January 9, 2001 5:45 PM PST
Apple's DVD-burning out of consumers' reach
- Related Stories
Apple, Compaq adding recordable DVD drivesJanuary 5, 2001
Apple CEO Steve Jobs unveiled iDVD and iTunes on Tuesday during his keynote speech at the Macworld Expo here.
The iDVD program, which lets Mac owners burn home movies and photos onto discs that can be played on a standard DVD player, only works if someone has a DVD-recordable drive. And that drive will be found only on the upcoming top-of-the-line Power Mac.
The free iTunes program runs on all computers using at least version 9 of the Mac operating system. But the CD-burning function requires a CD-rewritable drive that Apple is adding, at least for now, only to its business-oriented Power Mac line.
Analysts worry that Apple is offering software that primarily appeals to consumers but is including the necessary drives only on business models.
"No one who (buys) an iMac today can use iTunes to create CDs without buying additional hardware," said David Bailey, an analyst with Gerard Klauer Mattison.
Apple has said it will come out in the coming months with software drivers that allow Mac owners to use an external CD-burner with iTunes. But because there are no new consumer models with a built-in CD-RW drive, analysts say, it will be tough for iTunes to become a significant force in driving Apple's computer sales in the near term.
IDC analyst Anne Bui also questioned Apple pitching iDVD as a program that will let someone make movies and send them to Grandma.
"Are you or I, as average computer users," Bui said, "really going to be able to shell out $3,500" for a machine capable of running iDVD?
Apple vice president Phil Schiller said in an interview that iDVD is aimed at consumers, professionals and the education market. And Apple expects that the new SuperDrive, a combination CD-RW/DVD-recordable drive on the top-model Power Mac, will eventually make its way into lower-priced Macs.
"We are selling a solution that we hope someday everybody will" use, Schiller said. "To get there is going to take a bunch of time."
Gregory Stapp, an opera singer and longtime Mac devotee who was at Macworld, said he already records his performances and would love to put them onto DVDs. But he prefers his PowerBook laptop to the pricier and less portable Power Mac desktop. For him and others on the go, Stapp said, an external SuperDrive would be ideal.
"Nobody's going to want to tote around a tower," he said, explaining why he won't purchase the new Power Mac. "And price is always an issue."
Schiller would not give a timeframe for adding CD-RW drives to the iMac or say when the SuperDrive might be more broadly available.
In his speech, Jobs noted that until now, just the drive to record DVDs has cost in the neighborhood of $5,000, and now it is available in a $3,500 computer.
Schiller likened the SuperDrive to the Apple LaserWriter, which was revolutionary for those who could afford the laser printer's $5,000 price tag when it debuted in the 1980s. Eventually, the LaserWriter became something everyone could afford.
Like the LaserWriter, Schiller said, iDVD is a breakthrough today even though it's not available to everyone yet.
Bui also questioned whether iDVD will be a major factor in education sales, noting that many schools are fighting to cut costs even on basic supplies.
"Most school districts are struggling with their budgets to afford basics such as chalk," Bui said.
However, one Alaskan educator at the show said he was excited about iDVD. He pointed out that a number of students could do most of the work on their projects on less-expensive machines, meaning that one Power Mac with SuperDrive could serve a computer lab of 10 or more students.
Bui said Apple might have wanted to wait to announce some of the products until it came out with new consumer models. But the company may have felt under pressure to make a strong showing at Macworld in the wake of slowing sales, she said.
Apple has issued earnings warnings for the past two quarters and is expected to post its first quarterly loss in three years when it reports fiscal first-quarter earnings later this month.
Apple executives are also clearly trying to lay out a longer-term vision for the company, with Jobs touting the Mac as a "digital hub" that can make other consumer electronics--such as an MP3 player, camcorder or DVD player--more useful.
"For once, we decided to be a little bit more (open) about the vision," Schiller said.
Bailey said Apple is clearly responding to customer concerns but is finding that reworking its product line takes time.
"That was apparent in the new PowerBook because they included a DVD (drive) instead of a CD-RW drive," Bailey said.