The deal marks the largest corporate merger ever and will create a telecommunications titan able at last to take on market leader AT&T on relatively equal terms.
The buyout ends a bidding war for the hand of Sprint, which began when telephone company BellSouth got wind that MCI WorldCom was making an offer to acquire long distance its rival. After a dramatic few days of marathon negotiations, Sprint's board of directors finally accepted MCI WorldCom's sweetened offer last night.
"I think Sprint was looking to align with a player known for its aggressive behavior," said Boyd Peterson, a telecommunications analyst with the Yankee Group. "Any company in this business is looking at high growth in the Internet and data sides, and looking to shed slow growth assets. Joining with a Bell [local phone company] would be the opposite of that."
The merger is the latest example of rapid consolidation in the telephone industry, brought on by deregulation and the convergence of voice, video, and data services. Most regional Bell phone companies--with the notable exception of BellSouth--have combined, and long distance carriers such as MCI WorldCom has been aggressive in corporate buyouts as well.
The total value of the deal, which had been expected, is about $129 billion and will involve the exchange of about $115 billion in common stock and another $14 billion in debt and preferred shares. The new company will have more than $50 billion in revenues.
The deal values Sprint's phone business at about $76 per share in stock. Under the terms of the agreement, each share of Sprint PCS Group will be exchanged for one share of a new WorldCom PCS tracking stock and 0.15 shares of MCI WorldCom stock.
"The economics of the combination are particularly compelling," MCI WorldCom CEO Bernard Ebbers said. "The merger with Sprint is particularly timely as wireless communications emerges as a critical component of full service offerings."
Ebbers will retain the position of chief executive officer of the new company, and Sprint CEO William Esrey will become chairman.
MCI WorldCom has sought Sprint largely because of its national wireless phone network, analysts said. MCI WorldCom will now provide services to Sprint's 4 million PCS wireless subscribers and 1.7 million paging and advanced messaging customers.
The combination also would include Sprint's Internet businesses. "Sprint ION will enable the merged company to provide end-to-end integrated broadband services for the home, as well as for the business market, as an alternative to traditional cable and telephony providers," Esrey said in a statement.
MCI WorldCom said it will also offer a nationwide broadband access alternative to both cable and traditional phone service through a combination of high-speed digital subscribe line (DSL) facilities and fixed wireless access using the combined company's nationwide MMDS spectrum.
The deal must first, however, clear some high regulatory hurdles. Federal Communications Commission chairman William Kennard said last week that he would give a Sprint-MCI WorldCom merger close scrutiny and hinted that the companies would likely have to shed some assets to win approval.
Most analysts said the combined companies would have to sell Sprint's extensive Internet backbone, much as MCI sold off its Net assets when it merged with WorldCom.
If all goes well with regulators and shareholders, executives of both companies anticipate the merger to close in the second half of next year.
Although spurned by Sprint, BellSouth still could seek parts of the long distance carrier's business.
BellSouth raised its initial offer for Sprint yesterday in its unsuccessful attempt to outbid MCI WorldCom, according to reports.
Linux seller Caldera Systems is out shopping for investment firms to help it with an initial public offering, and sources say the leading contenders are Goldman Sachs and Morgan Stanley Dean Witter.
Sources familiar with the company's plan said several investment banks have approached the company, including Goldman Sachs, Morgan Stanley Dean Witter, SG Cowen, and Hambrecht and Quist. Merrill Lynch also approached the firm in 1998, sources said.
Red Hat, the first Linux seller out of the gate, went public in August, raising $84 million and seeing its stock soar from $14 a share on the first day of the IPO to its current price of 88.69. Goldman Sachs was one of Red Hat's underwriters.
The Linux operating system is a clone of Unix, first created by Linus Torvalds, then a Finnish graduate student. In the past year, the buzz around Linux as an operating system for servers--and more--has grown tremendously.
Caldera isn't the first to catch Linux IPO fever. Linux computer maker VA Linux Systems' plans are imminent, and Cobalt, which makes single-purpose servers using Linux, already announced its intent.
Meanwhile, LinuxOne, a 13-person company founded in March that doesn't yet have a final version of its product, is also trying to get a piece of the action.
Spokespeople for Goldman Sachs, Merrill Lynch, and Morgan Stanley Dean Witter declined to comment for the story. Caldera Systems spokeswoman Nancy Pomeroy said that going public "remains an option, as it always has been. We don't even have a timeline. We are getting our financial house in order so it can be an option at the appropriate time."
