DISSERTATION

ON

Evolution Of Apple

AMITY SCHOOL OF BUSINESS

AMITY UNIVERSITY, NOIDA

Submitted by: Nabeel Waris Kidwai

Project Guide:
Mrs. Swarna Bakshi
Amity School of Business
Amity University, Noida
 Evolution Of
APPLE
Inc.

By- Nabeel Waris Kidwai

Roll No. - B 33

Enroll. No. – A3906408304

 ACKNOWLEDGEMENTS

Writing an acknowledgement is perhaps the most difficult part of any assignment or

submission, as it is very difficult to thank all the people associated with making of the
project, but still I would like to make a sincere effort to do just that.

At the very outset, I would like to thank my faculty guide and mentor Mrs. Swarna Bakshi
for providing a stimulus to generate such deep rooted thoughts about the intricacies of this
Project.

In similar vein, I would also like to thank my relative Mr. Haider Ali working for Apple Inc. in
California USA , who was very forthcoming with his ideas and suggestions on ‘ Evolution of
APPLE Inc. ‘

Last but not the least, I would also like to extend a word of gratitude to Miss Unaiza Rashid ,
a friend , philosopherand guide for all her valuable inputs.
INTRODUCTION:

Apple Inc. (NASDAQ: AAPL; previously Apple Computer, Inc.) is an American multinational

corporation that designs and markets 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.
RESEARCH OBJECTIVE:

To Study the Marketing Strategies of Apple Inc.

RESEARCH METHODOLOGY ADOPTED

The research methodology being adopted in this project is to extract and analyse information
and secondary data available in the public domain from credible sources such as, ……… etc.
Information has also been sought from the related literaure (books, business newspapers, and
magazines) available in the departmental library. The information thus obtained has been
edited and condensed accodingly keeping in mind the scope of the project. Keeping in mind
the nature of topic choosen, primary data / research has not been conducted or included in
this research project.

This research was a descriptive research as it describes the Mutual Fund Industry of India.

SOURCES OF DATA
 Data Collected : Secondary Data

 Secondary Data Methodology: Secondary data was collected from the web, various
reports published on the internet, books, newspapers and business magazines.
 Contents
 Pre-Foundation
 Apple 1
 Apple 2
 Apple 3
 The Apple IPO
 Xerox PARC and The Lisa
 The release of Macintosh
 1985 –Steve Jobs leaves Apple
 The Apple II family of the 1980 ‘s
 The Mac family
 The early-mid 1990s
 1997: The Return of Jobs
 CEO
 The Microsoft deal
 1998- 2001: Apple's Renaissance
 The iMac, iBook, and Power Mac G4
 Mac OS X
 The iPod
 Apple retail stores
 The Intel transition
 Apple and "i" Web services
 iPod and iTunes Store
 iOS Evolution - iPhone & iPad
 Financial history
 Marketing Strategies Of Apple Inc.
 Products of Apple
 “ THINK DIFFERENT “ - CAMPAIGN
 Advertising Strategies of the iPOD
1969-1984: Jobs and Wozniak

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-year-old 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, 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.

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 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 Computer’s 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 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 Apple’s 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 introducedMacintosh 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 laterApple 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 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

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

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

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

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

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 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 then-CEO Gil Amelio when on
August 6, 1997 Microsoft bought a US$150 million non-voting 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 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.

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 mid-2008 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

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 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 iTunesfor 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.

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 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.
Financial history

As cash reserves increased significantly in 2006, Apple created Braeburn Capital on April 6,

2006 to manage its assets.

Financial Net sales (Mil Net profits (Mil Revenue Return on net
period USD) USD) growth sales

