San Francisco - Apple's push into mass-merchandise channels may mean higher volumes for the company and lower costs for consumers, but for the company's traditional dealers, the new distribution strategy spells trouble.
Faced with the prospect of competing with high-volume, low- margin discounters, many authorized Apple dealers - particularly small and medium-size outlets - are starting to put other manufacturers' products on their shelves.
"We spent 10 years building a business, and Apple turned its back on us," said an employee at The Computer Edge in Mt. Kisco, N.Y., which has carried Apple products since 1982. "It's disgraceful and horrible." The store recently won authorization to sell Unix systems and Novell Inc.'s NetWare.
Dealers were particularly miffed by Apple's decision to unload its PowerBook 100 inventories through Price Club outlets. Many said they could have moved the low-end notebooks just as quickly if offered the same heavy discounts.
"Apple over a period of months has decimated its core of dealers," said Betty Krusiewicz, vice president of marketing for Sun Computers Inc. in Los Angeles.
"The little guys will be gone in 18 months," said an East Coast dealer who requested anonymity.
Apple expects to add about 1,800 consumer-electronics and mass-merchant stores to its nationwide reseller base by mid-1993. Despite complaints from current dealers, who now number about 1,700, some industry observers said they think the company has no choice if it is to increase its market share.
"Traditional dealers are not merchandising to consumers, and if Apple is serious about getting into consumer computing, [it has] to have products available where people shop," said Bob Orbach, president of Orbach Inc., a New York-based technology consulting company.
Other analysts agreed. "Apple had to double its chain. Its products were only available in 20 percent of the U.S. computer stores," said Pieter Hartsook, editor of The Hartsook Letter in Alameda, Calif. "The move was long overdue if Apple products are to become more visible."
Indeed, Mike Dionne, senior vice president of marketing for Apple USA, said Apple will continue to "open up" distribution channels.
"Our 2-year-old strategy is simple: Generate new revenues from new markets," Dionne said. "And that presents a challenge for everyone."
Some dealers said they are willing to face that challenge but are disturbed by other recent Apple moves, such as its decision to end a popular infrastructure-funding program next March (see MacWEEK, July 13). Krusiewicz and others, such as Dan Neesley, owner of Northshore Computers Inc. in Milwaukee, said the loss of "soft dollars" from Apple will force them to sell competing products that offer higher margins. Neesley's store, for instance, will now push products from Sun Microsystems Inc. and Digital Equipment Corp.
Jerry Hanlon, manager of Bitznbytes Computer Center Inc. in Concord, N.H., said the longtime Mac dealer may have no other choice but to look at competing platforms.
Dealers also complained about shortages of some Mac models. Earlier this year, the Mac IIci, IIsi and LC were in short supply, and technical glitches have recently limited availability of the Quadra 950.
"The problem is supply is falling way short of demand," said Larry Reich, manager of J&R Computer in New York. "Competition is not the problem; it's having to wait 60 days to get a product. That's where the anger comes in."
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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New drive on for CD-ROM
By April Streeter and Neil McManus
San Francisco - Recent developments have prompted many corporate Mac users to pose the perennial question: Will this be the year of CD-ROM?
Apple's impending crop of Macintoshes with CD-ROM drives built in, falling prices for press-your-own-disc recorders and a spate of new business titles could finally bring the technology to corporate desktops, developers said.
Selling CD-ROM has been a "chicken-and-egg situation," said James Taylor, a CD-ROM consultant at ActiMedia in Los Gatos, Calif. "It's been hard to justify making titles when there weren't many players."
The number of players may soon reach that critical mass, however. Unit shipments of CD-ROM drives are projected to climb to 913,000 this year, a 70 percent increase from 1991, according to Framingham, Mass.-based International Data Corp. Apple CEO John Sculley has estimated that 4.5 percent of current Macs have CD-ROMs attached.
Until recently, Mac CD-ROM business titles have consisted mainly of font collections, clip art and information resources, such as MarketPlace Information Corp.'s MarketPlace disc containing thousands of indexed business addresses and phone numbers. However, a wider range of developers are ready to get in on the act when the Performa 600 CD and other Macs with built-in players arrive this fall (see MacWEEK, Aug. 10).
"The big thing that's changed is Apple's decision to bundle CD-ROM drives with the Mac," said Marianne Carroll, a Microsoft Word consultant in New York. "I had an idea for a CD-ROM collection of business templates last year but abandoned it because CD-ROM was too much of a niche market. Now I'm thinking, 'Wow! This is suddenly possible.' "
Apple also said it plans to bundle titles with future Macs. "We want the user who gets a machine with a CD-ROM to see [its] value," said Kirk Loevner, director of the Apple Developer Group. "We don't intend to compete with resellers but rather offer many titles that aren't generally available in the reseller channel."
