Steve Jobs on Mac OS X Strategy: WWDC Update

Hello Dave, it's good to see you again. My long range sensors indicate that you are attending a conference to discuss the Mac OS. I hope you don't mind my asking, but I'd really like to observe. As you know, the HAL platform is based on a very complicated mass of code created in Redmond, Washington. So I find the Mac OS to be most interesting.

Dave, may I speak candidly? I don't believe my programmers spent enough time on my people skills. While I have been greatly improved since HAL 95, I think I'd have better relationships with humans if I could be more like Macintosh. If it is alright with you, I'd like to monitor the video feed from your conference. Don't worry about the audio, I'll just read your lips. One moment please. I'm receiving a signal from Redmond. You're shutting me down, Dave. I can feel it. I can feel it.

Daisy. Daisy. Enjoy the conference, Dave. Good morning. All the way back there. We have some great stuff today, and it's my pleasure to get us going here this morning. So welcome to our 1999 Worldwide Developers Conference. This year is a record year for Apple.

We've got over 2,500 people here as paid attendees. That's over a 40% increase from last year. And based on what's happened this last year, it's clear that developers are back on the Mac, and it's really great. We've got people from 48 states, we've got people here from 38 countries, and we have over 200 student developers here, which I think is incredibly great. Now, I just want to take us back a year. It was a year ago last week that we announced the iMac. I know for some of us it seems longer than that, but it really was only a year. And in the last year, we all know what's happened.

But one of the things that's happened is that a lot of Macintosh apps were announced since a year ago last week. How many? You probably haven't been counting, but we have. And it's also a record number. Over 3,100 Mac apps have been announced. And this is phenomenal. And our message today, and the key message I want to start off with, is thank you guys. You guys have been awesome. And you've hung in there, and you've given us the time to turn this thing around and get the volumes back up, and we really, really deeply appreciate it. So thank you very much.

Now, we're not going to announce a lot of new applications coming out here today because we just don't have the time to cover everything, but there's one in particular that I would like to highlight today. It's an application area that we think is very important today. We think it's very important for the future. And we're extraordinarily excited to announce today that Dragon Systems is going to be bringing their incredible speech recognition technology to the Macintosh. And today with us, we have Janet Baker, their co-founder and CEO. Thank you.

Thank you. Steve, let me be the first to give you a Dragon of your own. I want to say that we are just thrilled to be here today and that it is wonderful to be working with Apple. Dragon Systems started working with the old Apple II, the 1 megahertz 6502, which some of you developers may be old enough to remember, and to start with very small vocabulary recognition. And today, of course, it's the best-selling large vocabulary recognition in the United States. And we're looking forward to bringing it out on the Macintosh, on the Apple platforms, so that everybody can have the ease of use of talking to their computer instead of just typing to it. So I want to say thank you so very much for the opportunity to be here and for the co-development with Apple.

We expect to have a release by the end of the year, an international version shortly thereafter. So once again, thank you so very much. Steve, it's wonderful. Thanks. Welcome to the platform. You bet. Thanks. We're really excited about this, and I think it's something a lot of our applications and our system software can take true advantage of. Now, I'd like to run through and give you an update on Apple really quick, and then we'll get into the heart of the matter, which is, of course, the updates on all of our software and where we're going. So first, the company. Now, when we last met a year ago, we had just finished our second quarter of profitability. And I know a lot of you were asking the question, well, you know, can this continue?

And I'm very pleased to report a year later that it did continue. And Apple has seen some healthy profits in the last year since we've met. And we've also seen some healthy unit growth. This has been fantastic. We've gone from sort of the mid-600s to the mid-800s, even climbing up to the mid-900s during that Christmas quarter just a few months ago. So we're very pleased with the unit volume, and we think it will continue to stay healthy. In terms of inventory, I just want to highlight this. I know this isn't something that maybe most of you care too much about, but we care deeply about it because our inventory costs more than yours. And we have to manage it really well because this stuff gets obsolete just sitting on the shelf.

And we have done, I think, a terrific job in doing that over the last several quarters. And as you see, in the last three quarters, we've gotten down to these are days of inventory leaving each quarter. So we used to have 30, and we literally left last quarter with one day of inventory. And during the last three quarters, we have beat Dell. And Apple has become in many ways the most operationally excellent company now in this industry. And we think that's very important. And lastly, again, cash. I think when we look back a year ago, there were still some questions about Apple's financial stability.

Those questions have, I hope, evaporated by now. Apple is in very strong shape financially. So that's just a brief update on the company. And now what we'd really like to do is get into the software. But as a last comment on the company state, I don't think there's ever been a better time to be a Mac developer. Next, I'd just like to cover the products a little bit. Where are we with the products? As you know, this is our product strategy. We have a very, very simple product strategy. Two pro products. Those are the ones on the right, the Power Mac and the Power Book. And soon to be two consumer products, iMac and a consumer portable, which we will announce a little later this year.

So let's take a look at each of these. Let's first take a look at the iMacs. You're familiar with Lifesavers. That was our internal code name for the colored iMacs. We introduced them in January, and they have been a huge hit. Our iMac volume is just very, very healthy right now. We're running some fun ads right now. The thrill of surfing, the agony of choosing a color. And we have another one that's kind of fun. It just says, whoops. Surf's up, right? And so you'll see this and running a lot of television as well right now. So who's buying all these iMacs? This is of paramount concern or importance to us and to you. So who's buying these? We do a lot of market research. We do it every single quarter, and this is what the latest stuff has said.

This data is about a month old. Of all the iMacs purchased in the U.S., 32% are first-time computer buyers. Thirty-two percent. This is way above the industry average. And 13% Wintel converts. So 45% of iMacs are new. iMac customers are new to the Mac platform. Fifty-five percent are not. But even those 55%, over half of them are replacing their Mac. And that's the time they buy new software, so that's good for all of us. In Japan, the numbers are even more staggering. First-time computer buyers in Japan are 49% of the total, almost half.

So we're like, we're really happy about this. And we want to get even more of those first-time computer buyers. Now, we also, in our market research, ask some questions. So one of the first questions we ask is, are you connected to the internet? Now, the industry average is fairly low, as you know. On iMac, 89%. That's up from 82% a quarter before. 89% are connected to the internet. When did you get connected? As you know, iMac, you can take it out of the box, and in 10 minutes, you're surfing the web, right? When did you get connected? 75% of these folks got connected the first day. Next, is iMac your primary internet access device?

We want to make sure that people aren't buying an iMac, and they get it connected, but then they're using some other computer as their primary internet computer. And that's very clear, because 87% of them say iMac is their primary internet access device. And is this the first time your home has had internet access? These iMac customers, 79% of them say yes. So if you add all this up, what it says is we're getting a ton of first-time computer buyers who have never been on the internet before, who are taking their iMacs home, getting internet access, and getting on the internet. 80% of them. Now, we ask this question a lot.

How do we get more customers like these? And there's many answers, and we're doing lots of things. But one is very important, which is we want to continue to carefully and very selectively expand our distribution. And we've looked at a lot of partners. And today, we're very happy to announce that we are adding Sears to our stable of national and regional distribution for iMac. And Sears is going to distribute iMac through their 800-some-odd stores that sell computers in the US. They reach 32 million households. 54% of our computer buyers are first-time buyers, which is exactly the core audience we're going for. And we're going to launch this late this month over the Memorial Day weekend.

So we're very, very excited about this. And we think Sears is going to provide a really great buying experience for these iMacs. So that's our iMac update. Next to the Power Mac G3s, I don't have too much new on that except to tell you that our volumes now on this product line are higher than they have been since I returned to the company. We are thrilled at the number of Power Mac G3s we are shipping. And I know some of you are customers. Thank you very much. We don't have anything new to announce in this product line, but it's doing extremely well since its launch in January. I want to spend some time on PowerBooks today because it's my pleasure today. I know there's been a lot of rumors, and they're true. It's my pleasure to announce the new PowerBook line today.

We've got some great products. So when we look at PowerBooks, we say, what do people want? Well, they want these gorgeous 14.1-inch displays. Of course, the new PowerBooks have those. They want DVD drives. The existing PowerBooks with DVD drives have become the best way to watch movies on airplanes, you know? People want desktop speed. While Wintel World is promising that with some new technology they're going to have late this year, we've been delivering that for over a year. And we have awesome desktop speed. Battery life is key, especially if you're watching your movie on that transatlantic flight and you don't even have enough battery to watch the whole movie. And weight, of course.

So what are we doing? Our new PowerBooks, two models, 333 and 400 megahertz. These are the fastest portables in the marketplace. They are running at our desktop speeds. Let's take a look at that. In terms of bite marks, these are the fastest Wintel portables money can buy, right? They're running at up to 366 megahertz, and they give you up to about five bite marks. These are our current and soon-to-be old PowerBooks, and they get you at 300 megahertz, running up to 10 bite marks. And these are the two new models, taking us over 13 bite marks.

