CDGIS

CHAMELI DEVI SCHOOL OF

ENGINEERING, INDORE
Evolution of Apple
by

NIKHIL RAO
0832EC111049
Guided by Mr.Aditya Sharma

DEPARTMENT OF ELECTRONICS AND

COMMUNICATION ENGINEERING
VII SEMESTER 2014 - 2015

CDGIS
CHAMELI DEVI SCHOOL OF
ENGINEERING, INDORE
Evolution of Apple
by

NIKHIL RAO
0832EC111049

Guided by 2

Mr.Aditya Sharma

DEPARTMENT OF ELECTRONICS AND

COMMUNICATION ENGINEERING
VII SEMESTER 2014 2015

CDGIS
CHAMELI DEVI SCHOOL OF ENGINEERING,
INDORE
DEPARTMENT OFELELCTRONICS AND
COMMUNICATION ENGINEERING
VII SEMESTER 2014 2015

CERTIFICATE
Certified that this is the bonafide record of the seminar report
on

Evolution of Apple
Carried out by

NIKHIL RAO(0832EC111049)
of 7th semester (Department of Electronics and Communication
engineering) during the Odd Semester 2014 15. He has
satisfactorily completed the seminar report and presentation as
prescribed by the Rajiv Gandhi Technical University, Bhopal, in
partial fulfillment towards the award of B.E. Degree in
information technology.

Signature of Guide
(Name -:Mr.Aditya Sharma)
Date:

Signature of Seminar Coordinator

(Name: Ms. Vivek Trivedi)
Date:

Signature of HOD
(Name:

CDGIS
CHAMELI DEVI SCHOOL OF ENGINEERING,
INDORE
DEPARTMENT OF ELECTRONICS AND
COMMUNICATION ENGINEERING
VII SEMESTER 2014 2015

ACKNOWLEDGEMENT
I have immense pleasure in expressing my sincerest and
deepest sense of gratitude towards my Guide Mr.Aditya Sharma
for the assistance in preparing and presenting the seminar. I
also take this opportunity to thank Seminar Coordinator and
Head of the department, for providing the required facilities in
completing my seminar report.
I am greatly thankful to my Parents, Friends and Faculty
members for their motivation, guidance and help whenever
needed.

NIKHIL RAO
(0832EC111049)
Contents of the report:

Contents
Chapter No.

Description
Certificate

Page numbers.
3

Acknowledgement

Contents

Synopsis

Pre-Foundation

Apple 1

Apple 2

10

Apple 3

11

The Apple IPO

12

Xerox PARC and The Lisa

13

The release of Macintosh

14

1985 Steve Jobs leaves Apple

15

The Apple II family of the 1980 s

16

The Mac family

16

The early-mid 1990s

16

1997: The Return of Jobs

17

CEO

17

The Microsoft deal

17

1998- 2001: Apple's Renaissance

18

The iMac, iBook, and Power Mac G4

18

Mac OS X

18

The iPod

19

Apple retail stores

19

The Intel transition

22

Apple and "i" Web services

22

iPod and iTunes Store

24

iOS Evolution - iPhone & iPad

26

Products of Apple

27

References

30

Synopsis
Apple

Inc. (NASDAQ: AAPL;previously Apple

American multinational

corporation that

designs

Computer,
and

Inc.)

markets

is

an

consumer

electronics, computer software, and personal computers. The company's best-known

hardware

products

include

the Macintosh line

of

computers,

the iPod,

the iPhone and the iPad. Apple software includes the Mac OS X operating system;
the iTunes media browser; the iLife suite of multimedia and creativity software;
the iWork suite of productivity software; Aperture, a professional photography
package; Final Cut Studio, a suite of professional audio and film-industry software
products; Logic Studio, a suite of music production tools; the Safari internet browser;
and iOS, a mobile operating system. As of August 2010, the company operates
301 retail stores in ten countries, and an online store where hardware and software
products are sold. As of May 2010, Apple is one of the largest companies in the

world and

the

most

valuable

technology

company

in

the

world,

having

surpassed Microsoft.

Pre-foundation

Garage of Steve Jobs' parents on Crist Drive in Los Altos, California

Steve Jobs and Steve Wozniak were outcasts while they were in high school; by
1975, they had withdrawn from Reed College and UC Berkeley, respectively.
Wozniak designed a video teletype that he could use to log on to the minicomputers
at Call Computer. Alex Kamradt commissioned the design and sold a small number
of them through his firm. Aside from their interest in up-to-date technology, the
impetus for "the two Steves" seems to have had another source. In his essay From
Satori to Silicon Valley (published 1986), cultural historian Theodore Roszak made
the point that the Apple Computer emerged from within the West

Coast counterculture and the need to produce print-outs, letter labels, and
databases. Roszak offers a bit of background on the development of the two Steves
prototype models.
In 1975, Wozniak started attending meetings of the Homebrew Computer Club. New
microcomputers such as the Altair 8800 and the IMSAI inspired him to build a
microprocessor into his video teletype and have a complete computer.
At
the
time
the
only microcomputer CPUs generally
available
were
the US$179 Intel 8080, and the US$170Motorola 6800. Wozniak preferred the 6800,
but both were out of his price range. So he watched, and learned, and designed
computers on paper, waiting for the day he could afford a CPU.
When MOS Technology released its US$20 6502 chip in 1976, Wozniak wrote a
version of BASIC for it, then began to design a computer for it to run on. The 6502
was designed by the same people who designed the 6800, as many in Silicon Valley
left employers to form their own companies. Wozniak's earlier 6800 paper-computer
needed only minor changes to run on the new chip.
Wozniak completed the machine and took it to Homebrew Computer Club meetings
to show it off. At the meeting, Wozniak met his old friend Jobs, who was interested in
the commercial potential of the small hobby machines.

