Hidden Dimensions - The Stakes For the Macworld Keynote are Enormous

by
January 8th, 2007

"I was seldom able to see an opportunity until it had ceased to be one."

-- Mark Twain

Apple is in a tough spot. Much is expected of the Macworld keynote presentation on January 9th.

There was a time when Apple, fighting for survival, could be excused for not setting the world on fire. After all, at one time, Apple was considered a beleaguered company. It's hard to imagine, isn't it?

Very often companies are victims of their own success, and Apple is not likely to be exempted from this typical business scenario. In Apple's case, they've gone from being a minor player in the computer market to being a minor player in the computer market with a big time reputation for being a media company, a potential mobile phone company, and a living room hardware company.

As a result, much is expected of Apple that goes beyond just building great computers. As I recall, because it's hard to Google, Mr. Spock once said in ST:TOS, "Small civilizations have small ambitions and large civilizations have large ambitions."

Apple now has large ambitions.

As a result, we have new, larger perspectives and questions.

The Keynote is the Thing

I've attended a dozen or so Apple keynotes in my life. During that time, I've seen Phil Schiller jump out of a two story window clutching a Mac and land on a mattress. I've seen Steve Jobs bring a G4 Cube out on a black pedestal as if it were a Cartier diamond. I've seen Steve Jobs edit a short video in iMovie of kids, add teary music and create a visual gem in a few minutes, adding, "This is why we do what we do." But I've also seen interminable demos of iLife applications and I've seen Steve Jobs almost go into a trance listening to "Love Shack" for minutes on end. Keynotes have their ups and downs.

Also, Apple keynote addresses are like a suitcase just before a trip to Antarctica. Things go in, things get pulled, items are moved around, wholesale substitutions and trade-offs are made, but in the end, the suitcase has to weigh not a gram more than 31.7515 kilos.

Similarly, the Macworld keynote address has bounds. It's constructed of segments designed to convey information in a carefully orchestrated and constructed timeline. What kind of information?

This year, Apple customers are looking more carefully at Apple. Customers have bought a boatload of iPods lately. Now, millions of new customers have a new breed of questions.

• Can Apple sustain its iPod driven growth?
• Will Apple become one of the premiere sources for video content? That is, is it wise to invest in a large collection of iTunes videos?
• Will Apple become a company that can make a big difference in our TV watching experience, or will Apple living room products simply be a footnote in the HDTV industry, eventually superseded by mainstream products from the TV manufacturers?
• Can Apple work effectively with Hollywood studios other than Disney?
• Regarding video DRM, how successful will Apple be in mediating the financial interests of the video content creators against the typical wants and needs of the consumer?
• What is Apple's vision for customers in the digital video age? Can they rescue us? Do they want to?
• Will Apple's consumer electronics do for our digital life what the Macintosh did for our newfound life with personal computers?
• Can Apple deliver an insanely great mobile phone, a device we've been waiting for since 2002?

Let's be careful here. I don't want to confuse the possibly irrational expectations of some with realistic business expectations. In the first case, customers, enthusiasts, and Websites can end up dreaming about a fantasy product from Apple so energetically that they feel a deep sense of disappointment when their unrealistic hopes are not met.

On the other hand, there are more hard-nosed expectations that relate to Apple's ability to succeed based on the concrete facts that we already know. We know that Apple has trademarked the term "iPhone" in a lot of countries. But not in the U.S. (Cisco has it.) We know that Apple has sought patent protection on a mobile phone/media player combination. We know that Mr. Jobs pre-announced a product code named iTV on September 12th. As a result of things that we do know, not just rumors and speculation, we can form a pretty good idea of what would constitute a keynote that will punctuate 2007 for Apple versus one that relies too heavily on reality distortion.

Sizing up the Keynote

Apple didn't do any thing special for their 30th anniversary. But the recent change in Apple's home page suggests that they're going to make up for that by setting the stage for many years to come.

In that sense, there is a lot of pressure on the upcoming keynote. We're waiting for Apple to draw a line in the sand. The Macworld 2007 keynote, whether we like it or not, is another defining moment for Apple. It's not just a keynote address for Macworld, its a keynote for a new Apple future. It follows this year's Consumer Electronics Show (CES) which will be exploding with video gear. In the best of all possible universes, Apple's keynote will be a proclamation by Apple about what they want to be and their vision (without tipping off the competition) as they delve into new product lines. Of course, that doesn't entail product announcements, but it does entail a brilliant, energetic articulation of ideas that address the questions listed above.

Make no mistake. These are defining years. HDTV arrived en masse this last Christmas. The price of a very nice HDTV is less than, in many cases, a MacBook Pro. Content creators are falling all over themselves striking agreements with carriers on how to deliver video content to customers. The wealth and breadth of video content strains our consciousness. We'll either move forward in a coherent fashion, satisfying our interests in video entertainment, or, worst case, the HDTV and video revolution will go down the path of the CB radio: Too much chatter, too much foulness, too much greed and irrelevance, and an idle distraction amidst possibly finer and more noble pursuits.

If this year's keynote amounts to nothing more than a sales chart for the iPod, a recap of the Intel transition, a chart on the number of Universal applications shipped, a miscellaneous partner executive on stage, a long winded demo of iLife '07, another Leopard teaser, and all wrapped up with a "one more thing" announcement that Apple will ship some kind of mobile communications device in June 2007, then Apple will have failed to deliver a defining keynote presentation.

You could call it a sales summary. Or you could call it a product update. Or you could call it another preemptive announcement. Or you could call it the Mr. Jobs and Mr. Mossberg media event. But it won't have the significant elements of what a keynote, at this point in Apple's life cycle, ought to be. Namely, what has Apple become, where Apple is going, how has Apple spent its time since last year, and here are, today, the new products that you've expected us to deliver. And why we did it the way we did.

These products are, namely, Leopard, a mobile phone, movie content, and an interface to HDTV that's so easy to use, it embarrasses the rest of the industry.

There is no other venue, no other time, no better crowd, and no better presenter that affords Apple the opportunity to announce the fruits of their labors in 2006 and what we can expect from Apple at the dawn of a new era in video communication and entertainment.

John Martellaro is a senior scientist and author. A former U.S. Air Force officer,he has worked for NASA, White Sands Missile Range, Lockheed Martin Astronautics, the Oak Ridge National Laboratory and Apple Computer. During his five years at Apple, he worked as a Senior Marketing Manager for science and technology, Federal Account Executive, and High Performance Computing Manager. His interests include alpine skiing, SciFi, astronomy, and Perl. John lives in Denver, Colorado.

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