Steve Jobs on Mac OS X Progress: 10.1 and Developer Apps

We're very happy to be here in New York. We got some great stuff to share with you this morning. So let's get started. The first thing I'd like to talk about is our new Apple retail stores. We've got, as you may know, in the middle of May, we opened two Apple retail stores. One at Tyson's Corner in McLean, Virginia.

That is the number one mall for the Washington, D.C. area, one of the top ten malls in the entire country. And second, in Glendale Galleria. That is a major mall in L.A., in the Valley. And they've been open for only eight weeks now. And thanks to a lot of you who visited there, the results have been terrific. Just terrific. And we are now able to offer some of our customers a different way to buy their computers. A solutions-oriented way to buy their computers. We're opening four more stores in August. One in Willow Bend, a great new development in Dallas, Texas. Carefully avoiding Austin and Houston.

One in the Mall of America, the largest mall in the world in Minneapolis, Minnesota. One in Woodfield Mall in Chicago, Illinois, just right outside of Chicago. And one in North Shore Mall in Boston, Massachusetts. So, these four stores will open in August and take us to six stores on our way to get to 25 stores open by the end of this year. Now, we had a Worldwide Developers Conference in May. And what we did was we made a video of the store to show them so that they could see where a lot of their software would be sold. And we also stayed up all night after the opening to edit together a video of our Glendale store opening.

And I would like to share with you those videos now if you'd like to see them. You want to see them? Yeah? All right. Well, let's go ahead and run the video of the stores. you

so we're really really excited about our Apple retail stores and I think they're a great compliment to the other great retailers that we have out there selling our products so that's an update on Apple retail look forward to giving you more as the year progresses we have more stores next I'd like to talk about Mac OS X how many of you out there how many of you out there are using Mac OS X raise your hand all right good so we introduced Mac OS X on March 24th of this year that is only a hundred and sixteen days ago and at that time we said we thought it would take us about a year to make that transition now one way I think about that is since there's 12 months in a year and there's 12 out 12 there are 12 hours on a clock face I tend to think of it like a clock face and since we're about four months into it we're about at four o'clock right now in our transition on Mac OS X so how we doing at four o'clock we're doing pretty well we've got over a thousand native Mac OS X app shipping today and there's a lot more coming how do we know this well we talked to the developers as a matter of fact at our developer conference in May we did a survey of our worldwide developers and here's what we found 29% of them said they plan to release a Mac OS X product within three months that's three months of two months

ago and 55% of them said they plan to release a Mac OS X product within six months right that's in the next four months so we're really pleased with these results now I got a surprise for you there's a lot of great software coming for Mac OS X in the next several months and we asked 10 of the most exciting developers to show their apps here today we've got 10 great apps running on Mac OS X that are coming soon to show you today 10 on 10 so let's get started the first of those is Microsoft with office and I'd like to invite Kevin Brown the general manager of Microsoft's Mac business unit up to show us Microsoft office running a Mac OS X. Kevin thank you very much Steve hello New York well this past March Mac OS X burst onto the scene with a series of great promises this really eye-catching new interface this rock-solid foundation these this set of features that would allow applications to do things they've never done before well now it's our turn the application developers have to take advantage of these features and deliver on those things we set out last September to begin bringing office to OS X and we said the number one thing we had to do was to make an application that you could hold up and say this is what an OS X app could do one of the early decisions we made was this product will run only on OS X we wanted to make no trade-offs in our OS X support so

you'll be able to say when we ship OS X promises it and office 10 delivers it so let me introduce you to OS X or to office 10 on OS X as you can see this is very different look for word than we've ever had before it's much it's a much warmer version of word you can see it is a native application with those translucent menus we've brought forward things that you love about the current version of word we redesigned 700 toolbar buttons with with smooth graphics so that the the application looks and feels like it really belongs on this system we poured over lovingly 800 plus dialog boxes throughout office to make sure each one is the very picture of the implementation of the aqua spec as you can see there are these native controls there's fast responsive feel that you should get from an OS X application but aqua is about much more than just beauty it helps to it helps make the applications more discoverable for instance by show of hands how many people actually knew that you can split the screen in word to be working in two different places in a word doc at the same time about 11 in the crowd I think so with aqua we can make that a much more discoverable function one of the things people really like about office 2001 is the formatting palette so we've added that for office 10 and it's it's much much improved you can see that it's photorealistic we had a lot of fun adding animation so that it's more discoverable how you turn it on and turn it off the great thing about the formatting palette is it puts the tools that you need right at your fingertips so you don't even need to go see the great work that we've done inside the dialog boxes so that's that's a little bit about word we've done the same we pay the same great attention to detail in each of our applications here's Excel that Excel 10 is I think the best

looking version of Excel we've ever shipped on any platform notice the photorealistic look of the tabs the nice clean interface on the spreadsheet frame one of the great things about aqua is that we could make it much more discoverable where you're actually typing believe me this is actually a problem on cell users you can actually lose your place but with these soft shadows you'll never do so in Excel 10 so there's there's aqua but there's so much more to OS 10 than just aqua we know you as Mac users chose this platform because you want to create the most graphically rich stunning documents you possibly can so we combined offices tools with the power of OS 10 to enable you to do things you've never been able to do before an office you actually see through that picture right to your data beyond so so that's that's just some of the things that you can do one of the big promises that OS 10 makes is this reliability and stability and multitasking the OS will will deliver the ability for you to to multitask between applications but properly done applications like office are going to enable you to multitask within the applications so I go to save this document and notice something else on the file list that I meant to do so I can bring up another document and here I can continue working in my document even while the panel is up on the other document so your work is never blocked in OS 10 or an office for OS 10 so I mentioned that we can do all of these great things with graphically rich documents let's actually take a look at a little bit of that by opening the the drawing toolbar office contains over 150 auto shapes these are just just easily drawn common symbols that you use in your documents you can do this in office 2001 but the results are so much better in office 10 you see that we can

apply these transparencies to give you the power to make documents the likes of which you've never been able to create an office ever before I wonder if you could do that in charts tell you what come to my feature presentation tomorrow morning and I'll show you all about office 10 and the draft of other great things for that we're doing for Mac OS 10 I hope we'll see you tomorrow thank you you thank you Kevin next up is Adobe and I'm pleased to welcome Shantanu Narayan executive vice president of worldwide products and marketing from Adobe welcome Shantanu thanks Steve thanks Steve it's a pleasure to be here this morning it's actually my son's birthday today and he was very excited about my going to New York which is always a mixed blessing but that's because he knew I'd have first-hand information about all the new goodies that would be available soon for him at Adobe we believe that we are at the start of a third generation in publishing we along with Apple help create desktop publishing the 90s saw web publishing and there's a new era that Adobe along with its partners is labeling network publishing network publishing is characterized by the need to be able to access information anytime anywhere on any device and our mission is to help you express your creativity with the

help of Apple so that you can have visually rich impactful communication across print web video and wireless we're very excited about OS 10 and we believe that it's a tremendous opportunity for our joint customers to be able to build and expand their business we're extremely hard at work all the product teams in trying to bring the next versions of all our major applications on OS 10 and these aren't just ports every one of them will take advantage of the new features available in OS 10 and we're very excited about the performance improvements we've seen as well as the opportunities accorded to us by the gorgeous aqua interface to illustrate our commitment to OS 10 I'd now like to ask Ted Altschbach to do a demo of three of our major applications on OS 10. Ted? Thanks Shantanu. Well what I'm showing here on screen for the first time is the version we have of Illustrator under development for OS X.

It looks just absolutely gorgeous with the Aqua interface. We've taken full advantage of everything OS X has to offer. We focus not just on new features, but also on performance enhancements. In fact, Illustrator now launches twice as fast as it did under OS 9. What you're seeing on screen right now... Yeah, that's fantastic by itself. What you're seeing on screen right now is an artist's rendition of Botticelli's Venus. Of course, Botticelli, were he alive today, would be using a Mac and OS X and the latest version of Illustrator to create Venus. And what's amazing about this, this was done entirely inside Illustrator. So these are all vector objects you can manipulate and change. But even Venus is surprised that she was created entirely inside Illustrator.

I'm going to show you one of the new features that we have planned for this upcoming version of Illustrator. And that's the ability to slice anything you've created inside Illustrator into slices for the web, actually optimize them. So I'm going to go ahead here, selected that logo. I'll choose slice and make. And the logo then is sliced into various pieces automatically. What's really nice is that inside Illustrator, you can then set each of those slices to be their own optimization directly inside Illustrator. You don't necessarily have to export at that time, but you can set those slices. You can even set slices not just to GIF and JPEG, but also to SWF and SVG right inside Illustrator. I'm going to save this file. And this file is being saved into the hard drive. I'm then going to pop into our web authoring application, Golive. And in Golive, I have a smart object selected here.

