Apple's Intel switch: Jobs' keynote transcript

CEO stunned customers, developers and industry analysts when he announced that Apple was embarking on its third major transition: putting Intel chips inside the Mac.

CNET News staff
27 min read
Apple Computer CEO Steve Jobs stunned customers, developers and industry analysts when he announced June 6 that the company was embarking on its third major transition: the adoption of Intel processors inside the Macintosh. For future reference, this is his keynote address explaining why the move is necessary and how it will occur over two years. (The speeches made by three Apple developers supporting the decision are not included in this transcript, but the comments of Paul Otellini, CEO of Intel, have been retained.)

Jobs: Welcome to our World Wide Developers Conference 2005. Today is an important day. We've got some great stuff for you today, but I want to start off with just some stats on the conference. There's over 3,800 attendees today here. This may be the largest developers conference in Apple's history--I'm not sure but I know it's the largest in the last decade, so welcome!

There are developers here from over 45 countries including China and India, and we've got some great stuff for you--over 110 lab sessions--and of those, 39 are hands-on, where you're sitting there on the machines during the labs--95 presentation sessions and over 500 Apple engineers are going to be on site this week to help you. We have our Apple Design Awards and this year we've got more entries than ever before, over 400 entries and it just shows the vibrancy of the developers community out there--it's fantastic! But the number that blows my mind for Apple developer connection members, we have now crossed a half-a-million members. Isn't that amazing? So the developer community at Apple is thriving.

"Last quarter the Mac grew at over three times the rate of the rest of the industry and we're pretty excited about that."
--Steve Jobs
Apple Computer CEO

I'd like to give you a quick update on retail next. Apple retail, we've got 109 stores now around the world. We are seeing over a million visitors per week--a million visitors per week--and over the last 12 months the retail stores and the online store have sold over half a billion dollars worth of your products, so they're doing really well for us.

We've opened a lot of stores like this in malls. We've also opened some, what are called flagship stores, this one being in London. I don't know if you've been to the London store but it's hopping; it's a phenomenal store. I was there about two weeks ago on a Tuesday afternoon. There were over 250 customers in the store--Tuesday afternoon at 2 o'clock. So it was amazing. Now our retail group is constantly trying to find the best real estate to locate stores and they made a video at a real estate convention and I saw it and I nabbed it because I wanted to show it to you, so could we run that video now?

So that's a little update on Apple retail. We think it's the best buying experience in the world for personal computers.

Now, I would like to give you an update on the iPod and our music efforts. You know, the iPod has really entered popular culture in America--you know that when you're lucky enough to get on the cover of The New Yorker, so we were thrilled with that. And that's reflected in iPod sales. This is the cumulative iPods sold and at the end of the last quarter, at the end of March, we'd sold about 16 million iPods and that's also reflected in the iPod's market share of all types of MP3 players including flash and hard drive--everything--76 percent market share. So we're thrilled with that.

Now as you know, iTunes goes with the iPod and we just recently crossed 430 million songs sold and downloaded in iTunes. We're thrilled with this and that is again reflected in iTunes' market share. We've gotten lots of competition over the last nine months and what's happened, our market shares has gone up--it's now 82 percent in the month of May.

Now we recently announced something new for iTunes and iPod and it's called podcasting. As you know, the podcasting phenomenon is exploding right now. Podcasting of course is a concatenation of iPod and broadcasting. And what is podcasting? It's been described a lot of different ways. One way has been a TiVo for radio--you can download radio shows and listen to them on your computer or put them on your iPod anytime you want. So it's just like television programs on TiVo, and that's true. Another way has been described as Wayne's World for radio, which means that anyone without much capital investment can make a podcast, put it on a server and get a worldwide audience for their radio show, and that's true too. We see it as the hottest thing going in radio, hotter than anything else in radio. And as you know, what podcasting is is that you can not only download radio shows and listen to them, you can subscribe to them, so that every time there's a new episode it automatically gets downloaded to your computer. You can listen to it there or it automatically gets synced to your iPod the next time you doc your iPod. So it's very, very exciting. And there are over 8,000 podcasts now and this is growing really, really fast. So that's pretty exciting.

Now it's not just amateurs doing these things, though. These 8,000 are not all amateurs, but the pros have realized that this is huge and here's just a list of some of the companies doing podcasts now: all the major radio broadcasters, the network broadcasters, major magazines, major newspapers, even major companies like Disney and Procter & Gamble and Ford and General Motors, so it's pretty exciting. And so what we're doing is, we're going to make it even easier because you're not going

to have to download other applications and get all sorts of stuff together to make this happen. We're going to build it right into iTunes and iPods. So you can subscribe to any podcast and we're going to make it really easy and so right into iTunes, very simple. But one of the most important things is, how do you find these podcasts? Do you want people typing URLs into iTunes? Well, they can do that, but we're also going to build right into the iTunes music store a podcast directory, so that we're going to list thousands of podcasts and you'll be able to click on them, download them for free and subscribe to them right in iTunes, so I'd just like to give you a quick peek of what this is going to look like.

Let me bring up iTunes here. And I'm going to the podcast home page, and this is the podcast directory, and we're going to list, again, thousands of podcasts. Let's just go ahead and listen to one. We can go to one here. This is Adam Curry, he's one of the inventors of podcasting and you could listen to his?so you could listen to an episode here. But it's much more interesting to subscribe to the podcast and we've now subscribed to Adam Curry's podcast, it's flipped us up to this podcast thing right in the source of list. It's downloaded the most recent one. If I want to download another one I can just push a button and go download one of the older episodes and I can listen to an episode.

OK. So let me give you another one. Adam's great. This is KCRW. This is a show called "The Treatment." They're a public radio station in L.A., so let me go ahead and subscribe to "The Treatment." And here's another one. I can close this one if I want to, and let's go listen to "The Treatment."

