Apple 2.0

Covering the business that Steve Jobs built

Live from Apple's last Macworld

January 6, 2009: 11:00 AM ET

moscone09outside06This is a live blog of the valedictory keynote Steve Jobs decided not to give -- sending Apple senior vice president Phil Schiller to Macworld 2009 in his place.

Schiller's remarks began shortly after 9 a.m PST (12 noon EST),

Posts are listed in reverse order, with the latest posts on top. All times are a.m. PST.

The headlines: Expectations were low, but even those were largely unmet. There was no Steve Jobs cameo, no Mac mini, no new iMac, no Snow Leopard ship date, no memory upgrades for iPhone or iPod touch, no new iPod shuffle, no revamped Apple TV or Time Capsule. There was a new unibody 17-inch MacBook Pro with an impressive (if non user-removable) battery. There are new price points for iTunes music and 10 million songs are going DRM-free, if you are willing to pay extra for them. And iWork is making collaboration on the Web a little easier, but it's still in beta and it's no Microsoft (MSFT) Office -- or even Google (GOOG) Apps -- killer.

As one wag put it afterward, Tony Bennett got a standing ovation. Apple, not so much.

Apple (AAPL) closed at 93.02 on Tuesday, down 1.65% for the day.

Below the fold: The live blog.

10:37 And we're done. Phil Schiller thanks his staff, his family, and invites us to enjoy the show.

img_045910:30 Ending with live music. It's not going to be Paul McCartney. No, it's Tony Bennett on a floating stage with a 4-piece band. "The Best is Yet to Come." He gets a warm applause. "I Left My Heart in San Francisco." Standing ovation.

10:24 One last thing. iTunes. 6 billion songs sold. World's largest media library. More than 10 million songs. Over 75 million accounts with credit cards. iTunes now the No. 1 channel for music in the U.S. So what's new? Three things. First: Price. Caving in to music publishers, starting in April, three price points $.69, $99, $1.29.

Second: Reviews what iTunes Plus does. Allows DRM-free music. Starting today, offering 8 million songs DRM free. By the end of this quarter, all 10 million songs in iTunes will be DRM free. Big applause. You can go into your library and update all your songs at once. (Doesn't mention what this would cost you.)

Third: iPhone wi-fi music store. Now you can also download over 3G networks as well. (Scattered applause.) Starts today. "This is really profound," says Schiller. The audience is silent.

10:21 Schiller back. Up to 7 hours with discrete graphics, up to 8 hours with integrated graphics chip. "Just as thin. Just as light." Take-back and recycling program.

Price: $2,799 4 GB  memory. 320 GB HD. Superdrive. Ships late January. Shows the TV ad. Battery is featured.

MacBoo Pro 1710:10 Finally, a piece of hardware! The 17" MacBook Pro. Quotes Jobs' favorite pet journalists -- Walt Mossberg, David Pogue -- talking about how great the new MacBooks are.

Specs: 0.98 inches thick. 6.6 pounds. 17-inch backlit display. 60% greater color gamut than previous. Glossy finish. Also an anti-glare option for $50 extra. (Applause.) Integrated battery connector. (Does "integrated" mean non removable?) 2.93 GHz. up to 8 GB memory. Both NVIDIA graphics options. 320 GB Hard drive. 256 GB Solid state.

Gets to the battery. Longest lasting battery life ever, but notebook just as thin and just as light. Clips Bob Mansfield. Up to 8 hours. More environmentally friendly. Dan Riccio. Made it bigger. Removable batteries waste a lot of space. By making it nonremovable, able to make it 40% bigger. Mansfield: Custom-designed. Unnamed chief engineer shows a manufacturing movie. Mansfield: adaptive charger. Up to 1000 recharges, more than 3X the old way. Chip within the battery that talks to each of the cells and adjusts accordingly. Claims 3X the lifespan. Mansfield: Greener. Free of "many of the harmful toxins." Lifespan extended to up to 5 years.

