Needing a Hit, Next Unveils Its New Computers : Technology: Steven Jobs’ latest offerings draw praise, but analysts say the firm must prove that its machines are the best way to solve specific problems.
Two years after launching the first Next Computer model amid a frenzy of hype--only to see it fail in the marketplace--Steven P. Jobs returned to Symphony Hall here Tuesday with a new series of products and the future of his company hanging in the balance.
Although Jobs, co-founder of Apple Computer, showed that he has not abandoned his lofty goal of revolutionizing the desktop computer, Tuesday’s announcements represented a practical response to those who criticized the original Next machine for its high price and lack of software.
Analysts generally praised the new products and said they should remove some of the doubts about Next’s future. But they added that Next must show that its new computers provide the most cost-effective solutions for specific problems.
The new Next product line maintains innovations such as compact disc-quality sound and a highly “user-friendly” software system, but the cheapest machine now costs $4,995--compared to $6,500 for the original model. The company also introduced a color machine and a new high-end system that can incorporate a high-performance graphics and video processor. All the computers will now use a new microprocessor from Motorola that allows them to operate three times faster than the earlier machine.
Just as important, Lotus Development Corp. and a number of other major software publishers announced plans to release software for Next. The Lotus product is a spreadsheet for financial analysis, but it contains major innovations that Lotus Chief Executive Jim Manzi said were the fruit of a four-year effort to “reconceptualize what a spreadsheet is all about.”
Jobs said Next had secured 15,000 firm orders for the new computers, double the number of old machines that analysts believe have been sold. Shipments of the low-cost Next will begin in November, though the color machines will not be available until early next year.
“It seems that (Jobs) is back in the race again,” said Richard Schaffer, principal of the New York consulting firm Technologic Partners. “Before, we were being polite, but it was over. Now he has provided a family of machines whose performance and price are best-in-class.”
Schaffer cautioned, however, that this assessment was based on the assumptions that the new software would be available on time and that the machines perform as advertised.
Stewart Alsop, a Silicon Valley personal computer consultant, characterized the Next announcement as “good enough to allow them to survive.”
Jobs will reveal few details about the financial condition of privately held Next, which he founded four years ago after being ousted from Apple. But Next was one of the best-funded start-up ventures ever, having raised some $200 million from investors ranging from Texas billionaire H. Ross Perot to the Japanese electronics firm Canon. And most analysts believe that the firm has plenty of cash.
The new products represent a retreat from one of the major innovations contained in the earlier Next--the effective, but very expensive, optical disk drives. Traditional floppy disk drives and high-capacity hard disk drives are now standard equipment, with the optical drives available only as an option on some models.
The low-cost Nextstation also abandons the trademark one-foot cube shape in favor of a flat, pizza-box-like profile, though the more expensive models are still cube-shaped.
Next has also altered its tight focus on the higher education market in favor of a broader sales strategy aimed at the corporate world. Specifically, Next is targeting business users who write their own computer programs to carry out specialized tasks, a market dominated by workstation vendors such as Sun Microsystems, Hewlett-Packard and Digital Equipment.
Next’s program-writing system, which has been licensed by International Business Machines for use in future products, has been widely praised as an important breakthrough in making applications development easy and efficient.
“It’s the most productive machine for a programmer, and it’s the easiest machine for the user,” said Hadar Pedhazur, a vice president at First Boston Corp., which has agreed to purchase at least several dozen of the Next machines.