FY 1981 335 unknown --- ---

FY 1982 583 61 74% 10%

FY 1983 983 77 69% 8%

FY 1984 1,516 64 54% 4%

FY 1985 1,918 61 27% 3%

FY 1986 1,902 154 -1% 8%

FY 1987 2,661 218 40% 8%

FY 1988 4,071 400 53% 10%

FY 1989 5,284 454 30% 9%

FY 1990 5,558 475 5% 9%

FY 1991 6,310 310 14% 4%

FY 1992 7,087 530 12% 7%

FY 1993 7,977 87 -11% 1%

FY 1994 9,189 310 46% 3%

FY 1995 11,062 424 20% 4%

FY 1996 9,833 -816 -11% -8%

FY 1997 7,081 -1,045 -28% -15%

FY 1998 5,941 309 -16% 5%

FY 1999 6,134 601 3% 10%

FY 2000 7,983 786 30% 10%

FY 2001 5,363 -25 -33% 0%

FY 2002 5,247 65 -2% 1%

FY 2003 6,207 57 18% 1%

FY 2004 8,279 266 33% 3%

FY 2005 13,931 1,328 68% 10%

FY 2006 19,315 1,989 39% 10%

FY 2007 24,578 3,495 27% 14%

FY 2008 37,491 6,119 53% 16%

FY 2009[47] 42,905 8,235 14% 19%

FY 2010 65,225 14,013 52% 21%

Stock

'AAPL' is the stock symbol under which Apple Inc. trades on the NASDAQ stock market.

Apple originally went public in on December 12, 1980, with an initial public offering at
US$22.00 per share. Apple does not currently pay dividends on its common stock. Apple
paid dividends from June 15, 1987 to December 15, 1995.

Gene Munster and Michael Olson of Piper Jaffray are the main analysts who track Apple stock.
Piper Jaffray estimate future stock and revenue of Apple annually, and have been doing so for
several years.

Marketing Strategy of Apple Inc. - December 10th, 2010

Apple Inc. (NASDAQ: AAPL; previously Apple Computer, Inc.) is an American multinational
corporation that designs and markets 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; 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.

Established on April 1, 1976 in Cupertino, California, and incorporated January 3, 1977, the
company was previously named Apple Computer, Inc., for its first 30 years, but removed the
word "Computer" on January 9, 2007, to reflect the company's ongoing expansion into the
consumer electronics market in addition to its traditional focus on personal computers. As
of September 25, 2010, Apple had 46,600 full time employees and 2,800 temporary full time
employees worldwide and had worldwide annual sales of $65.23 billion.

For reasons as various as its philosophy of comprehensive aesthetic design to its distinctive
advertising campaigns, Apple has established a unique reputation in the consumer
electronics industry. This includes a customer base that is devoted to the company and its
brand, particularly in the United States. Fortune magazine named Apple the most admired
company in the United States in 2008, and in the world in 2008, 2009, and 2010. The
company has also received widespread criticism for its contractors' labour, environmental,
and business practices.

Statistics:

Public Company
Incorporated: 1977
Employees: 9,736
Sales: $6.13 billion (1999)
Stock Exchanges: NASDAQ
Ticker Symbol: AAPL
NAIC: 334111 Electronic Computer Manufacturing; 334119 Other Computer Peripheral
Equipment Manufacturing (pt); 51121 Software Publishers

Company Perspectives:

Apple ignited the personal computer revolution in the 1970s with the Apple II and
reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to
bringing the best personal computing experience to students, educators, creative
professionals and consumers around the world through its innovative hardware, software
and Internet offerings.

Key Dates:

1976: With $1,300, Steve Jobs and Steve Wozniak found Apple Computer, Inc.
1980: Apple converts to public ownership.
1982: Apple becomes the first personal computer company to reach $1 billion in annual
sales.
1985: John Sculley assumes the helm after a management shakeup that causes the
departure of Jobs and several other Apple executives.
1991: PowerBook line of notebook computers is released.
1994: Power Macintosh line is released.
1996: Acquisition of NeXT brings Steve Jobs back to Apple as a special advisor.
1997: Steve Jobs is named interim chief executive officer.
1998: The all-in-one iMac is released.
2000: Jobs, now firmly in command as CEO, oversees a leaner, more tightly focused Apple.

Apple Computer, Inc. is largely responsible for the enormous growth of the personal
computer industry in the 20th century. The introduction of the Macintosh line of personal
computers in 1984 established the company as an innovator in industrial design whose
products became renowned for their intuitive ease of use. Though battered by bad decision-
making during the 1990s, Apple continues to exude the same enviable characteristics in the
21st century that catapulted the company toward fame during the 1980s. The company
designs, manufactures, and markets personal computers, software, and peripherals,
concentrating on lower-cost, uniquely designed computers such as iMAC and Power
Macintosh models.