However, sources familiar with Caldera Systems' plans tell a different story, saying the IPO is scheduled for the end of November. The company has set aside special stock for the open-source companies that have helped Caldera--the KDE programmers who have improved Linux user interface options and Troll Tech programmers who helped Caldera with its Lizard installation routine.
Though the company has been a bit nervous with recent Microsoft remarks sending tech stocks down, odds are the IPO will go ahead.
Caldera Systems is "something we've been expecting for while," said International Data Corporation analyst Dan Kusnetzky. Caldera systems' software--with its roots connected to former Novell chief executive Ray Noorda--works as a good bridge between Linux and Novell NetWare, acting like a NetWare server and providing NetWare services, he said.
In addition, Caldera Systems has strong ties with companies that tie together Caldera's software with their own, Kusnetzky said.
However, he said, "They need to strengthen their message that makes them a distinctive Linux distributor," he said. "In some cases it's hard to tell what Caldera is doing and why it's different from Red Hat."
Refurbishing Caldera
Last week, the company snared Mike Ballangee away from IBM, Pomeroy said. Ballangee was the person who drove IBM's alliances with several Linux sellers, including Caldera Systems, Red Hat, SuSE, and TurboLinux.
At Caldera Systems, Ballangee is now director of strategic alliances and business development.
In addition, Caldera Systems announced last week that Fujitsu will distribute servers with Caldera OpenLinux and that the two companies will jointly promote the products. In addition, Caldera will provide back-end technical support to Fujitsu Linux customers as well as train Fujitsu personnel in Linux.
The deal will give Caldera a foothold in the Japanese market, where TurboLinux currently dominates, according to market researchers.
In the longer term, Fujitsu and Caldera Systems "will work together to move OpenLinux Server Edition to laptops, PCs, personal digital assistants, and more." Specifically, the companies are eyeing cell phones and appliances that connect to the Internet.
The word from above at Compaq Computer is make it cool.
Taking a cue from Apple's success with the iMac and Sony's with its Vaio portables, Compaq will unveil two new products today--the Presario 3500 slimline PC and ultra-portable Presario 305 notebook-- that emphasize color and design, as well as a new desktop that incorporates the 700-MHz Athlon from AMD.
Compaq's shift toward style, which comes down as an edict from new CEO Michael Capellas, underscores a booming trend among PC manufacturers to give their products distinctive personalities through size, shape, and hue--rather than simply beat each other up over performance and price.
"It's come down from our new CEO Michael Capellas that we must make cool products, with passion behind them, and connection to the Internet," said Trey Litel, Compaq's marketing manager of Internet services for U.S. consumer products.
"We're realizing the consumer is really responding to design, similar to the way the car industry developed," Litel said. "We're so obsessed with clock speeds and such--we're missing the point. We need to differentiate on design."
Coincidentally, Apple is expected to unveil new iMacs today.
The Houston, Texas-based company, of course, is not the first company to play the design card. Apple's iMac, and G3 desktops with color accents, have been the basis for a financial and marketing reversal for the company. The slim, magnesium-cased Vaio notebooks became Sony's breakthrough computer with U.S. Consumers. Gateway, meanwhile, introduced a slim desktop with a built-in flat panel monitor this year. Yesterday, IBM released notebooks with snap-on color covers.
More are on the way. Dell will later this fall release a small, curved Pentium III computer, code-named the Webster. Custom-colored cases that come with company logos, university mascots, or other artwork also likely, executives at Dell have said. Executives at other companies also hint that further variations on the theme are coming.
The first model in the Presario 3500 series is the 3550, a 500-MHz Celeron PC with 64-MB of RAM, 8-GB hard drive, 8-MB video memory CD-RW drive, 56k modem and 15-inch LCD flat-panel monitor.
The magnetic blue colored slimline PC, which will sell for $1,999, is a departure from Compaq's current line of overstuffed Presario PCs. The box is 60 percent smaller than the Presario 5700 series, measuring a slim 11.8 x 3.4 x 12.6 and weighing in at a lean 13.2 pounds compared with 31 pounds for the Presario 5736.
"Our target market are second-time PC buyers looking for something cool for a different part of the house than in their office," said Litel. "They're more for the higher end of the market than for the people who buy our entry-level systems."
That market includes music aficionados, for which Compaq is offering flat speakers and subwoofer from Monsoon.
Compaq is betting the small size and sleek LCD monitor will also widely appeal to the "Sharper Image" set.
