Go Ahead And Pinch Yourself, It's Steve's Dream Last week Steve Jobs and Co. announced their best quarterly numbers in years, $106 million profit for the fiscal forth. So what does AAPL equity value do? It drifts downward. Of course, the share price of Apple had been rising steeply for days in anticipation of Steve's press gathering which the PC centric mainstream press dissed as unorthodox in style. They were a bit miffed since the rumors that Steve might spill the beans about upcoming new products for 1999 proved unfounded. In fact, the boffo market-hours press briefing was an anti-climatic miscalculation. Everyone already knew the sales and profit numbers were going to be great. Of course, the Steve and Fred show was calculated to proselytize the unwashed pagans on Wall Street. Instead they found that a gaggle of surly bears is hard to entertain. For most savvy Mac investors the iMac is already old news, a slam smash, out-of -the ballpark home run, woohoo. Ok, what's next? What's next is a happy, happy, joy, joy Christmas season with an iMac under every tree for good little boys and girls. 278,000 iMacs have already shipped in six weeks and the rate of sales is accelerating as the Noel approaches. Apple investors can rest on their laurels this holiday season. Rise and make a toast to Mr. Jobs and the crew at One Infinity Loop over turkey and silently gloat that as for the Redmond gang Christmas has been all but stolen by the Justice Department grinches. Hey, perhaps a little profit taking is even in order to buy that G3 PowerBook you really do need. As an anecdote of the iMac’s ascendancy I offer my Saturday trip to our local Austin, Texas Comp USA. to buy a new print cartridge. The store is lame by online catalog standards, staffed mainly by a few pimply faced graduates of the McDonald’s school of customer service with only a handfull of Apple Specialists. There wasn't more than a dozen shoppers in the place but two of them were buying iMacs and half of the rest were crowded around the one iMac demo machine like kids at a petting zoo. The darn thing really is lovable. Like the Volkswagen beetle you don't know whether to hug it or drive it. In fact, purchasers of the iMac in Japan are over fifty percent female. This remarkable statistic, under analyzed by the press, is the first time a personal computer has ever, in the history of the world, found a majority female market. What could it mean? I suspect it indicates that the iMac is going to be remembered as the first truly mass market consumer pc. That's why Apple wants to sell these babies at Best Buy. The iMac is the information age's first consumer-oriented “appliance”. And I mean a stylin’ appliance, as in a 1960’s housewife swooning over her color coordinated Amana stovetop kitchenette range. The iMac is fashionable in the way that Nike or Calvin Klein once were. Only the genius of Steve would ever think to bring a fashion/identity statement to the nerdy world of beige pc boxes. I predict that like Henry Ford who offered the Model T in black only at first but later relented and added color options, Steve is going to inject new zip into iMac sales by offering a summer of ‘99 line of various hues de iMac. It took about fifteen years for the US consumers to go from a few thousand television sets purchases per year to a TV in every living room in America. Now the great central mass of American consumers is waking up to the clarion call of the internet which will prove to be the “killer app” for en mass adoption of the at home computer. The internet is platform neutral and is already the driving force behind most personal computer sales today. That means Macs, unlike in the world of business bloatware, have a level playing field with Wintel PCs. Something like 55 percent of US households are still without a personal computer. Factoid: 30 percent of iMac sales are going to first-time computer buyers! In some as yet to be determined way the Wintel world and Apple are going to divvy up this vast empire of untapped market share in the next few years. Just a year ago Apple wasn't even in shape to be a contender in the consumer space. Now from out of the bondi blue Apple comes roaring back to take its slice of the pie. Which might come to 8 or even 15 percent by the turn of the millennium. No one doubts that Wintel based pc are going to take the lion's share. But who cares? Compaq, Dell, Gateway, Acer and the rest of the pc assemblers have combined sales of 100 million units this year as compared to Apple's 3 million. Even a measly 6 percent market share for Apple would mean 100 percent growth in Mac sales volume, surely to be accompanied by a substantial increase in equity capitalization. The rest of the pc market is expected to grow at a lame 15 percent in 1999. As the two platforms go head to head for consumer's hearts in this important and expanding market, Apple has the sexiest new product and the man with a plan at the helm. Look for Apple's market share to continue to expand through 1999. Go ahead, pinch yourself, it’s Steve's dream.