Origins

Apple was founded in April 1976 by Steve Wozniak, then 26 years old, and Steve Jobs, 21,
both college dropouts. Their partnership began several years earlier when Wozniak, a
talented, self-taught electronics engineer, began building boxes that allowed him to make
long-distance phone calls for free. The pair sold several hundred such boxes.

In 1976 Wozniak was working on another box--the Apple I computer, without keyboard or
power supply--for a computer hobbyist club. Jobs and Wozniak sold their most valuable
possessions, a van and two calculators, raising $1,300 with which to start a company. A local
retailer ordered 50 of the computers, which were built in Jobs's garage. They eventually sold
200 to computer hobbyists in the San Francisco Bay area for $666 each. Later that summer,
Wozniak began work on the Apple II, designed to appeal to a greater market than computer
hobbyists. Jobs hired local computer enthusiasts, many of them still in high school, to
assemble circuit boards and design software. Early microcomputers had usually been
housed in metal boxes. With the general consumer in mind, Jobs planned to house the
Apple II in a more attractive modular beige plastic container.

Jobs wanted to create a large company and consulted with Mike Markkula, a retired
electronics engineer who had managed marketing for Intel Corporation and Fairchild
Semiconductor. Chairman Markkula bought one-third of the company for $250,000, helped
Jobs with the business plan, and in 1977 hired Mike Scott as president. Wozniak worked for
Apple full time in his engineering capacity.

Jobs recruited Regis McKenna, owner of one of the most successful advertising and public
relations firms in Silicon Valley, to devise an advertising strategy for the company. McKenna
designed the Apple logo and began advertising personal computers in consumer magazines.
Apple's professional marketing team placed the Apple II in retail stores, and by June 1977,
annual sales reached $1 million. It was the first microcomputer to use color graphics, with a
television set as the screen. In addition, the Apple II expansion slot made it more versatile
than competing computers.

The earliest Apple IIs read and stored information on cassette tapes, which were unreliable
and slow. By 1978 Wozniak had invented the Apple Disk II, at the time the fastest and
cheapest disk drive offered by any computer manufacturer. The Disk II made possible the
development of software for the Apple II. The introduction of Apple II, with a user manual,
at a consumer electronics show signaled that Apple was expanding beyond the hobbyist
market to make its computers consumer items. By the end of 1978, Apple was one of the
fastest-growing companies in the United States, with its products carried by over 100
dealers.

In 1979 Apple introduced the Apple II+ with far more memory than the Apple II and an
easier startup system, and the Silentype, the company's first printer. VisiCalc, the first
spreadsheet for microcomputers, was also released that year. Its popularity helped to sell
many Apple IIs. By the end of the year sales were up 400 percent from 1978, at over 35,000
computers. Apple Fortran, introduced in March 1980, led to the further development of
software, particularly technical and educational applications.

In December 1980, Apple went public. Its offering of 4.6 million shares at $22 each sold out
within minutes. A second offering of 2.6 million shares quickly sold out in May 1981.

Meanwhile Apple was working on the Apple II's successor, which was intended to feature
expanded memory and graphics capabilities and run the software already designed for the
Apple II. The company, fearful that the Apple II would soon be outdated, put time pressures
on the designers of the Apple III, despite the fact that sales of the Apple II more than
doubled to 78,000 in 1980. The Apple III was well received when it was released in
September 1980 at $3,495, and many predicted it would achieve its goal of breaking into
the office market dominated by IBM. However, the Apple III was released without adequate
testing, and many units proved to be defective. Production was halted and the problems
were fixed, but the Apple III never sold as well as the Apple II. It was discontinued in April
1984.

The problems with the Apple III prompted Mike Scott to lay off employees in February 1981,
a move with which Jobs disagreed. As a result, Mike Markkula became president and Jobs
chairman. Scott was named vice-chairman shortly before leaving the firm.

Despite the problems with Apple III, the company forged ahead, tripling its 1981 research
and development budget to $21 million, releasing 40 new software programs, opening
European offices, and putting out its first hard disk. By January 1982, 650,000 Apple
computers had been sold worldwide. In December 1982, Apple became the first personal
computer company to reach $1 billion in annual sales.