I'm going to link to that object that I just created. So I've just linked to the Illustrator file. Again, I didn't export it as a raster image. It's actually the native Illustrator image that Golive is importing. Golive then gives you the opportunity to further modify those slices in any way that you'd like to. Or you can go ahead and just let the way it is. It brings it into Golive. And the real nice thing about this is that if I go back here to my Illustrator document and make a change, so for instance, if I go ahead and maybe just apply a gradient to that and save the file, as soon as I go back into Golive, that automatically gets updated. What Golive is doing, it's looking at the original Illustrator file, the vector file. It's re-rasterizing it, re-sampling it, and re-optimizing it. If I want to make a change later on in Golive, for instance, I want that word design to possibly have transparency, maybe make it a ping or something instead of the GIF that it's set to now, I can do that, of course, after the fact in Golive as well.

Golive, of course, also taking full advantage of OS X and its integration between Illustrator and InDesign and other Adobe applications is just phenomenal. I'm also going to show you some other interoperability between Illustrator, and this time between InDesign. And so here's the latest version of InDesign currently under development for OS X. Again, just looks absolutely stunning. We're going to take an Illustrator document, that same one that I was just using inside Golive, and use it inside InDesign. First thing I'm going to do here is change the opacity down to about 50% in Illustrator. I'll show you the background grid there so you can see it's truly transparent. Then I will just drag that word design inside my InDesign document.

I'll go ahead and click yes there, and that pops up inside InDesign. Now you'll notice that it's transparent inside InDesign as well. In fact, the transparency is live. I can drag it around. It interacts with the objects that already exist inside InDesign. So I'll go ahead and put that in place. There's also a lot of other things that can be done inside InDesign as far as transparency. For instance, with that same image I brought in from Illustrator, I can actually change the transparency, or I'll set the mode to multiply, to make it look a little bit better there. I can also add some other great new effects inside InDesign, such as drop shadows. Here I'm applying the drop shadow to an Illustrator object. And I can even apply drop shadows to live text. So I have a live text box right here, and drop shadow has been applied to the text. And the drop shadow is actually sticking to the text. It's a transparent drop shadow.

These are the sort of innovative features you've come to expect from Adobe, and we're really excited to be able to supply these with the new versions of Adobe applications coming out for OS X. And not only does this stuff look great on screen, but we've been working with service providers around the world to ensure that everything you're seeing on screen is going to print and look just as beautiful there as well. So be sure to keep your eye out for all these great Adobe applications and more coming soon to OS X. Thank you. Thank you. Next up is Quark. I'm pleased to welcome Brett Mueller, Senior Product Manager from Quark, who's going to show us something really cool running.

Welcome, Brett. Thank you, Steve. Appreciate the opportunity to be here. Thank you, and thank you for joining us. We have some really exciting stuff to show you today. We actually have a future version of Express that we would like to show you that we have actually not shown publicly, so you're going to see it for the first time here. And it is kind of exciting. This is going to be a future version. This is 5.X. It's running on the 5.0 code base, and our 5.0 product is getting ready for release. It's getting ready for beta right now. So let's go ahead and dig right in. Driving our demo today is Mike Garcia, one of our OS X engineers. And what we have here is the cover from Macworld. Now, every month, Macworld and thousands of other titles are published in over 184 languages using Express.

A lot of professional publishers rely heavily in their print workflows on Express, and it's very exciting. We'd like to show you a couple specific features here. As we look at this cover, we can go ahead and manipulate layers now. Our customers have been asking for layer control. So you can go ahead and suppress layers, combine layers. It gives you a great tool to go ahead and use for both print and the Web. The issue is print publishing has been paying a lot of the multimedia or media-independent publishing drive. It's been paying the way for the Web. And so we've got to give those print users a way to go to the Web easily, and we'll get into that in a minute. If we look down at the bottom here, we have, by the way, this is the issue that's out in the stands out there. There's a really good article here on printers.

And you can see that there's a table up here in the right-hand page. Well, for years people have been asking, well, what about tables? Well, now we can give you tables. Right in Express you can build tables, and not just statistical tables with text and numerical data. You can go ahead and use this as a design element. So if we switch, let's say, between layers, our art director can see different layouts right there. For instance, he can go ahead and combine those cells. Mike's going to go ahead and grab that. He can select cells, combine them, turn them into text or picture cells. This gives us a great design tool. Let's go ahead. We have new context menus that come up here. We can go ahead and actually create just about anything you can do artistically in Express with colors and dashed lines, et cetera, you can now do in a table cell.

And you can use all your paragraph and character style sheets. Now, this gives us some really powerful tools. But what about going to the Web? There are 700 active developers and 1,300 extensions out there. You can do just about anything you want with Express. But natively inside Express, I'm very pleased to show you now for the very first time, building Web pages right in Express using the tools you know and now showing it on OS X. Very exciting. Mike is opening up what is really going to be a Web page. Now, we can go ahead and populate this, put content in through XML, the XML tools that are available in Express, or we can just drag and drop it across. Print to Web. How long will it take print designers to learn this? Well, Mike's an engineer. He's doing it.

So, yes, it's not just for breakfast anymore. So, Mike goes ahead and pulls us across. Now, what we're going to do here in just a second, we're going to click one button. It's going to collect all of the style sheet data. It's going to port it to HTML with all our cascading style sheets, and it will take all of our print-ready images. It might be TIFFs or EPSs, convert those on the fly to JPEGs or PNGs or GIFs, your choice, and it will do it without Photoshop or any other third-party application. We're going to create valid HTML. So, let's go ahead and do it. One button click. It's going to launch the browser. I think we're using Internet Explorer, which is native on OS X. It comes up. There's our Web page. It's that fast. It is that easy to go from print to Web.

The exciting thing about this is, this is really what media-independent publishing is supposed to be about. You go from your current content that's making a lot of money to new media that you're going to hope is going to be making money out there to then other media. Now, there's a whole lot more to show you, but we don't have a whole lot of time. So, we look forward to talking to you. Thank you so much. Have a great show. Thank you. Next up. Wrong screen. Next up, we've got FileMaker, an amazing application, which is really a platform that thousands or probably tens of thousands of applications run on.

And it's my pleasure to bring up Dominique Coupil, the president of FileMaker, to show us FileMaker running on Mac OS X. Welcome, Dominique. Thank you, Steve. Two months ago, we started shipping FileMaker Pro 5.5, and today we are pleased to report that we have already shipped 50,000 copies of FileMaker Pro 5.5 for Mac OS X, and that's just in North America. Globally, we have several million customers. Therefore, having FileMaker available for Mac OS X means that literally millions of existing applications are automatically compatible with OS X. Every FileMaker solution you now run on OS 9 will run on OS X. Every FileMaker solution you run on any platform will now run better on OS X.

And now what you're seeing on screen is our second product for Mac OS X, FileMaker Server 5.5, which will provide better performance, reliability, and security thanks to the power of Mac OS X. One of the things you will do with the server, of course, is scheduling backups. You can see the very nice interface and also the window paint feature, which we got by using Cocoa technology. FileMaker Server 5.5 will start shipping on July 30, and it will be our first product leveraging Cocoa technology. What I'd like to show you now is not a product demonstration, but rather two real-world examples of what our customers can do using FileMaker and OS X. Showtime Networks, right here in New York, they create every year thousands of on-air promos for upcoming shows and specials.

So how do they keep track of when to show those promos? Well, they use FileMaker Pro, and this powerful application was built by David Preisman and Jamie Wilson, who are actually not database designers by trade, but are actually video editors and producers. The combination of FileMaker and Macintosh allows them to create very effective advertising. And if you're a boxing fan, you've probably already seen that clip on Showtime. So let's now turn to the fashion industry. FileMaker Pro has been used for years by QRS as an electronic fashion catalog, which they developed for customers like Donna Karan, Calvin Klein, Ralph Lauren, Versace, and others here in New York. The ease with which you can create what are called lookbook layouts, so that you can show this season's fashion line, the flexibility of FileMaker allows the user to do decidedly non-database things.