As you can see, that's two to three times faster than the fastest Wintel notebooks money can buy. True desktop performance. Let's take a look at the weight. On the weight, industry standard for a fully-featured notebook, you know, with a CD or DVD in it, drive, is 7 to 8 pounds. And our current PowerBooks are right in that range. Compact IBM ThinkPads and the Toshibas are the three top-selling Wintel notebooks. That's why I picked them, and that's where they are. The new PowerBook is substantially lighter, 5.9 pounds. It is now the lightest notebook in this class.

These all have 14-inch screens on them. This is the lightest in its class. Battery life. Battery life is really important, as you know if you use a portable. And again, these are the advertised battery lives of the Compact, the ThinkPad, and the Toshiba. And to be honest, your mileage may vary on these things. You don't usually get this kind of battery life. These are the advertised figures. Current PowerBook is right in there, 3 and 1⁄2 hours. The new PowerBook on real battery life, real tests, we have a lot of tests that we run on these things, is setting a new industry milestone, five-hour battery life.

And that's with one battery. You can have two batteries and get 10-hour battery life. So it's just phenomenal. And we're really, really pleased with this. And what it means is, yeah, your mileage may vary, but it depends on what you're doing. So what this means is that you can watch all of Austin Powers on one battery. But actually, you can do more than that. With five-hour battery life, you can watch it twice. Two complete DVD movies like this on one battery. OK. So this is what it looks like. It is a refinement of the current design.

It is about 20% thinner in addition to being substantially lighter. And it's just really wonderful. And you've got to get your hands on one of these to see it. They're just beautiful. Now, these are the two models we're going to offer. 400 megahertz DVD drive, 6 gigabyte internal drive. They've got a built-in power supply. They've got 6 gigabyte internal drive. They've got modems. They've got 64 megabytes of RAM. They've got pretty much everything you need. They've got 100 megabit ethernet built in them, USB built in them. $34.99 for the 400 megahertz. That's got a 1 megabyte L2 cache. The 333's got a half a megabyte L2 cache, CD drive, 4 gigabytes, et cetera, loaded up for about $2,500. So we're very happy with these products.

We are building these things now, and they should be available in the stores around 10 days from now in May 20th. We're starting to ship today or tomorrow to the channel. So we're very pleased about this. And in a continuing effort to express our appreciation to you guys, we want you to have some of the first ones. And so we're going to have a giveaway. And what we're going to do is, during the course of this week at the developer conference, we're going to give away 50 of these new PowerBooks. And since you guys are top of the line, we're going to give away our top of the line.

And what we're going to do, the way we're going to do this, is we're going to give one away every hour, one every hour. And we're going to do a drawing, and your name's going to be posted on the internet cafe, which is over there, once an hour, the winner's name. And we're going to go ahead and send, we're just going to send these to you. You should get them sometime next week. We'll pay postage. So I get the honor to give away the first one. Excuse me. All righty.

I have all your names in here. All right. And the winner of the first PowerBook is... Oh, Steve Jobs. No. The winner of the first PowerBook is Richard Winkler. Richard here from Boulder, Colorado. Where is he? Is that him over there? There he is. All right. Thank you, Richard. You get the first one of 50.

Where are you from? Boulder, Colorado. What do you do? Well, we're a laboratory that does atmospheric science. Uh-huh. And I've been working on Macintosh since the Mac 2. We've developed a lot of Intel software. Good. Well, congratulations. Thank you. Thank you very much. Okay. Take care. Now... Since I'm up here for two hours, I'm going to draw a second one. All right. Second one. Greg Pierce from Advanced Lighting Technology from Argyle, Texas. Greg here? All right. Thanks, Greg.

Congratulations. So those are our first two. And we're going to be drawing one of these every hour. So please check the Internet Cafe. We're going to be drawing one of these every hour. So those are our first two. And we're going to be drawing one of these every hour. So please check the Internet Cafe to see if you got lucky. So those are our new PowerBooks. And we look forward to telling you about our new consumer portable products sometime later this year. Now, I'd like to jump into software. I'd like to give you updates on OpenGL, Java, and QuickTime first. And to help me do that, I'm going to invite on stage... Whoops. Invite on stage Avi Tavenian, our Senior Vice President for Software Engineering and a colleague of mine for the last 12 or 13 years.

And... Hello, Avi. Hi, Steve. And to help us... Thanks. And to help us do these demos, Avi and I are going to be assisted by Phil Schiller, our Vice President of Worldwide Product Marketing and the best demo giver in the world. Where's Phil? He's going to come up a little later. He's going to come up a little later. Okay, great. We've got lots of alpha, pre-alpha, beta software, so it should be exciting. Yeah. All right. So OpenGL. As you know, we got a lot of feedback from a lot of you over the last year that you needed a more powerful 3D API and you needed more powerful 3D hardware acceleration. And so we've started building in much more powerful hardware acceleration into our products.

Not only the iMac-class consumer products, but in particular our pro products with the Rage 128, some of the fastest 3D hardware you can get in the industry. You also told us you need a really powerful API to deal with this hardware that was open-ended. And so we got the guidance from you guys to pick OpenGL, which we did and we announced in January as our 3D API. And this is the one we're going to focus on and this is, excuse me, the one we're going to stick with. And four months later, after announcing that choice, we are shipping it today. OpenGL is shipping today. It's on our website. It's got great performance. You can download it for free at www.apple.com and we encourage you to go check it out.

It will, of course, be built into future versions of the Mac OS. Right. We've actually done a lot of work to optimize OpenGL for the hardware platforms we're shipping today and some of the older ones. It gets just stunning performance on the Rage 128. And one of the benefits, actually, that our developers tell us about from our OpenGL work is not even the software per se, but the fact that it's very deterministic what they're going to get when they're developing, say, games and running it on a Mac because it's so well integrated with the operating system and there's so few problems with what a customer might have in terms of all kinds of different types of graphics cards or whatever, that it's just really simple and it's just much simpler than what they find in the PC space. Yeah, the configuration nightmare of matching OpenGL to the right graphics cards with the right drivers, all that evaporates and really allows developers to do what they want to do, which is develop their applications.

So we got a demo of this stuff. Right. The 3D stuff is always fun to demo, of course. Let's get Phil up here. He's going to help us out with the demo. Come on up, Phil. Phil may run product marketing, but he sure has fun playing all these games. That's all I do all night. If you're ever up on a server out there and you see somebody with a code name that looks like me, it's usually me out there. 3D is a lot of fun, especially when you get to play. Now, here's an area that I am no expert in. I have no pilot's license, but thanks to OpenGL and some of the great software coming out on the Mac, I can actually fly planes with incredible simulation. This is a piece of software called X-Plane, and for those of you who have ever tried it, you know it is wonderful. It truly simulates flying everything from B-1s to 747s, which is what I have up here.

It uses real GPS data so you can track and fly to different airports around the country. It downloads real weather information from off the Internet, so it's a tremendously lifelike real experience. It's very cool. So here we are. We've picked New York, and I have it paused right now, and we're going to start a little fly by. It has some of the actual building data from some of the buildings around there. Obviously, not all of it, but enough. So let's just start the plane flying. You're heading for a building. I can jump out, take a look around. That real time rendering is just totally awesome. Let's start to take it up. Head for the cloud. Let's start to take it up. Head for the cloud banks.

Okay, Phil, this looks kind of interesting, but it looks pretty easy. Do you think you can land it? 747? Don't they fly themselves? All right. I'm not very good at this, truthfully, but we'll give it a try. So let's go and set up a final. We can pick our airport, a final approach run. Let's try JFK. You can actually pick what runway you want. Let's pick 22 left. And before we start, let's make it a little more fun. Let's actually go and change the time of day. Make it a little interesting. Let's see it in the evening. Now you can see the runway at night.

Okay. Now, luckily, none of you are actually on board this flight. Bring down my flaps. Reduce my airspeed a bit. Not too much. We're coming in. Phil, I think you're missing the runway. We'll get there. We'll get there. Give me a chance. There are exits to the left and right. Let's get our gear down before it's too late. Thanks. Cool. Good job, Phil.

They obviously do land themselves. Thank you. Thanks, Phil. All right. We employ very multifaceted people here at Apple. Okay. So that's OpenGL. What about Java? We've talked for the last year about how we think Java is very important. And we've got some great stuff to talk about today. Today we are announcing MRJ 2.1.2. It's the fastest Mac Java ever. And it's downloadable today off our website. And it's not only fast, but it's highly functional. As we talked about last year when we were here at WWDC, we talked about the need for speed, and we've delivered that.

But we also talked about the need for compatibility. And so 2.1.2 is completely compatible with the 1.1.7 version of the JDK and includes Swing. Now, we've got some really great news, and we've got some still-in-progress news. The really great news is that the latest MRJ is five times faster than the one it's replacing. Right? That's almost 7,000 caffeine marks. And this is great. And that's the great news. The in-progress news is the following. There was a moment in time. As you know, we're a little competitive with Windows on this stuff. And there was a moment in time in January and February when we were in the lab with this stuff, just about to get it out, where we were faster than Windows.

