News

It's almost show time for Steve Jobs and Apple

Troy Wolverton
San Jose Mercury News

SAN JOSE, Calif. - On the eve of Apple Computer CEO Steve Jobs' speech today at Macworld in San Francisco, a swirl of sometimes conflicting rumors and reports circulated about what he likely will announce.

It was enough to leave anyone paying close attention a bit confused.

For months, speculation has focused on two separate tracks, both of which the company has acknowledged interest in. One is the company's digital video efforts, particularly its previously unveiled iTV product and a rumored large-screen update to the iPod. The second is Apple's expected introduction of a music-playing cell phone.

Depending on whom you paid attention to on Monday, either, both or neither of those tracks could be the centerpiece of Jobs' speech.

Late Monday, for instance, the Wall Street Journal reported that Apple could announce as soon as today that it will launch a cell phone in partnership with Cingular Wireless. That would seem to make sense, since the two companies have worked together before. Cingular was the only carrier to offer Motorola's ROKR phone, a cell phone introduced in 2005 that could store up to 100 songs and used Apple's iTunes software to organize and play them. A Cingular spokesperson refused to comment on the report, and an Apple spokesman did not return a call for comment.

But in a report issued Monday, J.P. Morgan analyst Bill Shope reportedly said his research indicates Apple's new cell phone may not be ready until the end of March and may not be announced at all at Macworld. That would be "a modest disappointment" for Apple's stock, Shope wrote, according to published reports.

Meanwhile Shaw Wu, an analyst with American Technology Research, would only predict that Apple would release its new phone sometime this year, potentially by the end of June.

"While our analysis continues to indicate (Apple's) first cell phone is technically complete, its `go-to-market' strategy continues to be a mystery and likely a gating factor," Wu said in his own research note on Monday.

A growing number of cell phones include music playing features. Some analysts have seen that as a potential threat to Apple's dominance of digital music. Others have emphasized the potential opportunity for the company. With some 1 billion cell phones sold in year, Apple could see huge shipments and added revenue by only capturing a small fraction of the market.

Analysts were also of different minds about Apple's video efforts. Shope for instance, reported that Apple was ordering "key components" for a new hard-drive based iPod. That suggested that its long-rumored full screen iPod was near, reportedly said.

Like Shope, Wu predicted that a new video-playing iPod is in the works, but said he "did not have high conviction" on when Apple would launch the device.

Apple's current video-playing iPod has a small, 2.5-inch screen. Analysts have predicted that its replacement could include a screen that's about double that size.

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