The next year, Apple lost its position as chief supplier of personal computers in Europe to
IBM, and tried to challenge IBM in the business market with the Lisa computer. Lisa
introduced the mouse, a hand-controlled pointer, and displayed pictures on the computer
screen that substituted for keyboard commands. These innovations come out of Jobs's
determination to design an unintimidating computer that anyone could use.

Unfortunately, the Lisa did not sell as well as Apple had hoped. Apple was having difficulty
designing the elaborate software to link together a number of Lisas and was finding it hard
to break IBM's hold on the business market. Apple's earnings went down and its stock
plummeted to $35, half of its sale price in 1982. Mike Markkula had viewed his presidency
as a temporary position, and in April 1983, Jobs brought in John Sculley, formerly president
of Pepsi-Cola, as the new president of Apple. Jobs felt the company needed Sculley's
marketing expertise.

1984 Debut of the Macintosh

The production division for Lisa had been vying with Jobs's Macintosh division. The
Macintosh personal computer offered Lisa's innovations at a fraction of the price. Jobs saw
the Macintosh as the 'people's computer'--designed for people with little technical
knowledge. With the failure of the Lisa, the Macintosh was seen as the future of the
company. Launched with a television commercial in January 1984, the Macintosh was
unveiled soon after, with a price tag of $2,495 and a new 3-inch disk drive that was faster
than the 5-inch drives used in other machines, including the Apple II.

Apple sold 70,000 Macintosh computers in the first 100 days. In September 1984 a new
Macintosh was released with more memory and two disk drives. Jobs was convinced that
anyone who tried the Macintosh would buy it. A national advertisement offered people the
chance to take a Macintosh home for 24 hours, and over 200,000 people did so. At the same
time, Apple sold its two millionth Apple II. Over the next six months Apple released
numerous products for the Macintosh, including a laser printer and a hard drive.

Despite these successes, Macintosh sales temporarily fell off after a promising start, and the
company was troubled by internal problems. Infighting between divisions continued, and
poor inventory tracking led to overproduction. Although Jobs had originally been a strong
supporter of Sculley, Jobs eventually decided to oust Sculley; Jobs, however, lost the
ensuing showdown. Sculley reorganized Apple in June 1985 to end the infighting caused by
the product-line divisions, and Jobs, along with several other Apple executives, left the
company in September. They founded a new computer company, NeXT Incorporated ,
which would later emerge as a rival to Apple in the business computer market.

The Macintosh personal computer finally moved Apple into the business office market.
Corporations saw its ease of use as a distinct advantage. It was far cheaper than the Lisa and
had the necessary software to link office computers. In 1986 and 1987 Apple produced
three new Macintosh personal computers with improved memory and power. By 1988, over
one million Macintosh computers had been sold, with 70 percent of sales to corporations.
Software was created that allowed the Macintosh to be connected to IBM-based systems.
Apple grew rapidly; income for 1988 topped $400 million on sales of $4.07 billion, up from
income of $217 million on sales of $1.9 billion in 1986. Apple had 5,500 employees in 1986
and over 14,600 by the early 1990s.

In 1988, Apple management had expected a worldwide shortage of memory chips to

worsen. They bought millions when prices were high, only to have the shortage end and
prices fall soon after. Apple ordered sharp price increases for the Macintosh line just before
the Christmas buying season, and consumers bought the less expensive Apple line or other
brands. In early 1989, Apple released significantly enhanced versions of the two upper-end
Macintosh computers, the SE and the Macintosh II, primarily to compete for the office
market. At the same time IBM marketed a new operating system that mimicked the
Macintosh's ease of use. In May 1989 Apple announced plans for its new operating system,
System 7, which would be available to users the next year and allow Macintoshes to run
tasks on more than one program simultaneously.

Apple was reorganized in August 1988 into four operating divisions: Apple USA, Apple
Europe, Apple Pacific, and Apple Products. Dissatisfied with the changes, many longtime
Apple executives left. In July 1990, Robert Puette, former head of Hewlett-Packard's
personal computer business, became head of the Apple USA division. Sculley saw the
reorganization as an attempt to create fewer layers of management within Apple, thus
encouraging innovation among staff. Analysts credit Sculley with expanding Apple from a
consumer and education computer company to a business computer company, one of the
biggest and fastest-growing corporations in the United States.