The Apple I

The very first Apple Computer logo, drawn by Ronald Wayne, depicts Isaac
Newton under an apple tree.

The Apple logo in 1977 created by Rob Janoff with the rainbow color theme used
until 1998.
Steve Jobs and Steve Wozniak had been friends for some time, having met in 1971,
when their mutual friend, Bill Fernandez, introduced 21-year-old Wozniak to 16-yearold Jobs. Jobs managed to interest Wozniak in assembling a machine and selling it.
Jobs approached a local computer store, The Byte Shop, who said they would be
interested in the machine, but only if it came fully assembled. The owner, Paul
Terrell, went further, saying he would order 50 of the machines and pay US $500
each on delivery. Jobs then took the purchase order that he had been given from the
Byte Shop to Cramer Electronics, a national electronic parts distributor, and ordered
the components he needed to assemble the Apple I Computer. The local credit
manager asked Jobs how he was going to pay for the parts and he replied, "I have
this purchase order from the Byte Shop chain of computer stores for 50 of my
computers and the payment terms are COD. If you give me the parts on a net 30 day
terms I can build and deliver the computers in that time frame, collect my money
from Terrell at the Byte Shop and pay you."
With that, the credit manager called Paul Terrell who was attending an IEEE
computer conference at Asilomar in Pacific Grove and verified the validity of the
purchase order. Amazed at the tenacity of Jobs, Terrell assured the credit manager if
the computers showed up in his stores Jobs would be paid and would have more
than enough money to pay for the parts order. The two Steves and their small crew
spent day and night building and testing the computers and delivered to Terrell on
time to pay his suppliers and have a tidy profit left over for their celebration and next
order. Steve Jobs had found a way to finance his soon-to-be multimillion-dollar
company without giving away one share of stock or ownership.
The machine had only a few notable features. One was the use of a TV as the
display system, whereas many machines had no display at all. This was not like the
displays of later machines, however; text was displayed at a terribly slow 60
characters per second. However, this was still faster than the teletypes used on
contemporary machines of that era. The Apple I also included bootstrap code
onROM, which made it easier to start up. Finally, at the insistence of Paul Terrell,

10

Wozniak also designed a cassette interface for loading and saving programs, at the
then-rapid pace of 1200 bit/s. Although the machine was fairly simple, it was
nevertheless a masterpiece of design, using far fewer parts than anything in its
class, and quickly earning Wozniak a reputation as a master designer.
Joined by another friend, Ronald Wayne, the three started to build the machines.
Using a variety of methods, including borrowing space from friends and family,
selling various prized items (like calculators and a VW bus) and scrounging, Jobs
managed to secure the parts needed while Wozniak and Wayne assembled them.
But the owner of the Byte Shop was expecting complete computers, not just printed
circuit boards. The boards still being a product for the customers Terrell still paid
them. Eventually 200 of the Apple I's were built.
The Apple II
But Wozniak had already moved on from the Apple I. Many of the design features of
the I were due to the limited amount of money they had to construct the prototype,
but with the income from the sales he was able to start construction of a greatly
improved machine, the Apple II; it was presented to the public at the first West Coast
Computer Faire on April 16 and April 17, 1977. On the first day of exhibition, Jobs
introduced Apple II to aJapanese chemist named Toshio Mizushima who became the
first authorized Apple dealer in Japan.
The main difference internally was a completely redesigned TV interface, which held
the display in memory. Now not only useful for simple text display, the Apple II
included graphics, and, eventually, color. Jobs meanwhile pressed for a much
improved case and keyboard, with the idea that the machine should be complete and
ready to run out of the box. This was almost the case for the Apple I machines sold
to The Byte Shop, but one still needed to plug various parts together and type in the
code to run BASIC.
Building such a machine was going to be fiscally burdensome. Jobs started looking
for cash, but Wayne was somewhat gun shy due to a failed venture four years
earlier, and eventually dropped out of the company. Banks were reluctant to lend
Jobs money; the idea of a computer for ordinary people seemed absurd at the time.
Jobs eventually met "Mike" Markkula who co-signed a bank loan for US$250,000,
and the three formed Apple Computer on April 1, 1976. Why Apple? At the time, the
company to beat was Atari, and Apple Computer came before Atari alphabetically
and thus also in the phone book. Another reason was that Jobs had happy memories
of working on an Oregon apple farm one summer.
With both cash and a new case design in hand thanks to designer Jerry Manock, the
Apple II was released in 1977 and became the computer generally credited with
creating the home computer market. Millions were sold well into the 1980s. A number
of different models of the Apple II series were built, including the Apple IIe and Apple
IIGS, which could still be found in many schools as late as 2005.