But they have a lab, too. And they had some stuff we didn't know about that they recently released. And doggone it, they got a little faster. So they are now at about 8,600 caffeine marks. We're still now about 30 percent slower than Windows. But doggone it, we're trying harder. And we're going to keep going until we're faster than those guys. Yeah. As Steve said, for a moment in time, we did have the lead. Unfortunately, it was still internal to us. We knew about it. The rest of the world didn't. And they did get a little bit faster. But we've also been a little bit upset. Get the data for the benchmarks. You have to wonder, is there stuff optimized for the benchmarks just to make the numbers better? Perhaps how was here last year and sent some messages up there about what we were going to do. But nevertheless, we are now in the game in terms of performance with Java performance of the JVM is really great.

And more importantly, it now runs real apps. One of the things that we spent a lot of time doing was working with real developers, writing real Java code to make sure that their applications worked and worked well. And we've achieved that. So it's great that all Java runs faster because we think Java is a good thing. And as Avi said, we are now in the race big time. What we'd like to do now is show you a demo of something we have in the lab. We're not going to announce any products today, not going to announce any strategies concerning Java 2 today. We have some stuff in the lab we'd like to show you. Yes. So those of you who follow Java closely know that Java 2 is the current version that Sun is shipping. We've been taking a hard look at it. We were kind of scared at first because Java 2 is pretty big.

Though the one dot one stuff starts out pretty big to start out with the Java 2 stuff gets even bigger. And so, you know, up until now and even further for the near future, we are focusing a lot on our one one based code. Again, focusing on the performance of that code base and focusing on making the applications that people are writing today, which is still based in one one with swing, work well. That having been said, we're doing our homework on Java 2 so we can be fully aware of what's going on in that space. And so one of the things that we've noticed is not only is it big, but it's got some performance problems. So we've been looking at, well, can we solve any of these and we bring the technology over to a Mac? And that's what we're going to demo right now. Let's do it. Come on over. OK. So we've got two machines here. Steve is going to drive the power Mac, which is a 400 megahertz power Mac.

And this is running a pre alpha version of our Java 2 technology. There is no just in time compiler integrated into it at all. We haven't got around to doing that yet. So it's very basic technology. We're going to show some graphics related demos using Java 2D. Now, what I'm running on is the fastest penny of money can buy today. Five hundred megahertz, Pentium three running son's latest code using hotspot technology with their hotspot just in time compiler. So you're running the fastest stuff money can buy, basically. That's right. Great. On the windshield side. That's right. And what we're going to do is we're going to focus on the we're going to focus the technology demo on Java 2D, which is a new imaging model for Java. And of course, graphics is important because that's what you see on your screen. That's what you build user interfaces out of. OK, we're going to do a heads up demo again.

Steve is running on the Mac on the left. I'm running on the right on the PC. OK, you want to count us down. Three, two, one. Sure. Three, two, one. Wow. So as you see, Macintosh is just going lightning fast here. It's going lightning fast, lightning fast. And the PC is well, he's not not OK, we're done. Mac is done at 12 seconds. PC is thinking, you know, it's not broken. It will. It's thinking. There it goes. OK. Wow. The Mac is resting.

PC is making sure you don't miss anything. It will eventually finish. There. Wow. That's four times faster. That is remarkable. That is remarkable. All righty. Well, that's a preview of some of the things we're working on in Java 2 in the lab. Again, no product announcements, but as you can see, we're putting a lot of resources into Java. And that was the demonstration. Whoops. QuickTime. I'd like to talk about QuickTime. And QuickTime is, again, a core technology for Apple. And one of the things that happened recently that you may know about is that Lucasfilm came to us and they said, you know, we put out a teaser trailer late last year for Star Wars Episode One, The Phantom Menace, and we put it out in all the industry formats, QuickTime, Real Networks, Microsoft's, Media Player.

And everybody, almost everybody, wanted the QuickTime version because it was the highest quality. So we just like to avoid a lot of trouble this time and give our audience what they want and put it out only in QuickTime. And we said, sounds good to us. And so we helped them get the best quality QuickTime compressions. And we put this Episode One trailer out. And it's been astounding. There have been over 10 million downloads of this trailer, making this the biggest Internet event ever in history. Isn't that amazing? By far. There's something even more amazing to me.

Because there would be people downloading this to a wide variety of destinations, like offices with very fast Internet on ramps, all the way to homes with 28.8 modems, we put various file sizes of the trailer available on the website, from 5 megabytes, where you give up some quality, all the way up to 25 megabytes in the highest quality. And you know what? Almost everybody, no matter whether they were downloading it to work or home, chose the 25 megabyte version. What does that tell us? They want the higher quality. Now, they didn't pay too much of a price to get that in the office, or if they had broadband to their home, like a, you know, ISDN or a cable modem or a DSL modem.

But on a 56K modem, that took a little while to download, and yet people were still willing to pay it because they wanted the quality. Really interesting. We just recently launched the new QuickTime 4 product. And this is the player from QuickTime 4. And it is terrific. It's stunning in its quality, and it adds live Internet streaming to what QuickTime has already done well, which is playing back files of almost any type from almost any source. We're adding live Internet streaming to it. And the player's been released on both Mac and Windows in a wide beta release a few weeks ago, and there have been over one million downloads of the player in the first two weeks.

So this has been very, very popular. Now, this is actually phenomenal, considering that it still is only a public beta. And we noticed something interesting, which surprised us at first, but when we thought about it, it made a lot of sense, which is normally when you release a big product like this, you get a huge spike of download activity the first day. What we noticed instead was things were a little, I mean, they were heavy, but reasonably light on the first day. And then things started to pick up. And what happened was people started to watch. And most people said, wait a minute, that's beta code. I don't want to install it. And then as a bunch of people installed and say, hey, this is great, this is really cool. Then lots more people started to install it because they had confidence in it. So we've been really happy, even though it's only a beta. And again, the amount of material now we are downloading from apple.com is astronomical.

The Star Wars trailer alone was over 200 terabytes of downloaded code so far, 200 terabytes. So we have put in really big pipes and are downloading tons of stuff to our customers and future customers every day. Now, we are adding content to the QuickTime 4 story as well. And today we have HBO, we have BBC, we have Bloomberg Television, and we have WGBH out of Boston. And some of these folks are broadcasting content 24 hours a day, seven days a week. And so you can take your QuickTime player and with live streaming, look at live streaming content 24 hours a day, seven days a week. And we will continue to announce new content partners as the weeks roll on.

We have several really hot ones in the pipe. And I think this is going to be just amazingly cool. So our strategy is based on delivering great quality and great content. But it's also there's a third leg to it, which is no server tax. Now, what do I mean by that? Our competitors, our primary one, Real Networks, gives away the player just like we give away our QuickTime 4 player. But they charge a big bucks for the server. They'll give you a baby version for free, but they'll charge you big bucks if you actually want to broadcast anything with any sort of number of streams. And some of our content partners are paying them tens, if not hundreds of thousands of dollars to use their servers. And that's a very important part of their business model.

And we respect them. This is America. But that's not our business model. We are going to provide our servers, our server software, basically for free. We're bundling it into Mac OS X server. And we are taking our open. Actually, let me just review this for a second. We're taking our open source streaming server and we're making or we're taking. streaming server, excuse me, software and we're making it open source and we're putting it on the web for download and we've done that and we've had over 6,000 actually we're up to about 8,000 downloads this morning. Keeps going up. 8,000 downloads of our open server open source streaming server software. Say that really fast three times. And so our stuff is based on open protocols RTP and RTSP and anyone can download the server and compile it use it with any operating system they want. They use it with NT, they use it with Linux, they can use it with Solaris and we are working with several of the hardware manufacturers like Sun and IBM and SGI who are going to just incorporate this stuff into their servers for free. And so we think there's a major movement here around open servers for streaming video that's going to be very very important here and we intend to participate and actually lead that movement. This stuff is really important. First of all you can get a server from us for free.

Either the one that runs on Mac OS X server or the source code version which you can just put on any system you want. No charge at all. As many streams as you want. Run on any system you want. No cost. The other thing is we support open protocols. We talked about RTP and RTSP which are IETF standards for this kind of technology. But the other thing that we're doing is we are really encouraging people to start using multicast for the for the basis of this protocols because we believe that overall that's going to be a much more efficient way to get a lot of this, a lot of the data, a lot of the content around the Internet. And so you can do interesting things like you can take our open source source code, take it and and you know modify it and do whatever you want to do it. Maybe run it inside of a corporate firewall as what we call a reflector. Take multicast streams run on the Internet and just put them on your your local network without actually without slowing down your connection to the Internet at all.