"LCD models are very attractive to consumers, but there won't be more widespread acceptance until the prices come down more," said Lindy Lesperance, analyst with Technology Business Research. The optimum price is around $1,500, said Lesperance.
Compaq hopes to achieve that through a $400 rebate program offered to consumers that sign-up for three years of Internet access with CompuServe.
PC manufacturers are increasingly incorporating LCD displays in new design models. Sony in February broke ground on the market with the Vaio Slimtop LCD Computer. More recently, Gateway and NEC jumped into the game with all-in-one PCs built around LCD displays.
Compaq decided on a multi-piece system for support reasons. "Should you ever have to send the system in for repair, at least you can keep the LCD monitor for use with another PC," said Litel.
Compaq's other trend setting consumer PC introduced today is the Presario 305 notebook. The Presario 305 is an ultra-thin notebook, less than 1-inch thick, and weighing only 3 pounds. It is essentially the consumer version of the Armada M300 corporate model announced in July.
The Presario 305 is available in a lighter iridescent blue than the 3550. It comes with a 333-MHz Celeron processor, 11.3-inch TFT screen, 64-MB of RAM, and 4.3-GB hard drive, for $2,199.
Compaq plans to unveil other new systems, including the Presario 5900Z, which is based on AMDıs 700-MHz Athlon processor. The 5900Z, which will only be available initially on a build-to-order basis direct from Compaq, will start at $2,185 with 17-inch monitor.
Compaq is also adding new models in its Presario 1800 and 1900 notebook line.
Starting today, all Compaq Presario systems, will feature Al the technician and free Internet access from NetZero.
Systems giant Sun Microsystems and data networking leader Cisco Systems tomorrow plan to announce further developments in an ongoing alliance, according to sources, with the duo focusing on providing hardware and software for use in communications networks.
Both Sun and Cisco spokespeople declined to comment, but a press teleconference is scheduled for tomorrow.
The deal centers around "universal messaging" technologies, according to sources familiar with the company's plans. All-in-one messaging systems allow individuals to access information--whether it be faxes, email, or voice mail--in one place. Universal messaging has become a hot area as Internet service providers and telecom carriers look to provide a wider array of business services to boost revenue.
Consultants Cap Gemini are also involved in tomorrow's announcement, according to sources, likely as a third-party integrator of the two companies' technology. The deal will include both hardware from Sun and software from the Sun-Netscape alliance, now called iPlanet.
Cisco has collected various pieces of the telecommunications software puzzle in recent months, both by purchasing tools that can connect Internet-based systems to the classic phone network and acquiring software that supports advanced features such as universal messaging.
In January, the company disclosed plans to release new technology as a result of an acquisition that will allow developers to build voice applications for a Net-based layout. That was followed in April by two more telco-focused acquisitions: GeoTel Communications and Amteva Technologies.
All the technology could play a possible role in forthcoming offerings from Sun and Cisco.
The move builds on Sun's strategy to expand the role of its high-end computer systems in service provider and voice carrier networks. Sun announced a similar deal with Cisco rival Lucent Technologies last summer. A key Netscape executive has quietly left America Online amid numerous high-profile departures from Netscape's top ranks.
Lori Mirek left this summer after a brief tenure as vice president and general manager of Netscape Business Solutions for AOL, the company confirmed. Prior to AOL's acquisition of Netscape in March, Mirek was Netscape's senior vice president of marketing.
Mirek left to pursue other opportunities following a "little bit of a reorganization and reallocation of resources" in her division, an AOL representative said today. AOL declined to comment further, but a source close to the company said Mirek was not happy with the position that remained after the reorganization.
Mirek could not be reached for comment.
In the August reorganization, AOL moved Netscape Business Solutions, responsible for sales of Netscape's e-commerce products to AOL partners and other customers, from under the oversight of AOL Interactive Services chief operating officer Mayo Stuntz to that of Netcenter division head Jim Martin. Mirek was not replaced.
Mirek is hardly alone among Netscape executives who have left AOL or scaled back their duties significantly since the acquisition. Just last week, key Netscape executive Barry Ariko said he was stepping down from his role as deputy general manager representing AOL and Netscape in the Sun-AOL alliance, but that he would remain at AOL for the time being.
After acquiring Netscape in March, AOL trumpeted the roles that Mirek, Ariko, Netscape cofounder Marc Andreessen, and Netcenter general manager Mike Homer would play in the new organization. In a statement, AOL said Mirek would have "significant responsibilities in the Interactive Services Group."