11

The Apple III

Apple III
By the early 1980s, Apple Computer faced increasing competition. While the Apple II
was already established as a successful business-ready platform because of
Visicalc, Apple was not content. The Apple III (Apple 3) was designed to take on the
IBM PC in the business environment.
The Apple III was a relatively conservative design for computers of the era. However,
Steve Jobs did not want the computer to have a fan; rather, he wanted the heat
generated by the electronics to be dissipated through the chassis of the machine,
forgoing the cooling fan.
Unfortunately, the physical design of the case was not sufficient to cool the
components inside it. By removing the fan from the design, the Apple III was prone to
overheating. This caused the integrated circuit chips to disconnect from the
motherboard. Customers who contacted Apple customer service were told to "drop
the computer on the desk", which would cause the ICs to fall back in to place.
Thousands of Apple III computers were recalled and, although a new model was
introduced in 1983 to rectify the problems, the damage was already done.
The Apple IPO
On December 12, 1980, Apple launched the Initial Public Offering of its stock to the
investing public. When Apple went public, it generated more capital than any IPO
since Ford Motor Company in 1956 (as claimed in two books and ICon: Steve Jobs )
and instantly created more millionaires (about 300) than any company in history.
Several venture capitalists cashed out, reaping billions in long-term capital gains.In
January 1981, Apple held its first shareholders meeting as a public company in
the Flint Center, a large auditorium at nearby De Anza College, which is often used
for symphony concerts. (Previous meetings were held quietly in smaller rooms,
because there had only been a few shareholders.) The business of the meeting had

12

been planned (or choreographed) so that the voting could be staged in 15 minutes or
less. In most cases, voting proxies are collected by mail and counted days or months
before a meeting. In this case, after the IPO, many shares were in new hands.Steve
Jobs started his prepared speech, but after being interrupted by voting several times,
he dropped his prepared speech and delivered a long, emotionally charged talk
about betrayal, lack of respect, and related topics.
Xerox PARC and the Lisa

Lisa
While Apple Computers business division was focused on the Apple III, a separate
group was focused on a computer that would change the world. While the Apple III
was another iteration of the text-based computer, this new machine would feature a
completely different interface and introduce the words mouse, icon, and desktop into
thelexicon of the computing public.
In return for the right to buy US$1,000,000 of pre-IPO stock, Xerox granted Apple
Computer three days access to the PARC facilities. After visiting PARC, they came
away with new ideas that would complete the foundation for Apple Computer's
first GUI computer, theApple Lisa.(Popular folklore states that "Lisa" was Steve Jobs'
first daughter; Apple maintains it means Locally Integrated Software Architecture.)
Apple Computer's engineers did not come up with the LISA interface overnight. In
fact, the first iteration of the soon-ubiquitous WIMPinterface was a poorly-drawn
picture of a floppy disk. It was only after months of usability testing and work that
Apple settled on the LISA interface of windows and icons.
The Lisa was introduced in 1983 at a cost of US$9,995. Because of the high price, it
failed to penetrate the market, however it was a useful proof of concept.
The release of the Macintosh and the 1984 commercial
The Macintosh 128k was announced to the press in October 1983, followed by an
18-page brochure included with various magazines in December. Its debut, however,
was announced by a single national broadcast of the now famous US$1.5 million

13

television commercial, "1984". It was directed by Ridley Scott, aired during the third
quarter of Super Bowl XVIII on January 22, 1984, and is now considered a
"watershed event" and a "masterpiece."1984 used an unnamed heroine to represent
the coming of the Macintosh (indicated by her white tank top with a Picasso-style
picture of Apples Macintosh computer on it) as a means of saving humanity from
"conformity" (Big Brother).[16] These images were an allusion to George Orwell's
noted novel, Nineteen Eighty-Four, which described a dystopian future ruled by a
televised "Big Brother."
For a special post-election edition of Newsweek in November 1984, Apple spent
more than US$2.5 million to buy all 39 of the advertising pages in the issue. Apple
also ran a Test Drive a Macintosh promotion, in which potential buyers with a credit
card could take home a Macintosh for 24 hours and return it to a dealer afterwards.
While 200,000 people participated, dealers disliked the promotion, the supply of
computers was insufficient for demand, and many were returned in such a bad
shape that they could no longer be sold. This marketing campaign caused CEO John
Sculley to raise the price from US$1,995 to US$2,495 (adjusting for inflation, about
US$5,000 in 2007).
Two days after the 1984 ad aired, the Macintosh went on sale. It came bundled with
two applications designed to show off its interface: MacWrite and MacPaint. Although
the Mac garnered an immediate, enthusiastic following, it was too radical for some,
who labeled it a mere "toy". Because the machine was entirely designed around the
GUI, existing text-mode and command-driven applications had to be redesigned and
the programming code rewritten; this was a challenging undertaking that
many software developers shied away from, and resulted in an initial lack of software
for the new system. In April 1984 Microsoft's MultiPlan migrated over from MS-DOS,
followed
by Microsoft
Word in
January
1985. In
1985, Lotus
Software introduced Lotus Jazz after the success of Lotus 1-2-3 for the IBM PC,
although it was largely a flop. Apple introduced Macintosh Office the same year with
the lemmings ad, infamous for insulting potential customers. It was not successful.
Macintosh also spawned the concept of Mac evangelism which was pioneered by
Apple employee, and later Apple Fellow, Guy Kawasaki.
Despite initial marketing difficulties, the Macintosh brand was eventually a success
for Apple. This was due to its introduction of desktop publishing (and later computer
animation) through Apple's partnership with Adobe Systems which introduced
the laser printer and Adobe PageMaker. Indeed, the Macintosh would become
known as the de-facto platform for many industries including cinema, music,
advertising, publishing and the arts.
While it did briefly license some of its own designs, Apple did not allow other
computer makers to "clone" the Mac until the 1990s, long after Microsoft dominated
the marketplace with its broad licensing program. By then, it was too late for Apple to

14

reclaim its lost market share and the Macintosh clones achieved limited success
before being axed after Steve Jobs returned to Apple Computer in 1997

1985: Jobs leaves Apple

After an internal power struggle the board of directors sided with Sculley and Jobs
was asked to resign. Jobs then co-founded the visual effects house, Pixar. He also
went on to found NeXT Inc., a computer company that built machines with futuristic
designs and ran the UNIX-derived NeXTstep operating system. NeXTSTEP would
eventually be developed into Mac OS X. While not a commercial success due in part
to its high price, the NeXT computer would introduce important concepts to the
history of the personal computer (including serving as the initial platform for Tim
Berners-Lee as he was developing the (World Wide Web).

