Steve Jobs's Macworld Keynote: An In-Depth LookSteve Jobs's Macworld Keynote: An In-Depth Look

It'd be a cheap shot for me to say that Steve Jobs's Macworld keynote this year was a little bit of a let-down. It'd be true, but it'd be a cheap shot.

I think Jobs himself was aware this isn't a revolutionary year for Apple -- he omitted his characteristic "one more thing," the statement used in past years to signal the introduction of game-changing technology.

Still, Jobs introduced a slew of meaty and attractive new products and services at his keynote Tuesday. The ultra-thin MacBook Air is guaranteed to be the notebook computer of choice for the fashionable geek this year. Updates to iPhone and iPod Touch software will make the devices more easy-to-use, useful, and fun. New wireless backup technology will make it a lot easier for users to protect their data.

And one of the announcements might prove revolutionary after all: The package of movie rentals over iTunes, along with upgrades to Apple TV. But it's too early to tell whether movie rentals will transform home theater the way iTunes and the iPod transformed the music industry. iTunes movie rentals will launch with a very limited selection -- although the business could prove formidable indeed if Apple can ramp up its catalog rapidly.

Everybody's talking about the MacBook Air and iTunes, so I'll run down the keynote in chronological order, which will let me highlight some of the less prominent -- but still interesting -- announcements, and describe what it was like to be there.

Introducing Time Capsule

The keynote kicked off with a viewing of a recent I'm a Mac/I'm a PC commercial, with a "Happy New Year" theme. The Mac guy was happy because he had a great year. The PC guy... not so much. But the PC guy was looking forward to a great 2008, copying what the Mac did in 2007.

Jobs took the stage dressed as always in black mock turtleneck sweater and jeans. "Thank you for an extraordinary 2007," he told the audience, and then trotted out the statistics: Leopard shipped 5 million copies in 2007, making it the most successful Mac OS ever. Nineteen percent of the Mac OS X installed base has upgraded.

He introduced Time Capsule, a hardware companion to Leopard Time Machine backup software. When Leopard shipped in the autumn, Time Machine required backing up to an attached external or internal hard drive, which is especially inconvenient for notebook users, who need to be able to take their devices with them. Apple introduced the Time Capsule home backup server to allow wireless backup. The Time Capsule includes a built-in 802.11n Airport Extreme base station, with a server-grade hard drive. "You can back up every Mac in your house to one server," Jobs said.

The Time Capsule will come in a 500 Gbyte configuration, priced at $299, or 1 Tbyte for $499.

Jobs broke for another I'm a Mac/I'm a PC commercial. This one showed the Mac guy duplicated many times, to illustrate Time Machine, which the PC guy found annoying. Oh, that PC guy, how put-upon he is!

iPhone Upgrade

Jobs then transitioned to talking about the iPhone.

"Today happens to be exactly the 200th day since the iPhone went on sale," he said, "and I'm extraordinarily pleased to report that we have sold 4 million iPhones today." That's a rate of 20,000 per day, he noted.

In its first quarter of availability, the iPhone became the second-most popular smartphone available, with 19.5% market share, topped only by the RIM BlackBerry, with 39% market share -- statistics which Jobs attributed to Gartner. The iPhone has more market share than Palm, Motorola, and Nokia. As a matter of fact, those three vendors combined have only slightly more market share than the iPhone.

Jobs mentioned the upcoming software developer kit, which will allow third-party developers to write software for the iPhone, only in passing. Instead, he talked about a significant new upgrade to the iPhone software, made available after the keynote Tuesday.

The new version upgrades the Maps application so the iPhone can find and display its current location, by triangulating on nearby cell towers using technology from Google. The mapping also triangulates on Wi-Fi hotspots using technology for Skyhook Wireless, which has mapped 23 million hotspots worldwide, and can triangulate based on beacons from known hotspots even if the user isn't logged in to the hotspot.

The Maps upgrade gives the application a less-confusing user interface. Users can drop a pin on a specific location and bookmark the pin.

Users will be able to use Web Clips to bookmark Web pages on the iPhone home screen. Users will be able to create up to nine home screens, which they can toggle between similar to the way they now browse photos. The iPhone will also support sending SMS messages to multiple recipients. Video upgrades include adding chapters, subtitles, and graphics.