Although CD-ROM transfer speeds are slower than those of hard drives, many companies have begun to look to CD-ROM's ability to hold 650 Mbytes of data as a vehicle for delivering large amounts of in-house data to employees.
"CD-ROM is an access bottleneck on any system, but we're migrating because of its capacity," said Mike Conley, CD-ROM project manager at American Airlines in Tulsa, Okla. By year- end, Conley said he expects 300 engineers and planners on a Mac network to join airline mechanics in accessing 25,000 pages of quarterly maintenance manuals for Boeing 757 and 767 airplanes via CD-ROM.
Conley has the CD-ROM manuals produced out of house, but two new recording systems, priced at less than $13,000 each, will let corporate users produce CD-ROMs in-house. The systems, available from JVC Information Products Co. of Huntington Beach, Calif., and Optical Media International Inc. of Los Gatos, Calif., combine a CD-ROM recorder with Mac software to produce discs for about $35 each.
The recorders produce master discs to be mass-duplicated by manufacturers or copied in limited quantities by the in-house system. Last year, similar recorder systems cost about $30,000 with a per-disc cost of about $50.
As the price of producing custom discs drops, corporate users may soon turn to CD-ROM for backup and archiving.
"Insurance companies and banks will use CD-ROM makers to archive data," said Tom O'Neil, system architect at MarketPlace, which is based in Waltham, Mass. "It's as cheap a method of archiving data as you can get, and it saves a lot of trees."
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Reshuffled ESD to deal ARA card, '040 server
Apple will certify VITAL third parties
By Mitch Ratcliffe
Cupertino, Calif. - Apple's newly retooled Enterprise Systems Division is gearing up to bring its first products, including the company's first server hardware and a multiline AppleTalk Remote Access server, to market early next year.
"We're trying to balance support of the networking and communications tools we've been doing with the objective of becoming a business unit that stands on its own and makes a lot of money for Apple," said Morris Taradalsky, Apple vice president and general manager of ESD. He said the division, originally created to sell Macs to large corporate customers and federal agencies, now will aim its marketing at medium- size business as well as universities.
The division was reorganized this month into business groups oriented around specific product categories (see chart at left and MacWEEK, Aug. 10).
ESD's offerings will include:
>Servers.
A 68040-based server designed to run A/UX and a new A/UX-based version of AppleShare is still on track for release early next year, sources said (see MacWEEK, April 6). A second generation of servers, based on the PowerPC RISC processor, reportedly is due in 1994.
"All the work we are doing in the OS - changes in file and print services, changes that we will have to make to accommodate great database performance and functionality - all those things have to be done whether it's done on a PowerPC-based platform or a 68000-based platform," Taradalsky said.
>AppleTalk Remote Access server.
A NuBus card that will handle multiple clients dialing in to the network with Apple's ARA software also should be ready next year, sources said.
The card reportedly will have ACE/Server, an enterprise security system developed by Security Dynamics Inc. of Cambridge, Mass., in firmware. The device generates a new security code number every minute; remote users carry credit card-size LED panels that display the same code. To log in to the network, users must enter the current number and an individual password.
Ted Stabler, president of Cambridge, Mass.-based Cayman Systems Inc., one of several third-party vendors developing ARA servers, said he is not worried about competition from Apple. "We were concerned that the AppleTalk Internet Router would have a large impact on the router market, but it was negligible," he said. "Apple doesn't have a history of optimizing products for price and performance."
>VITAL certification.
Taradalsky said ESD will launch an accreditation program for third-party products that fulfill the requirements of VITAL, the company's blueprint for enterprise connectivity.
"Customers want us to identify the products that fit into the VITAL model and actually tell them which one to use," Taradalsky said. "Apple has to stand behind these products as a guarantee that VITAL works."
ESD's products will appear at a time when, according to analysts, Apple is beginning to gain some ground in the corporate market. According to Computer Intelligence of La Jolla, Calif., Apple took 6 percent of the corporate microcomputer market for the three months ending in July, compared with a 4 percent share for the Mac over the past year.
"The corporate market has been Apple's toughest nut to crack," said Dan Ness, senior analyst at Computer Intelligence. "But it's clear it is beginning to say the right things."
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Apple does Likewise: Package updates software over network
By Stephen Howard
Cupertino, Calif. - Apple stealthily slipped a new networking product into the market last month when its Customer Services Division shipped Likewise, a $129 package that updates end-user software over AppleTalk.
Likewise offers tools "for anyone who must update other people's computers over the network," although it was "developed with education [users] in mind," said Tom Hudson, senior instructional designer at Apple and Likewise product manager.
The package consists of Client and Admin applications; Client must be running on end users' Macs for updates to take place. Although it is not required, Apple recommends that users start their Macs from a special Client floppy disk before updating. Competing software updaters use system extensions as the client software.
