Apple Computer Update

LAUREN THIERRY, CNNfn ANCHOR, IN THE GAME: Apple Computer <Company: Apple ; Ticker: AAPL ; URL: http://www.apple.com/> is making a renewed attack on the market for desktop publishing, both on the Net and on paper. Apple's interim chief, Steve Jobs, laid out the company' s goals to industry executives in San Francisco, Thursday. Fn's Steve Young spoke with Jobs after his speech to find out more about Apple' s plans and its newly elected board of directors. (BEGIN VIDEOTAPE) STEVE JOBS, INTERIM CEO, APPLE COMPUTER: It's going well. We had our first board meeting a few weeks ago. And we've got a great board: Bill Campbell, CEO of Intuit <Company: Intuit, Inc. ; Ticker: INTU ; URL: http://www.intuit.com>; Larry Ellison, CEO of Oracle <Company: Oracle Systems ; Ticker: ORCL ; URL: http://www.oracle.com/>, the second largest software company in the world; Jerry York (ph), who was the CFO of both Chrysler <Company: Chrysler; Ticker: C; URL: http://www.chryslercorp.com/ctc.html> and IBM <Company: International Business Machines ; Ticker: IBM ; URL: http://www.ibm.com/> during their turnarounds; Ed Willard (ph), Gareth (ph) Chang (ph). Really good guys.

And as I said it was a great board meeting, and we are interviewing people right now for the CEO job. The response has been a little better than I though it would be.
STEVE YOUNG, CNNfn CORRESPONDENT: How many candidates have you interviewed to date?
JOBS: We've got about a dozen on the list. I'm not interviewing them all, so I don't know the exact number, but many.
YOUNG: I'd like to come back to that. But I want to ask you. You' ve decided to end the cloning of Apple computers. Were you concerned about that cannibalizing your business?
JOBS: I talked to all the cloners, and the problem was not that we wanted to end cloning, the problem was that we wanted to end cloning by virtually giving away the software. And I said to them if you will pay us a fair price for the software, we would love to continue to license your software. We love to sell software. Unfortunately, they all turned us down, and we said fine, we'll honor the existing agreements that are in place, but we don't intend on expanding, because it's not a financially good deal for Apple Computer. So, I suspect that most of those customers will come back to Apple. As an example, one of the largest cloners had less than 1 percent of the customers to the new Mac/OS. So these were existing Apple customers. I think most of them will come back into the fold if we can offer them some really great machines at aggressive prices, which we're beginning to do.
YOUNG: There are a lot of people who admire your ability to make crisp decision, but as you know there are some people who say you may unwittingly be making it tough to find a CEO who will inherit your decisions. If a CEO is found whose views differ from yours, would you support him or her in changing policies you set in place?
JOBS: I feel very strongly that the job of the board is to hire and fire the CEO. That's their primary job of the company. And if this board hires a CEO, that person is running the company, and I think that the board needs to stand back and give them some rope.
YOUNG: Will you stand back also?
JOBS: Oh, of course.
YOUNG: In Boston when you announced the deal with Microsoft <Company: Microsoft Corporation ; Ticker: MSFT ; URL: http://www.microsoft.com/> and Bill Gates visage beamed down on the giant screen, it seemed like something right out of your 1984 commercial. Why did you make that deal with Gates, which seem to many people to be making a bargain with the devil?
JOBS: Apple and Microsoft are very different in a lot of ways. Apple really does think different about things than Microsoft in many cases. However, there are a lot of areas where the right thing to do for customers is to do some things together. And Internet Browsers, Microsoft Office on the Macintosh, things like that where both companies win. And the relationship between the two companies was so polarized, that none of the right stuff for customers was getting done. And so our effort was an attempt to normalize the relationship between the two companies - where we can work together on the stuff where it makes sense. And we are working together with Microsoft, and I' d say it's a very healthy relationship that's growing over time. Does that mean we're going to be the same? Absolutely not. Does it means we're going to do the right things for customers to make these systems work together in key ways? Absolutely, yes. Because in the end, Apple plus Microsoft equals a hundred percent of the desktop computer market. And so the two players need to work together. They don't have to agree on everything, but they need to work together.
YOUNG: The Visionarian (ph) says that Apple is losing people at the rate of about 2 to 3 percent a month: some choosing to move, some being persuaded to go with or without a package. I understand that people inside Apple now talk about being Steved. JOBS: Well, you know, I don't talk to everybody in Apple, but I actually sense quite the opposite. I think the turnover rate of people that are leaving involuntarily has slowed dramatically. Apple's turnover rate is still a little bit above the Silicon Valley average, but not very much, and it's going down. I actually see a bounce in people's step now that they see maybe a strategy that can be a winning strategy, that I did not see 12 weeks ago. So, I don't know. I haven't heard what you're saying.
(END VIDEOTAPE) END
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