late in 2004. The company would later agree to put its case on hold pending arguments from the EFF.
A 2-for-1 stock split took place February 18, which analysts said was largely possible due to the success of the iPod. However, the good news wouldn't last for long, as Apple mourned the loss of Macintosh creator Jef Raskin, who died at the end of the month at the age of 61.
Apple won a crucial ruling in early March that ordered Macintosh enthusiast sites to disclose their sources to, after the court said journalistic protections did not cover Web sites. Think Secret would fire back days later, asking for the Apple lawsuit to be dismissed.
Away from legal issues, Apple announced its support for Blu-ray during the month.
April would bring news that the company would begin selling the Mac Mini at Best Buy, the first time Apple computers had made an appearance in the retailer's stores since 2003.
Apple released Final Cut Studio on April 18, followed by the launch of Mac OS X version 10.4 Tiger two weeks later.
At the end of the month, Apple announced another record quarter for the company, with 1 million Macs and an astounding 5.3 million iPods shipped.
A Georgia county would help strengthen Apple's position in the educational sector as the go ahead was given for 63,000 iBooks to be distributed to Cobb County schoolchildren and teachers in early May.
Improvements would also come to iTunes during the month, including the addition of music videos to the catalog and the opening of four new European stores: Denmark, Norway, Sweden and Switzerland.
Rumors of negotiations with Intel would first surface at the end of May, as the Wall Street Journal said the two sides were close to a deal. But neither company would confirm it at the time. Those rumors would be confirmed as Apple announced a switch to Intel chips on June 6 at the company's Worldwide Developer's Conference.
The first Intel Macs will arrive in 2006, with a goal of all Macs being Intel-based the following year.
At the end of June, Apple brought color to its iPod lines, axing the 30GB version and keeping 20GB and 60GB models. The company also added podcasts to iTunes with the release of version 4.9.
Apple would post yet another record quarter in mid-July, announcing a $320 million profit. During the quarter, Apple shipped 6.16 million iPods and 1.18 million Macintosh computers. The company said it had sold 500 million songs through the iTunes Music service a week later.
The turbulent relationship between HP and Apple came to a close late in July as the company called it quits on their 18-month partnership.
The two button Apple-manufactured Mighty Mouse would make its appearance in early August after years of consumer demand. The company also expanded the iTunes Music store to Japan, and would later announce the store had sold one million songs in four days.
Whether it was a symbol of Apple's rising power, or just a chance to get a cheap laptop, an old iBook giveaway in Virginia resulted in several injuries and a lot of unhappy customers as supplies ran out quickly in mid-August.
Also during August, a settlement was reached for owners of iPods with defective batteries, affecting some 1.3 million customers.
September 7 would be a big day for Apple, as it announced an all new version of iTunes, the much anticipated Motorola ROKR phone, and the iPod nano, which replaced the aging iPod mini line. The nano's "impossibly small" size captivated the crowd and took much of the publicity, much to the chagrin of Motorola.
Jobs would also stand firm against the music industry during the month, saying songs in Apple's iTunes store would remain at 99 cents.
First reports of problems with the iPod nano would become public late in September, with users complaining of screen defects and scratching issues across user groups and on the Apple support Web site.
The company reported yet another stellar quarter in October, however iPod sales were relatively flat. Figuring the news likely would not sit well with investors and the media, a press event the next day introduced a media center iMac, as well as the oft-rumored video iPod.
To support these new products, Apple released iTunes 6 with individual music videos for purchase, as well as downloadable TV shows from ABC and the Disney Channel. The company announced at the end of the month that it had sold 1 million videos.
Apple's nano problems would come back to bite the company later in the month when it became the target of a class-action lawsuit over the quality of the player. The suit would go international in early November, and is believed to be the reason why Apple began to include protective sleeves with the nano shortly thereafter.
New television shows from NBC Universal, including 11 TV shows from NBC, USA Network and the Sci-Fi Channel, and select classic shows would appear on iTunes in early December. Rumors swirled that Apple was also in negotiations with other media companies to add their programming as well.
While 2005 was a landmark year for Apple, 2006 will pave the company's future path. Macworld kicks off the week after CES in early January and speculation has pointed to the release of an Intel based iBook and revamped Mac Mini, complete with DVR functionality. While such rumors have proven wrong in the past, one fact is clear: Apple continues to wow the industry with new and innovative products.
A Blue Apple a day, keeps the psychiatrist at bay!
haha :P
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|There's an Apple user born every minute.
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|Apple? Don't like them. Whos next?
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|Laugh out loud @ a fruit.
