Apple

As Yogi might say, it was deja vu all over again on Stockton Street as Apple released Mac OS X Leopard to the general public.

(Credit: Tom Krazit/CNET Networks)

It wasn't exactly iPhone Day, but hundreds of people lined up on Stockton Street on Friday outside the San Francisco Apple store to get their hands on Mac OS X Leopard, the newest version of Apple's operating system.

Tyler Howarth (middle) is psyched to be first in line in downtown San Francisco for Leopard.

(Credit: Tom Krazit/CNET Networks)

About 30 minutes before the doors of the store opened at 6 p.m., the line stretched up Stockton and around the corner onto O'Farrell Street, maybe two-thirds as long as the iPhone line at its longest on June 29. Still, prospective customers waited hours in line to buy Leopard, even though they could have preordered a copy from Apple or Amazon.com and have spent that time installing their new OS.

"That's kind of lame," said Tyler Howarth, first in line, referring to those who took the preorder route. Howarth, a student at San Francisco State University, arrived at 2 p.m. to start waiting in line, although the actual formal queue wasn't set up until 3 p.m. He planned to use the $100 store credit he received after the iPhone pricing snafu to defray the cost of the Leopard upgrade (click for CNET's review) for his Macbook Pro.

Granted, standing in line on a cool autumn evening in San Francisco isn't exactly as demanding as dodging raindrops on Fifth Avenue in Manhattan. And it's really, really hard to run out of software; I'm pretty sure you'll be able to walk into any Apple store later tonight or tomorrow and pick up a copy without a wait. But line-waiters seem determined to be part of something, to have an actual experience associated with their upgrades that's a little more interesting than signing for the package.

Apple's retail employees do everything they can to deliver that experience, cheering the early adopters like they just completed a 14-point comeback with 2 minutes left on the clock. The free coffee went quickly, but the first 500 people in line were given T-shirts to mark the occasion.

Apple retail employees welcome Leopard customers with a standing ovation and T-shirts.

(Credit: Tom Krazit/CNET News.com)

Several of those in line cited Time Machine as the single most important reason they're rushing out to get Leopard, sheepishly admitting they don't regularly back up their system. Not many people do so on a regular basis, even if they've taken the step of purchasing an external hard drive or going as far as to set up a home server.

Amadeus DeMarzi, about halfway back in the line, was relatively new to the Mac, having purchased his first Mac about a year ago. He was also planning to use his iPhone credit on the purchase of Leopard, and cited Time Machine and Spaces, a feature that lets you switch between four separate work areas to help organize your thoughts when working with multiple applications.

Passersby gawked at the crowd as things backed up in the area in front of the Apple store, which is adjacent to entrances for the Powell Street transit stop. "Ooh, I think they're giving out free iPhones!" one woman exclaimed as she passed by with several shopping bags. At around 6:30 p.m., the line was still around the corner onto O'Farrell, but things were moving in an orderly fashion.

It was probably a pretty good night for Apple's retail operation, but we'll get a better sense of the pace of Leopard adoption over the next few weeks and months. I'll check back over the weekend to see how the installation process is going for the early adopters. If you run into any problems, let me know in the comments below.

iPhone Day it wasn't, but foot traffic still backed up in front of Apple's downtown San Francisco store around 6 p.m. as commuters tried to figure out what was going on.

(Credit: Tom Krazit/CNET News.com)

If you want to use the Time Machine feature in Mac OS X Leopard to set up automatic backups, you'll have to find a networking cable.

In the advance marketing material for Leopard, which goes on sale later today, Apple had promoted the ability to connect an external USB hard drive to an AirPort Extreme wireless router (Airport Disk) and use Time Machine to wirelessly back up the hard drives of Macbooks scattered around a home. Time Machine, one of the more universally liked features in Leopard (click for CNET's review), is designed to make backing up and restoring files much easier than before.

Time Machine, being demonstrated by Apple's Scott Forstall at the 2006 Worldwide Developers Conference, won't work with external hard drives connected to Apple's Airport wireless routers.