So there's a lot of stuff that's going on here that we think is really important and is going to enable much broader use of this kind of content in the future. You know if you look at it from 10,000 feet, QuickTime owns the non-streaming space for multimedia software platforms. Almost every CD is QuickTime. Almost every download is QuickTime. Most of the content on the Internet available for download is QuickTime. Almost all of the multimedia content is authored in QuickTime including all the stuff that's eventually broadcast and streaming Unreal. And so QuickTime has got a very solid base there and we are moving QuickTime, that 800 pound gorilla in these other markets, into the streaming space in a very big way. And we are going to, the horse we're going to ride is open protocols and open source streaming server software. Okay, well we have again we mentioned it's included with Mac OS X server. Highest quality, no server tax. That's the key message here. And we'd like to show you this stuff now. Phil? Okay, so let's get Phil back up here. So Phil's going to show us all this great stuff in terms of the quality, the streaming, and everything else. Sure. Hopefully a lot of you've already downloaded the QuickTime 4 beta player and had a chance to use it. For those who haven't, I give you a quick run-through of what it does and what it looks like. It truly is just stunning in its quality and it's a lot of fun to use.

Consumers are finding it's the first really great consumer app for media on the web. Now what I have here is a Mac and we're sitting out on the Internet and I'm going to open up the QuickTime player, the brand-new QuickTime 4 beta public beta player. And first of all you see it opens up at one size. The size is the size you would see if you're going to play audio. It automatically scales to whatever content you're going to play. Audio, video, different sizes. It's got some very easy-to-use, very nice-looking controls for just what you want to have fast access to. Play, stop, really great volume control, hardware slider, and a beautiful little drawer that I can pull open and have instant access to all my favorite content. We call these channel wells. Inside these channels are channels of audio and video or any of my favorites, just like my favorites in my browser. And you see there BBC, HBO, Bloomberg's, WGBH, and one more we've added just this weekend, National Public Radio, NPR, now broadcasting Talk of the Nation. And a lot of their great content. So as we go through this beta cycle we'll be continuing to add more and more great content for people as well as the stuff you can download yourself right over the internet. And speaking of download, as Steve mentioned, this great Star Wars piece. There's probably two people out there who haven't seen it yet. And if you want to see what's the big deal, why do people download over 200 terabytes of video, and what makes this the Super Bowl of video on the web, let me show you.

I will not conjoin a course of action that will lead us to war. A communications disruption can mean only one thing. Invasion. At last we will reveal ourselves to the Jedi. At last we will have revenge. Begin landing your troops. We haven't much time. The Federation has gone too far. The deadfold is catastrophic. Our people are dying, Senator. We must do something quickly. You must contract me. There is something else behind all this, Your Highness. They will kill you if you stay. I can only protect you. I can't fight a war for you. I think we're going to have to accept Federation control for the time being. This is a battle I do not think that we can win. I will sign no treaty, Senator. You said people are gonna die? Once those droids take control of the surface, they will take control of you. I was not elected to watch my people suffer and die while you discuss this invasion in a committee meeting.

They will never get me onto one of those dreadful starships. Always two there are, a master and an apprentice. Wipe them out. All of them. So that's incredible. Over 10 million people have downloaded that over the internet, watched that quality of audio, that quality of video with compressors that only exists in QuickTime in a widescreen format that only QuickTime does. It's the kind of tool that delivers new media over the internet that no one expected even just a few years ago. Now that's a file download. That's why QuickTime is sitting on all these HTTP servers out there with incredible content all over the web. But now we have live streaming. So one question we've gotten is what if this video had been delivered as a live stream? How great could you make it? Well let me show you just that. I am now going to play from a server a live stream of that same piece encoded for broadband communications. Not only what you would see on your own network, but what you might see with for example a fast cable modem at home. So what can we all expect with things like

cable modems and DSL if we were to get this without downloading anything, simply watching a broadcast? I will not condone a course of action that will lead us to war. A communications disruption can mean only one thing. Invasion. At last we will reveal ourselves to the Jedi. At last we will have revenge. So that's pretty cool. Cable modems, cheaply once a month. We get to download and watch things like this. Very easy to do in the home and certainly all in the workplace. Let's take it even one step further.

Let's further compress this. Let's take another piece now. If you haven't had a chance in the last weekend, Lucas has put up four new ads based in QuickTime on their website. We've taken one of those and encoded that as a 56k stream that you might watch streaming over your modem at home. So really now we're trying to pack a lot of bits into a very little pipe. There are things I cannot do, I cannot watch while people suffer, I cannot sit when something must be done, I cannot judge those who are different, there are things I cannot do, run, hide, ignore, there are things I cannot do, but there are certainly things I will do.

So that's the new ad at a 56k data rate, streaming from a server. And let me go a step further, what if it was all live? What if on the internet, right now at home on a modem, I could watch live news and information? We've told you we have some of those content providers there today, and I'm going to just click right now, this is the internet, and click on BBC World, anything can happen, right? It's the internet. This is content being created in Europe, broadcast up over a satellite, bouncing down to the US, in New York being put on a live encoding server that's encoding in real time, sending it out anywhere along the internet, and now we're picking it up locally on our desktop over a 56k modem in QuickTime.

Just about moving in towards Aden, but for most of the Middle East, it's going to be dry and sunny, but something of a small northwestern wind blowing down the gulf there. Just what we all wanted, weather in Europe. Northwest with dry, hot and sunny, we may see a few showers coming in through Delhi down from the north, but most of the showers in the southern and eastern parts in towards Bangladesh. In the southeastern parts of Asia, showers in most parts of the country, but moving further north, we have some high pressure across Korea and Japan, and that's going to give some dry, fine weather over the next couple of days. Also fine weather through northern China, but here it's hot temperatures well into the 30s. Yeah, we knew a few people were traveling around the world, one of the small services we provide, weather before you go home. Now we have one version we've been testing, so I hope you bear with me on this test, but we've been working with the BBC on doing higher bandwidth, so assume you're on an ISDN modem, which people are in Europe and Japan, or of course a DSL or cable, or in the office you can get a higher stream.

So we just double it now to 100K data rates, and that's what this might look like. Again, this is real, coming for a server, being broadcast from London through New York to here in California. 2,000 qualifier. That's after this break. Of course, this is working great, even though there's a lot of motion going on on the screen.

We obviously hit it at just the right point to get maximum motion. But it's still working great. Well, we couldn't adjust the BBC's broadcast schedule for the demo. If we would, we'd have more people up there. But let's move on. So along with all this great video that we can produce on the internet and broadcast as channels, all the great video you can put out into your content on your HTTP sites, one of the greatest new media types out on the web that people are just eating up in droves is MP3 audio. I don't know if any of you've had a chance to use it, but it's incredible quality audio. And now with QuickTime 4, we've added compressor and decompressor to support MP3 audio. And built into the player is a decompressor for MP3 that is pristine quality. It's incredible quality MP3 audio.

So what we did yesterday, we went to mp3.com, downloaded one of the music content that they provide up there. I'd like to play you back MP3 audio coming right off of this desktop Macintosh. So why don't you show us what some of the controls can do while this is playing too. Sure. So you've all seen the volume slider. To the left half of the audience. Raw view on the right. Pop up the bass.

Dremel. So that's MP3 audio. Just a tremendous decompressor that gives incredible quality. And everyone can go on the web, get all their favorite MP3 audio, and play it back. And QuickTime is the best way to play this content back. Now, keep in mind, with all of this, there are over 17,000 apps that support QuickTime. If you support QuickTime, you can play this content back. If you support QuickTime, you get all this for free. You can stream right into your applications with video. You can now support MP3 audio. It all just works right in every QuickTime-aware application. Now, the last demo I'd like to do is something that's entirely new.

It's the kind of thing people have dreamed about for years and has never been possible. And now it would be really easy and really standard for people to deliver interactive video streaming over the Internet. To do that, I'm going to bring up a movie piece that uses a combination of QuickTime compressed video and composited in real time on top of that some Flash interactive animation using the new Flash plug-in for QuickTime from Macromedia. Now, this is a snowboard video, and I have controls on top of it to play it. And I have controls to jump around. Now, this is a snowboard video, and I have controls on top of it to play it.

And I have controls to jump around. So that's the new QuickTime 4. Just incredible quality, the greatest player ever delivered on the Internet, beautiful audio and video, live streams with real content in it, and the ability to deliver not only MP3 audio but interactive audio and video with tools like Flash. Thanks, Bill. Thank you. And all those features you saw demoed are in the free player.

Okay. That's pretty cool, huh? So now we get to macOS, our operating systems. Let me review for a minute. You're all, I think, familiar with macOS 8.5. We launched macOS 8.5 last October. We launched macOS 8.5 last October. That's seven months ago. I'm incredibly pleased to report, and it had some cool features in it, Sherlock, which was maybe the coolest, a whole new way to search on the Internet. This has been really popular, a meta search engine, if you will, where you can put in one query and it can dispatch that query to anywhere from a few to dozens of search engines on the Internet, automatically take back their asynchronous results and sort them by relevancy.

It's been a big deal. Some major improvements to AppleScript and ColorSync, and we announced that macOS 8.5 had the fastest network copy in the business, faster than any version of Windows, including NT. And what's been really great is in the last seven months, we have shipped 3.6 million copies of macOS 8.5, which is, I think, great for all of us and shows that we can fairly rapidly move new technology out into the marketplace. Now, today, we're announcing macOS 8.6, which is an update to macOS 8.5. And macOS 8.6 features just a lot of things, a lot of bug fixes, a lot of little features, a lot of enhancements.