Web clips not only work as bookmarks, they remember the specific zooming and panning in the browser, and return to that location and zoom level -- handy if you want to mark your place on a specific section of a specific page, like the technology section of the New York Times home page.

Users can rearrange icons on the iPhone home screen by simply tapping and holding on any icon for about three seconds. At that point, all the icons start to wiggle, and can be slid around with a fingertip, or moved to another home screen.

And the iPod application was upgraded to allow displaying song lyrics, where those are available. (Good. Now maybe I'll be able to figure out the lyrics to "1-2-3-4" by Feist -- which, by the way, was playing just prior to Jobs coming on stage.)

The upgrade is free to iPhone customers.

The iPod Touch -- often described as an iPhone without the phone bits -- gets an upgrade to incorporate the iPhone's Mail, Stocks, Weather, and Web Clips applications. The upgraded software is being built into new Touches immediately, and it's a $20 upgrade to existing users.

Movie Rentals

Jobs said the iTunes store reached a landmark last week, selling its 4 billionth song. On Christmas Day, the store sold 20 million songs. In the history of the service, it has sold 125 million TV shows and 7 million movies. "That's more than everyone else put together, but it's failed to meet expectations," Jobs said.

Buying movies doesn't really fit the way that most people consume movies, Jobs said. They'll listen to a favorite song thousands of times, and so it makes sense to own it, but they usually only watch a movie once.

To boost sales and better fit how people use movies, Apple introduced movie rentals in iTunes. Jobs said that Apple has lined up the six major American movie studies: 20th Century Fox, Warner Bros., Walt Disney, Paramount, Universal, and Sony. "We have every major studio supporting it," Jobs said.

The service includes all popular first-run movies, and a library of old movies.

Jobs said that the service will have over 1,000 movies by the end of February, and movies will be available 30 days after their DVD release.

Movies will be viewable on Macs, PCs, current generation iPods, and iPhones. Users will be able to start watching movies instantly if they're connected to broadband. Users will have 30 days to start watching, then 24 hours to finish. Movies can be transferred from one device to another -- for example, they can start watching a movie on their Mac, and finish on the iPod.

Pricing is $2.99 for movies in the library, and $3.99 for new releases -- $3.99 and $4.99 for high-def. The service launched Tuesday in the U.S, and internationally later this year.

The movie rentals are an intriguing offering, especially when paired with the new Apple TV (more on that later). Ramping up the selection will be essential to the service's success. One thousand titles sounds like a lot, but actually it's not much at all. Netflix has a selection of 90,000 DVDs for rent, plus 5,000 available for viewing on demand.

Jobs then turned to Apple TV. He reviewed the history of media-center PCs briefly, noting that Microsoft, Apple, TiVo, and others have tried interesting users in media-center PCs for their living rooms. "And you know what? We all missed," he said. No one has been successful.

Apple introduced Apple TV last year, a device for viewing movies and TV downloaded from iTunes. It required a network connection to a PC or Mac running iTunes.

Apple TV Take 2 removes the requirement for a second computer, allowing users to rent directly from their televisions. The machine will support high-definition movies with Dolby 5.1, allow users to view photos on Flickr or the .Mac service, or YouTube video.

Apple TV will also allow users to buy TV shows. Jobs made no mention of renting TV shows, which seemed a gap in their service. If people are more interested in renting movies than owning them, surely that goes double for TV shows.

The user interface for Apple TV borrows elements from hotel-room pay-per-view services, Amazon.com, and TiVo. Users can browse by genre, see what other movies people who rented a given movie also rented, and search using text.

The service also supports over 125,000 podcasts.

The Apple TV demo was the occasion for the only glitch in the demo that I could spot -- the Flickr photos didn't come up. Jobs was very calm about the whole thing -- he just waited a little bit to be sure the screen remained blank, commented, "Nope, I'm afraid Flickr isn't serving," and moved on.

The new capabilities are a free software upgrade for Apple TV.

Apple also announced a price cut for Apple TV. "Now, it sells for $299, " Jobs said, "but not anymore."

"Wow!" I thought to myself. "They're cutting the pricing to $199."

But the new price was $229. That's a respectable discount, but it lacks that sub-$200 thrill.

