Why Apple will bounce back

Forget Wall Street: Apple is still a contender.

Maybe it was my brief, unfortunate run as the worst player on the losingest Little League team in upstate New York, an abortive stint with the Cub Scouts (derailed as resoundingly as the Pinewood Derby car that abruptly ended my racing career), or a lonely flirtation with professional politics as my third-grade class' lone McGovern supporter. Whatever their foundation in my personal history, there's no denying I suffer from some serious mental blocks when it comes to working up team spirit for any institution, public or private.

Case in point: my longstanding love-hate relationship (I love them, they hate me) with Apple Computer Inc. As full-time Apple-pologists inside and outside the company will tell you (generally through clenched teeth), my enthusiastic interest in the company does not equate to a carte blanche endorsement of its every product and pronouncement. Whether or not those true believers trust my fealty, however, I remain a Mac-using Mac fan who believes in Apple's continued importance to the broader PC industry as well as its long-term viability as a technological and economic force.

Let's talk economics first; after all, Apple's September stock-market belly flop made waves throughout the industry and prompted some naysayers to tack the tired "beleaguered" label back onto the company after a two-year hiatus.

Now, I'm no stock analyst, so let me see if I have this straight: Apple (aapl) announces that it will make somewhere in the neighborhood of a gazillion dollars' profit for the fourth quarter; while impressive, that number falls short of the 1.3 gazillion dollars financial analysts were predicting. (Actually, I believe the precise numbers are closer to $100 million and $165 million, respectively, but we're still talking some serious lechuga here.)

In response, the stock drops by half literally overnight, as nervous tech investors scramble away in a blind panic reminiscent of Tokyo pedestrians during the third reel of a "Godzilla" movie.

To me, that says a whole lot more about the balky state of the market than about Apple's fundamental solvency. Commentators such as Evan Leibovitch are simply wrong when they compare Apple's current economic conditions to those during the bad old days of 1996 and 1997. Back then, Apple was ending quarters hundreds of millions of dollars in the red, and supply and QA problems were endemic to the company.

Now, Apple is on the verge of posting its 12th consecutive profitable quarter, it has billions of dollars in assets, and all those investors who jumped in when the stock was at its nadir are still about four times better off than they were when they bought.

Please, please explain to me what part of this scenario puts this company on the brink of the abyss!

Now let's talk technology: Even if Apple is profoundly hosed on some Greenspan-esque plane of financial reality that utterly escapes me, the Mac is evolving just fine, thanks.

Remember a scant couple of weeks ago -- before all this stock nonsense pushed it off the front page -- how users were raving about the qualities already evident in the newly released public beta version of Mac OS X? Users who installed it alongside Mac OS 9 on their PowerPC G3- and G4-based systems couldn't say enough nice things about the release's stability and power. (Most of them even said they'd warmed to the new twists in Mac OS X's Aqua interface.)

The advantages of a modern OS are finally available to Mac users, the system's BSD Unix core and Darwin underpinnings are already opening the platform up to a whole new population of developers, the Classic environment guarantees a smooth transition from 16 years' worth of Mac applications, and the whole shebang will be even more powerful and useable when the commercial version ships in early 2001.

Now, intrepid ZDNet reporter Adam Gillitt brings us Mac users even more tidings of great joy on the performance front: In today's story, Apple Director of Mac OS Product Marketing Ken Bereskin confirms that Mac OS X is designed to tap every drop of multiprocessing and graphics-rendering power built into the PowerPC G4 chip, whether the user is working in the Classic environment or using all the bells and whistles of the new OS.

That pesky cynical streak compels me to acknowledge the fact that the G4 still faces some serious hurdles, most notably manufacturer Motorola's seeming inability to push the processor to clock speeds approaching the gigahertz-plus specs of its x86-based counterparts.

However, the degree to which Mac OS X exploits the strengths of the chip -- megahertz be damned -- lends credence to Apple's arguments in favor of its control of the Mac's software and hardware from the ground up.

While I'm pleased that longtime Mac-o-phobe John Dvorak can find it in his heart to endorse Apple -- even if only as a potential source for exciting new Windows machines -- I remain optimistic that if Motorola can vault its G4 speed hurdles, Apple still has a chance to spin Mac OS X's hardware savvy into a performance advantage that puts the Mac at the front of the platform pack.

I may not be an Apple apologist, but -- so far, at least -- I believe that few apologies are necessary, either from the Mac maker or its supporters.


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