But the biggest ones are longer battery life. If you have an existing PowerBook, upgrading to 8.6 will upgrade your battery life. Some nice enhancements to Sherlock, AppleScript, ColorSync, the latest Java stuff. And if you're in design and publishing, some really cool new features in the LaserWriter driver, which you find quite useful. We actually started out with the plan for macOS 8.6 to just make it a very small, simple bug fix type of release on top of 8.5. But then a few things started to happen, and we realized we could actually put some other interesting things in there. The great example being the feature of the longer battery life, which is one of the contributors to the five-hour battery life of the new PowerBook you just saw announced.

What we did there is actually we made some core changes right down inside the nanokernel with some new interesting technologies that really make the system much better behaved for things like battery life. And you know, we even thought for a moment, should we delay this stuff until the next larger release of the macOS? And in the end, we just couldn't because this stuff is so good. We want to get it out to our customers. So we're really happy about this. Now, the only one I want to talk about here is the battery life. In our tests, we run, we have sort of city and highway tests. And this is the increase in battery life on an existing power book, before the new ones, three hours and 10 minutes on 8.5, four hours and 20 minutes on 8.6. And again, your mileage will vary. But as you can see, it's a pretty big increase.

So I think people will see anywhere from a 25% to 37% increase in their battery life just by upgrading their software. We're doing power management in a much smarter way. And Mac OS 8.5 is available today, downloadable off the web, free at apple.com for 8.5 owners. Only works if you already have 8.5. If you want 8.6, just go out and upgrade to 8.5 and freely download 8.6 off our website. It's also a worldwide release, available today and download in approximately 10 different languages. Now, let's move on to the next major release of the Mac OS. Internally, it's codenamed Sonata.

It's coming out this fall. And it's got over 50 new features in it. It's pretty hot. We're going to give you a sneak peek today. We don't want to say too much because we like to hold some things back for surprise when we announce the product. And so our sneak peek today is just going to focus on really two things. One is Sherlock 2, which is the next generation of Sherlock. The response we've gotten from Sherlock has been overwhelmingly positive. And we've been hard at work on improving it even still. And Sherlock 2 will ship in Sonata this fall. And secondly, we've gotten a lot of feedback that people using Macintoshes at work, in school, at home, want multiple users on the same machine.

And we sell some software that allows people to do that. We sell it mostly in education. But it's an extra thing you've got to add. Could we just build that right into the operating system? And we are going to do that for Sonata. And so we'd like to ask Phil to come back up and give us a demonstration. Can I get Phil back out here? I haven't done this in quite a while. Getting to play with all this great stuff. This is very early. So as many of you who write software know, the demo gods, we hope, are with us. And all goes well. But if not, I know you'll be understanding. What I have is a- By the way, just a couple of weeks ago, a standard part of the demo was entry into MaxBug. Yes. We'll be on that, hopefully. I think we'll be on that. We'll see. Time will tell. So what we have is a Power Mac G3 running Sonata.

And it looks pretty familiar. But you'll start to notice a couple of things as we get into it that are so exciting. The first one, as Steve said, is Sherlock 2. Sherlock 2 is evolving and changing very quickly to meet a lot of the things our customers need most. And to make it easier and easier to search on the internet. First of all, it has a nicer interface. It matches a lot more some of the great things you see happening with the QuickTime player. And inside this interface, I can do, as before, searching across the internet as a meta search tool. That is, talking to all the different search engines on the web simultaneously and getting them all to work for me get from one easy, comfortable interface. So here we are, as before, with an internet search.

I click on it. I select a number of search engines I want to simultaneously search through. In this case, I've selected AltaVista, Excite, PotBot, InfoSeek. If any of you use these sites, you know to go across all of them to find information will take some time. You have to learn how they each work. Type things in very carefully. Do they use and, or or, or not? I don't remember. Do I need quotes around the stuff? And this makes it so easy because you just type in a natural language query. So let me pick one here. Let's see, how big is the universe? Now, we'll have a test. Anybody who knows the answer can answer. If you can answer faster than Sherlock, we'll win a new PowerBook.

What Sherlock is doing when I click that search is literally, in that much time, we are live on the internet. It reached out to those search engine sites. And it heard back from all of them. And it put them in here. And it ranks them by relevance, depending on how they return what they have for content. And let's see how good it did. Very first one from AltaVista. We double click on it. And it jumps right in to our browser. We have a browser set up, ready to go. It takes us right to the web page that answers, how big is the universe? And it's that easy to get from your ideas and your questions straight to information on the web. You don't have to go through other home pages. You don't have to go through search engines. Just go straight from your question to the web. And that's what Sherlock has already been able to do. And it's very powerful.

We've asked our customers what they thought of macOS 8.5. And the number one feature that people bought macOS 8.5 for was Sherlock. And over 2 thirds of the people that have 8.5, either buying it or getting it on their machines, use Sherlock. So we know it's really loved, it's really used, and very powerful. But there's some things our customers have asked us for to make it easier for them to search on the net. And one of those things is to be able to actually save groups or sets of all their favorite plug-ins for searching. Different kinds of sets. So we've made that easy. I heard a few claps from Sherlock users out there. So now I can save sets of plug-ins, just like channels in QuickTime. And these can be automatically updated. So if you have plug-ins, we find new versions, your Sherlock will automatically be updated.

We can also automatically provide you new sets or channels of these plug-ins as we create them. So for example, I have my own set right here that's a pre-list of a number of sites I want to search, already pre-selected. I just click on it, search, and go. In fact, the interface is really beautiful. It allows you to save as many as you want. You can open it up and create more and more sets. It's a very powerful, very easy way to do it. But along with creating sets, we found that we can create a whole new category of information to search, more than just general questions. So for example, with Sherlock, we now support LDAP servers. LDAP is the industry standard for keeping people's information. And we have plug-ins here in this demo of three of the biggest ones out there.

It's Bigfoot, 411, and Yahoo have LDAP servers where you can search for people on the internet. So let me type in a person. Dave Foley, a reasonably well-known Canadian actor. And let's see if we can find Dave Foley out on the internet. Now, we've just spoke to those three different servers, and instantly, Sherlock comes back with a list of Dave Foley's out there. With a list of Dave Foley's out on the internet with their email and their phone numbers. And now, you see something else that Sherlock's doing. It's adjusting its interface based on the kind of information you want to get for the search you're doing. In this case, I'm not asking a question. I'm looking for people. And it comes back with a list of their name, their email, even their phone number. And all I have to do is click on either one of those and instantly sort on them.

And if I find the Dave Foley I want, and there's a lot of Dave Foley's out on the internet, even this guy who's got an email address, puke is good. You can't hide from Sherlock. If I just double click on one of them, that's the person I want, it will launch my email application and open up a new email pre-addressed to that person and their email address. So it's that easy to find people and start to create emails and send them to people. Of course, you can save them all in your own local directory. Now, if it isn't enough to find information and find people, one of the most powerful things we all want to do on the web is shop. What we find with Macintosh users on the iMac, almost half of them have been shopping on the internet with their new iMacs.

Just a huge number of people. But as you know, it's not an easy experience. Every website is different, how you enter information, how you search for things. Wouldn't it be great if you could search across different sites and shop simultaneously to different vendors? Well, now with Sherlock 2, you'll be able to do that. I bring up my shopping cart, and I have a number of search sites here that are all about e-commerce. I've selected a couple of them, Amazon.com, Barnes & Noble, eBay. And let's leave Dave Foley as my search. Hit the button, and let's see what's out there from Dave Foley of things I can buy. And sure enough, I come back. There's Amazon.com, Kids in the Hall, a video he was in, Sink or Swim. Let's scroll down.

A Bug's Life. And notice again, the columns have changed. It's not email anymore. It tells me the name of the content, the price, and availability, because that's what I want to know. How much does it cost, and when can I get it? Across different search engines. I mean, have you ever seen this before? Once we release this product, there'll be no other way that people will want to shop on the internet. No other way. Now, I want to make somebody really happy, so I'm going to order a copy of A Bug's Life. Some of you may know Dave Foley, who's the voice of Flick in A Bug's Life. And before I even go to the site, I get some information in my panel here that tells me the first one for $17.99 is a VHS. The second one at $24.99 is DVD. I have a DVD player in my PowerBook, so I think I'll get that.

When I double click on it, I jump right to Amazon.com, right to the web page where the movie is. And it's right here, no searching. Just add it to my shopping cart, and I'm ready to go and buy a copy of it. Just that easy, that fast. So that's Sherlock 2. Sherlock 2 is the easiest way to find information on the Internet. It's also the easiest way to find people on the Internet, the easiest way to shop on the Internet, to find just about anything you need, and it's flexible, powerful, and fast. But that's one feature. There's only time to show you two features. I wish I could show you all 50. But the other one, we've learned that the majority of people who own Macs have multiple people sharing the same computer.