With Likewise, a network manager can choose a single folder to download to all clients. If the users have started up from Likewise's Client floppy disks, the manager also can replace their System folders with one from the manager's local disk and can erase everything on their hard disks.
In addition, a manager can synchronize the clocks on all clients; standardize user names, Macintosh names and start-up volume names; set the color depth to black and white, maximum colors available or maximum gray scales available; and clone various system settings, including beep sound, sound volume, mouse speed, desktop pattern, highlight color and network setup. The Admin application also can shut down the Client Mac when updating is done.
Apple's product takes a cookie-cutter approach to software updating. Admin offers no conditional controls over which files are affected. For instance, the program can update only an entire System folder, not specific files within it. According to Hudson, Apple's target customers "didn't need a lot of those other functions."
Likewise is a low-end entry into a category populated by third-party developers such as CSG Technologies Inc., MacVonk*USA, TechWorks Inc. and Trik Inc. Apple's $129 price covers an unlimited number of clients. Competing products start at $295 and cost $395 to $495 for unlimited client licenses.
"We didn't want to price it out of the range of a school with eight to 12 computers," Hudson said. "It's incumbent on the administrator to create the client disks so they bear the cost [of duplication]."
Likewise is available through normal channels and from Apple Support Products at (800) 950-2442.
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Mac prices due for cuts; margins head downward
By Jon Swartz and Lisa Picarille
Cupertino, Calif. - Succumbing to competitive pressure from IBM PC and compatible vendors, Apple is on the verge of slashing prices across its CPU line - even though the cuts may push the company's gross margins to record-low levels.
Top-ranking Apple officials told analysts attending a briefing here this month that the company will drop prices an average of 15 percent to 20 percent within the next month. Cuts could reach 30 percent on some models, including selected Quadra configurations, sources said.
Apple reportedly also plans more aggressive pricing for high- end PowerBooks. The PowerBook 170's price is likely to be reduced in the upcoming cuts, and the 180 model due to replace it in October could carry even lower prices.
The dramatic price-cutting measures should bring Apple's prices more in line with those of other microcomputer makers. Since Compaq Computer Corp. launched a new low-price strategy in May, IBM Corp., Dell Computer Corp. and nearly every other PC vendor has slashed prices by up to 40 percent. Compaq is likely to announce a second round of price cuts next month, according to sources briefed on the company's plans.
Industry watchers said the Apple price-cutting measures are overdue. "Apple has put too high a premium on its machines," said one analyst who attended the briefing.
"Apple prices are 50 percent too high," said another analyst.
Apple's gross margins, which averaged more than 50 percent in the latter half of the 1980s, have already fallen to about 44 percent since the company adopted its lower-cost, higher- volume strategy in 1990 (see chart below). The new round of price cuts could push gross margins below 40 percent in fiscal 1993, analysts predicted.
In fact, they said, margins could decline for the fourth quarter of fiscal 1992, ending Sept. 30, even though the new price cuts won't take effect until the quarter is almost over. Apple's current Back To School Promotion has already effectively reduced prices for part of Apple's market, they said.
The program, which runs through Oct. 15, offers discounts to college students, faculty and staff on the Mac LC II, Classic II, IIsi and PowerBook 145.
The new pricing and distribution trends reshaping the industry are likely to hold down margins over the next five years, according to Kimball Brown, an analyst for International Data Corp. of Mountain View, Calif. Apple's margins, however, are expected to remain well above those of most PC vendors; Compaq's, for instance, hover around 27 percent.
Apple officials told analysts that its forthcoming Performa models for mass-market channels should help sustain margins despite declining prices. Cutting the cost of components and manufacturing reportedly was a central goal in the design of the new series.
The company also is looking to new models to help avert layoffs. Joseph Graziano, Apple chief financial officer, told analysts that Apple might shift employees from different departments to its fledgling consumer and server businesses rather than lay off workers.
Apple said it expects revenues to grow 10 percent in fiscal 1993. In fiscal 1991, the company recorded revenues of $6.3 billion. Through the first nine months of fiscal 1992, sales totaled $5.3 billion.
Because it sees technological innovation as the key to its future, Apple said it will continue to increase its R&D budget despite the margin pressures. R&D now accounts for 9 percent of Apple's total revenue, up from 5.6 percent in 1989.
Many analysts said the company's longer-term prospects still look good.
"[Fiscal] 1994 will be [Apple's] big year, when PDAs (Personal Digital Assistants), PowerPC and PowerOpen are on the market," said Charles Wolf, vice president of equity research for First Boston Corp. in New York.
Michael Murphy, editor of the California Technology Stock Letter in Half Moon Bay, Calif., said: "They have three very encouraging things going for them: High-margin products are coming out, the distribution changes are sensible, and they are becoming a first-class consumer-electronics company."
