Apple cuts prices and improves products

Apple introduced a range of new machines on Tuesday, as it gears up for the annual Christmas shopping season.

As part of the launch, it cut the price of its entry-level iBook G4 notebook computer and boosted chip speed across the line.

The new low-end iBook features a 1.2 GHz G4 chip, a combination drive that can play DVDs and burn CDs, and a 12-inch screen. It sells for £749.

A midrange model features a 1.33GHz chip, a combo drive and a 14-inch screen, for £899. The top-of-the-line iBook sells for £1,049 and has the SuperDrive, a drive that can burn both DVDs and CDs.

Previously, the SuperDrive had been available only as a configure-to-order option. "We think this is making the product quite a bit better, able to handle the consumer's complete digital life," said Dave Russell, Apple's senior director of portables and wireless marketing.

With the new iBooks, Apple's notebook line-up is complete for the holidays, said David Moody, vice president of worldwide Mac product marketing. Although the company typically doesn't comment on its future product plans, the pronouncement is Apple's way of dampening speculation that faster PowerBooks are on the way.

Apple has also added faster 802.11g wireless networking as standard to all its iBook models, and Bluetooth is now an option on the whole range as well.

One potential challenge for Apple is that the faster processors and 802.11g wireless networking put the iBook closer in features to the company's higher-end PowerBook line. In particular, the changes encroach on the 12-inch PowerBook, which sells for £1,149 and includes many of the same capabilities as the beefed-up iBooks. The 15-inch and 17-inch PowerBooks have features not included in the smaller model, such as Gigabit Ethernet networking and faster FireWire ports.

Russell said these features and others, such as lower weight and support for a second display, will lead professional customers to opt for the pricier PowerBook. "We think there is differentiation," Russell said. He went on to note: "We're certainly happy if they choose any Apple notebook."

On the desktop
Alongside the update to its iBook line, Apple added a cheaper, single-processor model to its Power Mac G5 desktops, introducing a 1.8GHz machine for £1,099. With that addition, the company's desktop line-up is probably also complete, as it recently introduced updated iMacs.

On top of this, Apple is adding the option of a cheaper Nvidia graphics card for its PowerMacs. The graphics card is capable of supporting the company's 30-inch Cinema Display. That display was announced in June, but just started shipping in volume two weeks ago -- weeks later than Apple had planned.

Finally, Apple revamped its Xserve RAID rack-mounted storage system. The new Xserve RAID systems come in three models. The first features four 250GB modules and sells for £4,599. A midrange model offers seven 400GB modules for £6,549, and the top model offers 5.6 terabytes of total storage for £9,999.

"It's bigger, it's faster and more affordable," said Alex Grossman, Apple's director of server and storage product marketing. Grossman noted that the new systems cost just over $2 per gigabyte, down from about $3 per gigabyte on earlier Xserve RAID models.

The 400GB modules will become available as an option for the Xserve server, allowing owners to increase the storage on those models to 1.2 terabytes. Apple said it doesn't plan to bump up the 2GHz top speed of the machine's processors, even though it did ship some 2.3GHz servers to Virginia Tech for that school's supercomputer.

"Virginia Tech was a one-off," Grossman said. "That is not something we have planned or announced."

The product news follows Sunday's price cut from Intel, which supplies computer chips to a majority of Apple's rivals. Intel has also ramped up its efforts to stimulate holiday sales. The chipmaker lowered prices on its flagship mobile computer chips, including its Pentium M processors and its Centrino bundle.

The fourth quarter of the calendar year is historically the most profitable for computer hardware makers and for many other consumer products companies.