Apple announces big-screen iMac, MP3 player

By Peter Svensson, The Associated Press
Thursday July 18, 2002

NEW YORK — Apple Computer Inc. Wednesday announced Windows versions of the acclaimed iPod digital music players, moving Apple more firmly into the PC peripherals market. 

Chief executive Steven Jobs, speaking at the MacWorld Expo and Conference here, also unveiled a new iMac computer with a larger display. 

The iMac, available in two weeks, has a 17-inch flat-panel display and a DVD-burning drive. It will sell for $1999. 

The most expensive of the existing iMac models, which have 15-inch screens, had its price reduced by $100 to $1799. 

Jobs also announced $100 price cuts on the slim white iPod MP3 players, bringing the 5-gigabyte model to $299 and the 10-gigabyte model to $399. A 20-gigabyte model, holding approximately 4,000 songs, will be introduced in early August. 

Current iPod models are made to connect only to Apple’s Macintosh computers. Windows versions of all three models will be available at the end of August. 

On Tuesday, Cupertino, Calif.-based Apple reported disappointing second quarter sales, reflecting an industrywide slowdown. 

“We are investing, and we are going to innovate ourselves out of this downturn,” Jobs said in his keynote speech. 

At midday on the Nasdaq Stock Market, Apple shares were down $2.36, or 13 percent, at $15.50. 

Noting that most Web sites that once provided free file storage and e-mail now charge fees for some or all of their services, Jobs said Apple will start charging $99 a year for its iTools services in September. 

ITools, which includes e-mail, file storage and online photo albums, will be expanded with calendar, backup and antivirus functions, and its name will be changed to ”.mac,” Job said. 

“Where did we get this name? Well, Microsoft has .NET, which is about Internet services, and that’s what iTools is all about,” he said, referring to Microsoft’s program of tying Internet services to its software. 

Jobs also touted the new version its OS X operating system, called Version 10.2 Jaguar. It will go on sale Aug. 24 for $129. It has incremental improvements in several areas, including file organization and networking. 

Responding to media reports that users have been adopting OS X slowly since its introduction last year, Jobs said the transition from older operating systems was “going well.” 

He projected that 20 percent, or 5 million, of all Macintosh computers would be running OS X by the end of the year. 

The keynote speech opened with video testimonials by Windows users who had switched to Macintosh, echoing a current marketing campaign. 

“The response we’ve had to this campaign is off the chart,” Jobs said, noting that a Web site set up in connection with the campaign has been visited by 1 million Windows users since set up June 10.