Apple makes big moolah

Apple had its third quarter financial conference call yesterday, and the company is reporting that its quarterly profits tripled compared to the same quarter last year. It looks like profits were largely driven by the iPod (big surprise there). Even the iTunes Music Store made a small profit (bigger surprise there). Mac sales were up across the board by a total of 14 per cent compared to last quarter, although iMacs and eMacs were down 15% from last year.

What’s even more interesting is that Apple confirmed that the delay in the release of the newest iteration of the iMac was due to production problems with the G5 at IBM. This is confirmation that the new iMac will have a G5 in it.

The next quarter is going to be interesting. Apple has absolutely no iMacs to sell until some time in September, meaning they will miss the back to school season completely. Supplies of the PowerMac are supposed to be tight until mid-August. The company has had a heckuva time keeping up with iPod demand (especially the Mini), and the problems with G5 production will continue until IBM gets the process bugs fixed.

Eventually, some company is going to develop a hard drive-based music player that has an interface and client software that is "good enough" and sell it at a lower price than the iPod. At some point, this type of device will become a commodity, like CD players and DVD players. I can’t see the iPod gold rush lasting forever. In fact, I would be really surprised if it lasted another year. I can see people paying a small premium for the Apple brand name, but I think there will be a saturation point, and I think it’s coming soon. What then?

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