It's a very powerful application. It can cost up to hundreds of thousands of dollars. It's built on FileMaker. It's running here on OS X. What better platform is there, indeed, than a Macintosh if you're going to work with images? And if you use FileMaker to organize the information, you can actually navigate very easily to the relevant data. And using QuickTime VR, you can see that fashions really come alive. So here you have it, powerful, real-world solutions using OS X and FileMaker. And the last thing I'd like to mention is that at FileMaker, our intent is not to ship one or two products for Mac OS X, but to make sure that by this fall, FileMaker will be one of the very first major software companies to have 100% of its products made for Mac OS X.

Thank you. Thank you, Dominique. Now, what happens if you have an app you really want to run that's not going to run on Mac OS X? Well, there's a way to run it coming soon from Connectix. My pleasure to introduce Kurt Schmucker, who is the Vice President of Product Management from Connectix, to show us Virtual PC running on Mac OS X. Welcome. Good morning, Steve. As Steve mentioned, there are times when a Mac user needs to run a piece of software which for one reason or another is not available on the Mac. That's where Virtual PC comes in. Virtual PC lets a Mac user run any Windows-based application right on their Mac screen.

Now, at Connectix, we know that lots of our users are moving to Mac OS X, so I'm happy to announce that a technology preview of Virtual PC for Mac OS X is available today. This technology preview, which we call the VPC test drive for Mac OS X, is a free download for any registered user of VPC 4.0. Let me show you the test drive. You can see here in this VPC window the OSs that we have loaded on this demo machine, and they include Windows 2000, Windows 95, Windows 98, Windows Millennium, Windows NT, and even the new Windows XP, which isn't even going to ship until the fall.

These OSs are all on this machine, ready to launch in just a few seconds, so let's launch one of them. Let's launch Windows 98. When you launch an OS in Virtual PC, it's like waking up a PowerBook. It just takes a few seconds to have it available to you, and any of those OSs have that characteristic. You can load as many of those OSs on your machine as you have disk space for, and you can run as many simultaneously as you have RAM for. Now you can see in this big blue window, inside that window is Windows 98, but outside that window Mac OS X is still running. When you move the cursor back and forth across the edge of that window, you see it change from a Mac cursor to a Windows cursor.

Now of course the thing that's really important, and what you care about, are the new applications you can run. The applications that wouldn't otherwise be available to a Mac user. I have lots of applications loaded into this copy of Windows 98, including the new Office XP suite, which isn't available for the Mac yet, but the application I'd like to show you today is AutoCAD. AutoCAD is an engineering application that allows people to design complex three-dimensional blueprints of objects prior to their manufacture. What we're loading here today is a blueprint of a car, and this is a car that you can see being drawn. Each of the lines and curves that design this car are brought into the system.

A car is a relatively complex object, so when you get all these lines and everything in there, it's hard for you to see what's going on. So AutoCAD includes a way to render the car to see it as it will be when the car is finally done. You can see that here. What you've just seen is AutoCAD, an application that's not available for the Mac, running on the Mac, in the VPC test drive for Mac OS X. So visit our website to download your copy of the VPC test drive, and come by the Connectix booth to learn even more about Virtual PC. Thank you very much. Next up is IBM with something truly remarkable that I think you're going to like.

I'd like to introduce Toby Manners, the segment manager of IBM's voice and pen systems. Toby, welcome to Macworld. Thank you very much. Two years ago, Ozzy Osbourne of IBM's voice systems stood up here and introduced to you the very first version of IBM's VIA Voice for the Macintosh platform. That was VIA Voice Millennium Edition. It was IBM's first continuous speech dictation application. A year later, we followed it up with VIA Voice for the Mac Enhanced Edition. We are here today to show you a preview of our latest VIA Voice for Mac OS X. Some of the new features that you'll notice are an Aqua user interface, completely redesigned for OS X.

We have customizable command and control of your desktop and your applications. We have dictation into practically any text field and text-based application, and the engine has been optimized for running on the G4 processor and on multiprocessors. Jeff Kuznets of IBM's Almaden Research Laboratory is here and will show you a demonstration and preview. Jeff, why don't you show some of the new features? Thank you. Okay. Open mail. Next message. Open video clip. Double size. Pause playback.

Switch to mail. Reply to message. Set speech mode to dictation. David, comma, new paragraph. Thank you for the video clip, period. I can't believe it has been two years since we announced the first version of VIA Voice for Macintosh, comma. Can you, question mark? It seems like only yesterday, period. New paragraph. I have just started using the newest version, comma, built specifically for Mac OS X, period. It is spectacular, exclamation point. You need to try it as soon as you get back to the office, period. New paragraph. Letter closing. Set speech mode to command.

Save as draft. Close window. Quit this. Resume playback. Thank you all very much. VIA Voice for the Mac OS X will be available later this year. We're in booth 749. Come by any time this week and you can see an enhanced, longer demonstration. We'd be more than happy to show it to you. Thanks very much. Next is a product that I think every home user and many of our education users are going to love.

It's from Worldbook. It's my pleasure to introduce Michael Ross, the publisher of Worldbook, to show us just an amazing new product for Mac OS X. Welcome. Thanks, Steve. Good morning. We're absolutely thrilled to debut for you the 2002 Worldbook on Mac OS X. From the moment that the application opens, you realize that this is not your ordinary encyclopedia. From the homepage, you get a rich display of multimedia experiences that are absolutely designed for exploration. The music that you hear is pulled from the Worldbook database randomly, and you can choose among classical, jazz, or international segments.

The visuals in the bottom of the page are also pulled from the thousands and thousands of Worldbook videos, animations, 3D views randomly. But they're not just for decoration. Click on any image, and you're immediately launched to the Worldbook Media Center, where you can learn more about that particular image or other images that are related to it, or open the article to that image and find out more information. That article and the articles in general are the heart of the Worldbook database. There are over 25,000 multimedia-rich articles on this Mac OS X product, and you can search all of these articles. So since we're in New York, we're going to go ahead and look up New York, and you can see the outline displayed, you can see the article displayed, and all the tools that you need to explore the information, including related information on the CD-ROM and information that you can pull in over the internet that are all web-approved websites by Worldbook editors.

You can also explore the timeline feature and get a history of New York. Or if you like, click on the animation canister and get a preview of all the images that are available in that article. You can click on any one of them. If you click on the map to New York, for example, you're immediately launched into the wonderful Worldbook atlas with that aquatic look in the water that just shimmers. From there, you can search any location on the Earth, including the Jacob Javits Center, and it'll take you right to the Javits Center. Or if you prefer, you can find two of your favorite destinations on Earth and find the relative distances between them on the wonderful distance calculator. Worldbook is a wonderful tool for getting information, but it's also a wonderful tool for exploring knowledge.

If you're a student and you want to look up a topic and you don't know what to do, you can put in a date or an era, in this case, the Civil War. Click on the Civil War and hundreds of images come before you to whet your appetite and look something up and do your report. Or if you want a different kind of search, you can go to Surf the Millennium, where we have divided the last thousand years into virtual websites. Yes, on Worldbook 2002 for Mac OS 2, even Joan of Arc gets her website. But don't try this on Windows, and it won't work on Mac OS 9, because this Worldbook is available only on Mac OS 10. It's available right now. You can see it at our booth for $59.95. Thank you very much for your time. Thank you.

Next, let's go to some games. Blizzard Entertainment. It's my pleasure to welcome Frank Pierce, the co-founder and vice president of Blizzard Up, to show us a hot new game running on Mac OS 10. Frank, welcome. Thanks, Steve. Thank you. It's great to be here today. We're really excited about OS 10. Mac gamers have always been a priority to us. Every game we've published has been available on the Mac.

We even have an in-house development team dedicated exclusively to our Mac products. Our commitment to Mac gaming continues this winter with the upcoming release of one of the most anticipated games of all time, Warcraft 3. Our goal is a simultaneous worldwide release of Warcraft 3 on both the Mac and the PC. In a moment here, Scott is demonstrating the latest build of Warcraft 3.

This is the first Blizzard game to use real-time 3D graphics. This version is carbonized, so it runs fast, and as you can see, it looks great on OS 10. Warcraft 3 is a real-time strategy game that we're taking to the next level. There will be four playable races, and we're incorporating role-playing elements by giving you legendary heroes. Your heroes will have inventory and gain experience and abilities through the course of the game. And as Scott will show you, Warcraft 3 will feature plenty of carnage.

Warcraft 3 will be playable on Battle.net. Our free online gaming service. Battle.net features will include automated tournaments, anonymous matchmaking, and competitive ladders with players from around the world. Warcraft 3 multiplayer gaming experience is going to kick ass. Mac gaming has never been as exciting as it is today, and we look forward to supporting Mac gamers for years to come. Thanks for your time today, and we'll see you on Battle.net soon. Thanks again, Steve. Warcraft 3, a simulation of the Microsoft AOL competition next year.