Competition in the industry of information technology involved Apple in a number of

lawsuits. In December 1989 for instance, the Xerox Corporation, in a $150 million lawsuit,
charged Apple with unlawfully using Xerox technology for the Macintosh software. Apple
did not deny borrowing from Xerox technology but explained that the company had spent
millions to refine that technology and had used other sources as well. In 1990 the court
found in favor of Apple in the Xerox case. Earlier, in March 1988, Apple had brought suits
against Microsoft and Hewlett-Packard, charging copyright infringement. Four years later, in
the spring of 1992, Apple's case was dealt a severe blow in a surprise ruling: copyright
protection cannot be based on 'look and feel' (appearance) alone; rather, 'specific' features
of an original program must be detailed by developers for protection.

Mismanagement--Crippling an Industry Giant: 1990s

Apple entered the 1990s well aware that the conditions that made the company an industry
giant in the previous decade had changed dramatically. Management recognized that for
Apple to succeed in the future, corporate strategies would have to be re-examined.

Apple had soared through the 1980s on the backs of its large, expensive computers, which
earned the company a committed, yet relatively small following. Sculley and his team saw
that competitors were relying increasingly on the user-friendly graphics that had become
the Macintosh signature and recognized that Apple needed to introduce smaller, cheaper
models, such as the Classic and LC, which were instant hits. At a time when the industry was
seeing slow unit sales, the numbers at Apple were skyrocketing. In 1990, desktop Macs
accounted for 11 percent of the PCs sold through American computer dealers. In mid-1992,
the figure was 19 percent.

But these modestly priced models had a considerably smaller profit margin than their larger
cousins. So even if sales took off, as they did, profits were threatened. In a severe austerity
move, Apple laid off nearly ten percent of its workforce, consolidated facilities, moved
production plants to areas where it was cheaper to operate, and drastically altered its
corporate organizational chart. The bill for such forward-looking surgery was great,
however, and in 1991 profits were off 35 percent. But analysts said that such pitfalls were
expected, indeed necessary, if the company intended to position itself as a leaner, better-
conditioned fighter in the years ahead.

Looking ahead is what analysts say saved Apple from foundering. In 1992, after the core of
the suit that Apple had brought against Microsoft and Hewlett-Packard was dismissed,
industry observers pointed out that although the loss was a disappointment for Apple, the
company wisely had not banked on a victory. They credited Apple's ambitious plans for the
future with quickly turning the lawsuit into yesterday's news.

In addition to remaining faithful to its central business of computer making--the notebook

PowerBook series, released in 1991, garnered a 21 percent market share in less than six
months--Apple intended to ride a digital wave into the next century. The company geared
itself to participate in a revolution in the consumer electronics industry, in which products
that were limited by a slow, restrictive analog system would be replaced by faster, digital
gadgets on the cutting edge of telecommunications technology. Apple also experimented
with the interweaving of sound and visuals in the operations of its computers.

For Apple, the most pressing issue of the 1990s was not related to technology, but
concerned capable and consistent management. The company endured tortuous failures
throughout much of the decade, as one chief executive officer after another faltered
miserably. Scully was forced out of his leadership position by Apple's board of directors in
1993. His replacement, Michael Spindler, broke tradition by licensing Apple technology to
outside firms, paving the way for ill-fated Apple clones that ultimately eroded Apple's
profits. Spindler also oversaw the introduction of the Power Macintosh line in 1994, an
episode in Apple's history that typified the perception that the company had the right
products but not the right people to deliver the products to the market. Power Macintosh
computers were highly sought after, but after overestimating demand for the earlier release
of its PowerBook laptops, the company grossly underestimated demand for the Power
Macintosh line. By 1995, Apple had $1 billion worth of unfilled orders, and investors took
note of the embarrassing miscue. In a two-day period, Apple's stock value plunged 15
percent.

