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Analysts Say Machine Needs Further Expandability : Apple Unveiling Macintosh Plus

January 16, 1986|DONNA K. H. WALTERS | Times Staff Writer

SAN FRANCISCO — Much of the talk about Apple Computer lately has focused on what it doesn't have.

Apple doesn't have its two Steves--founders Wozniak and Jobs--anymore. Not to mention about 1,200 others who used to work for the Cupertino, Calif.-based computer company.

It doesn't have its arrogant, we're-going-it-alone attitude, and so it doesn't have an arrogant and splashy television commercial to run during the Super Bowl, as it did in 1984 and '85.

It doesn't have a reputation as a stodgy company yet, but it doesn't have much left of its old nerd- cum -wunderkind persona, either.

Firm Doing Fine

Not to worry, Apple President John Sculley seems to be saying, Apple's doing fine without them, thank you. And there are those who agree with him.

But the biggest thing that Apple doesn't have--and even Sculley knows it--is a desk-top personal computer that lots of Fortune 500 companies want.

After today's scheduled unveiling of the Macintosh Plus computer, Apple still won't have it.

Analysts who have seen the machine say the Macintosh still needs further expandability and a way to link up with IBM-compatible offices. Sculley tacitly agrees, calling the Mac Plus "an important first step" toward meeting those needs.

At its three-day Apple World Conference here for dealers, analysts and users, Apple will show the Mac Plus, the new LaserWriter Plus, its enhanced printer, as well as strategies for the coming year and products by third-party developers.

Apple says the Mac Plus has features that the business community wanted but couldn't get with the existing Macintosh, called the Mac 512 because of its 512-kilobyte memory. The Mac Plus has 1 megabyte of internal memory, which means it can store about 500 typewritten pages of information, and a double-sided floppy disk drive with a capacity of 800 kilobytes (or 400 typewritten pages).

Doubling the Mac's internal memory and disk storage will also make it a faster machine; slowness was a common complaint about the earlier Macs.

Mac Plus also will be more expandable than the old machine, with two serial ports so that more accessories can be used.

The new machine has a larger keyboard with built-in cursor control keys and a numeric keypad. The Mac Plus will carry a retail price of $2,595.

Apple is lowering by $500 the price of its Mac 512 to $1,995. It already has been discounted by many vendors to that price level, and analysts expect that the new street price of the Mac 512 will settle at between $1,600 and $1,700.

'Many False Starts'

Sculley acknowledged that Apple has made "many false starts" in its attempt to capture a viable chunk of the business market now dominated by IBM Personal Computers and compatibles. So, for businesses that already have Lisa and Macintosh XL models, Apple will offer special trade-in deals for a Mac Plus and hard disk drive.

Additionally, Apple is introducing upgrade kits that will allow owners of Mac 512 or original Macintosh 128K models to give their machines the new Mac Plus features. Analysts believe, however, that the Mac Plus needs additional enhancements to make it truly "open" to a wide variety of accessories and allow it to communicate with IBM PCs and compatibles. Apple has said that such products are in development but that it could be another year and a half before they become available.

The new LaserWriter Plus, with a price of $6,995, or $1,000 more than the existing version, also will be a faster machine. The LaserWriter Plus will be able to present printed material in 35 different typefaces, accentuating what many users already praise as stunning graphics capabilities.

The new machines are intended to lead Apple's headlong assault on the desk-top publishing field--an emerging market that analysts say will become increasingly important.

Analyst Doubt Breakthrough

Analysts doubt that the new products will open up vast new sales opportunities for Apple at large corporations.

But they will help attract the small-business market, said Ralph Gilman, vice president of Infocorp, a Cupertino-based market research firm.

In those companies, Gilman said, "people are spending their own money, and they're very price sensitive." The changes will "help establish Macintosh in those markets," he added.

While Apple works to develop the products that will help it crack the lucrative Fortune 500 market, Sculley said, it will continue to concentrate its energies on the education and home markets, where its Apple II products flourish, and on small and medium-size companies.

Sculley denied that Apple was shrinking from its stated goal of selling to larger companies.

"Our strategy hasn't changed," he said. "We just haven't been able to implement it. . . . I think we have a much better grasp now on what it will take to implement it."

In an oblique reference to the turmoil created by the reorganization and acrimonious departure of former Chairman Steven P. Jobs last year, Sculley said this week that as "1985 was the year that Apple grew up, 1986 will be the year that its products grow up."

Position Improved

So far, Sculley has managed to turn the loss of personalities and brash image into pluses. Earlier this week, Apple reported record first-quarter profits on 23% lower revenues, a richer cash position and more manageable inventories, proving the virtues of a reorganized, leaner and more humble company structure.

"We very carefully put together plans that do not need any growth in revenues," Sculley said. "But I stick by my statements that we will significantly improve our earnings and increase research and development expenditures by 50% this year."

Analysts say, however, that Apple can only sustain such patterns for so long. "It's got to find some new growth markets pretty soon," Infocorp's Gilman said.

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