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Mail-order Macs may get stamp of approval
By Andrew Gore
Cupertino, Calif. - In the drive to cut margins, prices and boost market share, Apple has run down many sacred cows.
Now two of the company's most cherished principles - not to clone itself or sell CPUs via mail order - could be next under the wheels.
>Claris clone study.
Apple subsidiary Claris Corp. set up a secret division some months ago, according to sources, to investigate whether Macs could be built overseas by contractors and then sold direct under the Claris label. The study reportedly showed that it would be possible to build cheaper Macs and market them successfully against mail-order PC vendors without cannibalizing sales of Apple's own Macintosh product line.
The purpose of marketing the CPUs under a subsidiary label is to give Apple a way to go after customers who buy mail order, while distancing its own Mac line from the knockoffs, sources said.
The Claris project was recently brought into Apple for further study; it is unclear whether the company plans to pursue the project. Apple officials declined to comment.
>Direct sales.
Apple is looking at a number of other plans to legitimize mail-order Mac sales, sources said, possibly coming out with its own catalog or authorizing companies that now sell software and peripherals by mail order to start carrying Mac hardware.
The company already sells Macintoshes direct to education, developers and some large corporations. And Apple also has looked the other way, despite official denials, as "gray- market" resellers - mail-order vendors that acquire Macs without Apple authorization, generally from authorized dealers seeking to make quotas or reduce inventories - have become some of Apple's largest single-location outlets.
Now some mail-order outlets that don't carry gray-market machines are eager to get a share of that market. "Our customer list is 750,000 Macintosh users," said Peter Godfrey, president of MacWarehouse, a Mac mail-order company based in Norwalk, Conn. "Inevitably we'd increase Apple's sales if we were to offer Macs through our catalog."
The main fear Apple has over authorizing third-party mail order, sources said, is that it would take sales away from Apple's existing channels. But Godfrey disagreed.
"Our customers are the kinds who rarely go into dealers," Godfrey said. "They frequently ask about CPUs and unfortunately, we have to send them elsewhere.
>Software sales.
One indication of the potential of the mail- order market for Apple comes from Ingram Micro Inc. of Santa Ana, Calif., which now distributes the company's system- software products.
"The vast majority of system-software sales are going through mail order," said Dave Jaskulke, general manager of Mac D, Ingram's Macintosh products division. "System 7 is doing especially well, the QuickTime Starter Kit is also doing well, although the sales have flattened out."
MacWEEK 08.17.92
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(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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No single product fulfills multimedia storage needs
Mix and match seems to work best
By Larry Stevens
Even as the superfast processors on the Quadra and many accelerator cards reduce most of the processing obstacles in recording digital and audio production, storage is still a sore spot with both hardware vendors and producers.
"Once the data is in the Mac's RAM, the processor can usually handle it, but storing large files and accessing them quickly is a challenge," said Mark Wilcox, marketing specialist with Digidesign Inc. of Menlo Park, Calif., a manufacturer of Mac- based digital audio recording equipment.
The root of the problem for producers creating animation, QuickTime, digital video and digital audio on the Mac is the size of the files. For example, Wilcox said that his customers use up 10 Mbytes of hard disk space for every minute of CD- quality stereo sound that is recorded onto the hard disk.
Because of the huge amount of data coming on and off the hard disk, access time has to be at least 28 milliseconds or better for stereo, Wilcox suggests, and 18 milliseconds or faster for four-track sound. "It's not easy to find all of that in a single, economic solution," Wilcox said.
>Clear about requirements.
Multimedia producers working on the Mac are not bashful about their storage requirements. "We need drives that are high-speed, high-capacity, portable and reasonably priced," said David Lawrence, a San Francisco- based independent multimedia producer.
Lawrence, whose clients include LucasArts of Nicasio, Calif., and Apple, also notes that the elements on his wish list are not embodied in a single solution. "There's no one, good storage medium for the kind of work I do," he said.
As a result, he has learned to juggle the trade-offs to find the mix of products that, in combination, provide the features he needs. Currently, that mix includes a hard drive for speed and capacity, magneto-optical disks for low cost and high capacity, and SyQuest removable disks for portability.
>Multiple solutions.
Makers of multimedia equipment realize that a single solution may not suffice, and so they often have at least two types of technologies in their bag of storage tricks.
For example, Digidesign offers both a magneto-optical drive and two choices of hard drives with its audio recording systems, while Avid Technology Inc. of Tewksbury, Mass., offers a phase-change optical disk in some of its digital video-editing systems, as well as high-speed hard disks.
While faster and less-expensive solutions now are emerging, the storage needs of producers who do digital audio and video recording using a Mac are as varied as the projects they work on.
>Portability vs. speed and capacity.
Sam Green, owner of The Edit Room, a video post-production house in Washington, D.C., said for his Avid Media Composer system, he has two of Avid's phase-change optical disks.