After Spindler's much-publicized mistake of 1995, Apple's directors were ready to hand the
leadership reins to someone new. Gil Amelio, credited with spearheading the recovery of
National Semiconductor, was named chief executive officer in February 1996, beginning
another notorious era of leadership for the beleaguered Cupertino company. Amelio cut
Apple's payroll by a third and slashed operating costs, but drew a hail of criticism for his
compensation package and his inability to relate to Apple's unique corporate culture.
Apple's financial losses, meanwhile, mounted, reaching $816 million in 1996 and a
staggering $1 billion in 1997. The company' stock, which had traded at more than $70 per
share in 1991, fell to $14 per share. Its market share, 16 percent in the late 1980s, stood at
less than four percent. Fortune magazine offered its analysis, referring to Apple in its March
3, 1997 issue as 'Silicon Valley's paragon of dysfunctional management.'

Amelio was ousted from the company in July 1997, but before his departure a significant
deal was concluded that brought Apple's savior to Cupertino. In December 1996, Apple paid
$377 million for NeXT, a small, $50-million-in-sales company founded and led by Steve Jobs.
Concurrent with the acquisition, Amelio hired Jobs as his special advisor, marking the return
of Apple's visionary 12 years after he had left. In September 1997, two months after
Amelio's exit, Apple's board of directors named Jobs interim chief executive officer. Apple's
recovery occurred during the ensuing months.

Jobs assumed his responsibilities with the same passion and understanding that had made
Apple one of the greatest success stories in business history. He immediately discontinued
the licensing agreement that spawned Apple clones. He eliminated 15 of the company's 19
products, withdrawing Apple's involvement in making printers, scanners, portable digital
assistants, and other peripherals. From 1997 forward, Apple would focus exclusively on
desktop and portable Macintoshes for professional and consumer customers. Jobs closed
plants, laid off thousands of workers, and sold stock to rival Microsoft Corporation, receiving
a cash infusion of $150 million in exchange. Apple's organizational hierarchy underwent
sweeping reorganization as well, but the most visible indication of Jobs's return was
unveiled in August 1998. Distressed by his company's lack of popular computers that
retailed for less than $2,000, Jobs tapped Apple's resources and, ten months after the
project began, unveiled the massively successful iMAC, a sleek and colorful computer that
embodied Apple's skill in design and functionality.

Because of Jobs's restorative efforts, Apple exited the 1990s as a pared-down version of its
former self, but, importantly, a profitable company once again. Annual sales, which totaled
$11.5 billion in 1995, stood at $5.9 billion in 1998, from which the company recorded a
profit of $309 million. In 1999, sales grew a modest 3.2 percent, but the newfound health of
the company was evident in a 94 percent gain in net income, as Apple's profits swelled to
$601 million. Further, Apples' stock mustered a remarkable rebound, climbing 140 percent
to $99 per share in 1999. By the decade's end, 'interim' was dropped from Jobs's corporate
title, signaling Jobs's return on a permanent basis and fueling optimism that Apple could
look forward to a decade of vibrant and consistent growth.

Principal Subsidiaries:
Apple Computer, Inc. Limited (Ireland); Apple Computer Limited (Ireland); Apple Computer
U.K. Limited (U.K.); Apple Computer International (Ireland); FileMaker Inc.; Apple Japan,
LLC; Apple Computer B.V. (Netherlands); A C Real Properties, Inc.

Principal Competitors:

Compaq Computer Corporation; Dell Computer Corporation; International Business

Machines Corporation; Microsoft Corporation; Sun Microsystems, Inc.

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.

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.

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 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.
“ THINK DIFFERENT “ :

"Think Different" is an advertising slogan created for Apple Computer in 1997 by the Los

Angeles office of advertising agency TBWA\Chiat\Day[. It was used in a famous television
commercial, several print advertisements and a number of TV promos for Apple products.
Apple's use of the slogan was discontinued with the start of the Apple Switch ad
campaign in 2002. The slogan may have been a play on the venerable IBM Think motto
coined by Thomas J. Watson.

Television commercials

Significantly shortened versions of the text were used in two television commercials, known
as "Crazy Ones", directed by Chiat/Day's Jennifer Golub who also shared the art director
credit with Jessica Schulman and Yvonne Smith. The familiar voiceover was by Richard
Dreyfuss.