The new Apple TV will be available in two weeks.

Fox will offer DVDs with technology on it that allows consumers to copy the content to an iPod or iPhone.

The MacBook Air

The tiny MacBook Air was the big gun at the keynote. Jobs said the device is the world's thinnest notebook computer.

He compared it with most ultrathin notebooks, which, he said, weigh about 3 pounds, with 11-12" displays, miniature keyboards, and 1.2 GHz Intel Core 2 Duo processors.

The MacBook air also weighs about 3 pounds, but other than that, it's different from and more advanced than other ultrathins, Jobs said. He compared it to the ultrathin Sony Vaio, which, he said, is a wedge-shaped notebook that's 1.2" at the thickest and 0.8" at the thinnest. In contrast, the MacBook Air is 0.76" at the thickest, and 0.16" at the thinnest. In other words, the thickest part of the MacBook Air is thinner than the thinnest part of the Vaio. It fits inside a big manila envelope -- the kind that closes by looping red thread around buttons. Jobs showed a TV commercial demonstrating just that, and removed the MacBook Air from a manila envelope onstage.

The notebook has a magnetic latch, a 13.3" instant-on wireless display with LED backing, built-in iSight camera, and full-size keyboard with backlight that automatically switches on when ambient lighting dims. "This is possibly the best notebook keyboard we've ever shipped," Jobs said.

The notebook has a large trackpad, which supports multitouch gestures similar to the iPhone. Jobs demonstrated a few gestures using iPhoto: Double-tap and drag to move a window, pan a large photo by dragging with two fingers, rotate the photo by rotating two fingers, flick through photos by swiping a finger, and pinch in and out to zoom on a photo.

The notebook comes with an 80 Gbyte hard disk drive standard and optional 60 Gbyte solid state disk option. The spinning drive is a 1.8" hard drive, same as on an iPod. The processor is a 1.6 GHz Intel Core 2 Duo processor, with option to go to 1.8 GHz, same as in other notebooks and Macs. The processor was built specially by Intel to make it 60% smaller than the standard Core 2 processor.

The notebook has a magsafe connector and 45 watt power adapter. A latching door on one side of the unit accesses a USB 2.0 port, MicroDIV connection, headphone jack. The unit supports 802.11n Wi-Fi and Bluetooth 2.1.

Missing from the notebook: A hard Ethernet connection.

Also missing: An internal optical drive. Eleven years ago, Apple attracted criticism when it shipped the candy-colored iMac without a floppy disk drive built in, now it's shipping a notebook without an internal optical drive. Apple will sell a detachable USB optical drive for $99. "But you know what, we don't think most users will miss the optical drive. We don't think most users will need that optical drive," Jobs said.

Users use optical drives for movies, to burn backup disks, burn CDs for their cars, and install software, Jobs said. But iTunes will provide movies, Time Machine and Time Capsule will provide backup, and users can listen to music in their cars using iPods.

And for software installation, Apple is introducing technology to allow the MacBook Air to borrow optical drives from nearby PCs or Macs over a network. Users install special software on the remote machine, and the Air can address the remote machine's optical drive as though it was the Air's own. The Windows version of the software will allow PCs to run Mac installation programs on the Air's behalf.

The unit has a five-hour battery life. Many ultrathin notebooks only have enough juice for an hour and a half.

The price will start at $1,799.

Jobs said the MacBook Air is designed to minimize harm to the environment. The aluminum case is fully recyclable. "As a matter of fact, it is an extra desirable recyclable material," he said. It uses the first display that's free of mercury and uses arsenic-free glass. And retail packaging is 50% less volume than previous MacBooks. Apple has been taking heat from Greenpeace, which claims the company's environment practices are unsound.

The keynote concluded with music from Oscar-winning singer/songwriter Randy Newman, who wrote and sang for the soundtracks of Toy Story, A Bug's Life, and other Pixar movies.

He sang a satirical song about the end of the American empire. It was kind of a downer, actually, and added a political tone to the keynote that I thought was inappropriate.

But Newman saved the day by singing "You've Got a Friend In Me," which, he explained, he wrote for Toy Story. "I actually wrote a great love theme, but they cut the Buzz-Woody love scene," he said.