(Credit: CNET Networks)

But Macworld's Dan Frakes (who has an excellent spin move to the basket) noticed earlier this week that Apple had pulled the language advertising the use of an AirPort Disk from the Time Machine promotional copy. AppleInsider then verified that its copy of Leopard did not allow the use of an Airport Disk to do wireless backups, forcing you to physically connect the USB drive to a Macbook or Macbook Pro to make sure the backup operation takes place. Time Machine can also back up data to another Mac running Leopard that is set up for file sharing, a server running Leopard, or one of Apple's Xsan storage devices, but casual Mac users are much more likely to back up to one of the many external hard drives available.

That's certainly not the end of the world, but it's somewhat inconvenient if you're used to using your notebook on a wireless network at all times. Posters on AppleInsider's forums speculated that backing up an entire hard disk over a wireless network would take forever, even at 802.11n speeds of over 100Mbps, and that seems to make sense. But certainly Apple was ready to go forward with the feature up until the last minute, so it must have been convinced as recently as a few weeks ago that wireless backups wouldn't be an issue.

The most likely scenario seems to be that Apple pulled it from the final release of Leopard at the last minute because the software simply wasn't ready. The company can add support for Airport Disks at a later date with a software update, but Leopard early adopters will have to wait.

Progress is measured in steps both big and small. The smaller ones may get less attention, but they are much easier to take.

It's been a year of big steps for Apple. The company dropped the "Computer" from its name in January as a way of showing Apple was no longer just about the Mac, and the clear priority for 2007 in Cupertino was to get the iPhone out the door and selling briskly. Then, perhaps for kicks, it decided to overhaul its entire lineup of iPods.

Later today, Apple will take a smaller step, with the launch of Mac OS X 10.5, code-named Leopard. Leopard's coming on scene later than expected, almost 30 months after Tiger (Mac OS X 10.4) launched in April 2005, in part due to the push to get the iPhone out in time. CNET'S review is in, and my colleagues Elsa Wenzel and Robert Vamosi are positive.

Leopard, the latest version of Mac OS X, goes on sale at 6 p.m. today wherever you live.

(Credit: Apple)

There are dozens of important new features in Leopard, perhaps most notably the Time Machine application that could make it easier for users to back up and restore their files. Backing up your files is generally a simple exercise with a external hard drive, but Time Machine is interesting because of the friendly way in which it lets you restore files, flying back in time (and space) to the last instance in which that file was saved.

But all the reviewers, including Apple favorites Walt Mossberg at The Wall Street Journal and David Pogue at The New York Times, felt compelled to point out that Leopard is very much an evolution of previous versions of Mac OS X, and not a dramatic breakthrough like some past releases. It's certainly nothing like the tectonic shift Microsoft users went through in the switch from Windows XP to Vista, or Windows 98 to XP.

That can come off as a negative assessment. But it's not.

Computing trends change so quickly now: are you doing the same things with your Mac today that you were when Tiger was released in 2005? Maybe, but you're definitely capable of doing much more today, and even more so compared with when the first version of Mac OS X arrived in 2001. With Leopard, Apple will have made five major upgrades to the original Mac OS X operating system in six years.

Guess what other operating system made its debut in 2001. After the launch of Windows XP that year, it took Microsoft a well-documented eternity to release Vista, during which it changed its goals for the operating system several times and wound up releasing a solid, if underwhelming product earlier this year.

Here's the lesson: making smaller, more frequent changes to your product makes it much easier to stay on top of a changing industry than a five-year plan will ever allow. It keeps engineers on their toes and also makes the bean counters happy. That's because modest upgrades can be released more frequently that still have enough new bells and whistles to justify charging for the new software. A new copy of Leopard, for example, will set you back $129.

As my colleague Ina Fried noted to me as we watched the World Series on Wednesday night, Microsoft does make incremental changes to Windows. But it calls them service packs, and it gives them away for free. Apple sits in a happy middle, where it can make substantial--yet relatively modest--additions to Mac OS X, charge more than $100 each time, and have customers walk away satisfied that the upgrade was worth their time and money.