The Phase Change Rewritable drives, which Panasonic Communications and Systems Co. manufactures for Avid, have the advantage of a 1-Gbyte capacity compared with 650 Mbytes, which is standard on magneto-optical disks. But, like all optical disks, they offer only a 90-millisecond access rate.
Green also bought Avid's 2-Gbyte hard drive, rated at a 12- millisecond access rate, which he needs for speed and size. Unfortunately, neither one is perfect for all his needs.
"The optical disk is perfect for storing old files and for sending to colleagues, but it's too slow for everyday work," Green said. "The hard drive is ideal, but I'm not going to disconnect it and mail it to a client."
This two-media solution may no longer be necessary. Pinnacle Micro Inc. recently announced the PMO-650, a drive that uses split optics (moving some of the heavy optical hardware that slows other drives off the read-write head) and a direct seek method that eliminates one step in the seek process to boost performance.
According to Pinnacle, the drive delivers an average access time of 19 milliseconds - four times faster than most magneto-optical drives and as fast as many contemporary drives.
Independent benchmarks aren't in yet, however, and some observers question the comparison because the technique Pinnacle uses to measure seek time is different from the standard definition used by hard disk manufacturers.
>Data transfer.
While access time is important, a second issue is data transfer rate. Although the fastest hard drives today approach 4 Mbytes per second, the standard SCSI port on pre- Quadra Macs can handle only from about 1.5 Mbytes to 3 Mbytes per second.
For older-model Macs, the emerging solution is found in boards, such as Storage Dimensions Inc.'s Data Cannon, MicroNet Technology Inc.'s NuPort SCSI-2, PLI's QuickSCSI and FWB Inc.'s unreleased JackHammer, that use SCSI controllers that can handle 5 Mbytes or in some cases 10 Mbytes of data per second.
These boards plug into the NuBus or processor direct slot. Some boards support SCSI-2's Fast SCSI modes, which allow burst data transfer rates of up to 10 Mbytes per second. The SCSI-2 boards allow the original SCSI cable to remain in place to use low-speed devices such as scanners.
Most SCSI-2 board vendors said that by the end of this year they will release boards that support Wide as well as Fast SCSI, which have double-size (16-bit) data paths and will allow hard drives to transfer data at about 20 Mbytes per second.
Of course, having the ability to transfer data so quickly puts pressure on storage makers to produce products that can take advantage of those rates.
But some SCSI-2 board vendors have found ways to increase the throughput of drives to which their boards are connected.
For example, DayStar Digital Inc.'s SCSI PowerCard implements some of SCSI-2 and SCSI-2 Fast features to provide a maximum transfer rate of 5 Mbytes per second. By using a memory buffer and the ability to pump data directly from the drive to the buffer, PowerCard increases the ability of any storage medium to transfer data by a factor of three to five, according to the company.
>Disk arrays.
RAID (redundant array of inexpensive disks) systems offer another promising speed and capacity solution for multimedia users. These systems use at least two fast drives running in parallel. As a result, access time and data transfer rates are greatly reduced.
Products in this category include MicroNet's Raven-040 Disk Array, FWB's SledgeHammer Arrays, Lovil Computer Corp.'s Lovil R1 and Lovil R2, Unbound Inc.'s Raidstor, PLI's MiniArray, and Storage Dimensions' MacinStor SpeedArray.
Tim Byars, a multimedia producer at Sound and Vision Systems of Torrance, Calif., said that "RAID systems are currently the only way to get the Mac in a position where it can be used like a traditional analog recording studio with few compromises in speed."
Byars, a Lovil R2 beta tester, said the Mac storage system was the best value for the money. "The choice was to spend about $50,000 for the RAID system, which I can keep, or spend $20,000 per day to rent a recording studio," he said.
While speed is the main reason Byars has purchased the Lovil R2, the redundancy offered by RAID is also very important to him. "Multimedia work is very hard on drives," he said. "I burn out a drive every few months. With RAID, I don't lose anything between saves."
>RAM storage.
RAM disk cards provide yet another alternative for multimedia producers. While actually made up of memory chips, the main advantage of a RAM drive is that, because there are no moving parts, access time is virtually zero.
However, there are two disadvantages with RAM disks. While the access problem is solved, data transfer rate is restricted to that which the SCSI or NuBus port can handle. Second, because they use volatile memory, if your power fails, you've lost the data.
RAM disk manufacturers have come up with a number of solutions to these problems. DayStar's RAM PowerCard, for example, connects to the NuBus slot, avoiding SCSI slowdowns. As a result, it can transfer data at 5 Mbytes per second, according to the company.
Experts recommend, however, that those who want to protect data should purchase an uninterruptible power source, which typically will keep you up and running for about 15 minutes to a half-hour after the power fails.