Okay. Next, Aspire. It's my pleasure to welcome Mike Rogers, the president of Aspire, to show us something really wonderful running on Mac OS X. Welcome. Hi, Steve. Thank you. Okay. At Aspire, we're motivated by one thing, bringing the best gaming experience to the best platform on the planet. In 98, we brought you Tomb Raider. In 99, Madden Football. Last year was The Sims. And this year, we're going to be showing off a little bit of Tony Hawk's Pro Skater 2. It's an absolute thrill bringing this game to OS X. The power and stability of the X platform has elevated gaming to a whole new level.

It means faster load times, advanced virtual memory, so the system adapts to the game on the fly. And with the power and speed of a highly integrated system, every game I've seen just looks and plays better under 10. Now, Brandon here is going to show us some sick moves in the game, and hopefully he won't spill too much. Backstage, he told me he could clear this level before I was done talking. So, we'll see how he does. The game puts you in control of one of 13 of Skateboarder's Elite. Brandon here is playing as Tony, but each one of the skaters has their own special move.

You can even customize your skater to put yourself in the game. There's all kinds of different levels from indoor to outdoor, even competitions. And a custom skate park editor, so you can create your own skate park and share them with your friends. It's even got multiplayer support. You can play with your friends over a network or over the internet, which is a Mac-only feature of the game. Go for it, Brandon. Alright. So, if you've ever wanted to try a fakie 5.0 manual judo kickflip combo, almost, then this is your dream game come true.

It's incredibly fun, incredibly addictive, easy to play, and it's got all the fun in the real world without having to break some bruises. So, Tony Hawk's Pro Skater 2 is available now at our booth for OS 9 and OS 10. It ships with OS 10 version right in the box. We also have a bunch of other games that are OS 10 ready on display at our booth. So, give it a try. Come on by. We think you'll see why we think OS 10 and games are an incredible combination. Good job, Brandon. Thanks a lot to Apple and everybody at Activision and Westlake that helped us bring the game out. Thank you, Steve. Thank you. That's great. And it won't be the last we hear about Tony Hawk today.

Okay, last but not least, Alias Wavefront and Maya. It is my pleasure to introduce a friend and a former director of Maya. Technologies, Richard Karras. Welcome. Thank you very much, Tim. You know, these days, 3D computer graphics are everywhere. We see it in some of these amazing video games. We see it in some groundbreaking feature films. We're seeing 3D illustration in magazines and virtual worlds appearing on the web. 3D is a medium being used to communicate, present, and, of course, entertain. And Apple has been building Mac OS X to be the best platform for 3D.

They've been doing this because they've been working with developers as they build OS X. Developers like Alias Wavefront who have helped make sure that the absolute best 3D technology is available at the very core of the operating system. And because Apple provides both the hardware and the software, they can fine-tune it better than anybody. And Maya shows this off very well. Maya is the most incredible technology available for 3D graphics with an extensive set of tools ranging from modeling, animation, to very unique special effects. Maya is the tool of choice for the high-end 3D professional. Now, with me here today is Dan Pressman, product specialist at Alias Wavefront. He's going to show us some of the amazing things you can do with Maya on Mac OS X.

Dan? Thanks a lot, Richard. First thing I'd like to do is to show you a quick side movie that I've rendered out of Maya here. Let's go ahead and play that for you. Now, I'm just going to jump into Maya, and you can see that I have one of those robots loaded in. And let's just take a look at some of the stuff that was involved in setting that motion up.

So, the first thing I want to do is just select the robot, and I'm just going to set some keyframes for the robot animating along the conveyor belt. So, I'm just going to sort of grab that whole assembly and slide it forward, and you can see the motion I've set up. So, really basic right now, but because of Maya's advanced dynamic system, I can easily go in and rig this guy to be fully dynamic. So, what's going to happen here is the legs are going to move, and you can see the entire upper body behaves realistically, being calculated by our dynamics engine. This is being calculated on the fly here. And, as you saw in the final, what we can do is animate this guy falling apart. So, to do that, I can basically select all the hinges that are holding his body together, play him forward until a frame where I want him to fall apart, like so, and then just keyframe these hinges turning off over the course of one frame. So, if I play this back now, you can see that he moves forward until he gets to that frame, and he kind of falls to pieces under the conveyor belt.

Now, of course, in Maya, we can just grab those keyframes very easily and move them forward in time to another point. And, if I rewind this and play it back, you can see we get a completely different outcome from the robot. He kind of swings back, falls backwards. Now, we're fully integrated, so you can bring in particles as well. I've done that here. Play this again. You can see the particles. I've set them up to understand when the robot falls apart, start to emit some fire and smoke. And I've actually gone ahead and rendered out a few different variations on this. So, we can render straight out to QuickTime, and I've done that with these. So, let's just take a look at some of these here. Here's another one. Now, of course, you can take all these variations, render them out, drag and drop them into iDVD or DVD Studio Pro and very quickly create a DVD to present to a client.

So, I hope this gives you an idea of what you can do with Maya and Mac OS X. Isn't that incredible? And today is the official launch of this product. Alias Wavefront is taking orders starting today at their booth. And Apple's been building the best platform for 3D. So, from all of us in the 3D community, thank you, Apple. Thank you, Steve. Thank you. So, I know it's a lot to sit through, but I wanted to show you these 10 remarkable apps. They are 10 of the next 1,000 apps coming to Mac OS X that we're going to see in the coming months. So, I thank you for letting me share with you these 10 on 10.

Now, this is a peek at what some of our developers are doing. What's Apple doing? Well, we've been doing a lot. We've had four updates to Mac OS X so far in the first four months. And the software update mechanism in Mac OS X is working beautifully. And it's very popular. As an example, the last update we had, 10.0.4, we had over 300,000 downloads up. So, there's a lot of people out there using Mac OS X on a daily basis. But today, I'm pleased to announce the first major upgrade of Mac OS X that will be coming, 10.1. Our great software team worked real hard to get the first release out, but we didn't let them stop.

They've been working overtime to get this new release out. And I think you'll like it. We focused on a few things. The first one is performance. Performance, performance, performance. We have much faster menus, much faster window resizing, blazing application launch, faster login, faster graphics, you name it, it's faster. Spent a lot of time on performance. The second thing is enhancing Aqua based on a lot of requests. Number one, movable dock. Number two, I think you're going to like a lot, I'll show you in a minute, system menus. A dramatically improved Finder and a lot more personalization in the system. As far as supporting our digital hub, we now have iTunes bundled in.

We have DVD playback. We have CD burning, not only from iTunes for audio CDs, but from the Finder for data CDs. And we have dramatically enhanced support for digital cameras built in. On the printing side, we are now supporting over 200 PostScript printers with all the DLLs or whatever they are bundled in. LaserWriter 8 features and much better plug and play for USB printing. And on the networking side, AFP servers over AppleTalk, a big request that we've had. We have a built in SMB client, which means that if you hook Mac OS X up to a Windows network, the other Windows machines and all the Windows servers will see that Mac OS X machine as just another first class Windows citizen on that network.

We also have full support built in for an emerging Internet standard called WebDAV and we've moved iDiscover to run on top of WebDAV, so it's always there, it never disconnects. And you can now manage airport base stations right out of Mac OS X. So, this is just, these are just a few of the many thousands of improvements we've made in the last year and a half. This is just, these are just a few of the many thousands of improvements we've made and what I'd like to do now is I'd like to give you a sneak peek at Mac OS 10.1, if I could. All right. So, the first thing I'd like to do is just show you a little bit about the performance.

So, let's go up to menus. You'll see that menus are really fast now. Okay. So, that's nice. One of the other things that people really wanted us to speed up was application launch. So, I'm going to launch a photograph, I'm going to open a photo here, which is going to cause a launch of preview. Boom. There it is. Open. Let me quit that. Boom. There it is. Quit that. Boom. There it is. Let me open another text document. We'll open text edit. Boom. One bounce. All these applications are opening very, very fast, launching very, very fast. Let me launch Sherlock. Less than a bounce. Let me launch mail.

About a bounce. Okay. Now, these are our apps that we ship with Mac OS 10. What about third party apps? Well, Internet Explorer is a great poster child because it used to take over five bounces to launch IE. Let's take a look at it right now. One bounce. Okay. Let me close all these. I got a little folder here. Let me select all these apps and just launch them. So. All right. Let me put all these guys. So, that gives you a sense of how fast things are launching now in 10.1. So, I want to show you one other thing.

