THIS WEEK’S TECH NIGHT OWL LIVE RADIO UPDATE

Last year, within days after the iPhone debuted, you could easily buy one from an Apple or AT&T store without waiting very long. In fact, I bought mine from the latter; I walked in, went to the circular sales rep booth, and was on my way home five minutes later. So I didn’t think it likely that the purchase experience would involve waiting at three stores, and spending nearly two hours at the task, plus travel time, before I could begin the purchase and activation process.

Despite the known flaws in the activation system in its early stages, and the apparent lingering bugs in the software, there’s no stopping the sales momentum of the iPhone 3G. Apple has finally decided to open their retail outlets at 8:00AM to better handle the pent-up demand. As the device rolls out into more countries, one hopes that the production ramp will keep pace.

So we have one phenomenon becoming even a greater phenomenon. And once again on The Tech Night Owl LIVE this week, you can guess the main topic of discussion. Our featured guest, veteran Mac author and commentator Ted Landau, focused on his iPhone experiences: The good, the bad, and the ugly.

Apple’s latest quarterly financials were given a razor-sharp once over by NPD Group analyst Stephen Baker. Despite great record sales and profits, if you’re watching Apple’s stock price closely, you’ll see that it took a dive. In part, that seemed to be the direct result of concerns about the health of Steve Jobs. He ended up calling a reporter for The New York Times and apparently revealing the truth in a background briefing, so the reporter in question was able to confirm that he has apparently overcome an illness more serious than previously reported, but is apparently in good health now.

However, I remain concerned over why Apple is being so secretive about such a crucial matter. And no, it’s not private. The livelihoods of thousands of Apple employees and the holdings of the company’s stockholders are tightly linked to the ability of its CEO to stay on the job and perform at maximum efficiency.

In addition, prolific author Joe Kissell discussed his iPhone 3G experiences in France, Apple’s MobileMe fiasco and other hot topics. You also received his sage advice on whether Leopard’s Time Machine is the answer to all your backup needs.

Moving to another front, on The Paracast this week, meet Lawrence R. Spencer, “editor” of “Alien Interview,” a work that purports to represent communications with an alien from a retired U.S. Army Air Force Nurse who was reportedly involved in the Roswell UFO case. Our special panel includes UFO investigators Scott Ramsey and Frank Warren. And get your copy free in our Talk About the Show forum.

THE WINDOWS WORLD STILL DOESN’T GET IT!

Just this week, as Microsoft was completing its latest round of corporate musical chairs, Steve Ballmer said they were going to try, once again, to create user interfaces that were easier to use, in the same fashion as Apple. That, of course, was just their latest attempt to graft the Mac look and feel onto their products.

Lest we forget, Windows has always been basically a Mac OS knock-off. They got away with it, because Bill Gates managed to hoodwink ex-Apple CEO John Sculley into licensing Mac technology. So Apple’s pathetic efforts to sue Microsoft into submission years ago got knocked down in the courts time and time again.

So rather than invent new operating system technology, Microsoft prefers to to make their bloated, buggy imitation more Mac-like. So much for the world’s largest software company’s constant claims that it only wants to continue to innovate.

Unfortunately, they need to choose their words with greater precision. There is a distinct difference between innovation and imitation. Maybe someone should hand Ballmer a dictionary.

Whether this “new” initiative will bear fruit is anyone’s guess. Microsoft has always been capable of making promises. Fulfilling them has been far more difficult, and they haven’t learned that throwing lots of money at a problem seldom guarantees a solution. Take the Zune music player, with is still struggling from attempts to match the 2005 iPod, while Apple has long since moved on to bigger and better things.

But Microsoft isn’t the only PC company that makes lame decisions, although in their case, the built-in demand for Windows and Office has been more than sufficient to guarantee great profits. But the stagnant stock price demonstrates that Wall Street remains unconvinced.

As to other PC makers, this week it was reported that Gateway, now a division of Acer, is going to discontinue online sales of their PC boxes. This is only another in a long line of pullbacks in Gateway’s marketing plan.

This time, they want us to believe that there are greater financial rewards in selling products to third party distributors than selling direct. While even Dell has now come to the conclusion that they have to market their wares to different market segments in different ways, I cannot for a moment believe that online sales cost more for a company than the markup they have to allow for independent distribution. The key is to keep prices low in this hotly competitive market, and it doesn’t follow how they’ll achieve that by concentrating strictly on retail distribution.

Certainly, despite all its recent problems, Dell hasn’t given up on online sales, and I’ve never been enamored of their system. You still have to navigate through a byzantine array of different stores and contradictory offers to get the product you want. But isn’t that the Windows way?

Of course, when you look at Gateway, they really survived on smoke and mirrors for a long, long time prior to the merger — or takeover — involving eMachines. Do you remember Gateway’s pathetic effort at running their own retail stores? The way the stores were set up, you would select the computer you wanted, and it would have to be shipped to you. You couldn’t just take one home, as you can with an Apple Store.

Dell’s kiosks are pretty much organized in the same fashion. You can look, you can touch, but, as with the old fashioned Sears catalog stores, there was no retail stock.

