October 12, 1999 1:20 PM PDT

Display scarcity spurs iBook shortage

Apple Computer continues to face delays in getting its new line of consumer notebook computers to customers because of an ongoing paucity of displays and lingering aftereffects of last month's Taiwan earthquake.

Customers have been anticipating the arrival of the blueberry- and tangerine-colored versions since the new iBook was first announced in July. Now, even though shipments are starting to trickle in to retailers, the anticipation is starting to turn into frustration as customers learn the delays won't be fixed as soon as hoped.

Apple isn't alone, either. All computer companies are facing limited product availability due to a combination of component shortages and natural disasters.

"This is not necessarily an issue limited to Apple," said Brian Phillips, a mobile device analyst for market research firm ARS. There is an ongoing shortage of displays for notebooks, as well as continuing problems for all manufacturers shipping products out of Taiwan after the devastating quake, Phillips said.

Others also are dealing with the problem. Component shortages have caused Dell Computer to takes steps to ensure a steady supply of screens. The company said today it is investing $200 million in Samsung Electronics to ensure it will get about $8.5 billion in displays over the next five years. Apple made a similar strategic investment in July. Philips expects many other companies to follow suit.

Where are the iBooks?
ComputerWare, a large California-based chain of Mac-only stores, has reported receiving shipments of blueberry iBooks, but the shipments are small in relation to the size of the backordered units, said a company spokesperson.

Cyberian Outpost and MacZone are among the catalog resellers who don't have iBooks in stock, while ClubMac received a handful of portables and shipped them out to customers who had preordered systems. One customer noted in an email to CNET News.com that the shipment date on his order from Cyberian Outpost has been revised six times already.

For Apple's large nationwide retail partners such as CompUSA and Sears, availability is sporadic as well. While there are reports of customers receiving notebooks from both outlets, sales representatives from CompUSA and Sears report that they haven't received any product yet in some California stores, but they are expecting shipments within the next two weeks.

CompUSA received enough iBooks to cover advance orders with a few left over for its stores, a CompUSA spokesperson told Bloomberg. An Apple spokesperson said the company is speeding up production and expects more notebooks to hit shelves within the next two weeks.

Shortages an issue for earnings
The iBooks aren't the only products in short supply. Motorola has been unable to ship enough of the 450- and 500-MHz chips for use in Apple systems. That, along with the iBook shortage, caused Apple to warn investors in late September that its earnings for the fourth quarter of 1999 would fall short of expectations.

Analysts say that Apple's profitability won't suffer much for any delays in the G4 product line--it's the iMacs and iBooks they are wondering about.

"The G4 is a small chunk of change," in terms of overall revenue, said Lou Mazzuchelli, a financial analyst with Gerard Klauer Mattison. "The issue is, 'Are they going to sell lots of iMacs and iBooks?' " in the upcoming quarter.

Consensus analysts' estimates of earnings are at 45 cents per share for the fourth quarter when the company reports earnings tomorrow, according to First Call.

Bloomberg contributed to this report.


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