Let me open three photos again. Now, I want to show you something new we've added. You know what the GD effect is. It's a little bit of a bug. It's a little bit of a bug. But, it's a little bit of a bug. It's a little bit of a bug. It's a little bit of a bug. It's a little bit of a bug. It's a little bit of a bug. But, the GD effect we've had to miniaturize. Added a new effect called scale and you can pick whichever one you like But I think we're going to ship with scale turned on let me show you how fast the miniaturization is You see how fast it is much faster even in the genie and again, I'll run it in slow motion. It's a very nice effect Right boom boom So that is also much faster in 10.1 Now let's go to the finder Well resizing Resizing it's a lot faster in Mac OS 10.1. There's icon view Let's go to list view which was pretty slow All right, it's like butter now and Let's go to column view again, they've let's get another column here Column view very fast as well. Now another new feature in 10.1. Watch this Resizing the columns right there real time Very very nice Resize all the columns right there. Okay. One other thing I'd like to show you now in the menu bar We've added these new system menus here These are for things in your system where you want status and you don't want to take up a dock slot to do it You choose to put these things up here. We have connections here to modems You can right here take a look at what your connection status is connect and disconnect Speaker volume if you want it right here

Displays you can switch display resolutions even the battery and you can show as an example you can show the time left on the battery or you can even show the percent of time left on the battery and So all these things as well as airport if you have an airport card plugged in show you your signal strength Let you turn airport off and on etc. All right up there in the menu where they're super convenient So now let's do some multimedia stuff. First thing I like to do now is launch the DVD player Here it is and let's go ahead and bring up a title Here we go and you're one of my favorites Let's see. So let's go chapter selection and I'll pick a good chapter and let's go play this No Ha ha ha. All right, let's try that again All right chapter selection go here let's try playing that and let's play full frame You One of my favorite movies, so all right So that is the DVD player now, let's go ahead and launch iTunes

iTunes bundled in and again, you know, we can go search for music and oh wh you know, nowhere, man, let's say You Well iTunes bundled in the Mac OS 10.1 and Oh one other thing I want to show you about iTunes actually let's go ahead and You We want to do here so we have menus off of the applications as well as the folders now All right disc burning. Let me go ahead and eject this disc it's a Toy Story 2 disc and I will put in a CD-R disc and We will see that pop up in just a minute And let's go ahead and start to burn a CD right from the desktop Takes a few minutes to figure out what kind of disc it is go ahead and prepare it and it'll show up in just a second here and Now what I can do is just drag a few things right onto that disc Should it ever pop up there it is. So let me go ahead and open it and I'll just drag some things in like this and I can just now we have a burn button right on the toolbar if you choose to put it up there and I can just

Pick burn says you want to burn? Yes, and I am now burning a data CD right from the desktop. So All right Another Thing in the multimedia space is digital cameras. I've got a digital camera here with some photographs on it let's say I've just come back from taking these photographs and All I have to do now to make them work with OS 10 is to turn the camera on which can sometimes be the most time-consuming part of this process and plug the USB cable right into in this case the keyboard and If the camera indeed turned on Mac OS 10 is going to recognize the camera, which it I guess didn't turn on here Try turning the camera on All right Yeah, I need some help up here it's technical My camera's not turning on What's that I did slide it and let go Not turn it on here Okay We'll let an expert see if you can turn it on hopefully he can so I want to show you what got it on Batteries have to go back in for me throwing it. Sorry. All right. Let me show you one last thing then I'm going to show you the dock. So let's go get the dock preferences panel again preferences launches in about a bounce

So let's go get the dock preferences panel. And as you know, we can change the dock size, right? We can change magnification turn it off and on we can automatically hide the dock or not And now we can put the dock on the left the bottom or the right Works just the same as it did before boom Boom, really really nice Okay Now what I'd like to do is if we get this camera running Which it's not going to run. I'm afraid. All right Well, that's what I have to show you on Mac OS 10 some of the new features of Mac OS 10.1 So Mac OS 10.1. It's going to be a free upgrade For existing owners of Mac OS 10 we're going to ship it in September and If it is four o'clock today in our transition to Mac OS 10 when we ship 10-1 It will be six o'clock halfway through the transition. Not only have we shipped four upgrades, but we will have our first major release From the initial release of Mac OS 10 halfway through the transition this September. That's what's happening on Mac OS 10 All right Now Let's get into hardware Got four product lines first thing I'd like to do today is focus on our notebooks our notebooks Are like a rocket right now. Let me first take the iBook

The iBook is an incredible product we introduced on May 1st It is a wonderful implementation of our digital hub strategy The new iBook can sit at the center of all your digital devices. You can make movies you can burn CDs on it it's wonderful and The reviews it's gotten are phenomenal. I Have a new favorite laptop the LA Times The iBook richly featured and starting at $12.99 is close to ideal for students business week At 4.9 pounds with a full complement of ports a CD or DVD drive The new iBook is the lightest smallest full-featured consumer portable. I've seen Walt Mossberg the Wall Street Journal The iBook stealth feature is its price the base model is $500 less than the lowest price similarly configured Windows competitor Pounding a silver spike through the heart of the notion that Macintosh elegance necessarily commands a premium price the New York Times And The new iBook is simply the best consumer laptop on the market today Dell Compaq and the others should be ashamed They haven't come close to building a laptop this cool and at this price ZDNet So We announced the new iBook on May 1st and During the month of May and the month of June last quarter. We shipped a hundred and eighty two

Thousand of our new iBooks. This is more notebook computers than we have ever shipped of any model in any quarter And we did it in two months. Unfortunately, we were still not able to meet the retail demand. So we're working overtime to ship a lot more iBooks this month and this quarter. And if you've had trouble getting one, you should be able to get one real soon. So the new iBook's an exceptional product. Our second portable, PowerBook. PowerBook has won industry-wide acclaim as the best notebook computer around. It's made out of titanium. And the thing is, it's wonderful. It's wonderful. And the reviews it's gotten are also wonderful. The PowerBook G4 is a landmark hardware achievement.

The titanium laptop blew me away, the San Jose Mercury. Whether you need it or not, I guarantee you'll want one. If you've ever suffered Sony bio-envy, this PowerBook will end it once and for all, the Houston Chronicle. If you could take just one laptop with you on a desert island, this would be the one, the Boston Globe. I think the new PowerBook G4 titanium is the most impressive notebook computer ever, Fortune magazine. We have never had a notebook lineup get these kinds of reviews. It is unbelievable. And we really, really appreciate your response to these portables.

We're making them as fast as we can. So let's go to desktops now. Start with the iMac. iMac. Today, we got three new models of the iMac. Let's talk about it. 500, 600, and 700 megahertz iMacs, fastest iMacs we've ever shipped. 128 megabytes to 256 megabytes of memory. All plenty enough to run Mac OS X. 20, 40, and 60 hard gig drives, the largest drives we've ever shipped on an iMac. CDRW across the board. 999 on our entry iMac, 500 megahertz, 128 megabytes CDRW. Today, availability for the 500 and the 600 megahertz, availability on the 700 next month.

So again, take a look at this entry SKU and see how far we've come from where we were even a year ago. 500 megahertz, 128 megabytes, a 20 gig hard drive, CDRW for under $1,000. It's amazing. It's the first time we've ever had a CDRW iMac under $1,000. Now, the 500 megahertz SKU is available in indigo and snow. The 600 and 700 megahertz are available in snow and graphite. Again, the iMac bundled with iMovie and iTunes is the best desktop computer to be a digital hub to all of your other digital devices, and the best and fastest way to get onto the internet. So the new iMacs.

Which brings us to the Power Mac G4. Power Mac G4, we introduced a new lineup of Power Macs in January. Our phrase was the power to burn. Power to burn CDs, DVDs, and Pentiums. We also introduced the SuperDrive, a landmark achievement, a drive that's capable of burning CDs, reading DVDs, and most important, burning DVDs that you can read in almost any consumer DVD player. This has been a very successful product for us, and today I am thrilled to say we have the second generation of this product introduced to you this morning.

Internally, we call it Quicksilver. This is what the Power Mac has looked like up till today. This is what Quicksilver looks like. It's a nice refinement. And Quicksilver is going to come in three models. They are all very fast. 733 megahertz. Yesterday, 733 megahertz was at the top of our line, the fastest chip we shipped. Starting today, it is our entry-level Power Mac. Our mid-range is 867 megahertz, and we have a 2 megabyte L3 cache.