1985-1997: Sculley, Spindler, Amelio

Macintosh SE

Corporate Performance

15

Under leadership of John Sculley, Apple issued its first corporate stock dividend on
May 11, 1987. A month later on June 16, Apple stock split for the first time in a 2:1
split. Apple kept a quarterly dividend with about 0.3% yield until November 21, 1995.,
August 2010 Between March 1988 and January 1989, Apple undertook five
acquisitions, including software companies Network Innovations,Styleware, Nashoba
Systems, and Coral Software, as well as satellite communications company Orion
Network Systems.

The Apple II family of the 1980s

Apple now had two separate, incompatible platforms: the Apple II, an affordable,
expandable home computer, and the Apple Macintosh, the closed platform for
professionals. John Gruber, among others, has speculated that this platform
incompatibility was the main reason the Macintosh did not share the initial
commercial success which was experienced by the Apple II in the late
1970s. However, by the mid - 1980s, the Apple II was now competing with the IBM
PC and its clones, and a new energy was focused upon marketing the Macintosh.
Thus, Apple continued to sell both lines promoting them to different market
segments: the Macintosh to colleges, college students, and knowledge workers, and
the Apple II to home users and public schools. A few months after introducing the
Mac, Apple released a compact version of the Apple II called the Apple IIc. And in
1986 Apple introduced the Apple IIgs, an Apple II positioned as something of a
hybrid product with a mouse-driven, Mac-like operating environment. Apple II
computers remained an important part of Apple's business until they were
discontinued in the early 1990s.
The Mac family
At the same time, the Mac was becoming a product family of its own. The original
model evolved into the Mac Plus in 1986 and spawned the Mac SE and the Mac II in
1987 and the Mac Classic and Mac LC in 1990. Meanwhile, Apple attempted its first
portable Macs: the failed Macintosh Portable in 1989 and then the more
popular PowerBook in 1991, a landmark product that established the modern form
and ergonomic layout of thelaptop. Popular products and increasing revenues made
this a good time for Apple. MacAddict magazine has called 1989 to 1991 the "first
golden age" of the Macintosh.
On February 19, 1987, Apple registered the "Apple.com" domain name, making it
one of the first hundred companies to register a .com address on the
nascent Internet.
The early-mid 1990s

16

In the late 1980s, Apple's fiercest technological rivals were the Amiga and Atari
ST platforms. But by the 1990s, computers based on the IBM PC had become more
popular than all three; they finally had a comparable GUIthanks to Windows 3.0, and
were out-competing Apple.
Apple's response to the PC threat was a profusion of new Macintosh lines
including Quadra, Centris, andPerforma. Unfortunately, these new lines were
marketed poorly. For one, there were too many models, differentiated by very minor
graduations in their tech specs. The excess of arbitrary model numbers confused
many consumers and hurt Apple's reputation for simplicity. Apple's retail resellers
like Sears and CompUSAoften failed to sell or even competently display these Macs.
Compounding matters was the fact while the machines were cheaper than a
comparable PC (counting all the things built in which had to be added to the 'bare
bones PC') the poor marketing gave the impression that the machines were more
expensive.
In 1991, Apple partnered with long-time competitor IBM to form the AIM alliance. The
ultimate goal was to create a revolutionary new computing platform, known as PReP,
which would use IBM and Motorola hardware and Apple software. As the first step
toward the PReP platform, Apple started the Power Macintosh line in 1994, using
IBM's PowerPC processor. These processors used a RISC architecture, which
differed substantially from the Motorola 680X0 series that were used by all previous
Macs. Parts of Apple's operating system software were rewritten so that most
software written for older Macs could run in emulation on the PowerPC series. Apple
also refused IBM's offer to purchase the company, but later unsuccessfully sought
another offer from IBM.
In addition to computers, Apple has also produced consumer devices. In 1993, Apple
released the Newton, an early PDA. Though it failed commercially, it defined and
launched the category and was a forerunner and inspiration of devices such as Palm
Pilot and Pocket PC.
1997: The Return of Jobs
In 1996, the struggling NeXT company beat out Be Inc.'s BeOS in its bid to sell its
operating system to Apple. Apple purchased Steve Jobs' company, NeXT on
December 10, 1996, and its NeXT step operating system. This would not only bring
Steve Jobs back to Apple's management, but NeXT technology would become the
foundation of the Mac OS X operating system.
On November 10, 1997, Apple introduced the Apple Store, an online retail store
based upon the WebObjects application server the company had acquired in its
purchase of NeXT. The new direct sales outlet was also tied to a new build-to-order
manufacturing strategy.
CEO

17

On July 9, 1997, Gil Amelio was ousted as CEO of Apple by the board of directors
after turning the company around from a multibillion loss to a $25 million dollar
profit.Jobs stepped in as the interim CEO to begin a critical restructuring of the
company's product line. He would eventually become CEO and has served in that
position to the present day.
The Microsoft deal
At the 1997 Macworld Expo, Steve Jobs announced that Apple would be entering
into partnership with Microsoft. Included in this was a five-year commitment from
Microsoft to release Microsoft Office for Macintosh as well a US$150 million
investment in Apple. It was also announced that Internet Explorer would be shipped
as the default browser on the Macintosh. Microsoft chairman Bill Gates appeared at
the expo on-screen, further explaining Microsoft's plans for the software they were
developing for Mac, and stating that he was very excited to be helping Apple return
to success. After this, Steve Jobs said this to the audience at the expo:
If we want to move forward and see Apple healthy and prospering again, we have to
let go of a few things here. We have to let go of this notion that for Apple to win,
Microsoft has to lose. We have to embrace a notion that for Apple to win, Apple has
to do a really good job. And if others are going to help us that's great, because we
need all the help we can get, and if we screw up and we don't do a good job, it's not
somebody else's fault, it's our fault. So I think that is a very important perspective. If
we want Microsoft Office on the Mac, we better treat the company that puts it out
with a little bit of gratitude; we like their software.
So, the era of setting this up as a competition between Apple and Microsoft is over
as far as I'm concerned. This is about getting Apple healthy, this is about Apple being
able to make incredibly great contributions to the industry and to get healthy and
prosper again.
1998- 2001: Apple's Renaissance

