US Report: Apple hits back with the iMac

The bouncing beach balls in the audience were the right backdrop for Steve Jobs' unveiling of the frisky low-cost consumer computer called the iMac.
Written by Lisa M. Bowman, Contributor

"I'm really pleased to report to you today that Apple's back on track," the company's "interim" CEO told the Mac faithful gathered Wednesday near Apple's headquarters in California, before unveiling the iMac and a new line of PowerBooks.

Apple had billed this announcement as a "Pro-Go-Whoa" affair, even changing its Web site to reflect this. With the G3 processor making up the Pro and PowerBooks the "go," there was no question that the iMac provided the "whoa."

The translucent iMac, which features a rounded back and a carrying handle, looks more like it belongs in George Jetson's home than the average consumer's. From the front it looks like a small pastel TV and features a 15-inch screen, 33Kbps modem and support for Universal Serial Bus (USB) devices. It also has built-in Ethernet and other online-savvy technology, and includes a 233MHz G3 processor, infrared support and stereo speakers. It will ship in August for $1,299 (£773), Jobs said. No UK prices were announced.

Jobs said the iMac was twice as fast as the leading Windows-based consumer PC. In addition to Mac OS 8, the iMac includes Quicken 98 for the Mac, America Online's starter kit and Microsoft's Internet Explorer browser.

Jobs said Apple, a company known for its close connection to the consumer, had lost its way in that market, and that he initiated the iMac project the second day after he returned to Apple 10 months ago. "I'm incredibly thrilled to tell you that Apple is getting back into the consumer market," Jobs said, noting that "we have an incredibly good shot at coming back" in this sector.

Apple business partners gave the iMac whole-hearted support. "This is the first product that will make PC buyers switch to Mac," said Jim Halpin, CEO of computer retailer CompUSA where Apple products now account for 15 percent of computer sales.

Jobs said Apple would focus on four core products: the iMac, the G3 desktop machines unveiled in November, the new PowerBooks and a new portable consumer device to be unveiled next year.

The PowerBooks, which had been widely reported, were officially unveiled Wednesday, as well. The new systems, which start at $2,299 (£1,368), feature G3 processors and support for DVD and up to two batteries. Such devices can be swapped while the machine is turned on.

Jobs also said Apple's new management team has reduced the annualised employee attrition rate to 15 percent from 33 percent when he took over. He also said hits on the Apple.com Web site have jumped to 10 million a day from 1 million last July.

"The company can be great again, and I think we're well along the way to it," Jobs said.

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