Of course, life is different for Microsoft. As they add new features, they have to make sure everything plays nicely with a 20-year history of code, so their business customers don't freak out. This makes it much harder for Redmond to turn on a dime to respond to new trends like mobility or multimedia.

Leopard's a run-scoring double, to stretch the baseball analogy. It's not a revolution in Mac software, but it's a nice advance for older Mac owners as well as those new to the company in the last year or so. If Apple can get back on the 12- to 18-month pace of new releases that CEO Steve Jobs told The Times he'd like to stick to over the next several years, Apple could be able to pick out the next trend in personal computing well ahead of Microsoft if the engineers in Redmond stay on their current schedule.

The age-old Apple-Microsoft debate is changing. Microsoft continues to run a very profitable business, and even if Apple continues to expand its Mac market share, Windows will remain by far the dominant PC operating system when this decade ends.

But Apple has more momentum, as the iPhone and iPod continue to make both the mobile phone and music industries take notice. It has more investment, now worth more than tech-industry stalwarts IBM and Intel but still well behind Microsoft. And it's more nimble, a crucial advantage as an era dominated by the PC comes to a close and something new takes its place.

I'm not touching the Vista versus Leopard question until I've had a chance to use them both more thoroughly. But is Leopard a more significant advance compared to Tiger than Vista is compared to Windows XP? Nope. And Jobs is probably fine with that.

The newest versions of Opera's Web browsers will allow both mobile devices and PCs to share a common set of bookmarks.

The Norwegian browser company is set to release beta versions of Opera 9.5 and Opera Mini 4 later Thursday at a rock show, of all things, in San Francisco on the last day of the CTIA conference. The company is most excited about a new feature called Opera Link, Jon von Tetzchner, co-founder and CEO of Opera, said in an interview just a block away from the Moscone Center and the CTIA crowds. Opera Link is a service that lets Web surfers access a common set of bookmarks from both a mobile phone running Opera Mini and a PC running Opera 9.5.

Opera's CEO Jon von Tetzchner is eager to watch how future mobile computers access the Internet.

(Credit: Opera)

Opera is somewhat unique among its competitors in the browser world in that it has been focused on mobile devices for a very long time. Mozilla recently announced plans to develop a browser with smartphones in mind and Microsoft has Internet Explorer Mobile, but Opera is a popular browsing choice for smartphones running Symbian, the dominant operating system in this arena.

The idea behind Opera's mobile products is similar to how Apple CEO Steve Jobs has sold the iPhone: smartphone users will no longer endure a compromised Internet experience on their phones, von Tetzchner said. Opera has versions of its browser for PCs, smartphones, and regular mobile phones (as well as Nintendo's Wii) and it's very focused on the development of smartphones into full-fledge Internet-capable computers.

"Things are moving in our direction," von Tetzchner said. "The Web is changing, and it's moving in our direction as people are using it on more and more devices, and people are looking at alternatives on the desktop." Application development on both PCs and mobile devices is increasingly shifting toward Web-based applications that can run on any device through the browser, and although that's still a pretty fragmented notion in the smartphone world, it's an interesting time for a company like Opera.

Opera Link aims to help out mobile Web surfers who want to check out all the Web pages they usually access from their PC, but who don't want to type long URLs on small keyboards or store a ton of bookmarks on a small device. Unlike social bookmarking services like Delicio.us, you don't have to access a separate Web page to get to your bookmarks. You have to sign up for the Opera Link service, which stores bookmarks in a central place that can be directly accessed by your Opera browser either on your PC or mobile phone.

I haven't had a chance to test the service, so let us know if it works as seamlessly as the company claims. Opera is throwing a launch party for Opera Link as well as the new betas at San Francisco's Rickshaw Stop, described by BPM Magazine as "Your uncle's rec room where rock kids and electronic kids come together in fabulously dressed debauchery," on the club's Web site. Whatever that means.