I ask you: How can imitating a 100-year-old sales strategy possibly succeed in the 21st century, when you are trying to sell state-of-the art technology products? That’s a question that, I suppose, these failing PC makers still cannot answer, or maybe they just aren’t hiring people who know a lick about retail sales.

When Apple wanted to open its own retail stores, they went outside the company and hired Ron Johnson, a seasoned executive highly skilled at building retail chains. Johnson worked closely with Steve Jobs to build a successful strategy, figuring out the best way to showcase Apple’s products.

It’s clear they succeeded beyond the wildest expectations of most independent analysts, but like all successful business ventures, there’s a constant fine-tuning process. The fabled Genius Bar, for example, gets a far greater emphasis than it used to. You don’t even have to wait for hours to get your turn. You can simply make an appointment in advance at Apple’s site, and, from my experience, you’ll get you face time very close to the set schedule.

Maybe those doctors who care not a whit about keeping schedules could learn a thing or two from Apple.

In the real world, though, PC makers are still doing pretty well, despite the flagging state of the economy. Just when you thought the market was pretty much saturated, there still seems to be plenty of room for growth. Even though Apple won’t play in the entry-level arena, the companies that do continue to push lots of gear through the discounters. I’m not certain just how many excited buyers they’re getting, but the total sales are surely decent, although you can expect greater consolidation, particularly among marginal players.

Apple, however, just gets it. Despite having products that are regarded by most tech writers as premium priced, they continue to sell as many units as they can build and then some. You’ll notice, for example, that Mac inventories were actually lower than normal at the conclusion of the last quarter.

But this hasn’t helped Apple’s stock price. Wall Street still can’t give up their grisly Steve Jobs death watch, and that’s really, really sad.

WHERE IS THE 21ST CENTURY OPERATING SYSTEM?

Some years back, I wrote a book for a now defunct publisher about the first versions of Mac OS X. In the introductory chapter, I presented a screen shot showing the original Mac system desktop and the Mac OS X variation. Forgetting the colors and the various and sundry forms of eye-candy, the real differences are actually quite small.

If you take a person from 1984, send them on a journey to 2008 and pluck them down in front of a Mac, I dare say it wouldn’t take them an awful lot of time to get used to Leopard. The point-and-click fundamentals are very much the same, and the changes are mostly in the area of fine-tuning.

You could, I suppose, suggest that the original Mac graphical user interface was a work of perfection and it didn’t require major alterations to live long and prosper. Certainly, that’s what Microsoft evidently believes.

But is that true? Has innovation in the operating system universe simply stagnated because few big companies are throwing money, and hiring skilled software engineers, to look beyond the traditional?

Unfortunately, it’s not just about funneling enough development money at the problem. Microsoft has demonstrated that it takes a lot more than cold, hard cash to innovate. You need people who are capable of thinking beyond the box, finding new ways to solve old problems without restriction.

In the science fiction world, you might imagine a purely voice-driven method of interacting with your computer, and having the machine communicate with you in the same fashion. Then you don’t need a keyboard, a mouse, or even a touch screen. And before you go on, all you’re doing with that touch screen is making your fingers perform the very same functions they did on the keyboard. They just apply them directly to the screen instead.

In the 1980’s movie, “Star Trek: The Voyage Home,” ship’s engineer Scotty, played with relish by the late James Doohan, was asked to enter some data on a 20th century personal computer. In that case, it was a Mac, one of Apple’s early successes at product placement.

Scotty picks up the mouse, and announces, “Computer,” expecting the machine to function in precisely the same fashion as its 23rd century counterpart. When told that he had to use the keyboard and mouse to perform that task, he remarked with disdain, “How quaint!”

So the question is: Are today’s personal computers quaint? Are manufacturers just perpetuating basic technologies that are more than 20 years old? Can you find a lick of true innovation in today’s Mac? Or is Apple just milking the market until something better comes along?

Indeed, Steve Jobs made a suggestion of that sort over a decade ago, before he returned to Apple. Maybe he is carrying out that strategy. But you have to hope that he has a team of designers who are, even now, working behind the scenes on the Apple campus to take personal computing to the next generation.

If they don’t do it soon, two teenagers in someone’s kitchen or a garage may yet beat them to the punch.

THE FINAL WORD

The Tech Night Owl Newsletter is a weekly information service of Making The Impossible, Inc.

Publisher/Editor: Gene Steinberg
Managing Editor: Grayson Steinberg
Marketing and Public Relations: Barbara Kaplan
Worldwide Licensing and Marketing: Sharon Jarvis

This article was posted on Sunday, July 27th, 2008 at 6:30 PM and is filed under Newsletter and tagged with: Apple CEO, Apple Employees, Apple Store, Bill Gates, Commentator, Gateway, good health, hoodwink, Iphone, James Doohan, John Sculley, knock-off, livelihoods, Mac OS, Mac-like, Microsoft, New York Times, Night Owl, Npd Group, production ramp, purchase experience, Quarterly Financials, record sales, retail outlets, Ron Johnson, sales momentum, sales rep, Scotty, someone, Star Trek, stephen baker, Steve Ballmer, Steve Jobs, Stock Price, stockholders, technology, Ted Landau, Wall Street, Zune.