Apple just released its quarterly results, and the company profited on its operations, while losing money from its investments. Education sales dropped 12%, while portable sales are still strong. Mac OS X is still impressing people left and right, including lots of PC folks, while iPod for Windows seems to be a big hit. In the meanwhile, IBM and Motorola both have set the Mac world abuzz with hints about new processors on the horizon.

With all of these things, and more, as a backdrop, what do you see in Apple's future? Where is the company headed?

Notes to those participating in this discussion: Please do not let this conversation focus on processor wars, or any other one topic. As always, flames will not be tolerated.

With the runaway success of the iPod, I think Apple will look for other "non-Mac" markets that are maturing but not yet dominated by a single player. The iPod brought the portable music player just what it needed at the right time, and it has paid off. If they can find more niches than this, Apple could also grow to depend a bit less on hardware sales of Macs. The cell-phone market would seem to be off-limits, as it's dominated by Nokia (and soon will see Micro$oft enter the fray), but a TiVo-like device, or a cell-phone/PDA hybrid with the famed Apple style and ease of use could sell well.

I foresee them putting more stress on their software solutions, too. The last MacWorld keynotes were essentially all about software (MacOS X, iApps). Maybe a diversification into a free consumer line-up and a paid pro application (like with iMovie-Final Cut/iDVD-DVD Studio Pro) is an idea that can be explored.

Hardware-wise, they'll have a bit of a tough time until either the new G4 or IBM's Power4 derivative ends up in Macs, especially with Intel claiming 3Ghz by the end of the year. I don't think that's really a problem for the consumer market, because, frankly, ALL of today's machines are fast enough for daily home use. In that market, bundled applications may be the decisive factor. The pro market is something totally different, though. PowerMac sales have been dropping steadily, as the PowerMac is perceived as overpriced and underpowered when compared to Windows workstations.

Yes, the ipod is a huge hit with everyone. With Target beginning to sell the ipod in time for the Christmas season, its an even bigger hit. Similar devices, perhaps apple branded and teamed with another manufacturer, could cement apple's claim as a digital hub. If they can diversify enough, a downturn in computer sales could be offset by an increase in consumer electronics/digital hub devices. They do need to be careful not to stray too far into off the wall devices that may be very cool, but not ready for prime time, ala Newton. Newton was a groundbreaking device, but the public was not ready for it and it failed. The ipod met and exceeded everyone's expectations. Apple has the chance to expand that success into other aspects of the digital hub.

I agree with Eindvijand, the Pro market is suffering, but what seems to be keeping that area from being a total loss is Xserve. Unix folks are seeing Apple in a different light because of Xserve and OS X. Apple may be losing clients in it's typical niche markets (education and advertising) but it picking up new broader markets (small to medium non-media businesses, scientific research, upper level education). I think that, if we see anything from Apple in the Pro arena it will be to enhance it's new found notariety in the IT world. Expect enhanced Xserve offerings, perhaps quad 1.5GHZ G4s. Also expect more emphasis on services. IT likes to feel safe and they pay well to get that feeling. As Xserve makes its way into IT shops Apple will find more opportunities to provide services. New income avenues is always a good thing.

On the home front I think a big change is in the works. While Apple will continue to provide hardware and software it needs to become a service provider too. Witness .Mac. While many balked at paying the high fees for once free service, .Mac is the wave of the future. The services Apple could provide via .Mac may eventually make having the service worth it for a lot of people. Hardware and software will evolve to support .Mac services, and we will want to buy them. Expect to see an Xserve-like system for home use, something that includes a box that gets put in a closet and runs 24/7 and includes wireless terminals. At first such a system would be high-priced but popularity will drive the cost down. The key to such systems is the services behind them, services that will bring a steadier cash flow into Apple.

Just my thoughts.

I think the next step will be a PDA/Mac brought together into one cool portable computer. Merging the PDA and iBook into a hybrid.

Maybe a screen the size of the iBook but with a hideaway keyboard for typing. But most all functions would be accessible with a touch screen and stylus.

For the forseeable future, I think Apple will continue to focus on OS X development and getting more software ported to it.

The inclusion of Inkwell in OS 10.2 could be an omen of a new type of computer coming, like a tablet or something. Yes, I know, Microsoft already has one in devlopment, but how long do you think it will be before that thing works? Also consider the recent comitment to Bluetooth. Wireless + hand writing recognition = ?? I don't see the resurrection of the Newton [moment of silence please] so I'm thinking tablet. Could be wrong.

The iPhone? Would be great to see the cell phone done right, but don't hold your breath.