The one-minute commercial featured black-and-white footage of 17 iconic 20th century

personalities, some living, others deceased. In order of appearance they were: Albert
Einstein, Bob Dylan, Martin Luther King, Jr., Richard Branson, John Lennon (with Yoko
Ono), Buckminster Fuller, Thomas Edison, Muhammad Ali, Ted Turner, Maria
Callas, Mahatma Gandhi, Amelia Earhart, Alfred Hitchcock,Martha Graham, Jim
Henson (with Kermit the Frog), Frank Lloyd Wright and Pablo Picasso. The commercial ends
with an image of a young girl (identified as Shaan Sahota) opening her closed eyes, as if to
see the possibilities before her.

The thirty-second commercial was a shorter version of the previous one, using 11 of the 17
personalities, but closed with Jerry Seinfeld, instead of the young girl. In order of
appearance: Albert Einstein, Bob Dylan, Martin Luther King, Jr., John Lennon, Martha
Graham, Muhammad Ali, Alfred Hitchcock, Mahatma Gandhi, Jim Henson, Maria Callas,
Pablo Picasso, followed by Jerry Seinfeld. This version aired only once, during the series
finale of Seinfeld.
Print advertisements

Print advertisements from the campaign were published in many mainstream magazines
such as Newsweek and Time. Their style was predominantly traditional, prominently
featuring the company's computers or consumer electronics along with the slogan.

There was also another series of print ads which were more focused on brand image than
specific products. Those featured a portrait of one historic figure, with a small Apple logo
and the words "Think Different" in one corner, with no reference to the company's
products. The familiar faces on display included Jim Henson, Richard Feynman, Maria
Callas, Miles Davis, Martha Graham, Ansel Adams,Cesar Chavez and others.

Text

Original Version: The original "Long version" appeared on posters made by Apple.

The Crazy Ones

Original

“ Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round
pegs in the square holes.

The ones who see things differently. They’re not fond of rules. And they have no
respect for the status quo. You can quote them, disagree with them, glorify or vilify
them.

About the only thing you can’t do is ignore them. Because they change things. They
invent. They imagine. They heal. They explore. They create. They inspire. They push
the human race forward.

Maybe they have to be crazy.

How else can you stare at an empty canvas and see a work of art? Or sit in silence
and hear a song that’s never been written? Or gaze at a red planet and see a
laboratory on wheels?

While some see them as the crazy ones, we see genius. Because the people who are
crazy enough to think they can change the world, are the ones who do. ”

Full version

“ Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round ”
pegs in the square holes. The ones who see things differently. They’re not fond of
rules. And they have no respect for the status quo. You can quote them, disagree
 with them, glorify or vilify them. About the only thing you can’t do is ignore them.
Because they change things. They push the human race forward. And while some
may see them as the crazy ones, we see genius. Because the people who are crazy
enough to think they can change the world, are the ones who do. - Apple Inc.

Short version

“ Here’s to the crazy ones. The rebels. The troublemakers. The ones who see things
differently. While some may see them as the crazy ones, we see genius. Because the
people who are crazy enough to think they can change the world, are the ones who
do. ”

Reception and Impact

Upon release, the "Think Different" Campaign proved to be an enormous success for Apple
and TBWA\Chiat\Day. Critically acclaimed, the spot would garner numerous awards and
accolades, including the 1998 Emmy Award for Best Commercial and the 2000 Grand Effie
Award for most effective campaign in America.

In many ways, the new ad campaign would mark the beginning of Apple's re-emergence as
technical giant. In the years leading up to the ad, Apple had seen many of even its most
staunch supporters switch over to other competitors in the market offering more
sophisticated and better equipped processors. Even worse, the company had lost hundreds
of millions of dollars due to the failure of Apple Newton, a billion-dollar project that proved
to be critically, and commercially, unsuccessful. Appealing to the "counter-culture" image
Apple had gained in its earlier years, the "Think Different" campaign, along with the return
of Steve Jobs, put a bright spotlight on the company and consequently on many of the new
products that were being announced, chief among them the immensely successful iMac
personal computer and later the revolutionary Mac OSX operating system.
Advertising of the ‘ REVOLUTIONARY ‘ iPOD :

The more notable commercials and print advertising feature dark silhouetted characters
against bright-colored backgrounds. The silhouettes are usually dancing, and in television
commercials are backed by up-beat music. The silhouettes are also usually holding iPods and
listening to them with Apple's supplied earphones. These appear in white, so that they
stand out against the colored background and black silhouettes. Apple changes the style of
these commercials often depending on the song's theme or genre.

