Tech: Leopard, Apple's New OS

Luisa Gartner works out with an iPod. She buys her music from iTunes. And next year, when the second generation of iPhone makes its debut, she says she'll probably get one. But does she compute on an iMac? "No. I have a PC," the 26-year-old paralegal says while browsing through a Los Angeles Apple store. "My husband works on a PC, and it's easier if I have to do work at home."

With the release Friday of Leopard, Apple's much-anticipated new operating system, the Cupertino, Calif.-based computer company is hoping to take next a big step forward in getting customers like Gartner--and, maybe even her husband--to jump over to the Mac side. "It's the best upgrade we've ever released," says Lynn Fox, a spokesman for Apple. "It's packed with new, innovative features."

To be exact, Leopard boasts 300 new features. They range from the highly useful, (it automatically backs up anything on your computer) to relatively arcane (it can translate English to Japanese and vice versa). Perhaps most importantly, Apple says Leopard can facilitate virtually seamless networking capabilities between a group of computers--say, the laptop your daughter takes to school, the desktop at your home office and the one you use at work--along with your iPod, iPhone and any other "i"s the company may be cooking up.

"Lots of people have iPods and products that tie them into Apple's eco-system," says Chris McHugh, a tech-company portfolio manager with Berwyn, Pa.-based Turner Investment Partners. "But what Leopard gives Apple is the core ingredient to sell more Macs." And that is something that Apple has been working hard to do recently to great effect.

Earlier this week, Apple reported a 67 percent rise in profits for the quarter ending Sept. 29, largely by selling 2.16 million computers, a 34 percent increase from a year earlier. Apple's market capitalization recently surpassed that of both IBM and Intel. And, analysts say, there is considerable room to grow. Worldwide, Apple has about 3 percent of the computer market, McHugh says, a share that could grow as much as 8 percent in the next three to five years.

How? Apple, says McHugh, has an advantage in having integrated so many products into its customers' lifestyles. Your adorable new baby during his first bath? Take a picture with your iPhone, send it to your Web site, where you (and your whole family, for that matter) can access it from a desktop or laptop and maybe even a television. Leopard "redefines what a computer user experience is like and while it's certainly not putting Microsoft out of business tomorrow, Microsoft really has to be concerned with Apple's resurgence," says Michael Gartenberg, an analyst with Jupiter Research in New York. "The consumer experience--mind share--leads to market share."

Redmond, Wash.-based Microsoft has recently taken considerable flack over Vista, the new PC operating system the company released broadly early this year. It was highly anticipated; Microsoft, parent of the ubiquitous Windows system, tends to release new versions of its operating systems, to much hype in part because they arrive several years apart, in contrast to Apple's practice of updating its systems roughly every 18 months.

But for some, Vista wasn't worth the wait. Users and critics complained of slow start-up times and incompatibility with other programs, among other issues. There were even reports of users remedying the problems by uninstalling Vista and replacing it with its Windows predecessor. A Microsoft spokesperson says many early problems have been addressed and noted that more than 88 million copies sold since the end of January. Sales of Vista and Halo lifted Microsoft's fiscal first-quarter profit by 23 percent and boosted its stock price from $31.99 to $35.55 in after-hours trading Thursday.

Browsing the Apple store before heading to a catch a movie, Luisa Gartner says she's still "fairly happy" with her PC and its Windows system. Unfortunately for Microsoft, Apple's riding high on more passionate endorsements.

Tech: Leopard, Apple's New OS | News