Oh you know nothing. I'm just saying "64 bit". I know why Jobs sleeps comfortable at night.

1) I certainly agree that Apple is suffering somewhat with its Pro line. While I will not be a Mac to PC 'switcher' any time in the near future, using a friend's PC (something greater than 2gz) recently with WinXP, that computer just simply flies. Even for mundane tasks like browsing it is faster than my Superdrive iMac. For this reason, I do hope that Apple is underway with intensive efforts on faster processors and faster system architecture. I agree that the Xserve was absolutely necessary to start moving into small business and grow from there. Without it, I only see marketshare continuing to shrink.

2) Something I would love to see is a home entertainment device that is Airport ready. Something like TiVo on steroids. I would love to be able to wirelessly download or stream my iTunes library into my home theater. Soundsticks are great, but I can't very well supply music for a party through my computer speakers which are upstairs in the office. (iTunes visuals on TV would also be a great touch).

Michael

I predict that within the next five years, Apple will introduce a totally new computer interface that will be as revolutionary as the original desktop metaphor was in 1984. It will be ridiculed and reviled by the rest of the PC world (as usual) but in the end accepted (and copied) by the great innovator, Microsoft.

I think it would be cool if Apple could have a subsidiary that could make only consumer electronics, like a cell phone. And maybe a lamp based on the design of the iMac But I don't think that's going to happen any time soon...

Apple signed a license agreement about a month and a half ago with Philips to make a home entertainment system with Mac OS X as the operating system behind the system. It will be available only in Europe...I'm sure though, if there is enough demand we could get it to the U.S.

That is basically a stripped down imac that uses a television for a monitor. If marketed correctly this could enable Windows users to use iTunes and an iPod without feeling as if they sold out and bought a Mac. An AT EASE type interface could overlay the thing making it even easier to use than the current Mac so that the last non-web savy soccer-moms would feel comfortable.

This would give you:

dvd player (and possibly burner)
cd player
iTunes/iPod synching
Some games

If it had webaccess you could easily compete with webtv and Tivo.

If they cut a deal with sony they might be able to get Playstation dvd's to work (Sony would like this since they money on games, and take a loss on Playstation II sales).

Bluetooth connection for the keyboard would be nice.

They could probably jury-rig something by Christmas since the current iMac has nearly all of the capacity now.

I know its been said a thousand times, but I think Apple is once again headed towards a fight for survival. Lately, Apple has been losing education and pro sales on a pace it hasn't seen since '97. Consumer products are great, but the profit levels just aren't there.

I think that the ultimate success or failure of the iPod to the Windows crowd will dictate Apple's direction. If the iPod continues to be a hit with the other 95% than Apple will probably try to make other devices that will be adopted by that crowd. If the iPod ultimately fails on that side I think Apple will have a tougher time with future devices.

Apple really needs to address the speed issue. The new IBM chip looks promising, but a year is a long time. Maybe Apple should goto quad processors in January to help address the issue. If Apple cannot manage 2 ghz by next summer, the pro crowd is sure to either bail or continue to hold off new purchases.

Don't get me wrong, I love Apple and wouldn't use any other computer as long as they are in business, but for the first time in a number of years my optimism has waned. The .Mac situation bothered me a bit, the no MW Boston has irritated me a bit, but my feelings on this have been building for a year or so now. Apple has always made me say "wow" , but lately I'm saying "yeah whatever" a bit too often.

I hope I'm wrong, but I started to get this feeling back in the early ninety's about my first technological passion, ATARI. We all know what happened to them.

Sorry to be so gloomy,

Pete

The comments regarding XServe and small business are on the right track. Apple has just put up a business page. Its a sign of where they would like to place themselves. What comes next after XServe? Perhaps an array, and services for it.

Unfortunately, Apple made me (and everyone else in the world except for Trappist monks, people living on mountains without electricity, desert nomads, and worms) say "wow" in 1998 with the original iMac, and they haven't made me say "wow" as much as that since. It's sad but true, that 1998 was the last time Apple successfully changed the way we look at computers forever. Apple dropped the "Think Different" campaign earlier this year, but I think the philosophy was already fading. I think Apple needs to do something truly different. Not just another digital hub device, not just a new iApp. Not just a few slightly speed-bumped computers, not just some new features in an OS update (although HFS+ journaling is a welcome addition in 10.2.2).

Something different. Just listen to Big Brother's speech and watch the sledgehammer hit the screen and behold the drones "seeing the light". Listen to the narrator in the original Think Different. Those both perfectly represent the culture of Apple - what Apple's all about.