This thing screams. And our high-end, by popular request from almost all of our pro customers, dual 800 megahertz with dual 2 megabyte L3 caches. It's going to be the ultimate machine to run Mac OS X on. This machine delivers 12 gigaflops of sustained throughput. These machines are very fast. They all have 133 megahertz system and memory bus. They all have five slots, AGP 4X graphics, FireWire, three drive bays, and gigabit Ethernet built in on the motherboard. And they all come in the award-winning enclosure we've come to know and love. Power Mac, where a pro customer can get at any component inside, be it memory, a drive, anything, just by opening one door.

So three models, 733, 867, and dual 800. Single, single, and dual processor. Let's take a look at the configs. The 867 is the fastest chip we've ever shipped. The dual 800 is the fastest system we've ever shipped. 128 to 256 megabytes of memory. 40, 60, and 80 gigabyte drives. This is the largest hard drive we've ever shipped. And since you can fit three of them in the box, you can fit a quarter terabyte in the Power Mac box now. NVIDIA GeForce 2 graphics cards across the line, except at the top end, we have included a dual display card, which has both an Apple digital display output and a VGA output, so you can have two displays operating simultaneously with independent screens.

This is the big one. CD-RW at the entry, super drive, not only on the high-end model, but we are bringing it down now to the mid-range. And the price is $1,699, $2,499, $3,499. So let's take a look at these SKUs. The entry level, it cost $3,500 yesterday to get a 733 megahertz G4. It costs $1,699 today. It cost $3,499 to get a super drive yesterday. That's $1,000 less today with an incredible config, with an 867 megahertz G4.

And the high-end is to die for if you're running Mac OS X. Dual processors, 80 gigabyte hard drive, dual display and super drive for $3,499. We're very, very pleased with these configs. Now let's talk about the super drive for a minute for those of you who haven't used one yet. This is a breakthrough of the first order. When we first shipped the super drive early this year, we were the first people in the world to do so. And what a super drive is is we can look at the different kinds of drives here. A CD-ROM is a drive that reads CDs. A DVD drive is a drive that reads both CDs and DVDs, so that in particular, you can play movies.

A CD-RW drive forsakes the ability to read DVDs in exchange for the ability to both read and write CDs. So we can write music CDs. We can write data CDs. Now an interesting drive that's just come on the market that's popular, we're shipping a lot of them in our new iBook, is the combo drive, which adds back in the ability to read DVDs so you can watch movies on the road. It's called a combo drive. But there's still been one thing missing, and that's the ability to write DVDs that we can go play in consumer DVD players. And that is what the super drive adds back in. The super drive does all of these things in one drive. So we can write DVDs that we can play in consumer DVD players without giving up the ability to play movies and write CDs as well.

And the super drive is now available in two of the three PowerMax SKUs starting at $24.99. We think a lot of people are going to be writing a lot of DVDs starting now. So all of these new PowerMax, of course, are powered with the incredibly fast G4 chip. But how does this stack up against Intel's Pentium 4? We've got an 867 megahertz G4 trying to compete with a 1.7 gigahertz Pentium 4. They say they've released a 1.8, but we tried to buy one the last few weeks and we can't find one anywhere. So my guess is they'll be out soon. So we had to settle for a 1.7 gigahertz one.

How do they compare? Well, I'd like to invite Bill Schiller, our Vice President of Worldwide Product Marketing up, and let's have a showdown. Hi, Bill. What do we have here today? Good morning. This is my favorite part of the show. This is the part where we get to see whether our favorite computer, the super fast PowerMax, can really keep up with these amazing... amazingly high megahertz of Pentium 4s. You see on the screen, we have two computers here, a Power Mac G4 on the left screen, running at 867 megahertz, and an Intel Pentium 4 system at 1.7 gigahertz. Now they're both configured the same, like gigabyte of memory, same drives, same NVIDIA graphic cards, and what we want to do is put them side by side, running the latest software, exactly the same on both machines, with exactly the same files, and see how they do.

So Steve, if you can help me up. Yeah. I'd like to bring up MediaCleaner. This is new MediaCleaner 5. And what we're going to do, is we're going to do a very processor-intensive and system-intensive task, that a lot of our pro customers do, putting up content with QuickTime, and other media applications, and some coding, and decoding, and a lot of very powerful work. So, to begin with, you want to give us a countdown. First we have to start up, pre-flight it by hitting play. And it's going to give us a prompt for an output file, it's going to make. So if the count of three. Three, two, one, go. So now what we're doing, there's a starting with a source QuickTime movie, we're going to de-interlace it, because it's coming from an NTC video, has to be de-interlaced.

We're going to crop it, and we're going to encode it with the brand new Sorenson 3 video codec. So a lot of high-end processing performance. And the machines are both going. It's a brand new movie trailer that went up on Friday on our movie trailer website, up on apple.com. The kind of work our developers do every single day. And as you see, the Power Mac is moving ahead on the left. The Pentium 4 trying to keep up on the right. It's an appropriate video clip for here, because of course, as you all know, Spider-Man is from New York. Every time you watch video on the web, somebody has done this, or something very similar to this. So this is a very, very common thing that's done all the time by our customers. I know the suspense is killing you all.

What is going to happen? You can see why people want this to happen as fast as possible. You can see how much laser we've used here. This book has a date. We've used 11 days to get this. The end result one time, one of the most powerful machine learning phenomena that Hashem will ever see. You can see why people want this to happen as fast as possible. All right, Power Mac is just about done here. And the 1.7 gigahertz Pentium 4 looks a little under halfway done. All right, Power Mac is done.

While we're waiting, why don't you play the video? All right, take a look at this clip we've just encoded. All right, so there are thousands of people doing this right now as we're sitting here.

And you can see why they want these machines to go as fast as they can. The 1.7 gigahertz Pentium looks to be a little over halfway done. So we're gonna let it rest in peace here and go on to our next demo. All right, Bill, what's next? All right, well, a performance demo for our customers who use Power Macs wouldn't be complete with a demo of Photoshop. It's one of the most used apps by our Power Mac customers. It really takes full advantage of everything the system has to offer. The velocity engine, the memory bus performance, graphics and the hard drive to do amazing things for amazing documents that our customers create. We again have a 867 megahertz G4 on the left and a 1.7 gigahertz Pentium on the right. All right, let's bring up Photoshop here.

And now this is a document, the exact same document in both machines. And for those who've watched this before, you know that with Photoshop, not only can we move the same document cross platform, but we can go through and script a series of actions that an artist would actually do to create a document as the case here. Now on every one of these demos, I always ask Bill and his team, is there any trickery going on here? Is this totally straight? Is this exactly what somebody does every day? And now the answer is always yes. And we police these things very, very strictly, but I can guarantee you this one's yes because I am familiar with what you're about to see. All right, three, two, one, go. We have a movie poster here that was created by an artist with actual output from some very high end 3D software.

And we're going through a 200 megabyte file that has over a hundred actions that an artist would do to create this document. We're bringing in different layers, we're transforming them, we're using fills and gradients, unsharp mass and color lenses. And this really taxes all the great capabilities in Adobe Photoshop, the type of work our customers do every single day. The Mac is done. And I know what you're thinking is the PC working? What are those 1.7 gigahertz actually doing? You can see the weight cursor as it's trying to scale down this image and bring it in, something the Mac did a while ago.

And again, the number one thing most people do with Photoshop is scale images. This is done by every Photoshop user many, many, many times a day. By the way, this poster is an answer to the question, what will you be doing on November 2nd? You sure this thing's running? Okay, good. All right, Penny in 1.7 gigahertz. So, thank you, Phil. Thanks, Steve. So, in our showdown, in our showdown, we've got an 867 megahertz G4 against a 1.7 gigahertz Mac.

And we've got a 1.7 gigahertz Mac. And we've got a 1.7 gigahertz Mac. And we've got a 1.7 gigahertz Mac. And we've got a 1.7 gigahertz Pentium 4. And in the showdown, whoops, sorry. In the showdown, the G4 completed the task in 45 seconds. The Pentium 4 took 82 seconds for the same exact task. That means the G4 at this task is 80% faster than a 1.7 gigahertz Pentium. Now, I know what you're thinking. How can this be? The answer to this question is a technical one, but the name that we've given it is the megahertz myth. And to explain the megahertz myth for us, I've asked John Rubenstein, our Senior Vice President of Hardware at Apple, to come up and give us a brief tutorial on the megahertz myth.

John. Thank you. Thank you, Steve. Morning, everybody. Okay, so you just saw the G4 beat the Pentium 4. And some of you are thinking to yourselves, wait a minute, 1.8 gigahertz, that's twice as fast as 867 megahertz. And those of you that are thinking this are suffering from belief in the megahertz myth. And that is that megahertz equals performance. But megahertz does not equal performance. It's just a contributing factor to performance. Now, to understand this, we have to look at how processors are designed.