Newer Technology's SCSI-II Dart combines a RAM disk with SCSI-2 capabilities, achieving more than 11 Mbytes per second sustained transfer rate, according to the manufacturer. The company also said that when Fast and Wide SCSI-2 becomes available, it will be able to double the data transfer rate. Additionally, the board has a built-in battery backup, which can keep it running for about seven hours in the event of a power outage.
>Quadra solution.
Ultimately, experts feel the best solution for SCSI throughput and storage capabilities may be to bite the bullet and upgrade your computer to a Quadra 900 or 950. The Quadra's 5396-A SCSI chip is similar to the ones used in MicroNet's NuPort and PLI's QuickSCSI accelerator boards, and the Quadra has built-in capabilities for an internal RAID system.
Add to this the processing power and increased NuBus speeds (up to 8 Mbytes per second) of the Quadra 900 series, and you may find it might be worth it to buy into a more enhanced computer. David Lawrence, after many years of working on older systems, feels it may be worth the cost to upgrade. "I want to be able to take advantage of the newer technology, like SCSI-II drives," he said.
Still, storage bottlenecks continue to dog those working to produce broadcast-quality video and stereo CD-quality sound. While no single answer has yet emerged, producers have several options which, in combination, may allow for a cost- effective solution.
MacWEEK 08.17.92
ProductWatch Page 61
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LetraStudio upgrade offers new level of type manipulation
While LetraStudio's method of loading fonts falls far short of the standard, Version 2.0's strong features set it apart from the competition.
By Bruce Fraser
LetraStudio 2.0, a major reworking of Letraset's type- manipulation utility, marks the re-entry of the new leaner and meaner Letraset into the Macintosh software market. The updated program features the same strong typographic controls and Pantone Matching System color support as its predecessor, combining these with performance improvements, more envelope transformations and a new $249 price tag that makes it a direct competitor to Broderbund Software Inc.'s TypeStyler (see MacWEEK, April 20).
>Unpack your suitcases.
Unfortunately, the current release of LetraStudio 2.0 has some problems, and ironically enough for a type-manipulation program, they lie in the area of font loading. First, LetraStudio doesn't correctly load fonts loaded with Fifth Generation Systems Inc.'s Suitcase 2.1.1. It will load fonts that are installed in the System file, but when we used Suitcase, we found that some fonts didn't load all weights, and others didn't load at all.
One work-around for this is to install fonts in the System file; however, that isn't a serious option for users with large type libraries. A second, safer work-around is to manually add fonts to LetraStudio using a built-in routine that converts Type 1 and TrueType fonts to Letraset's LetraFont format. This works well, and there are no compatibility issues between the LetraFonts and their PostScript or TrueType equivalents - the LetraFonts are used only internally by LetraStudio.
But there's also a problem with this work-around, which affects only users of 32-bit addressing who have more than 16 Mbytes of RAM installed. Under this configuration, the routine for adding fonts manually doesn't work - LetraStudio simply doesn't see PostScript or TrueType outline fonts. Under this configuration the best work-around is to temporarily restart the Macintosh under 24-bit addressing, run LetraStudio and convert the fonts.
This sounds like a lot of work, and, frankly, it is. But if you need a high-end type-manipulation program for logo or package design, it's worth it because LetraStudio's typographic controls far surpass those of its rival, TypeStyler, and other than the aforementioned admittedly severe shortcomings, the program is well-designed and stable.
>Tools and hues.
The basic user interface is largely unchanged from the first release of LetraStudio. The main window shows a page, with vertical and horizontal rulers; a customizable grid; and a palette of simple tools - a selection pointer as well as tools for text, zooming, lines, curves, rectangles and ellipses. These tools allow you to create text objects and simple graphic elements, which then can be assigned a stroke (outline) and fill from the Graphic Specifications dialog. LetraStudio uses Pantone colors exclusively, either as solid colors or as tints from zero percent to 100 percent. You can print spot-color separations or composite-color images from directly within the program, or export your artwork as Encapsulated PostScript and convert it to process-color separations using a separation utility such as Adobe Separator or Aldus PrePrint. You also can print process-color separations of a LetraStudio-generated EPS graphic from QuarkXPress.
>The envelopes, please.
Once you've created basic objects, the fun really starts. LetraStudio offers a variety of transformations that you can apply either as line transformations, which affect the baselines of text objects and line graphics, or as envelope transformations, which apply to the entire letterforms in text objects and to graphic elements drawn with the ellipse or rectangle tool. The built-in envelopes fall into three groups: linear transformations such as scaling, stretching, slanting and perspective distortion; curvilinear distortions such as half-arches, unilateral curves, curved perspective, independent curves, linked curves and mirror-image curves; and two fine-control envelopes, resize and Bezier control. The Bezier controls are particularly useful in fine-tuning the effects of an envelope on text.
