January 6, 2000

Jobs will stay on at Apple

SAN FRANCISCO (AP) -- Capping his remarkable two-year leadership of Apple Computer Inc., chief executive Steve Jobs dropped "interim" from his title on Wednesday and unveiled new Internet services and the next generation of his company's operating system.

Apple also announced a $200 million investment in EarthLink, an Internet service provider that will work with Apple to bring new online features to computer users.

Jobs' decision to become permanent sent a strong signal to the Macintosh and investor community of his commitment to keeping Apple's recovery on track. Still, Jobs said he will continue in his unusual dual role -- he also heads Pixar Animation Studios, the hot studio that produced top-selling films including "Toy Story" and "Toy Story 2."

The news, revealed during Jobs' keynote speech at the MacWorld trade show here, drew gasps and rock-concert level cheers from the crowd of Mac faithful.

"It's a sigh of relief to a lot of Mac enthusiasts," said Rafi Guroian, editor of the Macreactor.com gaming Web site. "There were a lot of questions going around about whether he would stay. And obviously we want him to stay."

Jobs co-founded Apple in 1976 and returned to run it in September 1997. He kept the title of interim chief executive even as he reversed several years of losses by introducing new computers and slashing costs.

On Wednesday, Jobs introduced Internet services to Apple computer users through EarthLink. They include customized e-mail service for Macintosh users called mac.com, new ways to store files, an easy way to set up a personal Web site and a Web greeting card service.

Apple gets a seat on EarthLink's board as part of its $200 million investment.

"We're definitely spreading our wings," Jobs told 6,000 customers, developers and supporters during his two-hour speech.

Jobs also previewed the Macintosh OS X operating system, the next version of the software that runs the basic functions of Apple computers, saying it will be available later this year. Its colorful images include chic, translucent buttons and sliding screens, intended to make it easier to organize and work with computer programs and files.

"It's also meant to look cool," he said.

Jobs was hampered during his presentation by a series of technical glitches that kept him from demonstrating some features of a greeting card service. The reputed perfectionist, dressed for his speech in trademark jeans and running shoes, took things relatively in stride.

"Golly, golly, golly, golly, golly," he said at one point as his computer directed him to log in several times in a row.

Despite the problems, Mac users were impressed.

"I'm sitting in the audience and I realize I'm welling up with tears," said Rob Burgess, chief executive of MacroMedia, a software seller. "I'm spent. I've never seen anything like this."

Under Jobs' leadership, Apple has narrowed its product line from a burgeoning 15 scattered hardware and software products to just four -- the chic iMac desktop and iBook laptop for consumers, and the PowerBook laptop and G-line of desktop models for business.

Rocketing sales -- Apple sold 1.35 million Macs in the last fiscal quarter alone -- have rebuilt the company's financial side.

Apple ended its fiscal year in September 1997 with a loss of $1.04 billion and a stock price of about $21.The company ended its 1999 fiscal year with profits of $601 million. Shares hit an all time high at $118 in 1999, and were at $108 after his keynote speech, up more than $5 from Tuesday despite a Wall Street selloff among technology shares.

Apple stock eased by late Wednesday, up $1.50 a share at $104.