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|I own an iPod, but I thoroughly appreciate Apple having a good year since I invested almost all my cash into 100 shares of their stock about six months ago, and it's paid off in spades :-D
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|iPods are like enimas... only good for a nice colon cleansing.
The new Intel Macs are nothing more than PC's with MacOS, which begs the question, why not just open up MacOS to PC's? Oh yeah, because it would require support for non-Mac hardware and prove that they're not as Plug 'n' Play as they claim. The good news is that I've heard it will now be much easier to develop for MacOS.
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|There is a reason why Mac OS is more stable. they control what products it supports. In return my profit from liscensing, and also a better expierence for the USER. Yes more limited expierence due to not everything is plug and play. But those that are designed and liscensed for Mac OS work better on Mac OS then they do when also designed for windows and linux. Poorly supported for both windows and linux. Windows chooses to support a generic driver to power devices while you can still download the more defined drivers from the company web sites. Now with linux, you have a bunch of linux guys sitting around programing together and designing some great stuff. But the problem is they didn't design the hardware, they don't know how they can utilize it even better, only the company does and I don't see any companies releasing their trade secrets to help the opensource community.
Final word, Mac OS is more stable due to the vigerous testing they do on their products and third party products. Creating a much more bug/crash free experience.
As to the other person who posted about Apple dying as a company. They are jumping in size by leaps and bounds. I do not see them fading any time soon. Pardon me for saying this, but with Apples standings right now in all their markets. They have a better chance of staying in the market then Linux does.
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|"iPods are like enimas... only good for a nice colon cleansing."
Speaking from experience??? You can only use it that way if you have you head up your... ;o)
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|Linux is more stable too, what's your point?
"They have a better chance of staying in the market then Linux does."
Linux can't die. It's too wide spread. Windows and MacOS CAN die (doubt it through) because they are controled by one company each.
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|As a Linux and OS X user, I can say that's a joke.
"Linux," the kernel, is very stable, sure, and that's why it runs on many of my servers. But once you heap all the typical desktop niceties on top, it's a nightmare. My Windows XP box is worlds more stable than a typical Linux desktop setup. The problem is that between Xorg, a DE like Gnome or KDE, and all the additional cruft, something is always bound to crash. And if it doesn't, well, wait til your next upgrade, when you need to recompile your drivers for video acceleration and pray that when you move to the new kernel everything doesn't get screwed up.
I love Linux, believe me, but as it stands today, the user experience of OS X and Linux are simply not comparable.
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|I have to say that over the past year I've been tempted to buy an Apple Computer to run along side my Windows and Linux PCs.
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|Resist the temptation... it's an overrated experience! Never give up! Never surrender!
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|Completly agree. Most people that I spoke with are very disapointed with their iPod. But they can't get rid of it since they spent $400 for it. They are now comitted to it.
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|I'm sorry, gotta call your you know what on this. I've seen two much data by third-party companies that show the overwhelming majority of Apple iPod owners are satisfied with their purchase. Plus, on top of this, iPod's aren't $400.
Explain to me why 10 million of these players are expected to be sold this quarter?
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|Hahahaha! Such obvious, total BULL! If people weren't massively satisfied with their iPods, Apple wouldn't own nearly 70% of the market in music players. Who you been talking to, Creative employees???
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|Does not cost 400 give me a break look before you give a stupid answer.
http://www.compusa.com/p...e=335473&pfp=SEARCH
iPod Video 60GB $399
http://www.buy.com/retai...p;Gad=0&dcaid=17379
Creative Nomad Jukebox Zen Xtra - MP3 Player - 60GB $299.98
http://reviews.cnet.com/...05-6490_7-30571470.html
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|I've not met a single person that didn't like their IPod.
Did you meet them at a Windows users group meeting by chance? (joke)
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|Yeah, the IPod video is $399, but the IPod is $299 . Quit trying to twist the facts.
Correction: IPod Video 30GB is $299 and the 60GB is $399.
The IPod Video has a MAJOR feature that the Zen doesn't and you know it.
How about comparing like products.
http://reviews.cnet.com/...05-6490_7-30571470.html
http://reviews.cnet.com/...05-6490_7-30978812.html
Oh look, the IPod was rated higher by CNET.
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|Not the iPod video the normal iPod (it is a typo on their website). I just went to the store and checked it out.
If you don't want choice choose the iPod.
First you need to install software to use the iPod. Don't need that with the creative. Can I buy songs from anyone with the iPod. No I am stuck with the dictator Apple. No Choice when you choose Apple.
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|http://store.apple.com/1.../AppleStore?family=iPod
30GB Ipod: $299 w/ Video
40GB Creative Zen: $299 w/o Video
There you go, much closer to apples to apples.
Ok, by your math the Ipod is still better because it plays video, and at the same price as the Zen.