Six months later, Mirek is gone, Ariko has given up his position, Marc Andreessen has relinquished his title as AOL's chief technology officer, and Homer has stepped aside as general manager of Netcenter. In addition to these developments, a substantial exodus followed the merger.
Gemstar, known for its VCR programming technology, is expanding into new markets with the acquisition of TV Guide. While TV Guide is best known for its print publications, it also operates a fast growing and popular service called TV Guide Interactive that holds significant strategic importance for Gemstar.
TV Guide Interactive is an "electronic programming guide," or EPG, which lets viewers check listings by time, channel, category, or name, and use the service for such conveniences as scanning program schedules in advance. While such uses sound simple, they present enormous business opportunities as the EPG becomes one of the most-used applications in the digital TV set-top boxes that are being developed and deployed by cable companies.
"The electronic programming guide is going to be the TV portal to any of the interactive stuff that is to come," said Leslie Ellis, analyst with Paul Kagan Associates.
These guides are important because they will be the equivalent of Web browsers for cable and satellite TV, allowing consumers to navigate an increasingly complicated array of program choices. They are cited by consumers as the most popular reason to subscribe to the new digital TV offerings from cable companies.
As such, EPGs are a significant piece of screen real estate to control, especially as cable companies start to use these guides to offer viewers the ability to buy merchandise related to ads or shows they've seen.
"The combined company will have the technology, sales force, and advertiser customer base to be well positioned to compete in these highly competitive areas of advertising and e-commerce on a global basis," said Joe Kiener, chairman and CEO of TV Guide, in a prepared statement.
Ellis said TV Guide already has agreements to use its EPG with the majority of cable operators, including AT&T. There are about 2.3 million users of TV Guide's EPG currently, and that number is growing rapidly as cable operators deploy digital cable services to more communities. TV Guide also has 28 million viewers of its older TV Guide Channel service, which isn't interactive, over 73,000 visitors to its online site, and 34 million readers of its magazine publication.
Gemstar, meanwhile, has solid hooks into the consumer electronics industry. Its technology has been licensed to most major TV and VCR makers and is available on a worldwide basis.
This combination could make it harder for other companies competing in this space--including Microsoft, with its WebTV offering, America Online, and Excite@Home--to get their technology into next-generation digital TVs and cable set-tops.
The move also puts battles over technology standards for digital television in a different light. Consumer electronics and cable companies have been wrangling over issues such as passing digitized data from a cable set-top to a TV set. The new company, called TV Guide International, has an opportunity to become a bridge between the two groups--and to profit from that position.
Gemstar said TV Guide shareholders will get 45 percent of the newly combined company. The acquisition price represents a 32.4 percent premium for TV Guide's shares, based on Friday's closing price of 41.05. Gemstar also will assume $600 million in debt to pay for the transaction.
Gemstar chief executive Henry Yuen will hold the same position in the new company. The board of directors will be expanded to 12 members, with six appointed by each company.
Gemstar said the combined company will have revenues in excess of $1.5 billion and yearly earnings of $400 million.
Trading in both companies was halted prior to the announcement of the acquisition. TV Guide closed at 41.56, up slightly. Gemstar gained 4.06 on the day to 87.68 before trading was stopped.
Bloomberg contributed to this report. Microsoft has fixed a security hole that threatened the privacy of its 40 million Hotmail users in August, according to the results of an outside audit released today.
The announcement disclosed only that a "Big Five" accounting firm reviewed the "nature, extent, and cause of the problem," as well as the solutions that Microsoft put in place. As part of the audit, Microsoft employees who fixed the hole were interviewed, and the unnamed firm tested the solution to make sure the problem wouldn't reoccur.
As previously reported, the review of Hotmail was commissioned after the service was pulled offline for two hours when it was discovered that accounts could be accessed without passwords as long as a user's name--which is commonly found in a Hotmail address--was known.
Microsoft said it fixed the problem the same day and has since admitted that the hole was the result of a string of code that hadn't been tested for security.
Microsoft in August voluntarily agreed to the audit at the request of the Web privacy seal program Truste. Until today, however, there had been doubts about whether any results of the audit would be made public.
Based on guidelines set by the American Institute of Certified Public Accountants (AICPA), which oversees the conduct of major firms, Microsoft and others participating in the audit were restricted from releasing the accounting firm's full report.
