Apple's Tiger, Burning How Bright?

The updated Mac operating system will impress techies and novices alike. But new features may not be enough to significantly boost sales right away

By Peter Burrows

Most people have some passion that would cause them to stand in line for hours -- a playoff game, a rock concert, maybe even a gallery opening. At exactly 6 p.m. on Apr. 29, the lines at a shopping district or mall near you will be at the Apple Store, where Macintosh fans will be waiting to get the latest release of the MacOS software.

Of course, software releases have a tendency to be anticlimactic because they're filled with cryptic features people rarely use, and because they're often late -- sometimes real late. Just ask the folks at Microsoft (MSFT ), which isn't expected to ship the long-awaited Longhorn upgrade to its Windows operating system until late 2006, five years since the last major release.

But Apple's (AAPL ) new software, dubbed Tiger, could surprise on both counts. Apple announced its release plans for the new operating system on Apr. 12. For starters, "this is one of those rare occasions when a major software release is actually early," Apple Chief Executive Steven Jobs joked in an interview with BusinessWeek. And Apple claims the 200 new features in Tiger make it well worth a $129 retail price. "It has turned out just wonderfully," says Jobs. "It's our biggest leap forward since the original Macintosh in 1984."


  It's turning out to be a busy week for the Silicon Valley computer company. On Apr. 13, Apple will announce results for the first quarter of 2005. Most Wall Street analysts expect another strong performance, but they'll be looking hard to see if Jobs & Co. can hit ever-rising sales projections for its hot iPod digital music players -- which vary from around 4 million to more than 6 million per quarter (see BW Online, 4/12/05, "The Little iPod That Could"). Investors will also be looking for signs of whether the iPod is having a positive influence on Apple's computer sales. If they are, it could turn out to be a rosy year.

Certainly, Tiger is proof that Apple isn't ignoring its traditional business. Many of its features are the kinds of behind-the-scenes capabilities that are unlikely to attract much attention but are nonetheless important. Jobs is enthusiastic about a new feature that will allow Tiger-equipped Macs to handle high-definition video.

But Tiger does have some key offerings that could well change the way Apple customers use their Macs. The first is Spotlight, a search capability that allows users to find all references to a topic on a hard drive by filling in a Google-like search field. Type in "April," and it'll display a long list of documents, calendar appointments, e-mails, and other files on the hard drive containing that term. Add a date to it, and the list gets shorter.


  Other companies, such as Microsoft, have introduced so-called desktop search features. But Apple claims that Spotlight is faster because it's built right into the operating system, rather than an add-on. "The company is really underscoring the importance of Spotlight," says Tim Deal, an analyst with research firm Technology Business Research. "I do think it will better enable users to manage the wealth of data they download or install on their computers."

The other headline-grabbing feature is likely to be Dashboard, which is basically a collection of "widgets" that users can click on and then off again with a simple keystroke. Initially, they'll include the familiar desktop calculator and clock, a stock ticker, a currency translator, a real-time airline flight tracker, a tool that gives weather reports, and other useful services.

Apple has also developed a program to let third parties create more of these little features. "This is a really great way to front-end a lot of the Web services that are out there," says Brian Croll, senior director of software product marketing at Apple.


  The big question is whether Tiger will add fuel to Apple's recent momentum in the computer business. After years of losing share, Mac sales have been growing faster than the overall PC market -- thanks, in large part, to added luster from the iPod's "halo effect."

In the short term, Tiger may not provide that much of a boost, says Deal. For starters, it's hard for a software release to gain much attention when new hardware such as the Mac mini and iPod shuffle are already turning heads. Also, convincing non-Mac owners of the new software's benefits can take time. "Honestly, I don't think new consumers are going to get really excited about it," says Deal. "They have to see the immediate value [to go out and get a new Mac], and it's hard to communicate that in TV ads."

Over time, Jobs thinks Tiger could be crucial in expanding the Mac base. "Tiger will give customers one more reason to buy a Mac, because it's so far ahead of Windows," Jobs boasts. The people developing Longhorn "are trying to copy everything they can from it." With more than a year until Longhorn arrives, Microsoft is giving Apple's most famous salesman a long time to convince the world of Tiger's merits.

Burrows is Computer editor in BusinessWeek's Silicon Valley bureau