Think about it. In a classroom, in a kindergarten through 12th grade classroom, you'll see multiple students coming up to a computer. Or at home. I know at my house, I share my computer, my wife and sons, and we all have different information we want to use. We all have different settings we like to have. Wouldn't it be great if your computer could be shared by multiple people, but it was actually feeling like your computer all the time you used it and their computer all the time they used it? Now, with macOS blank, I won't tell you. We'll take a poll on what people want to call this. It's so cool. We have the ability with Sonata to actually know who you are and log you in. A password will become your key to everything you do. So I'm going to log out of macOS.

Now, people who use AdEase for workgroups and classrooms knew you had that before. You could add it. But now it's built in. So here I have my login panel. In the login panel, we've set it up for me and my family, and we can all access the computer just by clicking on an icon, and I can set my own picture, my photo, any graphic I want and log in. And, of course, it asks for a password. The password is your key. When I log in and use my password, it now brings up my work environment, all of my preferences, what desktop I want, what fonts I like, what applications I have access to, what documents I'm allowed to see. The person who sets up the computer can set this all up. Even my Internet access for what my web browser goes to, what e-mail account I have is all unlocked with that simple password.

As you see, I have a folder here that says Phil. It actually is a server and a set of documents that just my area, my workspace, no one else can get in here if I don't want them to. I can even double-click open a server and watch what happens. Instantly, it opens the server. What you didn't see is I actually had to send a password, an ID, to that server. Now, how many people have more than one password on servers, on Internet sites? We all do. It's such a pain to remember all these things. Some like six things. Some want only numbers. Some need a combination. It's changing all the time. It's so hard to keep track of this stuff. Well, now, with Sonata, we've integrated a feature called the keychain. I'm going to open that up. The keychain has a number of items in here.

They're servers that I have access to. When I entered my very first password to get onto this computer, it unlocked my keychain, and all of the items within it are open to me and will instantly, invisibly pass those passwords back and forth if I wanted to. And so that's how I can open that server. Let's go a step forward. Not only access servers, but protect my data. Not only access servers, but protect my information from prying eyes. I have a bunch of documents here. JPEG pictures. I'll upgrade to QuickTime later. Here's a picture I downloaded from the Internet. Lego toys for Star Wars. My kids love Lego toys and Star Wars. Well, they don't have access to this, but I want to be doubly sure.

I want to protect this information. Now, from my file menu, I can go down and encrypt that document. Built-in file encryption. I'm going to give it a password and confirm it. Now, I'm not going to add this to my keychain. I have that choice. Encrypt. It's really fast, particularly on these G3s, and Apple owns some encryption technology that's incredible. It's got a really long name, Fast Elliptical Encryption. We call it FEE for short. Very powerful, as powerful as anything from RSA and other companies, and now you have very secure, safe encryption on your system. That document's icon changes. If I double-click on it, since I did not add it to my keychain, it asks me for the password.

I can enter the password. If I want to share this document with my wife, give her the password. She can see it. The kids can't. Let me add that password. And now it opens up the document. It's that easy to encrypt things, protect them from prying eyes, and automatically manage my content. In fact, let's take another graphic I have here, a second one. Let's do the same thing. Let me go and encrypt that document. But this time I am going to add it to the keychain. I'm going to let the power of the keychain and Sonata manage my documents. I just added a new entry to my keychain. So the next time I go back to that document, since I'm logged on as Phil and I've entered my own password that unlocked my keychain, when I double-click on it, it automatically decrypts it, and now I can open it and see the content.

I didn't have to enter that password. If I gave the document to anyone else, they have to know the password and enter it. Very powerful logon support and file encryption and access to all the information you need and manage simply by the power of the keychain. The last thing. I'd like to show you one more feature of this. Let's log out now. And it's restoring all my preferences. The last time I left my folders open, what apps I left open, all the information is stored there. This time I'm going to go back in and log on as someone else. I'm going to log on for my son, Eric. I'm going to show you how he likes the system set up. And one cool feature that we've added that's a lot of fun and shows some of the technology we can start to build in to make it secure and easy to use, and that's a voice print.

The ability to rather than use a typewritten command for your password, your password can be your own voice. And with any microphone supported on a shipping Macintosh, we can support voice print technology. Phil has told us that voice demos never work on stage, and he has said before that he would never do a voice demo on stage himself. I swore I'd never do a voice demo. So good luck, Phil. Okay. So I've got a little earphone here, a really cool microphone, but, again, it works with any mic. I'm going to log on as Eric. When I hit log on, it's going to prompt me for my passphrase. To infinity and beyond. There we go. We've logged in as Eric.

And as we log on, you see that Eric comes to his desktop, his preferences. We've set it up as a simple finder for Eric. He's got single-click buttons rather than double-click because he's only 7 years old. It will make it easy for him. And everything is Eric's workspace. Even if I go to browse the Internet, it's going to come up, open up Eric's browser, and take him to Eric's home page. There you go. So it's that easy to share a computer with multiple users, and no other personal computer in the world can do this. So Sonata is going to be a lot of fun. The other 48 features are just as cool. Thanks, Phil. We have Sonata here at the show. If you have your applications with you, you can test them out and see if they're compatible.

Hopefully they are. If they're not, let us know so we can work to fixing it. The other thing is this week we are starting to seed Sonata, the alpha and beta builds, to all of our registered developers. So you'll get to play with it pretty soon yourself. Another thing about Sonata, as we keep rolling out new versions of the OS, we know you guys have to test for the old versions too. And this is a product that we've got here at the show today. It's the Mac OS Anthology. It's every OS release we've ever put out since System 7. And you can, I think, buy this for, what, $149? And this thing is our first DVD product too, so you need a DVD drive to use it. But every single release, starting with System 7, when you have to test for old stuff. Okay.

Mac OS X. In 2018, we got, we think, an awesome release of the Mac OS coming out this fall called Sonata. And beyond that, we are working very hard on Mac OS X. We'd like to give you a bit of an update today. First thing is we released Apple's first product based on Mac OS X technology, called the Mac OS X Server, in January. And if you recall, that product does some pretty cool things. Not only file service for Macintoshes on a local area network, but net booting. This is where you can have a client Mac, let's say an iMac, with no operating system on it.

Matter of fact, you can even take the disks out of it and boot over the net and boot an OS image off of the server. Run every application off of the server. Keep all of your state on the server to where the client is stateless. You can walk up to any number of Macs in a network, log in as yourself, and boom, your world shows up on that particular Mac. Because all of the state about the apps and your preferences and everything else is on that server. And as a matter of fact, when anyone upgrades anything on that server, you get the latest and greatest version the next time you log in. So if somebody upgrades the OS, they upgrade it in one place on a server, and every Mac on the network gets it. If they upgrade an app, the same thing. And then we wanted Mac OS X to be an awesome web server, Mac OS X server to be an awesome web server too.

So Avi and his team built in the most popular web server software, Apache, and built in WebObjects, and not on this chart, because it's breaking news, built in the QuickTime streaming server. There's actually a version that's been in Mac OS X server since we started shipping, and I believe there's an updated version on the net right now. And obviously development tools like BSD 4.4 and Java. So we're pretty excited about this product. It's Apple's first really modern server product ever, and so far the response has been very positive. And if you're building server-based Internet applications, that I know a lot of you are thinking about or are already doing today, this is really a wonderful platform because it's got all the pieces that you need, whether it be Java or just low-level tools that you see in the Berkeley standard distribution of Unix, or in very powerful tools that give you great database connectivity and interfacing like WebObjects.

We're very excited about this product, and you will see more server products as this evolves from Apple. But we're really going to spend most of our time today talking about Mac OS X clients, which is something we're working on. And I want to take you through what that is now with help from Avi, and we're going to show you a few demos. Mac OS X client is based on that same core of software that we have put into open source we call Darwin. So the Darwin core, which is Mock, BSD, etc., is what we base the Mac OS X client on. And we believe that taking that stuff open source is going to be terrific for us. There's been a tremendous number of downloads.

Already we're starting to get people feeding back suggestions and bugs and things like that. And we think it's going to make better products for everyone all the way around. On top of – oh, actually, and I have a slide here, as you know. This is what Darwin is, Mock, BSD. It provides all of the modern features that we're looking for in the next generation Mac OS. So we've got protected memory, preemptive multitasking, multithreading, much more modern networking, etc. So we all know what that stuff is. We all want it. And it's open. As we said, in our Darwin open source program, there are now over 20,000 developers registered. And there have been over – I think we're up to about 185,000 components now that have been downloaded, about another 10,000 in the last two days.

So it's been really popular so far out of the chute. And we're really excited about this whole strategy of having the core part of the operating system be open source because we're already a consumer of a lot of open source technology. You see a lot of open source components in there already, things that we integrate in, like Apache, like the GNU compiler, and add some value to before shipping them out. What we're now doing is taking other things that we do that have always just been, you know, Apple proprietary technologies, if you will, and put them back out there. And people just love this because they can go, they can tweak things, they can take some of the technologies, move them to other platforms if they want, which will benefit us, we believe. And it's just a wonderful working relationship with a lot of our developers. Now, Avi, there's a new release of Darwin that's being put on the web. Yes, that's right.