"Both Microsoft and Truste have confirmed that we've effectively resolved that incident, and that we are in compliance with Truste's licensing agreement," Richard Purcell, data practices director at Microsoft, said today.
"The firm had technical experts, and they were careful about reviewing the solutions we put in place at the code level," he added.
Truste, which monitors participating sites' privacy practices, asked the company to undergo a voluntary review by an unnamed Big Five accounting firm. Truste licensees must ensure they will "help protect the security" of the information they store.
Watchdogs skeptical
But consumer advocacy group Junkbusters had called for full
disclosure of the report, insisting that if the results weren't made public, Hotmail users would have no assurance that their accounts are safeguarded.
Despite the announcement that Hotmail is secure, Jason Catlett, founder of Junkbusters, was not satisfied with the level of detail in the companies' announcement.
"All Microsoft and Truste are saying is that someone went in with a notebook and pen and asked questions, but the company is not revealing the name of the auditor or the instructions to the auditor--the summary is vague," Catlett said. "They had the chance to commission an audit that could have been open."
Specifically, Microsoft had commissioned an "Agreed-Upon Procedures Engagement," in which the parameters of the review are set by the certified public account, the client, and usually a specified third party, in this case Truste. The results of this type of report can only be made available to those parties, according to the AICPA.
The online industry and the Clinton administration have endorsed so-called privacy seal programs as a way to safeguard anonymity. But as more Net users provide valuable personal information in exchange for goods and custom Web content, privacy advocates say better laws are needed to shield privacy, because industry guidelines don't come with strong enough enforcement.
Truste says its voluntary efforts are effective.
"From our point of view this does demonstrate that the resolution process we have in place works," said Bob Lewin, executive director of Truste.
But for Microsoft, the review only puts to rest concern over the August 20 Hotmail security hole. The company has since been investigating programs that people could use to generate false passwords to crack open Hotmail accounts.
Ten months since releasing its SQL Server 7.0 database software, Microsoft has designed an upgrade, code-named Shiloh, that the company hopes will better compete with rivals Oracle, IBM, Informix, and Sybase.
Microsoft has shipped the initial beta version of this next-generation database software, featuring more Web support and improved analysis of business information.
Like its competitors, Microsoft is hawking its new SQL Server as the database needed for building e-commerce Web sites. The new SQL Server database is part of Microsoft's recently announced Web-based software development push, which includes new development tools and the forthcoming Windows 2000 operating system for businesses.
Microsoft ranks fourth in the overall database market, behind Oracle, IBM, and Informix, which includes sales of databases that support Windows NT and Unix operating systems. But in the Windows NT-only database market, Microsoft is in second place--behind Oracle but ahead of IBM--according to an International Data Corporation study.
Analysts say Microsoft's future success in the database market hinges on the success of its forthcoming Windows 2000 operating system, due by the end of this year. Microsoft has worked to make the forthcoming business operating system faster and more reliable to better compete against the Unix operating system.
Improved operating system performance may entice more businesses to use Windows as their operating system, and that in turn could drive Microsoft's database sales, said IDC analyst Carl Olofson.
"It's going to be tough. They could possibly overtake Informix and move into third place, but I have a hard time imagining they could overtake IBM, and certainly not Oracle, in the overall market," Olofson said. "But if you look at NT, you could have a horse race between Microsoft and Oracle."
According to IDC, Microsoft earned $496 million, or 5.1 percent of the overall database market, in 1998. Oracle led the pack with 40 percent of the market, or $3.9 billion in revenue; IBM was second with $1.7 billion in revenue, or 18 percent; and Informix was third, with $556 million in revenue, or 5.8 percent of the market.
Barry Goffe, Microsoft's lead product manager for SQL Server, said Windows 2000 and Shiloh, its next-generation database, will be powerful and reliable enough for large businesses and e-commerce Web sites.
"There are customers building [high-performance] Web sites today on SQL Server 7.0 and Windows NT 4, and Shiloh and Windows 2000 will offer major improvements and performance is not going to be an issue anymore," he said.
Microsoft shipped Shiloh to several hundred customers and partners last week. The company plans to ship a public beta of Shiloh early next year and release a final version by mid-2000. It is already working on a newer, faster version of the database, code-named Yukon, Goffe said.
Shiloh will let its users analyze data with a Web browser for the first time. It will also support XML, a Web standard that simplifies the exchange of data over the Internet and corporate networks, Goffe said.
Microsoft said improvements to its online analytical processing (OLAP) technology will allow users to view simple reports over the Web, such as how products are selling by region or how products are selling by date. "You can slice and dice data over the Internet," Goffe said.
