Apple Year in Review Part II

Starting the second half of the year with a whimper was the release of a revamped U2 iPod. An iPod inscribed with the signatures of the most self-important, pretentious band of recent memory? Baby steps, one supposes. In any event, the new U2 iPod retained the same garish color scheme and added a black stainless steel enclosure. Capacity received a bump to 30 GB (the same as the pedestrian regular iPods) and those yearning for more time spent staring at the band the new U2 iPod came with a coupon for 30 minutes worth of U2 video. All this, and more, could be yours for a mere $239.99 starting on June 6.

The rest of June, like most months of 2006 was marked a thin, but steady trickle of content for the video section of the ever increasingly misnamed iTunes store until June 29 rolled around. On that day, Apple announced that the company was conducting an internal investigation of stock option grants. The move was nothing unusual, many silicon valley companies had dispensed options in questionable ways and were investigating. Apple, according to Steve Jobs, was “focused on resolving these issues as quickly as possible.”

The eMac had been on Apple life support for some time. What once looked like a classic iMac after ingesting the contents of Rafael Palmeiro’s medicine cabinet seemed positively antiquated when compared to the iMac G5 and later revisions. Apple decided to take care of two problems at one time by announcing the eMac would no longer be in production and unveiling a replacement for the aging hunk of white on July 5. Instead of a school worthy and new eMac Apple’s made for education Mac was simply a 17” iMac with a smaller $899 price tag and a couple of specification changes compared to the consumer version.

Two weeks later news investors can use was the order of the day as Apple announced third quarter results. As with every other quarter in 2006 the results were cause for celebration as Apple raked in an impressive 4.37 billion dollars while it managed to keep a cool 472 million in the form of profits.

After a few months without any hardware changes of note, and Apple fans are a hardware obsessed bunch in general, the moment was ripe for a new piece of hardware that would blow people’s minds. Apple stepped up to the plate, took a mighty swing and hit a blistering line drive home run when the company released a wireless version of the Mighty Mouse. Naturally, the blogosphere erupted and the new mouse was…. Wait, scratch the previous paragraph, that isn’t at all what happened. On July 25, almost a full year after the corded Mighty Mouse debuted Apple released a wireless Mighty Mouse. The biggest reaction was: Geeze man, what took so long?

The first week in August saw the kick off of WWDC (World Wide Developer Conference) and with the WWDC a lot of new stuff was thrown at Mac users. The most intriguing thing was the preview of Leopard, Apple’s next release of OS X. The features ranged from positively goofy (Photo Booth effects in iChat) to impressive (Time Machine should prove useful) the real driver behind conversations was what Apple didn’t show off. What didn’t Apple show? No one outside of Cupertino knows but Steve Jobs said that Apple was keeping some features under wraps to stop Microsoft from, well, copying any killer feature Apple might include in the actual release.

Surprisingly the developer conference also sowed the seeds for griping about one of Apple’s biggest developers Adobe. Why was the desktop publishing giant in hot water because of events at WWDC? Simply because Apple completed the transition to Intel when the company rolled out a Mac Pro and Xserves based on Quad 64 bit Xeon processors. Once the transition was completed (a year ahead of schedule) pundits began taking aim at companies like Adobe for not keeping up with Apple. That will teach major software developers to take Steve Jobs at his word.

A mini scandal had been brewing since the publication in mid June of an article accusing Apple subcontractors (specifically Foxconn) of running iPod manufacturing facilities like sweatshops. The obvious solution would have been for Steve Jobs to point out that though the factory workers in Asia made very little money (as low as $54 per month) while working oppressive hours he earned a solitary dollar a year but he didn’t. Instead Apple investigated the claims. On August 17 the company issued a report that concluded that a few small violations of Apple policy had occurred but nothing grievous enough to cause a major shift in manufacturing.

September 12 was a big day for the iPod with three new iPods introduced. Actually calling all three iPods “new” is a bit of a stretch. The iPod was slightly tweaked with a brighter screen, more capacity and a lower price (to Microsoft’s chagrin) but other than that it remained the standard iPod everyone has come to know and love. Major changes were in line for the nano. Gone was the iPod baby brother black and white look replaced by a retro mini motif. Colors and aluminum were back and battery life was extended to 24 hours. Capacities were also changed, the nano now topped out at 8 GB with 2 and 4 GB models available as well.

What about the 1 GB nano? That model was simply gone. For those only requiring one GB of musical storage fun Apple introduced a new shuffle. As thin as a pencil with length and height dimensions reminiscent of a matchbook the shuffle went from product that Apple needed to drop to a product many people needed to own. To go along with all the new iPods floating around Apple went ahead and released iTunes 7.0. The release was, of course, the greatest version of iTunes ever according to Apple but had many users wishing they waited to upgrade.

October 4 saw another entry in the scandal that refused to die when Apple released the findings of a committee appointed to investigate the stock option problem. Te report concluded that Steve Jobs was not in any way culpable, no current employees had anything to do with the mess and that the irregularities occurred between 1997 and 2002. In what was surely not related in any way (wink wink, nudge nudge) Fred Anderson’s resignation was also announced.

When people see a red iPod the naturally think U2. When people think of U2 they think of Bono. When Bono isn’t hinking of U2’s next over-produced pop hit he is thinking of ways to help the world. Part of Bono’s solution was (PRODUCT) RED. While plenty of other companies were already selling red baubles to fund the fight against aids in Africa Apple joined the effort when the company announced the iPod nano (PRODUCT) RED. There is no information on whether there are discussions between (PRODUCT) RED and Apple on trading capital letters for lowercase options but the prospect is tantalizing, imagine the Nano or Shuffle and (Product) Red all living in perfect harmony.

Mid October is the traditional time for Apple to report earnings. Steve Jobs wasn’t spinning when he said:

“This strong quarter caps an extraordinary year for Apple. Selling more than 39 million iPods and 5.3 million Macs while performing an incredibly complex architecture transition is something we are all very proud of. Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history.”

The rest of the year was rounded out with a few chip updates, iPod integration on flights by select air carriers, additional content in the iTunes store and another development in the scandal that refused to die when Steve Jobs retained private legal counsel in the continuing options investigation.

If you’re a fan of Apple you’d be forced to call the year a stellar one for the company. Not only were profits soaring the adoption of Macs was increasing and the future looks very bright. Surely someone will note that the year in review only mentions the Zune a single time and that is only in passing. The question arises: how can any year in review column skip what is probably the most talked about event of the year? The answer is simple, for all the hype, hand wringing and hedging right now the Zune, like every other “iPod killer” that has preceded it just doesn’t matter.