The exact details of AT&T's revenue-sharing agreement with Apple have not been disclosed, but one analyst thinks that over the two-year life of a user contract, the amount exceeds the actual price of the iPhone.

Silicon Alley Insider spotted a research note from Piper Jaffray's Gene Munster estimating that Apple is receiving $18 per month for each iPhone subscriber, under the revenue-sharing agreement between the two companies. Apple has confirmed that such an agreement exists, but has not shared the details about exactly how much cash it's getting from the revenue AT&T makes on iPhone customers using the carrier's data network. In July, Munster estimated Apple was receiving just $3 per iPhone subscriber and $11 per iPhone customers new to AT&T, but he's rethought the numbers after Apple's latest earnings release.

Munster takes the 1.4 million iPhones that Apple has sold since the device made its debut, and subtracts the 250,000 iPhones that Apple said it believes were bought to unlock from AT&T's network, to calculate that there were 1.15 million revenue-generating iPhones in play during Apple's fourth quarter. He then uses the $118 million that Apple recorded in iPhone-related revenue during the quarter to estimate out how much service revenue Apple took in from its share of AT&T's data charges by subtracting his estimate of hardware revenue generated by the sale of each iPhone, based on the average selling price.

iPhone users on AT&T's data network could be giving Apple as much as $18 a month under their revenue-sharing agreement.

(Credit: CNET Networks)

It's a little tricky because the iPhones that were sold in June and July have obviously been generating revenue for longer than the ones sold in September, but he arrives at a figure of $18 per iPhone subscriber in monthly payments to Apple during the fourth quarter.

That would mean that over the life of a two-year contract, AT&T will pay Apple $432 per iPhone subscriber. Silicon Alley Insider adds the $400 in revenue per iPhone and uses iSuppli's cost estimates to calculate a $565 profit per iPhone over a two-year period. I'm a little wary of those iSuppli numbers myself (they don't really account for things like research and development costs), but the exact number isn't really the point: Apple has a huge incentive to make sure iPhones stay on AT&T's network, even if Munster's numbers aren't perfect.

I sent Munster an e-mail with a few questions, including whether it's fair to assume that the $18 a month figure will remain constant over the two-year contract, but I haven't heard back yet. A reader of Tuesday's iPhone blog made a fair point that Apple still gets revenue from the sale of an unlocked iPhone. But it's leaving quite a bit of money on the table if that phone doesn't run on AT&T's network.

Throughout all the hoopla over the hacking of the iPhone, it was never very clear how many people were actually trying to escape from AT&T. Apple ventured a guess on Monday.

During a conference call to discuss the company's blowout fourth quarter, Apple Chief Operating Officer Tim Cook said that of the 1.4 million iPhones sold since June 29, 250,000 were bought with unlocking in mind.

As many as 250,000 iPhones might have been bought last quarter and unlocked, Apple said Monday.

(Credit: CNET Networks)

"Where we don't know precisely how many people are doing that, our current guess is there were probably 250,000 of the 1.4 million that we sold where people had bought them with the intention of doing that," Cook said, or actually volunteered: no one asked him that specific question.

There are now several reports out that suggest the 250,000 is a firm number of unlocked iPhones in the wild, but that's not exactly what Cook said. An Apple representative said Tuesday that Cook's comments were just an estimate of unlocked iPhones, although it does appear to be a pretty damn good estimate.

AT&T had its own earnings conference call earlier Tuesday, and Bloomberg reported that the carrier said it has activated 1.1 million iPhones to date, which could suggest that as many as 300,000 iPhones might be destined for other cellular networks. Some of that difference can be chalked up to units in transit as the quarter ended on September 29, or iPhones that were bought at the very end of the quarter and activated at the very beginning of the next. Of course, it's also very possible to unlock an iPhone without going through the registration and activation process with both Apple and AT&T, disappearing off the radar screen.