18

The original iMac

The iMac, iBook, and Power Mac G4
While discontinuing Apple's licensing of its operating system to third-party computer
manufacturers, one of Jobs's first moves as new acting CEO was to develop
the iMac, which bought Apple time to restructure. The original iMac integrated a CRT
display and CPU into a streamlined, translucent plastic body. The line became a
sales smash, moving about one million units a year. It also helped re-introduce Apple
to the media and public, and announced the company's new emphasis on the design
and aesthetics of its products.
More recent products include the iBook, the Power Mac G4, and the AirPort product
series, which helped popularize the use of Wireless LAN technology to connect
computers to networks.
In 1999, Apple introduced the Power Mac G4, which utilized the Motorola-made
PowerPC 7400 containing a 128-bit instruction unit known as AltiVec, its flagship
processor line. Also that year, Apple unveiled the iBook, its first consumer-oriented
laptop that was also the first Macintosh to support the use of Wireless LAN via the
optional AirPort card that was based on the 802.11b standard.
Mac OS X

Company headquarters on Infinite Loop in Cupertino

In 2001, Apple introduced Mac OS X, an operating system based
onNeXT's NeXTstep and
the FreeBSD kernel. Aimed
at
consumers
and
professionals alike, Mac OS X married the stability, reliability and security
of Unix with the ease of a completely overhauled user interface. To aid users in
transitioning their applications from Mac OS 9, the new operating system allowed the
use of Mac OS 9 applications through the Classic environment. Apple's Carbon API
also allowed developers to adapt their Mac OS 9 software to use Mac OS X's
features.
Apple retail stores

19

In May 2001, after much speculation, Apple announced the opening of a line of Apple
retail stores, to be located throughout the major U.S. computer buying markets. The
stores were designed for two primary purposes: to stem the tide of Apple's declining
share of the computer market, as well as a response to poor marketing of Apple
products at third-party retail outlets.

The iPod
In October 2001, Apple introduced its first iPod portable digital audio player. The
iPod started as a 5 gigabyte player capable of storing around 1000 songs. Since
then it has evolved into an array of products including theMini (now discontinued),
the iPod Touch, the Shuffle, the iPod Classic, the Nano, and the iPhone. As of March
2010, the largest storage capacity for an iPod was 160 gigabytes.
2002 - Present: the iTunes-iOS Juggernaut
In early 2002, Apple unveiled a redesigned iMac, using the G4 processor. The new
design had a hemispherical base and a flat panel all-digital display supported by a
swiveling neck. This model was discontinued in the summer of 2004.
In 2002, Apple also released the Xserve 1U rack mounted server. Originally featuring
two G4 chips, the Xserve was unusual for Apple in two ways. It represented an
earnest effort to enter the enterprise computer market and it was also relatively
cheaper than similar machines released by its competitors. This was due, in no small
part, to Apple's use of Fast ATA drives as opposed to the SCSI hard drives used in
traditional rack-mounted servers. Apple later released the Xserve RAID, a 14
drive RAID which was, again, cheaper than competing systems.
In mid-2003, Steve Jobs launched the Power Mac G5, based on IBM's G5
processor. Apple claims this was the first 64-bit computer sold to the general public,
but in fact that title actually goes to the AMD Opteron line (Opteron processors were
however marketed more directly to the enterprise for use in rackmount servers and
in workstations). Both 64-bit CPUs were pre-dated by the 64-bit Alpha architecture,
although the Alpha was aimed more at servers and workstations and not at the
"general public." The Power Mac G5 was also used by Virginia Tech to build its
prototype System X supercomputing cluster, which at the time garnered the
prestigious recognition of the third fastest supercomputer in the world. It cost only
US$5.2 million to build, far less than the previous #3 and other ranking
supercomputers. Apple's Xserves were soon updated to use the G5 as well. They
replaced the Power Mac G5 machines as the main building block of Virginia