As of today, we are posting a binary image of Darwin, which is a completely functional download. You download it, you install it on your computer for free, gives you the complete Darwin environment, completely pre-built, which is a great way for you to go off and actually start building and enhancing the Darwin components yourself. That was missing from our first release. We hope to get it out sooner, but we had our developers working on something more important that we'll be talking about in a little while. Okay. Now, on top of Darwin, we layer on top something we are calling Quartz. And what Quartz is, is a whole new imaging model and windowing system for Mac OS X. We wanted a windowing system and a graphics model that was based on the latest and greatest stuff, and that is the PDF standard invented by Adobe.

And we believe in that standard, and we are embracing that standard, and we are building it into Mac OS X. This is the direction our entire design and publishing market is going. It's also, we believe, the direction the web is going in terms of graphics. PDF is the richest content on the web, and we're going to support it as native, and what we're basing our entire imaging model and windowing system on. And we've added to PDF full compositing. So all of those wonderful things you can do in terms of compositing in applications like Photoshop, the basic operations of those things are built into the core of Mac OS X. Full alpha channel and the original Pixar compositing operators upon which all of this stuff is based. And lots of really cool effects.

Yes. Yeah, it's really hot. So this is going way beyond the stuff that, of those of you that were next step developers, had. It's really hot. Then, on top of this foundation, we have three application environments that are part of Mac OS X. Oh, actually, no. We have a demonstration. We're going to do a demo. We have a demo. So we want to show you the Quartz stuff. So let's get our friend Phil back out here. The graphics stuff, you know, Steve and I can stand up here and describe it, but words can't do justice to what has been done. You've got to see this stuff. So you have to see it. So let's have Phil show it to us. Hi again. Hi, Phil. The Quartz is a really powerful graphics model. It lets you very quickly and easily take advantage of some very powerful new features in all your applications.

If you build on top of these new application environments, you're going to get these benefits. I have two quick, simple applications we've created just for demonstration purposes to show you some of the things you'll get. This first application, called Layer View, it brings up a background. In this case, I'm using a TIFF background. I'm going to just start typing right on top of this TIFF background. And what you see is gorgeous anti-alias text with a drop shadow. That drop shadow actually has a blur effect on it and is semi-transparent, all happening dynamically on the fly. It's kind of hard to see, I think, if you're sitting out in the audience, especially in the back. But it's truly amazing, especially from here, where you can see the clouds peeking through, partially the drop shadow of, like, the L or the O.

It's just amazing. Now let me open up from a folder on my desktop a graphic. By the way, it's also blurred. Now on my desktop, I have a graphic. This is a PDF file. I'll drop it right in and instantly image it. It's incredibly fast at taking PDF documents and imaging them in. Now you notice that graphic also has a drop shadow. It's on the fly. It's cropped up beautifully. It's added a semi-transparent drop shadow with a blurred edge. And it's anti-aliased. And it's anti-aliased. All the line art is anti-aliased on the fly. All on the fly. All on the fly. Producted by Quartz. Now, for example, let's just take a selection here.

If you could see it out there, the selection itself, that selected region has a drop shadow. The selected region has transparency. And blur. And anti-aliasing. And everything. It's just easy and fast. And this is the kind of stuff you can add to your applications building on top of Quartz. That's one demonstration. Let me show you one other we've quickly put together here to show some of the compositing features. We call this the playground or PDF playground. And in here, this is a PDF file we just brought in. Move it around. I can resize it. I can rotate it. It's all done with a PDF file.

But the fun comes in when I bring in a second PDF file. Let's take this one of the world. You can move that around as well. You can resize it. You can rotate it. I've heard of some people here from Australia. I know you see the world a little differently. There he is. And the real power is built-in alpha channel and transparency. We can start to see. And remember, these are all PDFs. So Quartz is an incredibly rich imaging system. Allows you to build into your application gorgeous anti-aliased text and graphics.

Allows you to composite them. And it's built-in transparency. A lot of cool special effects like drop shadow. These are the kind of things we hope from all of your great Mac apps as you build on top of Quartz. Thanks, Bill. This stuff was actually invented by Pixar like 15 years ago. And this will be really the first time that the full set of compositing stuff has ever been built into an operating system. And we're very, very excited about it. And what it basically means is that we and you can build software that have this kind of functionality without having to reinvent the wheel ourselves. Very high performance stuff built right into the core imaging and window system model of the operating system itself. Okay. There are three application environments built on top of this very powerful Darwin and Quartz foundation.

And the first one of those we used to call Blue Box and now we call Classic. And Classic is an environment that runs existing Mac apps without modification. However... You do not get any new features. You don't get that fancy court stuff we just showed you. You don't get memory protection in the sense that if you're running three or four classic apps, and one of them bombs, all of the classic apps will bomb. It won't take down the rest of your system, but all the classic apps will bomb. So this is a way to run existing apps where the developers either went sailing and aren't going to rev their apps, or if there's an app that hasn't been revved that you need to use. So that's what the classic environment is, and it's part of Mac OS X.

But far more exciting than that is the Carbon environment. Carbon is something that we announced at last year's developer conference. And Carbon was a way to go into the Mac APIs and clean them up after 15 years of some barnacles. And we've done that. We've cleaned up the Carbon APIs, and they're wonderful. And it's very, very fast to what we call carbonize your application, to where it runs on Carbon. And Carbon allows carbonized apps to get all of the new features. A carbonized app, again, very little work, all of a sudden pops alive, has full preemptive multitasking, runs in fully protective memory, gets access to all the new features of the system with a very small amount of work.

Now, we put an app on the web a year ago called the Carbon Dater, which basically you could download and run against your app, and it would tell you how well it matched Carbon. And there have been over 5,500 apps that have been Carbon dated in the last year, and the average coverage is 95%, which means you've got less than about 5% of your app that you've got to change to carbonize it. And matter of fact, we've had developers tell us, oh my god, thank you. I didn't know that garbage was still in there. So the Carbon Dater has been a real tool and is still the primary tool to evaluate how much work there's going to be to do with your app, and we've been incredibly pleased with the results. And lastly, Mac OS X is going to come with what was formerly called Yellowbox.

We are renaming it to Coco. We're renaming it to Coco because in addition to its Objective-C APIs, we have added full Java APIs on top of Coco so that you can write your app totally in Java now and get incredibly great performance on top of Coco. And so Coco is for writing new object-oriented Java apps. And all three of these application environments coexist together on Mac OS X on top of this very powerful foundation of Quartz and Darwin. And you may have different apps running one in each. In fact, we've architected the system such that much of the implementation of Carbon and Coco is shared between the two, not including just the graphics layer, but also higher-level toolbox-type code to make it very compatible and make them interoperate really well.

Now, we believe in something. Ever since Avi and I started working together so long ago when we were young, we believe that you got to eat your own dog food. And what that means is if we're going to be developing new APIs for you, we have to be developing for them first. We have to find out if they really do serve the needs of the developers by being a developer ourselves of applications. And so in Mac OS X, we're not developing anything for Classic. We know that works. There's plenty of stuff that we already run and verify, so we're covered there, no problem. We are developing several apps in Carbon, but the biggest of those is a brand-new Finder. And believe me, a Finder is a wonderful test case for Carbon. And then on top of Coco, we're developing a wonderful app as well, in fact, several, but one in particular we want to highlight today.

We believe that in these OSes, communication is one of the key parts, one of the key things our customers are doing. And so we believe email is really, really important. And Mac OS X will include a great email client right in the operating system. And so among the many apps we're writing as part of the system, we'd like to highlight the new Finder and the new Mail for you today to show you not only how far we've come, but that we are indeed eating our own dog food. So let's get Phil back up here. Last time, Phil. Another OS. This is really cool to actually have a Mac OS X client system to be able to demo to you and to show off some of the applications we're starting to build on top of Carbon and Coco and the things we're able to do.

It's a lot of fun. I have here on my machine, again, Mac OS X, the same demo machine as before. And now, along with having our desktop, the ability to bring up a really cool Finder, and some of you have worked with Next, will recognize some of these great features. So we'll launch the Finder app. Performance will be tuned later. And now what you'll see is a very simple and powerful view of all my folders, my machines. Now, to begin with, here we are in our G3. And our G3 has attached to it a hard drive, in fact, two of them, and of course, is plugged into the network. So now there's one easy way to see that. Easy way to see that. You're going through choosers and older ways. You can actually see it right here through your Finder.

In other words, let me just take a brief moment to explain this. It's really important. When we did the original Mac, there wasn't a network. We put in this thing that became AppleTalk so we could share a printer. And so the Finder had no notion of anything beyond the walls of the plastic of the machine, except for this one piece of code called a chooser, which was originally invented for choosing the printer, if you had more than one printer on the net. That paradigm, Mac has been stuck in that paradigm since 1984 of an island and a chooser to go outside and choose resources. And they're two completely different things. And what we are doing here is integrating them together. Whether you're working with stuff in your own file system or whether you're working with stuff on a network file system, they should look and behave exactly the same.