As discussed at length, Apple is unlikely to stand idly by and let users unlock their iPhones. Peter Oppenheimer, the company's CFO, confirmed the obvious on Monday, that Apple doesn't receive any payments from AT&T under their revenue-sharing agreement for iPhones that aren't running on the AT&T network.

Many of the iPhones counted in Cook's estimate were sold after Apple cut the price of the device by $200, he said. So not only did Apple miss out on the higher profit on those iPhones, it's also losing the ongoing revenue from AT&T's data services. Now that several of the iPhone hacking groups have figured out a way around the 1.1.1 software update, which bricked many of the early unlocked phones, Apple likely has another software update waiting in the wings.

Influence is tough to measure, but it's one of those things where you know it when you see it.

Apple's influence on the mobile phone industry after just over 90 days as a player was evident at the CTIA show Tuesday. Microsoft CEO Steve Ballmer didn't mention the iPhone specifically in his keynote address, but noted that Apple "has done some nice work." After Ballmer's keynote, a friend of some staffers in Microsoft's booth enthusiastically demonstrated his iPhone for an audience checking out the latest Windows Mobile phones. And a panel of five mobile executives spent 90 minutes discussing the impact of the iPhone on their businesses and the future of the industry.

Surrounded by Windows Mobile phones, a friend of the blue-shirted staffers at Microsoft's booth shows off his iPhone.

(Credit: Tom Krazit/CNET News.com)

That's not because they're scared Apple is eating into their piece of the pie, observed Motorola's David Ulmer, senior director of entertainment products. Apple may have sold over a million iPhones last quarter, but "some of us sold that many before breakfast," he quipped: The entire mobile phone industry ships well over a billion handsets a year these days.

Instead, panelists recognized the iPhone as bringing two major changes to their industry. First, the iPhone is the "first mass-market non-carrier controlled event," said Adam Guy, general manager of the telecom and media practice at Compete, a market research firm. Apple owns the experience and the relationship with iPhone users, not the carrier, and that's a feat the other hardware companies have yet to pull off.

The iPhone also is a new way of looking at smartphones: Is it a computer? A phone? An iPod? Lee Ott, director of product management for Yahoo Mobile, said, "The iPhone is the first phone that puts the Internet and data right up on a par with calling," explaining that while there are plenty of phones out there capable of browsing the Internet, few of those products emphasize data as much as they do voice calls. In fact, the iPhone is already one of the top five devices in the world that accesses Yahoo Mobile on a daily basis, he said.

Well then, why didn't the established players figure out that formula? Given the lack of a carrier representative on stage, panelists spent a fair amount of time discussing the sins of the carriers. Ulmer said that Motorola sells tons of touch-screen capable phones in China, but when they approached U.S. carriers with similar designs two years ago, they were rebuffed by executives who said, "Come back when you've got a keypad."

He also noted that in the past, it was more profitable for carriers to emphasize voice and text messaging on bandwidth-constrained networks over interesting video or data applications, so that's what they did. That's changing as 3G networks become more widespread, but helps explain why the iPhone caught the industry flat-footed.

But these are companies with deep pockets and enough experience to know which way the wind blows. All major U.S. carriers and most major phone manufacturers will have an answer to the iPhone available by the end of this year that emphasizes a better user experience, said Sam Altman, CEO of Loopt, a start-up that lets friends track each other's whereabouts through their mobile phones. "Even for people that don't have iPhones, they expect their phone to behave like that."

Sometimes, it takes an outsider to remind an industry where it needs to be, said Cyriac Roeding, executive vice president for CBS Mobile. "For the first time, you have a Silicon Valley company disrupting the entire (mobile) market. The fact that we are sitting here talking about the iPhone, and that Motorola is joining us to talk about the iPhone, shows the power of the iPhone. It's an awesome version 1.0."

It's very easy to take a look at Apple's stellar fourth quarter and conclude that the long-awaited iPod "halo effect" is in full swing and move onto something more pressing, like handicapping the World Series.

Are Mac sales really soaring simply because people like iPods?