20

Tech's System X, which was ranked in November 2004 as the world's seventh
fastest supercomputer.[30]
A new iMac based on the G5 processor was unveiled August 31, 2004 and was
made available in mid-September. This model dispensed with the base altogether,
placing the CPU and the rest of the computing hardware behind the flat-panel
screen, which is suspended from a streamlined aluminium foot. This new iMac,
dubbed the iMac G5, is the world's thinnest desktop computer, measuring in at
around two inches (around 5 centimeters).
2004, however, was a turning point for Apple. After creating a sizable financial base
to work with, the company began experimenting with new parts from new suppliers.
As a result Apple was able to produce new designs so quickly over a short amount of
time, with the release of the iPod Video, then the iPod Classic, and eventually the
iPod touch and iPhone. Each Apple product thus far has been under equally high
demand.
Through the 1990s, personal computers based on Microsoft's Windows operating
system began to gain a much larger percentage of new computer users than Apple.
As a result, Apple fell from controlling 20% of the total personal computer market to
5% by the end of the decade. The company was struggling financially under thenCEO Gil Amelio when on August 6, 1997 Microsoft bought a US$150 million nonvoting share of the company as a result of a court settlement with Apple. Perhaps
more significantly, Microsoft simultaneously announced its continued support for Mac
versions of its office suite, Microsoft Office, and soon created a Macintosh Business
Unit. This reversed the earlier trend within Microsoft that resulted in poor Mac
versions of their software and has resulted in several award-winning releases.
However, Apple's market share continued to decline, reaching 3% by 2004.
Initially, the Apple Stores were only opened in the United States, but in late 2003,
Apple opened its first Apple Store abroad, in Tokyo's Ginza district. Ginza was
followed by a store in Osaka, Japan in August 2004. In 2005, Apple opened stores
in Nagoya, the Shibuya district of Tokyo, Fukuoka, and Sendai. Another store was
opened in Sapporo in 2006. Apple's first European store opened in London in
November 2004, and is currently the largest store. A store in the Bullring shopping
centre in Birmingham opened in April 2005, and the Bluewatershopping centre
in Kent opened in July 2005. Apple opened its first store in Canada in the middle of
2005 at theYorkdale Shopping Centre in North York, Toronto. Later on in 2005 Apple
opened
the Meadowhall Store
inSheffield and
the Trafford
Centre Store
in Manchester (UK). Recent additions in the London area include theBrent
Cross Apple Store (January 2006) and the Apple Store in Westfield in Shepherd's
Bush (September 2008).
Also, in an effort to court a broader market, Apple opened several "mini" stores in
October 2004 in attempt to capture markets where demand does not necessarily
dictate a full scale store. The first of these stores was opened at Stanford Shopping

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Center in Palo Alto, California. These stores follow in the footsteps of the successful
Apple products: iPod mini and Mac mini. These stores are only one half the square
footage of the smallest "normal" store and thus can be placed in several smaller
markets.
On April 29, 2005, Apple released Mac OS X v10.4 "Tiger" to the general public.
Apple's wildly successful PowerBook and iBook products relied on Apple's previous
generation G4 architecture which were produced by Freescale Semiconductor, a
spin off from Motorola. Engineers at IBM had minimal success in making their
PowerPC G5 processor consume less power and run cooler but not enough to run in
iBook or PowerBook formats. As of the week of October 24, 2005. Apple released
the Power Mac G5 Dual that features a Dual-Core processor. This processor
contains two cores in one rather than have two separate processors. Apple has also
developed the Power Mac G5 Quad that uses two of the Dual-Core processors for
enhanced workstation power and performance. The new Power Mac G5 Dual cores
run individually at 2.0 GHz or 2.3 GHz. The Power Mac G5 Quad cores run
individually at 2.5 GHz and all variations have a graphics processor that has 256-bit
memory bandwidth.
The Intel transition
In a keynote address on June 6, 2005, Steve Jobs officially announced that Apple
will begin producing Intel-based Macintosh computers beginning in 2006.Jobs
confirmed rumors that the company had secretly been producing versions of its
current operating system Mac OS X for both PowerPC and Intel processors over the
past 5 years, and that the transition to Intel processor systems would last until the
end of 2007. Rumors of cross-platform compatibility had been spurred by the fact
that Mac OS X is based on OPENSTEP, an operating system that was available for
many platforms. In fact, Apple's own Darwin, the open source underpinnings of Mac
OS X, was also available for Intel's x86 architecture.
On January 10, 2006, the first Intel-based machines, the iMac and MacBook Pro,
were introduced.[36][37] They were based on the Intel Core Duo platform. This
introduction came with the news that Apple will complete the transition to Intel
processors on all hardware by the end of 2006, a year ahead of the originally quoted
schedule.
In January 2007, Apple Computer, Inc. shortened its name to simply Apple Inc. In his
Keynote address, Jobs explained that with their current product mix consisting of the
iPod and Apple TV as well as their Macintosh brand, Apple really wasn't just a
computer company anymore. At the same address, Jobs revealed a product that
would revolutionize an industry in which Apple had never previously competed: the
Apple iPhone. The iPhone combined Apple's first widescreen iPod with the world's
first mobile device boasting visual voicemail, and an internet communicator capable
of running a fully functional version of Apple's web browser Safari on the iPhone OS.

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Apple and "i" Web services

In 2000, Apple introduced its iTools service, a collection of free web-based tools that
included an email account, internet greeting cards called iCards, a service
called iReview that gave internet users a place to read and write reviews of Web
sites, and a tool called KidSafe which promised to prevent children from browsing
inappropriate portions of the web. The latter two services were eventually canceled
because of lack of success, while iCards and email became integrated into
Apple's .Mac subscription based service introduced in 2002 and discontinued in mid2008 to make way for the release of the new MobileMe service, coinciding with the
iPhone 3G release. MobileMe, which carries the same US$99.00 annual subscription
price as its .Mac predecessor, features the addition of "push" services to instantly
and automatically send emails, contacts and calendar updates directly to user's
iPhone devices. Some controversy surrounded the release of MobileMe services to
users resulting in expected downtime and a significantly longer release window. As a
result of this, Apple extended the subscriptions existing MobileMe subscribers by an
additional 30 days free-of-charge.

iPod and iTunes Store

A 2nd generation iPod

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iPod mini with the user interface set to German

