Apple Powers On At Macworld

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Apple Computer Inc. on Tuesday reported a record $5.7 billion in sales during the holiday quarter, topping Wall Street expectations as it sold nearly three times as many iPods as it did in the same period a year ago.

And in a historic shift for the company, CEO Steve Jobs unveiled desktop and notebook computers based on new two-brained chips from Intel Corp., the world's largest semiconductor company. The introduction during the Macworld Expo show in San Francisco came just six months after the partnership between the two once-unlikely Silicon Valley bedfellows was announced.

CBS News correspondent John Blackstone reports Jobs said the new MacBook Pro notebook is four to five times faster than the company's Powerbook. It will ship in February. The new iMacs will have the same all-in-one design as previous models, and are currently available. Jobs said the iMacs are two to three times faster than the iMac G5, based on an IBM chip.

With rock music booming through the huge convention hall, thousands of Apple faithful cheered as Jobs walked onto the stage before a massive video screen at the annual conference. He announced that Apple sold 14 million iPods in the last quarter of 2005. In all, 42 million iPods have been sold.

"That's 100 sold every minute, 24-7," he said, "and it still wasn't enough."

Jobs also said iTunes has sold more than 8 million videos since the company introduced the video iPod. Jobs announced that, starting Tuesday, iTunes will sell videos of "Saturday Night Live" skits.

The Apple CEO also announced an iLife Suite upgrade that includes new Podcast-creating software, as well as a new addition to iLife called iWeb. Jobs demonstrated iWeb, getting cheers from the Mac faithful as he created an attractive Web site with music and photos in less than five minutes.

Jobs calls one new feature in iPhoto "photocasting," a new way to share digital photos — even with non-Macintosh friends.

"This is podcasting for photos," Jobs said.

The new photo program also supports more than 250,000 photos and enables one-click support for giving pictures an antique or other effect. It also includes a template for creating picture-based calendars, he said.

The iLife suite also will enable the one-click export of iMovie video to iPods as well as a simple, drag-and-drop method of creating DVDs in iDVD. That program also will support third-party DVD burners.

Apple also released a free update for the Tiger operating system Tuesday.

The switch to Intel was first announced in June, when Apple said it expected to begin making the transition by the middle of 2006.

But on Tuesday, Jobs was joined onstage by Intel CEO Paul Otellini to make the announcement. Otellini came onstage wearing a clean room suit that the chip company has famously used in its ad campaigns — and that Apple once lampooned in its ads of its own.

"With (the) Mac OS X (operating system) plus Intel's latest dual-core processor under the hood, the new iMac delivers performance that will knock our customers' socks off," said Jobs.

For years, Apple shunned Intel, which has provided chips that power a majority of the world's PCs, along with Windows software from Microsoft Corp. In the late 1990s, Apple even ran TV ads with a Pentium II glued to a snail.

But Apple, looking for faster, more energy-efficient chips, became increasingly frustrated in recent years as its chip suppliers, IBM Corp. and Motorola Corp.'s spinoff, Freescale Semiconductor Inc., failed to meet its needs.

Of particular concern was IBM's apparent inability to develop a G5 chip that would work well in notebook computers.

Intel, on the other hand, has been focusing on developing chips specifically tailored for notebooks. In 2003, it launched its Centrino notebook technology with a processor that boosted a longer battery life by minimizing its power demand without a major hit to performance.

During last week's International Consumer Electronics Show, Intel unveiled the latest generation, the Core Duo, which features two computing engines on a single piece of silicon.

It was that chip the Apple decided to fit into the new iMac.

The Core Duo chip's low energy requirements are expected to enable ever-smaller computers, including some built right into television sets as the industry gears its machines more toward multimedia use.