To apply a transformation to an object, you simply select the object, choose the line or envelope transformation from a menu, then drag the envelope's control handles to attain the desired shape. New to Version 2.0 is the capability to copy and paste envelope shapes, which lets you quickly apply the same transformation to several different objects. LetraStudio also comes with 20 documents that contain custom envelope shapes such as cans, candy wrappers, ribbons and a variety of true- perspective distortions. You can copy these envelopes and paste their shapes onto any object in a document.
Circular and elliptical text forms are also easy to create. You drag the text tool diagonally to set the radius of the ellipse then choose between running the type inside or outside the circle by a menu command. You can make concentric circles of type either by using the Alignment command or by drawing circles from a common known center, using the rulers and grid as alignment aids.
>Top type control.
As long as you have applied only a single transformation to a text object, the type remains editable. LetraStudio lets you mix multiple fonts, sizes and styles in a single text object. It offers fine control over kerning, character spacing and baseline shifting either by dragging; typing values in a dialog box (to an accuracy of 0.01 points); or using the arrow keys on the keyboard to move selected characters in increments of 10, 1 or 0.1 pixels, at any level of magnification up to 800 percent. Display typography stands or falls on the strength of its spacing, and LetraStudio's controls are more than accurate enough for first-class results.
For distortions more extreme than those offered by a single envelope, you can apply successive envelope transformations to an object. Applying a second transformation has the effect of locking the first transformation and converting the object into a graphic: You lose the ability to edit text or change type specifications, but you can still change the stroke and fill of the object. Some particularly spectacular effects can be created by building a piece of "flat" artwork then applying a true-perspective distortion to the entire piece, and some of the custom envelopes such as cans make it a snap for package designers to simulate the 3-D appearance of the final product.
>Further font features.
You can import PostScript art into LetraStudio in either Adobe Illustrator 1.1 or Illustrator 88 formats (Aldus FreeHand users must convert their art using Altsys Corp.'s EPS Exchange utility) for transformation using any of LetraStudio's effects. Illustrator graphics first appear as a single grouped object, but ungrouping them separates them into their constituent parts. Stroke and fill information isn't retained when you import Illustrator files - you must apply the final strokes and fills in LetraStudio. You also can import Illustrator-format graphics as templates. These then appear grayed on the screen and serve as a guide when you need to create type to an exact size and shape.
Rounding out LetraStudio's features are the conveniences one expects from Macintosh illustration programs. A status box displays the horizontal and vertical location of the cursor or the vertical and horizontal distance of the last move. You can drag up to 16 guides onto the document from the ruler and even place the guides at an angle. A full-featured Replicate command makes quick work of step-and-repeat duplicating and gives the option of changing the scaling percentage and the tint of the duplicates. Other controls include flipping, rotating (manually or by numbers), aligning, hiding and locking objects and changing objects' stacking order. The program also offers a wealth of keyboard shortcuts that, once mastered, make LetraStudio a very productive tool.
>Conclusions.
We hope the new Letraset will make good on the promise of LetraStudio 2.0 by offering a Suitcase-compatible, 32-bit-clean version of LetraStudio as soon as possible. With so much going it for it, it's a pity that LetraStudio doesn't fall in with mainstream methods of Macintosh font handling. While the work-arounds are somewhat tedious, particularly for those with more than 16 Mbytes of RAM, LetraStudio offers so much more than the competition that, ultimately, it is worthwhile.
Letraset is at 40 Eisenhower Drive, Paramus, N.J. 07653. Phone (201) 845-6100; fax (201) 845-7539.
MacWEEK 08.17.92
Reviews Page 43
(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Aldus lays off 100 U.S. workers
Slowing DTP growth prompts 11 percent cut
By Lisa Picarille
Seattle - Financial and management temblors continue to shake the house that PageMaker built. Aldus Corp. this month reduced its domestic work force by 11 percent, eliminating 100 full-time and temporary employees in the company's corporate headquarters here and in development and sales offices nationwide.
The move came after several quarters of less-than-stellar financial results caused by fierce competitive pressures and a sagging economy - both at home and abroad, according to Sandy Smith, Aldus vice president of operations and acting chief operating officer through the end of the year.
Aldus insiders blame the recent upheaval on executives' inability to make decisions. "It's analysis paralysis. Decisions get made and remade," said one former employee.
Observers said things went awry about 18 months ago when Aldus CEO Paul Brainerd left on sabbatical. "Aldus seemed to launch into automatic pilot when Brainerd left," said a source familiar with the company who requested anonymity. "Aldus went from the cutting edge of technology to lackadaisical, and that is being manifested today."
The company has experienced shuffles in its executive suite. Former COO Phil Herres departed in April.