On October 23, 2001, Apple introduced the iPod, a portable digital music player. Its
signature features included an LCD, easy to use interface, and a large capacity drive
(initially 5 GB) which was enough to hold approximately 1,000 songs. It was quite
large when compared to the 20-30 songs of Flash-based players of the time. Apple
has since revised its iPod line several times, introducing a slimmer, more compact
design, Windows compatibility (previous iPods only interacted with Macintosh
computers), AAC compatibility, storage sizes of up to 160 GB, and easier
connectivity with car or home stereo systems. On October 26, 2004, Apple released
a color version of their award winning iPod which can not only play music but also
show photos. In early 2005, Apple unveiled a smaller iPod : theiPod Shuffle, which is
about the size of a pack of gum. Speaking to software developers on June 6, 2005,
Steve Jobs said the company's share of the entire portable music device market
stood at 76%.
Apple has revolutionized the computer and music industry by signing the five major
record companies to join its new music download service, the successful iTunes
Music Store, now known as iTunes Store. Unlike other fee-based music services, the
iTunes Store charges a flat US$0.99 per song (or US$9.99 per album). Users have
more flexibility than on previous on-line music services. For example, they can burn
CDs including the purchased songs (although a particular playlist containing
purchased music may only be burned seven times), share and play the songs on up
to five computers, and, of course, download songs onto an iPod.
The iTunes Music Store commercial model is one-time purchase, which contrasts
with other commercial subscription music services where users are required to pay a

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regular fee to be able to access musical content (but are able to access a larger
volume of music during the subscription).
The iTunes Music Store was launched in 2003 with 2 million downloads in only 16
days; all of which were purchased only on Macintosh computers. Apple has since
released a version of iTunes for Windows, allowing Windows users the ability to
access the store as well. Initially, the music store was only available in the United
States due to licensing restrictions, but there were plans to release the store to many
other countries in the future.
In January 2004 Apple released a more compact version of their iPod player, the
4 GB iPod Mini. Although the Mini held fewer songs than the other iPod models at
that time, its smaller size and multiple colours made it popular with consumers on
debut with many stores having "sold out" their initial inventories of the devices.
In June 2004 Apple opened their iTunes Music Store in the United Kingdom, France,
and Germany. A European Union version opened October 2004 (actually,
a Eurozone version; not initially available in the Republic of Irelanddue to the
intransigence of the Irish Recorded Music Association (IRMA) but eventually opened
Thursday January 6, 2005.) A version for Canada opened in December 2004. On
May 10, 2005, the iTunes Music Store was expanded to Denmark, Norway, Sweden,
and Switzerland.
On December 16, 2004, Apple sold its 200 millionth song on the iTunes Music Store
to Ryan Alekman fromBelchertown, Massachusetts. The download was The
Complete U2, by U2. Just under three months later Apple sold its 300 millionth song
on March 2, 2005. On July 17, 2005, the iTunes Music Store sold its 500 millionth
song. At that point, songs were selling at an accelerating annualized rate of more
than 500 million.
On January 11, 2005, an even smaller version of the iPod was announced, this one
based on flash memory instead of using a miniaturized hard drive. The iPod Shuffle,
like its predecessors, proved so popular that it sold out almost immediately, causing
delays of up to four weeks in obtaining one within a single week of its debut.This is
despite the fact that critics had gawked at the lack of LCD screen in the Shuffle, a
norm in almost all current flash memory based mp3 players.
The iPod is giving an enormous lift to Apple's financial results. In the quarter ending
March 26, 2005, Apple earned US$290 million, or 34 a share, on sales of US$3.24
billion. The year before in the same quarter, Apple earned just US$46 million, or 6 a
share, on revenue of US$1.91 billion.
In July 2005, the iPod was given a color screen, merging the iPod and iPod Photo.
On September 7, 2005, Apple replaced the iPod Mini line with the new iPod Nano.
While some consumers were put off by the high price tag (US$199 for 2 GB), and
easily scratchable surface, the Nano had sold 1 million units in the first 17 days.

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A month later, on October 12, 2005 Apple introduced the new 5th generation iPod
with video playback capabilities. The device is also 40% thinner than a 4th
generation iPod and has a larger screen.
On October 25, 2005, the iTunes Store went live in Australia, with songs selling
for A$1.69 each, albums at (generally) A$16.99 and music videos and Pixar short
films at A$3.39. Briefly, people in New Zealand were able to buy music off the
Australian store. However, that loophole was quickly closed.
On February 23, 2006, the iTunes Music Store sold its 1 billionth song.
The iTunes Music Store changed its name to iTunes Store on September 12, 2006
when it began offering video content (TV shows and movies) for sale. Since iTunes
inception it has sold over 2 billion songs, 1.2 billion of which were sold in 2006. Since
downloadable TV and movie content was added 50 million TV episodes and 1.3
million movies have been downloaded.
In early 2010, Apple celebrated the 10 billionth song downloaded from the iTunes
Music Store.
iOS Evolution - iPhone & iPad
First announced on January 9, 2007, Apple introduced the first version of the iPhone
being publicly available on June 29 that same year in selected countries/markets. It
was another 12 months before the iPhone 3G became available on July 11, 2008.
Apple announced the iPhone 3GS on June 8, 2009, along with plans to release it
later in June, July, and August, starting with the U.S., Canada and major European
countries on June 19. This 12-month iteration cycle has continued with the iPhone4
model arriving in similar fashion in 2010. January 2011 has also seen a Verizon
model being announced with expected availability in February 2011.
The Macs that are available now (Jan. 2011) are the 27 iMac, the mac pro, the mac
book, mac book air, mac book pro and the mac mini. The latest version or mac os x
is Snow leopard (10.6). In summer 2011, Apple will have Mac OS X lion (10.7). On
February 10, 2011, the Apple iPhone will be on Verizon Wireless and AT&T. Now 2
iPod types are touch screen (Jan. 2011), the iPod nano and the iPod touch, a big
advance in technology. Apple TV now has a 2nd generation (Jan 2011) 4 times
smaller, but 4 times better! And now Apple has gone wireless, Apple now has a
wireless touch pad, a wireless keyboard, a wireless mouse, and even a wireless
external hard drive.
The Apple iPad was announced on January 27, 2010 with retail availability
commencing in April and systematically growing in markets throughout 2010. The
iPad fits into Apple product line snuggly, as an iOS device, twice the screen size of
an iPhone without the phone capabilities. While there were initial fears of product
cannibalisation the FY2010 financial results released in Jan 2011 included