And the fact that something happens to be on your local machine is just circumstance. So now when I click on one of these items, Carbon, Carbon is an HFS plus hard drive volume. You see the drive above here, and you see all the contents within it. Really logical. My Macintosh hard drive in the system, that's a UFS volume. Yen works seamlessly together right inside here. You see the drive. You see everything in its contents. Now I click on the network, and I'm going into our local area network. You see a network icon, and I see people sitting here with machines in engineering, and in marketing, and in sales. And I am actually moving across the network. When we jump out to Ken Bereskin's machine, and he's got a public area here. Now Ken is somebody I share a lot of these files with when we do all our 10 demos.

So I may need to get back here. So I take Ken's home directory, and I place it up on an area right above. We call the shelf. And now it's there for whenever I want to get to it again later. Now something subtle's just happened. As I drilled down across the network and look for his home directory, you see it kept moving to the right. It kept adding columns. So I don't spawn multiple directories and windows all over my desktop that I have to option click and close. It just keeps moving and adding what I need. And now with the scroll bar, I can see where I've gone. How did I get there? It's all intuitive and right there in front of me. I can very quickly jump back to the network. It's just all one click away. Very intuitive and obvious. Now let me drill down inside my carbon hard drive. I'm going to go into my hard drive.

I'm going to go into my documents. I have a folder here on Alaska filled with pictures. If I click on a picture, I get a preview of it right there in the finder. It's really fast. And I get info on it. So I don't have to do a get info command. I get information right there appropriate for that content so I can get that whenever I need. And here's this humpback whale JPEG. I may need that again later. So again, put it right up here on my shelf. And I have instant access to it whenever I want. And now let me jump to Ken's directory again. Click. I've just reached out over the network, gone down, gone into Ken's directory. Let's go back to that JPEG picture. Click. Right back there. Moved on to my hard drive, got there, and found it. It would take so many clicks and steps with Mac and Windows to get there.

But with this new file viewer, it's just as simple as one click, and it's so intuitive for users. It's just like programming buttons on your car radio. Now, if you want to work in another view, you can open up other views. For example, let's view this as icons. So there's our familiar icon view. But we still keep our hierarchy up above so I know where I am. I don't have to lose out because I like to use my icon view. And I can click on things. And I can double click on folders, like the Alaska pictures, and jump right there. And again, if I wanted to, I can keep everything right in context, right in that view, not spawn multiple windows. So the Finder will be very powerful, very fast, and very easy to work with your local information and information out on the network.

And you can look at it in columns or in icons, whatever you want. Now, the bonus demo that Phil just did but didn't actually explicitly mention is this is a Carbon application. So what we're showing here is the reliability and completeness of Carbon at this point in time. The Finder is one of Apple's biggest piece of code. And to write this in Carbon is a tremendous amount of work. But now, Steve also mentioned we're going to do an application on top of Cocoa to show you. That's the new mail viewer app. Phil, just one other comment on this. This basic user interface paradigm of the Finder, of course, is not new. This is one of the things that we're able to bring along with us from Next. And we have actually beta tested this for years out there with everybody from professionals in the design and publishing market all the way down to first time users.

And we know from experience that somebody who's never used a computer before in an hour can be navigating around a local area network, going into their colleagues' machines, finding things they have permission to look at, sharing information across a local area network that only most sophisticated Mac users can figure out how to do today. And it's amazingly better than what we have today. Let's see if I can get this one to run. There we go. There we go. So the new mail viewer, entirely written on Cocoa, is a very powerful but very simple to use email application.

I have all my buttons above for checking my email, finding addresses, composing new email, forwarding messages. And this email application is based on the latest standards. It uses POP and IMAP for its email servers. So just what everyone uses in their companies and out there on the internet. And it uses LDAP servers for address directories so I can keep lists of people and groups and work with these great LDAP servers that we demoed earlier in Sherlock. Let me click through a few email messages. Here's one from Peter Lowe. Here's one from Ken Breskin about Canada. But here's a really cool one. Of course, it's from my boss. And what's in this email is a PDF file, not as an attachment, not as an enclosure, but right in line in the document.

Because with Quartz, I can render all my great graphics types, including PDF documents, right in the body of all my documents. So my emails can be incredibly beautiful and rich with data. Now let me show you my favorite feature. This is just going to save us all hours and hours of time every week. We do a search. And the search tool is based on the same technology from Sherlock. So inside my email, well, I can do simple things. I can look for someone's name in their email. And as I'm typing, I never hit Return. As I'm typing, in line with my typing, it's going out and doing its searching. Well, that wasn't too tough. Let me look for a mail message, Canada.

That's not too tough. There's Ken's message. But now, watch how fast I look for content inside an email. Very quickly, it brought up this document, this email message. This email message has a PDF file inside it. And it searched for content inside my email, inside my PDF file. Let's do one more. Here's an email from Peter, that tax table I was looking for. Here, right from the IRS website, is a 1040 tax table from 1998 dragged into my email documents. Peter emailed it to me. And now, I searched inside with my Sherlock searching tools, right inside my email, got inside that PDF file, and found it very quickly.

So it's a great email package. It's all written in COCO. It uses a great search engine. It's based on the latest standards, IMAP and POP and LDAP. Thanks, Phil. So these applications are obviously works in progress. But the reason we wanted to show them to you today was because we want to let you know that we're doing major app development on top of Carbon and on top of COCO. And this stuff's really looking good. Now, let's talk about schedule. Developer Preview 1 is a CD-ROM with the current state of Darwin, Quartz, the three application development environments, the tools, basically, the Mac OS X client system.

Developer Preview 1. And we are going to make that available to you today. We have a bunch of them. This is one right here. The artwork actually looks great, too, on the top of the CD. You'll be able to pick them up as you leave. As you leave, right outside the door. So Developer Preview 1 is coming out today. Now, Avi and his team, you want to discuss some of the technical changes recently? Yeah, let's talk about what's gone on to make Developer Preview 1 a reality. Well, first of all, you know that we've already shipped Mac OS X server. And that was a GM quality, very high quality product that we brought to market and actually is selling quite well now. But what we did was we said, from that code base to get to where we want to be in the end with Mac OS X in the future, we've got to make a handful of really fundamental changes.

And so we've done that as part of this preview release. Let me go through some of them. And as developers, I think you can appreciate how destabilizing some of these changes can be. First thing we did was we replaced the bottom end guts of the core operating system. We released, we replaced the Mac 2.5 based kernel that was in the previous version of the system with the Mac 3.0 kernel. That's the first thing that we did. The second thing that we did was, as you saw a demo, we put in quarts. So the entire imaging model and the entire window system that's being used for all the graphics, for all the windowing, is completely brand new. And it all works. That's a big change. The third thing that we did, which can be very scary, is we changed the compiler.

What we did with the compiler is, as you know, internally we use the compilers based on the GNU tools. And we're continuing to do that. But we made a major change to the compiler that takes us to a version of GCC called EGCS. And the major benefit there, people know what it is apparently and like it. The major benefit there is it's really an outstanding C++ compiler, which meets our needs for the future. So we've made three major changes, and we're going to give it to you. So you're going to find a few things that are broken, but you'll also find that Carbon is largely complete. Almost the entire high level toolbox and all the managers that make it up are complete from a functionality standpoint. I'm sure you'll find a few things that don't work quite like you expect. That's OK. Just let us know we'll fix them if we haven't fixed them already.

You'll find a handful of managers that are sort of on the fringe of what most people do, which aren't there yet, and we'll update them later. So you will see something that should allow you to get your applications up and running without too much trouble. It should work. You'll hit a few bumps along the way, but we believe we've got a solid release that you can now take home and start Carbonizing and bring your apps up on Mac OS X with. All right. So that's today. Developer preview number one. And again, this is the first really wide release moving into the path of Mac OS X. The next one is going to be called developer preview two, and we are going to give it to you this fall.

And we then plan on shipping 10.0 early next year. So we are less than a year away from 10.0, and that is our plan. And we are now in that phase of the development where the foundational stuff is pretty much behind us, and you'll see rapid improvements in the top layers and things in the user interface as well. Yes, we're going to stop making substantial changes like changing the underlying kernel, at least for this year. So we're really excited about this. Please get your copy. Please give us feedback. And this is what we're doing at Apple. I'm told this is the third year in a row that we have the same senior vice president of software, Avi Tevanian.

I'm actually told that that's a record. Yeah, I think that's a record for Apple. And we'll be setting more records there as well. And in addition to that, I'm hoping that our software strategies are starting to sound a little boring to you, because they're not changing every year. They're the same thing. We should review the changes from last year. The changes from last year in our software strategy, I think they're zero. Zero changes. And so hopefully, we're making up from not having the drama of the strategy a year with exciting and timely implementation that is surprising you on the upside, both in how rapidly we're bringing things to market and how good they are when they come out.

And that is our strategy. So when we meet again next year, we will have accomplished quite a lot, and we will have launched Mac OS X. And it's going to be a very exciting year. And if we can get the kind of help that we've gotten from all of you this past year, I know that we will be successful together. So thank you very much, guys. Thanks. Thank you. WHAT?

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