10:03. iWork.com. As predicted, its been updated to be more Web friendly. Allows people to collaborate on documents that are shared on the Internet. But -- and here's a piece of news -- it's still in beta. Demo: Hit a button and it alerts a collaborator -- Tia -- that a document you want to share that the document is available for viewing on iWork.com. Tia gets e-mail invited to view document. Launches her browser (Mac or PC) and she sees the document. She can read, leave a note or comment, and, if she wants to edit it, she has to download it. (This is less than expected. In Google's tools, collaborators can actually edit the document online.) Launches today. Eventually Apple will sell it; today it's free

9:59 Numbers '09. Table categories. Categorize by column -- by baseball position rather than player name, for example. More functions -- more than 250 now -- that pastes into your spreadsheet with color-coded variables. New chart types. Trend lines, error bars. (More candy for the biz guys.) Links to Pages so that an update in a spreadsheet gets updated in your word processing document. And, naturally, more "beautiful new templates." $49 with new Mac, $79 otherwise. $99 family pack. Starts shipping today. You need Leopard to run these, but a box set that includes all three comes for $169.

9:55 Pages '09. Full screen view to focus on your writing and get rid of everything else on your desktop. Dynamic outlines. See your document in outline view, reorganize your sections. Mail merge with Numbers. Mathtype and Endnote. 40 new templates. Business cards etc.  Is this what Apple has been doing with its time?

[Will we never get any new hardware?]

img_04579:49 No 2. A new version of iWork. Starts with Keynote. Magic Move, a transition between slides. Object transitions. Text transitions. Bush swings into Obama. (Applause, laughs.) Chart animations. Crane move in a bar graph. Etched metal. Stone texture. Zoom through wood texture pie chart. (Going after the business market, are we?) Themes. (Does anybody actually use these?) Keynote remote to run on your iPhone or iPod touch so you can control your slideshow with your iPhone, flicking between slides with swipe of your finger. Selling on iTunes App Store for $.99.

9:48 iLife 09 ships free with new Macs, upgrade for $79, shipping late January.

9:41 Schiller back on stage. To talk about Garage Band '09. Added new feature called "learn to play." Guitar or keyboards. Instructor up above, guitar in the middle, controls on the bottom. Plays a snippet. 12-bar blues in key of A. Chords A, D and E. Another snippet from keyboard: Hearts and Minds. Free: 9 lessons for guitar, 9 for piano. Also, Artists Lessons. John Fogerty. Colbie Caillat. Patrick Stump. Sting. Sarah McLachlan. Ryan Tedder. Norah Jones. Promises to add more along the way. $4.99 a lesson. Clip: Fogerty. "It was early 1968, the best as I can remember it..." (Audience laughs). Proud Mary, it turns out, was inspired by Beethoven's Fifth.

9:31 iMovie demo by Randy Ubillos. Inserts video clip with lots of options. Selects some sound from another clip. Drops audio only into other video. (The audience loves this.) Tightens up action and adjusts an edit on the fly. Gets a finished shot of a boy jumping in a lake from two different angles, with clean audio from only one shot. (Applause.)  New project: Safari. Shot from a jeep smoothed out using video stabilization. (Oooh.) Makes a gazelle pop out of the background. Slows a leopard down. Cartoon effects. X-ray effect. Aged film, complete with fake scratches. Adds maps with start and end locations. Get cool animated map with a red line zooming across the globe like the old Warner Bros. cartoons. Themes: five of them. Comic book, Scrap book, Film strip, Photo album and one more. ("Directed by Phil Schiller" gets a laugh.) Finished movie gets a big applause.

9:28 New version of iMovie. (Strangely muted response to that one.) Reminds us that iMovie was completely revamped last year, drawing complaints about some missing features. What's in it? New editing feature. New drag and drop feature. Context sensitive menus. Dynamic themes with titles, transitions, effects. Maps showing where you traveled. Video stabilization. (The audience has gone silent.) So he goes to a demo. Invites Randy Ubillos to the stage to do it. Big applause.