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commentary of a reverse 'halo' effect, where iPad sales were leading to increased
sales of iMacs and MacBooks.
Considering that both product ranges have only been in existence for a combined 4
years, the fact that over 70 million iPhones and earning the company billions is a
remarkable success. Apple now rates highly as a mobile phone manufacturer and
continues to break new ground with the iPad.

Apple Products:
Apple has been so successful in these last years thanks to his fresh, imaginative
way to think and do its business: a winning combination of exceptional products,
great style and design, great strategy, innovative marketing, sleek and enticing
communications.
Apple owes its overwhelming success in the last years to the iPhone and to the
smart iPod and iTunes product combination, a combination of a great hardware
piece with great style, great software, great performance, user friendly interface, with
a good e-business service. The iPod + iTunes halo effect and new great Mac
computers and Mac OS software did the rest in increasing Apple revenue stream.
In the 5 years between 2003 to 2008 the Apple share value increased 25 times, from
$7.5 to $180 per share. At july 2008 prices, before the US Financial Crisis, Apple
stock market capitalization was $160 billion.
In January 2010 Apple shares topped the $210 mark.

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But even the best companies with the best products have bottleneck factors which
often avoid full exploitation of the opportunities.

The iPad
The new Apple Tablet, the iPad - an unnecessary product? iPad Marketing Strategy
Steve Jobs claims the iPad gives the best way to experience the web.
Yet, the iPad does not have Flash Player, Flash is essential on the web and is used
everywhere. Surfing the Web without Flash gives you big empty boxes in the middle
of a page. Video on the web is mostly implemented in Flash. No Flash, no video.
So, what Steve Jobs says is untrue. Actually the iPad gives one of the worst web
experiences you can imagine.
Besides, the iPad does not have USB ports.

The iPod.
Few people are aware - and few market analysts too - that for the first 3 years the
iPod was an absolute flop. The iPod was launched in october 2001, and between
2001 and 2004 iPod sales were between 100-200 thousand units per quarter, very
far from today's 10-20 million units per quarter, and the iPod sales were not even
covering the product research & development costs.
Then, in June-Aug 2004 something happened, and iPod sales began to grow
strongly, quarter after quarter. Today, we all know where the iPod stands, and what a
remarkable success it is.
The iPod made the fortune of Apple, and it stands out as the major turning point in
the company growth.
Few people know that the iPod + iTunes business idea was not conceived inside
Apple, but was proposed to Apple by an outside source, a music lover and Engineer
named Tony Fadell.
More on Tony Fadell and on the iPod marketing on iPod Marketing Strategy
The iPod marks another outstanding result in marketing:
the annihilation of competitors. To know more see the analysis on
The iPod competitors
It should be noted that, since the second generation of iPods in 2002, the iPods were
made compatible not only with the Mac operating systems but with Microsoft
Windows operating systems as well.

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We should ask ourselves (and to Steve Jobs): how many iPods would have been
sold if the iPods would had been compatible only with Mac operating systems?
Where the iPod is manufactured and assembled

The iPhone
The pipeline of new products which came out from Apple in the last years is
impressive, and overwhelming. In 2007, with the successful launch of the iPhone,
Apple has marked another milestone in its development and growth.
And moreover, the iPhone enters a market - the market of mobile phones - a market
which is mature, and saturated. Nonetheless, Apple has been able to develop a
revolutionary product, and to change the paradigm in the mobile phone market.
The iPhone is 5 years ahead of all its competitors. A wonderful product, amazing
user interface, great design. It is not only a mobile phone, it is a product between a
mobile phone and a laptop computer. Even calling it a smartphone is not enough.
In July 2008 Apple launched the second generation iPhone, the iPhone 3G.

The iPhone 3GS

In June 2009 Apple launched its third generation iPhone: the iPhone 3GS.
The iPhone 3GS has a 3 megapixel autofocus camera, video recording and editing
capabilities, voice control, longer battery life, 7.2 Mbps HSDPA internet connection.
iPhone 3GS is twice faster than the iPhone 3G. The iPhone 3GS prices: $199 for the
16GB model, $299 for the 32GB model.
more on the new iPhone 3GS on the iPhone 3GS page.
More on iPhone Marketing on the iPhone Marketing Strategy page.

Apple did great. no doubt. However Apple has done some serious mistakes.
The most serious mistakes Apple has done concern marketing and distribution
strategies in Europe.
Apple has overlooked the European markets, and missing big numbers in
unexploited sales. With better marketing strategy, better communication and
distribution, Apple could have made 300% more revenues in Europe in the last 4
years. Apple Marketing in Europe
We met with with Erik Stannow, Apple Vice President of Marketing for Europe &
EMEA. We have been talking with Erik Stannow about the marketing and distribution

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issues of Apple in the European markets and we gave some valuable suggestions to
improve the Apple marketing strategy and distribution in Europe.
Well, it seems that in Cupertino they don't care so much about Europe.

References
How stuff works.com
Apple.us.org
Wikipedia.com
Google.com

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