(Credit: James Martin/CNET Networks)

For years as the iPod took over the digital music player market, we all wondered whether it was a one-hit wonder, whether Apple could translate that success into increased Mac market share. Millions of people who might not have used an Apple product since they spent the third grade playing Oregon Trail on an Apple II were re-introduced to Apple through the iPod, and for the last year or so, they would appear to be trying the other things on the menu.

Apple announced Monday that Mac shipments were up 34 percent during the last quarter, the most successful period of computer sales ever for Apple (neé Computer) Inc. Overall, Apple sold 2.2 million Macs, 400,000 more than the previous record for Mac sales set just last quarter.

The iPod often gets the credit for increased Mac shipments, described as the "halo effect" over past years. The thinking is that iPod customers, having enjoyed their iPod experience and having seen Apple in a new light, might be more inclined to pick up a Mac while shopping for a new iPod case and realizing their old PC is woefully out of date.

But despite the recent results, it's still just not that simple. Apple said during its earnings conference call that half of the customers who bought Macs at its retail store last quarter were new Mac owners. Viewed against total Mac shipments of 2.2 million during the quarter, that's actually not all that many brand-new Mac users.

Obvious as it may seem, it's really hard to quantify the halo effect. Believe me, I've just spent the last several hours trying. The numbers seem simple: Apple has sold more than 120 million iPods to date, and Mac shipments are growing much faster than the overall market.

But Hewlett-Packard's worldwide shipments are growing twice as fast as the overall market. Acer's worldwide shipments are growing at nearly four times the overall market. Even in the U.S., where Apple does the majority of its business and is the third-leading PC vendor, everyone but Dell is growing much faster than the overall market. HP might have a brand name in printers, but nobody, even HP, has a consumer product with nearly the cachet of the iPod.

Maybe Mac shipments are growing because people have had two or three Windows PCs in their lifetime, and are looking for something different. Maybe Mac shipments are growing because people are upgrading older PowerPC-based systems to Intel-based systems. Maybe younger buyers, a larger segment of the population than us Gen Xers, prefer the Mac over the PC. And, yes, maybe Mac shipments are growing because of the amazing swirl around Apple in 2007 spearheaded by the iPhone.

It would be silly to say the iPod has had no effect on the way Apple is viewed by the public. Anyway you slice it, the iPod contributed to a more positive impression of the company among those who hadn't always supported Apple as a matter of principle.

But I'm not convinced that you can draw a direct line between iPods and Macs. Are you more likely to buy an HP PC because you own (and like) your HP printer? Are you more likely to buy a Sony television because you've spent thousands of quality hours with your PlayStation 2? Maybe, maybe not.

I will throw this out there: I think more people are buying Macs because there is no longer a penalty for switching to a Mac. After all, you can run Windows on a Mac, open and edit Word documents in Mac OS, and you probably spend most of your time on one Web page or another that doesn't care what operating system is in control.

With only small technical differences to worry about, the purchasing decision comes down to branding and marketing. Apple may resonate in your brain because you like your iPod, but I'd argue that the company's combination of world-class marketing, a laser-like focus on design, and the decision to switch to Intel's chips has done more for Mac sales than any one factor alone.

UPDATED 3:42 p.m.--Added a few more details, numbers, and statements from Apple executives from the conference call.

Apple reported another stellar quarter Monday, exceeding estimates in just about every facet of its business.

For the company's fourth fiscal quarter, which ended September 29, the company reported revenue of $6.22 billion and profit of $904 million, or $1.01 in earnings per share. Wall Street analysts had expected Apple to report revenue of $6.1 billion and earnings per share of 86 cents, according to estimates compiled by Thomson Financial.

Apple has now sold 1.39 million iPhones, and 1.1 million during the quarter, the company reported. Mac shipments were up 34 percent compared to last year, and iPod shipments were up 17 percent.