9:24 Now he's doing a demo of places. Adding locations to all his events. Seeing pins of every photo taken during a trip to Paris, up and down the Seine. Column view that lists all the photos of every picture he's taken in the world. All the U.S. photos. All the Calif. photos. All the Arc de Triumph photos.

9:21 Schiller begins a demo. Recognizing faces, confirming names, zooming in on the faces (applause.) Makes a smart albums of a whole family. That's faces.

9:19. Books from iPhoto. Travel theme with maps that includes geotagging info and pins on that page to show where photo was taking.You can also print on the sleeve and the hardcover.

9:17 Slideshow things. Assign music to your slideshow, pick themes from Apple's Muzak library. (My wife will hate this.) Slideshow somehow centers your faces. Demos some wacky transitions. Can save slideshow, complete with bad music and wacky transitions to your iPhone.

9:15 Also added to iPhoto: support for Facebook and Flickr. Tags the faces. Click facebook button and it sends the photo to Facebook with nametags. Your friends can then add the names of the faces you didn't know and the names get synched to your iPhoto. Flickr sharing works as you would expect. Includes geotagging.

9:11 Another new iPhoto feature: Places. Open and get a map with pins wherever your photos were taken using geotagging (if your camera has it; the iPhone does). Take a photo, geotag with longitude and latitude is added to your photo. Reverse encodes and determines that it's at, say the Eiffel Tower in Paris, France. If you don't have a geotag camera, you can add the event location to a photo file. iPhoto then assigns a geotag to every photo in that Event. The maps comes from Google Maps. So you can zoom to street level. You can click on the pin and see street map, satellite image.

9:08. New version of iPhoto. Talks about Events, the feature added last year. This year, adding to events: Faces. Really powerful. Wouldn't it be great to allow you to organize your photos around your people. Corkboard with snaps of your people using face detection. Click on picture, name this person, face detect finds the face. Then the program tracks that person using face recognition to find the same person across multiple photos. You confirm or don't. Not perfect, but the best technology we've found.

9:07 Three new things to tell you about. First: an entire new version of iLife, iLife 09.

9:05 Today I'm going to talk about the Mac. 9.7 million sold last year, grew 2 x faster than rest of industry.

9:05 Stats. 3.4 million people visit Apple stores every week. 100 Macworlds every week.

9:04 Appreciates us showing up. "Incredibly exciting time at Apple." Photos of stores in Beijing, China; Munich, Germany; Sydney, Australia.

9:03 The lights dim. The music stops. Phil Schiller takes the stage.

img_04559:00 The music swells ... nothing.

8:59 Silence your cell phones.

8:56 OK, the room is filling up, although there are still large expanses of open seating.

8:40 The doors are open and the crowd, such as it is, files in. A lot of empty seats. My row is empty.

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8:31 The media, however, are out in force, preening and strutting. Or maybe more like sharks who smell blood in the water.

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8:24 The ground floor is nearly empty.

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8:21 With less than 40 minutes to go to showtime, the entrance to Moscone West is strangely quiet.

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7:55   Toni Sacconaghi, the Bernstein Research analyst whom investors love to hate, has issued a long report to clients this morning on the potential of an Apple TV box equipped with Tru2way cable TV, lending partial credence to Macworld Rumor No. 2. (See here.)

7:45  Analysis of Jobs' health letter, which dominated the Techmeme news aggregator Monday (see here), has all but fallen off its front page. Oppenheimer & Co., which had withheld its price estimate three weeks ago, has reinstated the stock -- for now. See here.

Apple yellow tag7:30  The online Apple Store, as it is wont to do in advance of a product announcement -- any product announcement -- is closed for updating.

Meanwhile, for background reading, check out:

[Photo courtesy of setteB.IT.]

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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