Ipod:
Audio support MP3 (8 to 320 Kbps), MP3 VBR, AAC (8 to 320 Kbps), Protected AAC (from iTunes Music Store, M4A, M4B, M4P), Audible (formats 2, 3, and 4) and WAV AAC (16 to 320 Kbps), Protected AAC (from iTunes Music Store), MP3 (16 to 320 Kbps), MP3 VBR, Audible (formats 2, 3 and 4), Apple Lossless, WAV, AIFF
Photo support Syncs iPod-viewable photos in JPEG, BMP, GIF, TIFF, PSD (Mac only) and PNG formats
Video support H.264 video: up to 768 Kbps, 320 x 240, 30 frames per sec., Baseline Profile up to Level 1.3 with AAC-LC up to 160 Kbps, 48 Khz, stereo audio in .m4v, .mp4 and .mov file formats
MPEG-4 video: up to 2.5 mbps, 480 x 480, 30 frames per sec., Simple Profile with AAC-LC up to 160 Kbps, 48 Khz, stereo audio in .m4v, .mp4 and .mov file formats
Creative Zen:
Playback Formats MPEG Audio Layer 3 (MP3), Windows Media Audio (WMA), WAV, IMA ADPCM
Uhh which one did you say was limited again?
HAHA
Come on, there's tons more choice with the IPod. It's not like the IPod won't play MP3, SO WHAT if it doesn't play WMA.
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|You should. Good IT people know something about all systems. I'd also recommend you look into running FreeBSD or Solaris, just to touch up your Unix skills.
The world is too polar - people here will swear one way or the other. The fact remains for me, my Windows machine is incredibly fast and easy, my Mac is fast and easy. They both have interesting concepts. But I use my Mac almost 100% of the time at home. I'd recommend everyone give it a shot.
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|iRiver? :(
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|iRiver? :(
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|A stellar year for Apple indeed. I agree with the "overlooked items" list and would stress esp. Aperture and Pages as overlooked gems in the original article by Ed Oswald.
So what's the Cupertino competitor's New Year's resolution? Maybe rename the vaporware "new" system again?
The PC lemmings may use 2006 to finally transition from the non-existent "Longhorn" to the still unfinished "Vista" to "Hasta la vista, I'm switching to a Mac ..." ;-)
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|Apple is evolving into a music company. Their computer business has no long term future.
When the iPod fad goes the same way as the WalkMan fad, Apple will be only an on-line music store which used to also sell computers !
The Computer Rodent
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|Another prediction of Apple's impending death. The music business fueled a nice increase in computer sales, and continues to bring people to Mac's as a second machine. If those machines perform well, and indications are that they will, then there may be even more of an increase in sales. You should lose the pessimism and buy some stock. Then you could be doing the happy dance with the rest of us!
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|Interesting article, but several things might want to be added: Aperture was released, quad processor G5s, and for 2006 expected release of Leopard. Additionally, I would be hesitant to say the mini was aging, in fact, the pundits were shocked that the best selling iPod was supplanted by the nano until its sales exploded. Additionally, Apples supply side actions on memory with SAMSUNG and others as well as the continuing litany of patent suits including Creative on screen menus. Finally, the "old news" that iPod buds may be hearing risk if over used at high volume [recall the French and Europeans limited sound volume because of this last year/2004.
It was interesting how short was the comments on iLife05 as a continuing revolution for home multimedia and the thousands of widgets that are a new tool for Tiger.
In other words, it was a really crazy ride in 2005. A question might be "Was this the outcome of years of internal research exploding i.e., a once off or is this a pattern for the future representing institutionalization of innovation?"
Finally, the most remarkable outcome of the last few years by Apple is the reinvigoration of the vertical market with ITunes store, application, and iPod as a model Sony and Microsoft are aspiring to with video, music, games, and perhaps web applications. The key challenge that Apple has approached and Microsoft and Sony are trying to apply is avoid commodization [Does IT Matter? by Nicholas Carr] that LINUX and OpenSource place before these companies.
George P.
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|Apple had a lot of news this year, that is for sure. With year in review stories, not everything makes it in, or else it would be twice as long hah
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|WOW more junk out the door and WOW more people to buy it. I can't see how anyone could by that slow outdated and easy to brake junk. Flame if you have to I need to roast some hotdogs anyway, but I won't be replying to them.
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|Mmm... s'mores!
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|You need to put just a little more effort into it. That comment wasn't quite worth breaking out the matches for, let alone the flamethrower. Happy New Year anyway!
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|I have to say, I enjoy Apple products. I bought a Mac Mini, an iPod for myself and one for a friend this year. They work great, look good, and I've had no problems with them.
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