The Greatest Thing that Apple Has Ever Done

What will be the next killer app?
Joseph RadiganJanuary 8, 2001

(Editor’s note: “Today in Technology,” will cover the corporate technology market on a daily basis. Comments are welcome. Send E- Mails to [email protected])

The week at hand brings two highlights of the annual technology calendar — the MacWorld Expo in San Francisco and the Consumer Electronics Show in Las Vegas.

Published reports have said the products Apple CEO Steve Jobs is expected to introduce will include applications that let consumers use iMacs to record movies into a DVD format.

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Meanwhile, Bill Gates was expected to demonstrate Microsoft’s Xbox video game console over the weekend in Las Vegas. According to the Wall Street Journal, Gates will also unveil Ultimate TV, a satellite- based interactive TV system Microsoft has developed with Hughes Electronics, Sony, and Thomson Multimedia’s RCA division.

The Journal also reported on Friday that Jobs called some of the software applications Apple is planning for the coming year as “the greatest thing that Apple has ever done.” Of all the things Jobs is known for, modesty is not one of them. So such a statement should be taken with a grain of salt.

Under normal conditions, corporate CFOs probably wouldn’t concern themselves with mere games. But these are not normal times, and the consumer products coming from Microsoft and Apple have special importance.

Right now, the economy is in desperate need of a positive catalyst, and as the aftermath of Wednesday’s cut in interest rates has made clear, the Federal Reserve has yet to provide one. A second rate cut later this month, and a third one in March will help, but something more is going to have to happen, and this is where the computer industry’s consumer products can help.

Prior boom cycles in the technology industry were in part driven by the mass appeal of so- called killer apps.

In the 1980s, spreadsheets, word processing, and graphics software helped the personal computer grow into a mass market. A decade later, E-mail and Web browsers sparked an even larger boom. More recently, the expected boom in wireless Web applications contributed to the mad market surge of late 1999 and early 2000. All of that momentum is gone.

A decade or so back, the tech sector was small enough that its booms and busts had little impact on the larger economy, and vice versa. The past few years have changed all that.

This time around, an economic recovery isn’t going to happen unless the tech sector rebounds, too. It may not matter much whether the tech rebound precedes a wider recovery or follows it, but one won’t happen without the other.

Who knows whether the wares introduced this week in Las Vegas and San Francisco will be the killer apps the tech sector needs for a recovery? But sooner or later somebody – – Sony, Microsoft, Apple, Nokia, whomever – – is going to have to sell something that gets consumers once again racking up charges on their MasterCards. Until then, nobody’s going to have any fun and games.