That iPhone price cut, however controversial among the early adopters, seemed to do the trick. As of September 10, Apple said it had sold 1 million iPhones in total. So after the price was cut from $599 to $399, and the $499 4GB iPhone disappeared, Apple sold almost 400,000 iPhones in 18 days, or more than a quarter of all the iPhones sold to date.

Tim Cook, Apple's chief operating officer, confirmed the company expects to sell 10 million iPhones in the calendar year of 2008, but he didn't set a target for iPhones sales during the holiday quarter. It took Apple 2 years to sell around 1.4 million iPods sales in the early days of that product, he said.

It's also clear that Apple is gaining share on the rest of the PC industry. Last week IDC and Gartner had the worldwide PC market growing at around 15 percent, while Mac shipments are growing more than twice as fast. Apple sold 2.1 million Macs during the quarter, a company record and 400,000 units better than its previous best.

Students helped account for the surge in Mac shipments, during a quarter that Cook called "the most successful back-to-school season we've ever had." Apple introduced new iMacs in August, but it also ran a promotion for students that bundled a free iPod along with the sale of a new notebook.

That might have had something to do with the fact that iPod shipments were actually lower than some Wall Street analysts had anticipated. Shaw Wu of American Technology Research had expected Apple to sell 11 million iPods, but the company shipped a total of 10.2 million units. That was actually right in line, however, with a prediction from Piper Jaffray's Gene Munster, who cited an average analyst estimate of 10.9 million units.

Going into the holiday season, Apple expects to record $9.2 billion in revenue and earnings per share of $1.42, the company said. That's higher than what financial analysts were expecting for Apple's first fiscal quarter, a twist for a company that usually provides conservative guidance.

The holiday quarter is usually huge for the iPod division; last year Apple sold 21 million iPods during its first fiscal quarter. And the new iPods that were introduced during in September didn't really have much time to make an impact on the results announced Monday.

Mac shipments are usually flat during the company's first fiscal quarter compared to the back-to-school totals as educational buyers drop off and holiday buying kicks in, said Apple CFO Peter Oppenheimer. When asked to look ahead to the current quarter, he seemed somewhat pessimistic that Apple could duplicate the amazing growth it showed during its fourth quarter. Cook, however, noted that Apple saw strong growth in Europe during the past quarter.

One tidbit mentioned during Intel's blowout third quarter was the promotion of long-time Chief Financial Officer Andy Bryant to something called "chief administrative officer."

Bryant has been the CFO at Intel for 13 years and will step up to his new title effective immediately, so that Stacy Smith can become CFO in a move planned for some time, said Tom Beermann, an Intel spokesman. The move frees Bryant up from the day-to-day responsibilities of running Intel's finances, which is actually a quite-complicated exercise of making sure Intel's factories are running at optimum capacity in order to keep costs down--the CFO's real job. He'll continue to report to CEO Paul Otellini.

Andy Bryant

(Credit: Intel)

Bryant's new role as CAO appears to carry forward many of the same things he's been doing for a while now: he'll be the head of Intel's human resources and IT departments, both of which appear to be busy these days with the latest round of restructurings and layoffs. There's a chance Bryant will be able to work on other projects with the CFO responsibilities on someone else's plate, Beermann said.

I have to wonder if this is Bryant's way of transitioning out of Intel, although Beerman naturally downplayed that line of thinking. Bryant's probably not on the short list to succeed Otellini, as capable a financial manager as he has been over the years. For one, he'd be the first CFO to ascend to the top ranks at Intel, but he's also the same age as Otellini, and Intel has a corporate bylaw that forces CEOs to step down once they turn 65. The name most frequently mentioned as Otellini's successor is current sales head Sean Maloney, at least among reporters over drinks at various IDFs.

Without a doubt, Bryant has been one of the more entertaining CFOs on those monotonous earnings calls four times a year, able to explain the complicated business of making and selling chips like it was running a lemonade stand. Normally, the CFO's role during these calls is to accept congratulations from sycophantic financial analysts or to explain away problems that crept up during the quarter, but Bryant was often good for a laugh as well.