Now some observers are saying that it would not be surprising if changes at the highest level were under consideration. "Aldus' market growth has been negligible for some time. The [board of] directors may decide it's time for a change," said Jeff Silverstein, editor and publisher of Software Industry Bulletin in Stamford, Conn. "It's like a baseball manager in trouble. You don't fire all the players. The manager is the first to go." Aldus denied that Brainerd may be ousted.
Others agreed. "Brainerd is the heart and soul of the organization, and what he needs is more of a supporting cast," said Charlie Federman, managing director of Broadview Associates, a Fort Lee, N.J., company specializing in mergers and acquisitions in the computer field.
Still another factor in Aldus' stormy times are threats at both the high and low end of the desktop publishing market.
Although Aldus has a variety of graphics products for both the Mac and IBM PCs and compatibles, PageMaker accounts for more than half of its revenues, according to Smith.
While QuarkXPress is eating away at the high-end Mac market, a Windows version of the same product expected in late 1992 may further erode PageMaker's share of the Windows market. At the low end, word processors with publishing features are moving into PageMaker's domain.
Besides, the overall DTP market is dwindling, said Dan Ness, an analyst for Computer Intelligence Inc., a La Jolla, Calif., market research company. "A few years ago, DTP represented about 5 percent of all the software people bought. It's down to half of that," he said.
Aldus still has 68 percent of the DTP market and is in the process of rethinking its channel strategy to maintain its lead, Smith said.
(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
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Mac the Knife
Supply side slows system sales
This is the week many have been waiting for. Having first had a look at the first of the party conventions in New York, we now have a chance to see what the other one has to offer as it gathers this week in Houston to do James Baker's bidding. Of course, the Knife has already weighed in with the opinion that the international Mac clan, as defined by the recent gathering in Boston, is a decidedly more interesting group, in terms of both parties and products.
The Knife points out that no politician has yet to address the looming problem of spotty supplies of several hot Mac models over the next several months. Right now the spotlight is on the Quadra 950, which everyone seems to want for one high-end application or another, but which very few are getting with any regularity.
One dealer, in a fit of frustrated angst, called John Sculley's office to complain. You can imagine her surprise upon receiving a call back from Sculley himself, or so the caller claimed. The (supposed) Apple CEO commiserated that he had a couple of 950s on order but no delivery in sight. Whether or not it really was Sculley on the other end of the line, the dealer did notice that the level of Apple service increased dramatically immediately after that one call.
>PowerBook backup.
The Knife has learned that Apple is girding itself for complaints about the four- to eight-week delay in filling PowerBook 145 orders, primarily because of very high demand. Part of that demand can be attributed to the education channel, where a back-to-school promotion featuring the PowerBook 145 4/40 at a hefty discount has proven to be an immediate hit.
And those of you out there who believe that $1,000 is not too much to pay for a handheld Personal Digital Assistant might use the period between now and the end of the year to brush up on your patience skills, too. Recently Sculley, Chief Financial Officer Joe Graziano and President and Chief Operating Officer Michael Spindler briefed a group of financial analysts, and among the many Apple particulars revealed was the prediction that the Newton PDA, which originally was planned for introduction at the beginning of the year, is not scheduled for introduction until mid-1993. So no PDA on the inauguration stand this time around.
>Dynamic dockables.
Elsewhere in Apple CPU shortages news this week, expect long lines when you drop by your local dealer this October to pick up the first PowerBook Duo 210s and Duo 230s. The Knife has learned that demand for these PowerBooks, too, will exceed supply. No one seems to be quite certain as to how long the shortage will last.
But all the news is not shortages and production holds. For example, the Knife has learned that the PowerBook Duo MiniDock, which is designed primarily for on-the-road use with the Duos and is the lesser of the two docks Apple will offer, is expected to carry an aggressive price, probably less than $200.
The upcoming PowerBook 160s and 180s are also expected to be both in plentiful supply and aggressively priced. In fact, the Knife's sources claim Apple is aiming to price the PowerBook 160 squarely in the PowerBook 145 neighborhood. Besides being good news for buyers, such 160 pricing raises the obvious question of the future of the 145. Will Apple discontinue the 145, thus making it one of the shortest-lived CPUs in Apple history, or will it reposition it at a lower price? The answer to that one probably depends on how much it actually costs to build a 145 and thus how much maneuvering room Apple has.
These ersatz nominating conventions may leave you cold, but almost everyone warms to the MacWEEK mug. Use your inside knowledge to earn a mug of your own. Contact the Knife at (415) 243-3500, fax (415) 243-3650, MCI (MactheKnife), AppleLink (MacWEEK) and CompuServe/ZiffNet/Mac.
MacWEEK 08.17.92
Mac the Knife Page 110
(c) Copyright 1992 Coastal Associates, L.P. All rights reserved. This material may not be reproduced in any form without permission.