There's a lot of complicated trade-offs in processor design. And I've picked four of the key architectural trade-offs for us to look at. Of course, there's frequency. We want to run as fast as possible. The frequency will be based on what process we're in and the number of pipeline stages. The more pipeline stages we have, the less work we do every cycle. And so the faster the pipeline can run. These two are very much related. And there's some real downsides to having long pipelines. We're gonna talk about that in a minute. Then there's a number of functional units. The more functional units you have, the more parallelism you can have. That's how many instructions you can execute every cycle. And the cache design, whether you have a level one or the size of the level one, size of the level two, and if you have one, the level three cache.

So all of these factors play into what the performance of the processor, not just frequency. So let's look at some examples of this. Here are the four leading processors in the industry today. The PowerPC G4, my personal favorite, the Pentium 4, Intel's next generation 64-bit architecture, the Itanium, and Sun's latest SPARC processor, the Ultra SPARC 3. We can compare several characteristics of these processors. We can look at the process, the size, the number of pipeline stages, and how many megahertz they run at. Now it's interesting, most people would assume that because the Pentium 4 runs at 1.8 gigahertz, that it would be in a much faster process.

But the reality is, is all four of these processors are in the same process, give or take. And it's interesting to note that the G4 is a very efficient design, because it's half the size of the other processors. Now let's look at how Intel got to 1.8 gigahertz. They did that to go into 20 pipeline stages. Now we see that the G4 is only seven pipeline stages. So you're thinking, well, what's a pipeline stage? So all processors execute instructions through their pipeline. This is a very simplified version of it. It's a four-stage pipeline. Instruction gets fetched, decoded, executes, and the result's stored. Now all the processors we're looking at have more pipeline stages than this, and they have one or more of these pipeline stages broken down into multiple pipeline stages.

Let's look at an example of this. We have the seven-stage G4 versus the 20-stage Pentium 4 here, and we're going to execute equivalent instruction streams down these pipelines. So we see instructions flowing down the pipeline, and the short pipeline starts getting results sooner. It takes us a while to fill the longer pipeline. Now we start seeing some results coming off the long pipeline. So right off the bat, the long pipeline has a disadvantage in that it takes longer time to fill. Now every cycle, we're executing one instruction and completing it. So you're probably thinking, well, wait a minute. The longer pipeline is running twice as fast as the shorter pipeline. And so at some point in time, it's going to catch up to the short pipeline and pass it.

And that would be true in the ideal case. But it's not a perfect world, and there's inefficiencies associated with long pipelines. That's been called in the press lately the pipeline tax. The pipeline tax occurs because there are bubbles in the pipeline that come from data dependencies. That's where one instruction is dependent on the data from a previous instruction. Or even more catastrophic is certain branches can cause the entire pipeline to drain. So let's take a look at this again. Now again, we're going to run the same instruction stream down both of these pipelines. We start. We see that the short instruction pipeline starts generating results first, and you start to see some bubbles.

So we see bubbles. Now bubbles can be one to many clock cycles. Now we see a branch. That's the red instruction. You notice the pipeline drains. Now the instructions get to the end of the long pipeline, and that one drains. So we see that whenever we hit one of these kind of branches, we pay an enormous penalty for having that long pipeline. Now the short pipeline drains. We see a variety of bubbles, more branches, and we see that the longer pipeline falls farther and farther behind the short pipeline. Okay, there's the last branch on the short pipeline. Finish that last instruction. Continue executing along. Here's the final branch for the long pipeline.

Now these branches' data dependencies occur very often, and it really depends on what your code looks like. Okay, now we'll finish up that last instruction, and we're done on the long pipeline. So let's go back and compare our four processors again. We have the Pentium 4 running at 1.8 gigahertz in those 20 pipeline stages. It's interesting to look at the Itanium because, again, Intel's next generation processor, they chose to go with 10 pipeline stages. Note that it runs at 800 megahertz. And we see the UltraSpark 3 has 14 pipeline stages and runs at 900 megahertz. So the G4 is an extremely efficient design in that it only has seven pipeline stages and yet runs at the same speed as other processors that have much longer pipelines.

So I hope that this gets you to understand that performance is more than just megahertz. And I hope you're not fooled by the megahertz myth. Thank you, everybody. Thank you, John. So again, the megahertz myth, an 867 megahertz G4 can be as fast or even faster than a 1.7 gigahertz Pentium 4. And it gets even better when you add two G4s in the multiprocessor model. So these things are very, very fast. Let's talk about availability. We've got three models. The 733 and the 867 are available starting today.

The multiprocessor model will be available starting next month. We also have three great displays to go with them. They're fantastic for Mac OS X. They all are active matrix LCD. They are all digitally driven from the computer, so you get the most precise, crisp images. They all have a built-in USB hub, so you get two USB ports right on the display. And they are all powered from the computer, so you don't need these power bricks lying around. And all of that is over one cable, the power, the USB, and the digital signaling. So three displays. We have a 22-inch cinema display, the finest flat display in the industry by far. Our new 17-inch display, 1280x1024, and our 15-inch display, 10x7, and three aggressive prices.

We've lowered the price on the cinema display down to $24.99. Our 17-inch is under $1,000, and $5.99 for a 15-inch. So these are very, very high quality, very affordable displays that are designed to go perfectly with the Power Mac G4. So I've made a video now that I'd love to show you about our new Power Mac lineup. So let's roll the video. So I've made a video now that I'd love to show you about our new Power Mac lineup.

So let's roll the video. So I've made a video now that I'd love to show you about our new Power Mac lineup. So let's roll the video. So I've made a video now that I'd love to show you about our new Power Mac lineup.

So let's roll the video. you you you you

you you you you so the new power Mac g4 is really fast and that completes our product lineup today got one last thing I want to show you but before that I'm gonna go back here to 10 and I'm going to show you in 10.1 what we can do with digital photography so this camera should now be working and I should now be able to plug it in here all right now hopefully camera is on maybe not oh oh please okay here we go is the switch on yes there we go there we go all right so when it detects a digital camera plugged in Mac OS 10 automatically launches an app the image capture app loads all of the pictures off the camera

and into your pictures folder without doing a thing and so here we are opens the finder there's my pictures folder and here's all these pictures right off the digital camera I can click on one and get a full-size image there right see these are large images these are several megabytes apiece but let me do something really cool I'm gonna go to preview and all I have to do is go into the screensaver panel on preview and I'm gonna set the screensaver to be a slideshow and I'm gonna say test it automatically goes to my pictures folder and makes a screensaver ever pictures are in the pictures folder and uses open GL to zoom into them and to do a cross dissolve to other pictures this can happen within a few seconds after you're getting back from a trip and plugging in your digital camera into Mac OS 10 and any of these pictures it's also very easy well whatever okay it's also very easy to make any of those your desktop picture as well but that's something going wrong okay last thing I want to talk about I DVD with the proliferation of super drives into two out of our three power Mac models we're going to ship well over between one and two hundred thousand super drives this

quarter that's a lot a lot of people are going to be making DVDs I DVD is the revolutionary software we introduced this last January that lets you easily make DVDs that you can play in almost any consumer DVD player now this is getting more and more relevant by the day the latest research out last week says that by the end of this calendar year there will be 28 million DVD players in the US alone that is one in every four households in the US by the end of this calendar year DVDs are exploding the same way that CD players loaded a decade ago it's happening we're already 25% of the way there by the end of this year so this is really important it's important for business it's important for education and it's important in the home I DVD is a truly breakthrough app let me just read you some of the reviews it got when it comes to the actual experience of creating a DVD Apple wins hands-down Apple has created a beautiful and simple DVD recording program it's called I DVD and looks a lot like Apple's brilliant iMovie program for importing and editing videos Walt Mossberg the Wall Street Journal here's another part of that article using the Apple I produced discs filled with a mix of home videos and personal photos in every case the Apple rendered the videos perfectly and they looked and sounded great on my TV the Washington Post says this program is easier to use than much of the Mac OS itself designing the DVD itself requires Apple Apple's free iDVD