The original television commercials and posters featured solid black silhouettes against a
solid bright color, which usually changed every time the camera angle changed. Some of the
television adverts also depict highlights on the silhouettes using darkened shades of the
background color, and shadows on the floor. Since then, various commercials in the
campaign have changed the format further:

 One live action TV commercial made reference to the silhouette theme to emphasize
its icon status. It involved a man walking past a set of silhouette posters, which came
to life and danced when his iPod was playing, but froze when he paused it.

 in 2004, Wired Magazine featured a new service where people could create their
own ipod ads from their personal photos. Service is still active at: iPod My Photo

 The TV commercials for the iPod shuffle used a green background with black arrows
moving in the background representing the "shuffle" icon. The silhouettes danced on
top of the arrows as if they were a moving floor while listening to iPod shuffles
hanging from white lanyards.

 Following the release of the fifth-generation iPod, two TV commercials, one

featuring Eminem and the other Wynton Marsalis, made radical changes to the style,
by exchanging the solid changing backgrounds for abstract composite backgrounds
based around a main color (orange and blue respectively). The camera shots
alternate between the artists performing their songs (Eminem sporting a white
microphone, Marsalis' drummer sporting white drumsticks) and traditional
silhouette dancers listening to iPods. The solid silhouette was also traded for a more
varied silhouette, which shows certain facial features of a person. Apple CEO Steve
Jobs has suggested that this more complex composition will be the style of future
commercials as well.

 In early 2006 a new type of iPod commercial was released. It was thirty seconds, and
it spotlighted album art. The album art was constructed into a city, and then
dismantled and it flowed into aniPod nano and said "1,000 songs in your pocket", the
slogan for the 1st Generation iPod Nano.
 In August 2006, another reimagining of the iPod commercial was introduced through
an ad for Bob Dylan's album available in the music store, Modern Times. In this new
style, the only silhouette facet of it was that it seemed lighting was reduced on the
figure of Bob Dylan and the female dancer, while the iPod was brightened. Color
variation, as well as reflection on the face of the guitar, is evident. The ad is much
more realistic and the people, as well as details, are much more visible. This ad was
an almost complete departure from the traditional, and even the Eminem-styled
adverts of the past.

 In September 2006, Apple once again reimagined their vision of the silhouette ad
campaign to go with the new iPod nano aluminum case. They made a departure
from the contrasting background and characters. Both the characters and the
background are thrown into deeper shadow than we've ever seen before, and, in
order to showcase the new colors of the nano, the characters swing their nanos
around while dancing, which leaves a luminescent light trail.

 In November 2006 Apple used their original style again in their Latino TV Ad.

 Also in November 2006, Apple released a new ad for the second generation iPod
shuffle, which featured people clipping the minuscule player to different articles of
clothing while jamming to the beat of Prototypes' "Who's Gonna Sing?".

 At Macworld 2007, Apple debuted their new ad campaign, featuring a reverse color
scheme of previous campaigns: Colored silhouettes on a black background, as well as
a second styled ad featuring colored silhouettes amongst a dynamic, moving and
multi-colored background.

 Paul McCartney walking and strumming a mandolin performing his song "Dance

Tonight" being very much like an updated version of the Eminem commercial, having
backdrops of buildings and featuring McCartney walking with animations of shapes
around him.

 In November 2007, Apple released a new ad using a similar formula to the one used
with the "Mi Es Tropical" ad, but with a light emanating from the background as if
the characters were on a stage. This time the ad is featuring Mary J. Blige along with
a group of dancer in silhouette form. The song is "Work That" from the album
"Growing Pains".

 YouTube member njhaley (More commonly known as Nick Haley) created a fan
commercial of the iPod touch. Apple was impressed with the commercial and then
contacted him about putting the commercial on the air. He and Apple's advertising
agency TBWA then got to work on making a more polished version of the Ad which
ran during the 2007 World Series on Fox.[
 In April 2008, a new ad was released following the original formula – but with
animated backgrounds and more detailed silhouettes. The song was "Shut Up and
Let Me Go" by The Ting Tings

 On May 20, 2008, a new ad premiered during the American Idol finale. It follows the
original form but with even more animated backgrounds and Coldplay is shown in
the shadow. The song was Viva la Vida by Coldplay.