Or rather, was. Apple's attempts to enter the mainstream has destroyed much of their culture. I'm not saying it's wrong to try to have more brand name recognition and market presence. That's a logical move. But remember when the original Bondi Blue iMac was first released? They were selling like - well, I don't want to use that old clichй "hot cakes". Maybe "selling like iMacs" can become a clichй for the new millennium. And yet, the iMac was as "different" as you can get. It was probably the first computer ever that could be described as "beautiful." It was a work of art. My point in this is that Apple has its own ways of amazing people, and therefor getting them to by its products. Apple's been continuing to make beautiful computers, but that's the point: They look nice, but they're really the same old thing.

That was what annoyed me in the pre-LCD iMac days. Look, Steve announced some new iMacs with different colors. Look, some more new colors. Wow. Hey, they're more transparent now. Oh look! They're slightly bigger! Wow, now there are only a few colors! Hey, patterns! Yuk! Oh good, the patterns are gone.

Now there's the LCD iMac. But let's ask ourselves: Is it really different? I don't think so. Sure, it's another piece of art to come out of Apple's industrial design department, an engineering marvel from Apple's engineers. But are there any major innovations? Was this beautiful dome groundbreaking? Did Apple release anything truly groundbreaking since the original iMac? Sorry, but I don't think so.

What can Apple do different (bad grammar intentional)? I don't know. In fact, I don't have the slightest idea. I'm not a visionary like Steve Jobs. But on the other hand, I don't have a Reality Distortion Field like he does, that causes him to believe that everything to come out of Apple is a groundbreaking innovation, including Blue Dalmation and Flower Power iMacs.

Of course, being crazy is part of being a visionary. But Apple's becoming just another computer maker in the wind, minus Windows, beige, and general ugliness and badness. For the first time, I feel that instead of Apple telling everyone else to Think Different... we need to tell Apple to.

"Here's to the crazy ones..."

My dream...
I see a DV camcorder that will record onto an iPod or 802.11g transmit to an Airport enabled Mac directly into iMovie. (Remember all those video companys Apple bought?)
Apple will then be able to sell more Airport, iPods, and Macs.
...innovating to sell more hardware...
Good for them, good for us.

Airport+ goes ultra wide (for schools and business) and/or supports home power networking so you can work around your fridge.
networked iTunes version allows you to to broadcast commands over network to your stereo based computer.
iTunes gets basic DJ features. Lets you scratch, mix etc. Linked to a new product release of SimParty.
iPod+ or new iPod supports DV cameras and/or digital still cameras. Also records as well as plays audio.
iBook gets colors (or high end machine goes black)
iSync supports mail accounts, so an email marked read on one Mac doesn't look like it was unread on a different Mac.
Ships a sonic flashlight speaker system so you can blast tunes in your cube and not bother anyone, even those just a few feet away.
iMac gets a screen you can rotate 90deg and remove/upgrade and/or 22" model.
Powerbook gets improved wireless reception.
iPage, super simple graphical HTML editor introduced.
eMac quietly dropped.

Somethings lacking in apple's audio "hub"

I want to see a decent 5:1 surround system with great sounding speakers, probably with a variety of wattages depending on the cost and quality.

Where I live I only can find PC capable cards. :-/

I see nothing but hurt. Apple doesn't seem to be able to introduce any new hardware, the exception being the LCD iMac. All the rest of their designs are ancient, yet Apple refuses to let them go. The Power Mac is a great example.

Frankly, I think it's time for Jobs to go. Let's get some fresh CEO talent in there--someone who has vision. Someone who won't ignore us Pro users. Someone who'll put the muscle back in the Pro machines.

Jobs is focused on consumer Macs, and while this may keep Apple's market share from eroding, it sure doesn't seem to be advancing the state-of-the-art. Meanwhile, we all get to sit back and watch PCs clear 3GHz (nevermind the megahertz myth).

Come on, Steve. We're all waiting for *new* Pro machines--get on the stick.

Sorry guys the iMac was the last revolution is downright silly. All the things has done is evolution, not revolution. The code name Darwin speaks of the philosophy in which is thinking. iMac, what makes it so revolutionary, the on the other hand was, yet it nearly destroyed the company in the ammount of cash it took to develope.

In these very difficult times it would be silly to ask for to pull the proverbial rabbit out of the hat. Slow and easy. Ask yourself turly what you want out of your computer experience, are you getting it?

Someone look up punctuated evolution, perhaps that's the model and its loyal community need. We have a more than a year to wait for the new chips, it's all OS X software, get used to it. I hope I'm wrong, would love to get something from the wife for Christmas.