program which is about as difficult to master as a grapefruit the finished product is a DVD that plays with pristine sound color and resolution in almost any DVD player the New York Times Apple's iDVD is by far the simplest and easiest way the simplest and easiest to use DVD authoring tool on the market today TV magazine so these are incredible reviews and this is hard stuff there are four steps to making a DVD editing the video creating the menus encoding and MPEG-2 and burning the DVD so let's examine editing the videos we have the two most popular video editing programs on the planet now iMovie is the most popular consumer and education and semi pro video editing program in the world and Final Cut Pro now has become the most popular by volume editing program proposed but we don't limit it to that iDVD works with video from any source including Adobe Premiere and Avid and any other video source that can generate a QuickTime file so anything out there pretty much can be a source for iDVD and digital cameras can too an incredible thing about DVDs is they can store tens of thousands of digital photographs it's one of the best ways to look at digital photography ever so that's editing the video the next three steps iDVD manages for you let's look at it creating the menus will show you in a minute but iDVD lets you drag and drop your videos into

a very simple window which creates the menus entirely for you it's so simple so this is the easiest part encoding into MPEG-2 what's MPEG-2 MPEG-2 is the compression standard that every consumer DVD player is built to understand you have to be an MPEG-2 if you want to play on DVD players now when we looked at doing this we looked at hardware and software hardware looked attractive until we found out the price about a thousand dollars worth of hardware to do it at the pristine quality which our customers would demand from us we said nope it ain't hardware let's look at software the problem with software compression is though it is even finer quality than hardware compression or can be if you have the right algorithms it's very slow and the fastest stuff we could find was 25x which meant if you had an hour's worth of video it would take 25 hours to compress it into MPEG-2 not so good we had a technical breakthrough using the GeForce Velocity engine and we were able to reduce that 25X down to 2X.

Hours worth of video, take two hours to compress on your G4, a lot better than 25. And now, with our dual 800 megahertz G4s, we've taken that 2X and we're actually a little smidgen less than 1X now. So that is encoding to MPEG-2. And burning the DVD, iDVD manages this with a super drive. Actually burn the physical DVD. So this, these are the four steps, again, iDVD manages the bottom three. It is a revolutionary app. But today, it's my pleasure to share something really special with you, we've been working on real hard, and that is a preview of the successor to iDVD, iDVD2.

Now iDVD2 adds the one big thing that will take the DVDs you can make up to a level where they are as impressive, or even more impressive, than most of the Hollywood DVDs you can go out and buy today, and that is motion menus. The ability to put video on buttons and in backgrounds is stunning. And added to that are some new themes to take advantage of these motion menus. The ability not only to have slideshows on your DVD, like iDVD1, but add soundtracks to them, so you can have music in the background. Sound encoding, this is huge. When you drag a movie into iDVD2, it will start encoding it into MPEG-2 in the background, using all the cycles that you're not using, taking advantage of Mac OS X's multi-threading, and encode that video into MPEG-2, such that the chances are likely that when you're done constructing your menus, many of the videos are already encoded into MPEG-2, saving you that much time thereafter.

And we have DVDs that will now hold up to 90 minutes of video, up from iDVD1's 60 minutes of video. iDVD2 runs on Mac OS X, takes advantage of a ton of the new features to make a much better product. We're going to ship iDVD2 in September. It is going to be a free upgrade for our iDVD customers, and it is stunning. It is really stunning, and I would enjoy giving you a sneak peek of it right now. Now, iDVD is still in development.

We have a little bit longer to go, and I only got three hours of sleep last night. So, we may have some glitches up here, but we'll do our best. So, first thing we do in iDVD is we open the app here, and I pulled up the chalkboard theme. It's the same as in iDVD1, and I can drag some movies in here, and I'll drag three in. And iDVD automatically lays out where the buttons will be. It's very simple. And I can actually just click on one of these and set the thumbnail anywhere I want to. And this is just exactly like iDVD1. And I can make a DVD this way, and I can just push this burn button, and it will go ahead and lay out my DVD and burn it.

That's that. Exactly what iDVD1 did. And I can move these things around, of course, and things like that. Now, iDVD2, though, adds a huge feature, and again, that is motion menus. Let me go ahead and show that to you. There you go. You can have video in your buttons. So, these are the actual videos playing, and they're dropping some frames right here because we're playing three of them, but in your actual DVD, they're smooth as silk. They're beautiful. We can even go in here if we want to and customize that and say, well, let's even add some music here. All right.

Let's go to another theme here, the road trip theme from iDVD1. And again, I'll just add a fun song here. So, that's simple. Now, we've added some new themes. We've added a great brush metal theme. A lot of our business customers will like that. We've added a wonderful theme here. This is called parchment. Whoops. Don't want Johnny Cash on this one. And let's go ahead and turn this one on.

And again, you can drag in four movies here, and it'll just reorganize itself. And again, all these things are live. Live menus. All right. Let's go back to three here. Here's a wonderful new theme. This is called claim check. And whoops. Isn't this great? You can see the production value now getting better and better and better.

Now, let me go down to this one. Here we've got some textual menus, and we can do some different things here. The first thing we can do is, of course, just like iDVD1, we can just drag in a background picture and all of a sudden make this anything we want here. So I'll go ahead and change this to Allie and Jeff. And we've got a DVD here, and I can very simply put some music on this, again, just by dragging a music track on. We've also come up with some themes that actually have background motion in the theme so that you don't even have to add your own background video to this.

So let me go ahead and choose this one. This is an obvious one. And I just turn this on. Can't cut Frank off there. Here's another one that's really wonderful. This is phenomenal.

This may be my favorite of all of them. Well, let me give you an example. We'll go to this one, and I'm going to just, for fun, take away these two. And one of the great things you can do in iDVD2 that you couldn't do in iDVD1 is free position all the buttons.

You can put the buttons anywhere you want. And I'll just move this one here. And then what I'm going to do is I'm going to actually take that movie and put that movie behind the button. So now what I'm going to do is go here and just turn it on. So you get the idea.

So I DVD2, we think it is the 2nd iteration of a revolution that we started with I DVD1. It is the perfect companion to iMovie 2 and of course, Final Cut Pro. And it is also a perfect example of our digital hub strategy in action where you can actually make these DVDs using videos you edited with iMovie as an example that will play in almost every consumer DVD player and as you see, the production value of these DVDs now is in many cases better than most Hollywood DVDs you can buy and you can make them yourself in a matter of a few minutes.

The other thing this illustrates for me is what Apple is all about. You know, we make things faster. We love making things faster than yesterday and last month and last year. But the other thing we love is allowing people, enabling people to do things they could never do before and that is what we have done here with iDVD. This is an illustration of Apple standing at the intersection of liberal arts and technology and bringing those two things together like no other company can in the world to put tools like this into the hands of businesses and educators and all of us mere mortals to use in our daily lives. And this is what drives us, bringing together the SuperDrive, the new PowerMax, iMovie, Final Cut Pro and iDVD and letting our customers create, whether it is for business or education or just their own personal fulfillment.

So this is what we're all about. Now we love making TV ads too and we've had some great ads this year to communicate iTunes and our digital music strategy. We had an ad called Concert which you might have seen to communicate our new iBooks, incredible ability to be the best digital hub in the world. We did Middle Seat we called it and we have a new ad to communicate making your own DVDs and we call it Elope. So what I would like to do now is if you let me, I'd love to run all three ads for you. Let's run Concert, Middle Seat and then let's run Elope which will start running on television later this week.

Let's go ahead and run it. So you'll see that soon on television.

Now we're in a really interesting time. The very tough economic conditions out there and most of our industry is retrenching. They're retrenching, they're restructuring, they're laying off people. We've decided to try to find a different path to navigate through this difficult economic time and our path is innovation. We've got our incredibly talented people working overtime to try to bring incredible products to you and incredible software, incredible buying experiences and since the beginning of this year we've launched a ton of new products and new initiatives.

A totally new way to buy a computer, a solutions based way to buy a computer launched this year. Mac OS X, we are transitioning to an entire new operating system, the most advanced operating system in the world this year. PowerBook G4 Titanium, the most advanced portable on the market introduced this year. The new iBook, the best consumer notebook in the world for home and education use introduced this year. Our new PowerMac G4 Towers, the fastest personal computers in the world bringing super drives, the ability to write DVDs introduced this year.

iTunes, the best digital music software on the planet introduced this year. And iDVD 1 and 2, the ability for mere mortals to make DVDs that will rival and even exceed the DVDs you can buy from Hollywood introduced this year. Our team is working very, very hard. What I would like you to join me in doing is giving them a round of applause for bringing us these wonderful things. And I'd like you to join me in one more thing.

Our folks are working really hard. They're working a lot of hours. And I would like to ask you to give me a round of applause for their families, for their spouses, partners and children who have not seen enough of them this year. You can see all the stuff we introduced today on the show floor. I encourage you to go check it out. Thank you for giving us such a warm welcome. See you again soon.