The software giant has built "data mining" capabilities into Shiloh--technology that spits out more complex reports by examining the business information and seeking out patterns and trends, Goffe said. Businesses using Shiloh, for example, can build data mining features into their e-commerce or financial applications.
For an e-commerce site, data mining can profile online buyers, predict the kind of products they're interested in, and make purchase suggestions to them, Goffe said.
With Shiloh, Microsoft for the first time will release a lightweight, mobile version of its database for handheld Windows CE devices, a move to compete head-on with rivals such as IBM and Oracle, which already have smaller versions available, Goffe said. The technology will let handheld users connect to their corporate network and download information such as sales data, and upload new data onto the main corporate database.
Olofson, of IDC, said many of the new features Shiloh offers are, or will be, supported by its competitors. The XML support is important, he said, because it allows businesses with different databases to easily exchange data.
"Microsoft is moving in the direction of open standards and Internet-based standards," Olofson said.
Shiloh also features a performance boost. SQL Server currently supports 3 GBytes of memory, but will support up to 64 GBytes of memory in Shiloh. Microsoft's next database will have even better performance, Goffe said.
Unlike Oracle's database, SQL Server 7.0 doesn't allow for load balancing, which is the ability to distribute transactions evenly to prevent the system from overloading, Goffe said. Currently, users of SQL Server can run multiple databases side by side, and if one crashes the other can take over, he said.
One way to offer load balancing, Goffe said, is to allow multiple databases to share and access one hard drive filled with corporate data. Yukon will offer users load balancing by allowing databases to each support its own hard drive, thereby reducing the network bottleneck that occurs in trying to access information, Goffe said.
Olofson said the technology is already available in IBM, Informix, and NCR databases, and that Oracle has created it's own version of the technology. Adding the load balancing feature to a future version of SQL Server could make the Microsoft database fast and reliable enough for large corporations to use for heavy-duty corporate transactions, he said. Right now, most businesses use SQL Server for less-than-critical uses.
Apple Computer appears to be ready to finally launch the successor to the immensely popular iMac.
Apple posted a message on its Web site inviting customers to view a "special event" tomorrow. In anticipation of the news, Apple stock was up almost 3 points, or 4.51 percent, today, closing at 64.5.
Industry sources expect that Apple will use tomorrow's occasion to formally launch the next-generation iMac along with the new Mac OS 9 operating system software.
The new iMacs are expected to have faster chips and, for the first time, DVD players, sources said. The new iMacs themselves have been ready to go into volume production, but they needed certain software technology present in the OS 9 before they could ship, said one source familiar with the matter.
Apple declined to comment.
New iMacs would come at a time when two other recently introduced products are in short supply, say various resellers contacted by CNET News.com. The iBook notebook computer, introduced in July, was shipped to customers in September--as Apple promised--but only in extremely limited quantities.
Also, the high-end Power Mac G4 systems, especially those with the fastest chips, have been delayed and have only recently started to trickle into customers' hands. Those delays will cause Apple to post lower earnings for the fourth fiscal quarter of 1999 than had been anticipated, the company has said. Apple will report earnings on October 13. Consensus analysts estimates of earnings are now at 45 cents per share, according to First Call.
Anticipation builds
Reseller sources note that Apple has been instructing them to pare down
inventory of the current iMacs. Historically, such moves have preceeded the
launch of new products.
Apple itself has been hinting at the introduction of new products, including the new Power Mac G4 systems, since July. During a conference call, chief financial officer Fred Anderson told financial analysts to expect product transitions in the December quarter (which is the first fiscal quarter of 2000 for Apple).
Apple has previously said that Mac OS 9 would be available in mid-October. Among the features are an update to the Sherlock search technology which would make online shopping easier, as well as offer Apple opportunities to boost revenues by becoming an e-commerce portal. The new OS will be available for $99, Apple has stated previously.
Will new products restore sheen?
Apple has lost some of its luster as a result of the product availability
issues, but analysts have not expressed concern that the issues will last
into the next quarter, mostly because things such as processor availability
were out of Apple's control. A new product launch often has resulted in a
lift for Apple's stock price, and should help boost investor confidence in
the company.
Retailers and financial analysts alike are anticipating that the revised iMacs should be popular items in the upcoming holiday selling season. The systems could be even more popular if Apple decided to offer rebates for Internet service, like other PC companies, analysts say.
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