July 17, 2002 7:20 AM PDT

Apple to charge for iTools services

Apple Computer on Wednesday will transition its iTools Web services from a free program to a paid program called .Mac.

The Cupertino, Calif.-based company plans to charge about $100 per year for the program. The shift to paid Web services and the .Mac renaming bears some similarity to Microsoft's .Net software-as-a-service strategy.

Apple launched the collection of Web services about three years ago, which now includes online storage via a service called iDisk, online greeting cards through iCards and other features.

Apple took iTools offline on Wednesday morning, ahead of CEO Steve Jobs' keynote address at the Macworld trade show in New York. It later returned as .Mac.

The .Mac service is available now for $99.95 annually. People who were iTools members as of midnight Tuesday and who sign up for .Mac before Sept. 30 will get an introductory offer of $49.95 for the first year.

"The world is changing," Jobs said of the disappearing free Web services. "We're going to have to reflect that too."

Jobs also addressed the .Mac name, which is similar to Microsoft's .Net. Apple already offers Web services, while Microsoft is still talking about them, he said. "Let's jump in this boat," Jobs said of the .Mac naming.

Apple plans to enhance its crop of online services with additional online storage, Virex antivirus protection and online backup, and Web-based e-mail. Storage will be increased from 25MB to 100MB.

Current services users will have until Sept. 30 to sign up for .Mac before existing iTools accounts are deleted.

Mac users had mixed reactions to the plan.

"Yes, I'd pay," said Jeffrey Barbose, a software president based in San Francisco. "At least with Apple, all the costs will be upfront, and the 'death by a thousand paper cuts' nickel-and-diming that Microsoft does and plans to continue to do with .Net won't be an issue."

Neema Agha, a Los Angeles-based doctor, said he wouldn't pay for the current level of services.

"However, should they offer greatly enhanced services, $100 a year sounds reasonable," he said. "Such services could be a MyPalm.com environment which would allow me to sync information between my Palm and my OS X desktop. It would have to go beyond the e-mail, iDisk and iCards currently offered."

"Fact is, all the services can be found for free elsewhere but with banner ads probably," said Tom Koons, an equipment technician and software user in Chandler, Ariz. "Apple would need to make the service much better to be worth it for $100 a year. Maybe $60, so that would be $5 a month. If they relaxed the bandwidth on hosted Web sites, then possibly $100 a year will be OK."

Chris Coleman, a college student at Penn State University in State College, Pa., said he doesn't use iTools much, but sees an enhanced service as another way to woo new people to the Mac.

"I think it's a potential selling point for PC switchers who might have reservations about giving up their floppy drives," he said. "If Apple were to add more advanced features to iTools, such as the ability to set up online stores on home page sites, I could see it being worth it to some people. But I think that what exists now would do best to remain free."

 

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