Apple pins survival hopes on eye-popping design

When the Tanaiste Ms Harney arrives at Apple Computer headquarters today in Cupertino, California, it will be immediately apparent…

When the Tanaiste Ms Harney arrives at Apple Computer headquarters today in Cupertino, California, it will be immediately apparent that she is not merely in a different country, but in a different world.

Let's begin with Apple's streetless address; a 30-acre campus whose main building is a four-storey building called 1 Infinite Loop. Inside the large glass doors, signs direct the visitor to various offices. Instead of numbers, suites are named after rivers, such as the Nile, the Amazon, the Seine. One collection of offices is called Here. Another is called There. So a worker can leave a meeting in the Seine to stroll over to There. Are you still with me?

Perhaps Ms Harney will want to stop in the Apple restaurant called Caffe Mac. It serves vegan dishes, because chief executive officer Steve Jobs is a vegan. (Do not confuse vegan with the garden variety vegetarian who eschews meat products; the vegan refuses ANY animal products in food or clothing, such as dairy because milking disturbs the cow, or honey, because honey collection upsets the bee.)

Ms Harney probably will not opt for a game on the basketball court, located just beyond the restaurant. And hopefully, someone will inform the Irish delegation not to light up. Smoking is prohibited even outside the building. Smokers must drive off Apple property altogether to have a cigarette.

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Apple Computer is a different world indeed. And while Ms Harney will be there fighting for hundreds of jobs at the company's Cork plant, the fact is that Apple Computer itself is fighting to survive as a company.

This summer may be the season of Apple's discontent or its salvation. Its survival may depend on a plucky little teal-coloured translucent machine called the iMac.

Apple has been in trouble for years with declining sales and profits.

Last year, for example, Apple sold about $7.1 billion (£5 billion) worth of computers and software, almost the same as five years ago.

Even the last quarter's results of $1.4 billion in revenue is down 12 per cent from a year ago.

Other computer companies, by comparison, are not suffering. Dell Computer's revenues grew from $2.9 billion in 1993 to over $12.3 billion last year. And while Apple's market share was 15 per cent in 1985, it was just 4 per cent in the last quarter (granted, up from 3.6 per cent a year ago.) The company has lost $2 billion in the last two years. But even the dire numbers hardly illustrate the soap opera that has been the tale of Apple's corporati wars over the last few years.

The enterprise that Steve Jobs and Steve Wozniak began in a garage in 1977 became a legend, a company whose informal and apt motto was "Insanely Great".

By 1983, with Mr Wozniak gone, Mr Jobs was ousted by former Pepsi chairman John Sculley. He would remain ceo until 1993, overseeing a drop in market share from 20 per cent to 8 per cent.

The board of directors ousted Mr Sculley and gave the job to his right-hand man, Michael Spindler. By 1996, with losses mounting, Mr Spindler was gone, replaced by a respected executive named Dr Gil Amelio.

In a new book On the Firing Line - My 500 Days at Apple, a bitter Dr Amelio describes the first day at work at his $990,000-a-year job; the first 10 minutes were spent driving around the two-story parking structure searching for a spot. Apple, egalitarian to the core, does not have reserved spaces for its top officers.

Now, after ousting Dr Amelio, Mr Jobs is back, although he won't commit to marriage. His title, in as much as these things are relevant at Apple and they are assuredly not, is "interim ceo".

Therein begins the update on Apple. Steve Jobs is by all accounts an inspiring, maddening man, given to fits of temper and arrogance.

He is also a marketing genius and a visionary. Technology author Robert X Cringely, in his book about Silicon Valley called Accidental Empires, notes that Mr Jobs is considered dangerous because he really doesn't care about money.

Unlike Bill Gates, who sees the personal computer as a tool for transferring every stray dollar and deutschmark into his pocket, Mr Jobs wants to tell the world how to compute and to set the style. Think of Mr Gates as the emir of Kuwait and Mr Jobs as Saddam Hussein, Mr Cringely advises.

In his 10 months back at Apple, Mr Jobs has made seismic changes and Wall Street is cautiously responding. The stock value has doubled to $30 a share. In essence, he has narrowed the company to just three products, all captured in a typical Apple advertising campaign. Big banners are now draped from the sides of Apple buildings. The message is simple: "Pro. Go. Whoa."

"Pro" is the G3 Mac Desktop, powered by a chip that is at least twice as fast as Intel's Pentium II processor. "Go" is the G3 Powerbook, a laptop with a sleek design that also includes the new processor. "Whoa" is what Steve Jobs is betting the farm on.

Unveiled in a Cupertino auditorium two months ago, the Whoa computer is called the iMac, and it represents Mr Jobs's vision of eye-popping design and marketing over real technological innovation. Priced at $1,299 and set for release in August, the iMac is unlike any computer you have ever seen.

Squatty, all rounded and curves, it manages to look futuristic and nostalgic simultaneously (in the style of the Volkswagen Beetle). The cords are translucent, as is the mouse, allowing the user to watch a two-colour ball rotate as the cursor is dragged. It sports a fast 233Mhz G3 processor, and 32 megabites of RAM, expandable to 128.

But for a machine aimed at the Internet and entry-level consumer market, the iMac has problems. Its modem is a slow 33.6 kilobits per second (Kbps). Other machines offer a standard 56 Kbps. It has a CD-Rom drive, but no floppy disk drive. Why? Because Mr Jobs says users don't need them, that they can use CD-Roms or back-up to a Zip drive.

Also the new iMac USB ports will not work with any other existing Mac peripherals. Forget your printer or scanner. Apple says that other manufacturers will come forward with compatible peripherals, but they won't say who or when.

The emphasis on sizzle and prettiness is vintage Jobs. The question is whether consumers will bite into this Apple. For the first time ever, Apple dropped to third place in a survey of computer customer loyalty taken by Market Intelligence. It was overtaken by Gateway and HewlettPackard. Some are predicting the iMac won't save Apple.

"Consumers are not going to fall in love with a computer because of what it looks like," Oppenheimer and Co industry analyst James Poyner told Business Week magazine. "Am I buying a piece of art or a computer?"

Mr Jobs would probably argue that you are buying something never seen before, a machine that history will record as the salvation of Apple Computer. But posterity, as the American poet Billy Collins has written, is a cruel and savagely attired mistress. Prosperity, on the other hand, corporate, cold and unpoetic, will save Apple Computer, and with it, all those jobs in Cork.

Madeleine Lyons

Madeleine Lyons

Madeleine Lyons is Food & Drink Editor of The Irish Times