So you get the idea. These are really cool. Some are amateur and some are pro. One more I want to just highlight. We're going to do one ourselves because we have new-music Tuesdays and we put new music on the iTunes music stores, so we decided to do a podcast. This is just a test, but you can subscribe to that?and the nice thing about this one is, as we scrub along you see the artwork changes too, right? And you can go to different chapters in this thing. You can go right to different chapters. So, very, very simple, and we think it's going to basically take the podcasting mainstream to where anyone can do it. Really easy to find these podcasts, really easy to listen to them. So we're very excited about this and there's going to be one more way in which iPod and the iTunes digital-music community are really at the forefront of this stuff, bringing the innovation into the marketplace.

Now I'd like to give you a little update on Mac. Mac is doing really well right now. Let me start off with just some figures. If we look at growth rates, these are year-over-year unit growth rates for the last five quarters ending in March. And if we look at the PC market, the growth has slowed down a little bit from just under 20 percent five quarters ago to just over 10 percent today. This is, again, year-over-year growth rates in terms of units shipped. But let's look and see how the Mac's done during the same period. Look at this. Nine months ago,

the Mac took off in terms of growth rates and it grew over 40 percent.

So last quarter the Mac grew at over three times the rate of the rest of the industry and we're pretty excited about that. The most important thing, of course, happening in the Mac is Mac OS X Tiger. I hope all of you are using it. We shipped it recently. I'm sure you're all using Spotlight, Dashboard. We've shipped H.264-based QuickTime 7. As a matter of fact, today we're previewing QuickTime 7 on Windows, so you'll be able to download that later on Windows today, so Windows users as well can get the best digital video in the world. You know, we've shipped over a billion copies of QuickTime during its lifetime--over a billion copies. And now QuickTime 7 with H.264 is available on Macs and a preview release today on Windows. You've seen the new mail with instant searching in it. We've seen Safari with instant RSS access built right into it. And you've seen iChat AV where up to four people can do video conferencing right on the desktop with great quality, again because of H.264.

So, Tiger we think is the best release we've ever shipped and you know what, the critics have agreed. You know the quotes. I'm sure you've seen some of them. This is from Computerworld. "Want to see what the future of personal computing looks like? Don't wait for Microsoft to show you; go out and get yourself a copy of Apple's OS X Tiger. It's that good." Here's The New York Times: "Spotlight isn't just a super fast Find command, it's an enhancement that's so deep, convenient and powerful, it threatens to reduce the 20-year old system of nested folders to irrelevance." Hear, hear! CBSnews.com. "I remember writing an article about Lotus 1-2-3 back when the product was released during the '80s? it may have been nearly two decades since I wrote that column, but it took Spotlight less than two seconds to find it." Business Week: "Tiger bolsters OS X's edge as the best personal computer operating system around," and a similar one from The Detroit Free Press: "It's the most elegant, useful and powerful operating system I've ever used in three decades of computer ownership. It runs circles around Windows." And finally Walt Mossberg: "It leaves Windows XP in the dust."

And I know you guys are all taking advantage of the greatest, latest Tiger features in your apps and it's very exciting and I'm really pleased to report to you that this week we will deliver copies sold through retail delivered through maintenance and shipped on the Mac since we cut over, the 2 millionth copy of Mac OS X Tiger. This is the fastest? remember, it's been about six weeks since we started shipping it and we are thrilled with this. This is the most successful OS release ever and it's not just us that have been busy with Tiger. Take a look at the third-party stuff that's been released. Over 400 Spotlight plug-ins, over 40, I'm sorry, over 400 Dashboard widgets and over 550 Automaton actions have already been posted. And in particular, I want to focus in on these dashboard widgets.

Dashboard is one of the most exciting features of Tiger and people have done some beautiful things and I'd like to just show you a few of them now. So let me go ahead into Dashboard, you all know Dashboard and let me get a few out here. Here's a great one for Amazon. This one doesn't just take you to Amazon when you search for something, but I can search for let's say, Tiger, and it right in place goes and searches Amazon. It just gives me all the stuff I might want, right, or iPod, boom, and there is all the stuff on Amazon I might want from an iPod.

Let me show you another one that's really cool. Business Week is just releasing this, I think, today, but this gives me up-to-date Business Week stories right here and so I can look and take a look at Apple if I want to and there's all the stories about the Apple today and I can flip it around in the back and look at top news or technology and whatever I want to do. It's pretty cool. So there we go and let's go on to CNN, it's got a similar thing. It's not as nice-looking as Business Week's, but it does the job and here is all the latest CNN stories. You know, now here is a cool one, if you haven't seen a countdown calendar, so you bring up this countdown calendar and you go in the back and you fill in the dates that you want to count down to. So I'm going to say 12/31/2006, I'm going to put in Longhorn and that's the days until Longhorn, it just counts them down.

Here is, you know, here is a good package tracker for UPS, DHL, FedEx and I was tracking a package earlier, so I can go track a package here, and there is my FedEx package. You know here's a fun one, Rabbit Radio. This finds you a local NPR station and you can listen to it and you can even listen to it when Dashboard's off. It's great. Nothing's as great as NPR.

Here is a?let me go find another one here. Let's see, here is a fun one for sports enthusiasts, which is baseball scores, just sit there, and scrolling. TV tracker, I'm sure you've seen. It goes and finds all the TV shows that you might want. This is a favorite of mine, Wikipedia. For those of you who don't know, this is an open-source encyclopedia where everybody contributes to it. It has now become one of the most robust and certainly accurate encyclopedias in the world because you've got experts from all over the world contributing to it and we just look up Tiger here and you can get the lowdown on all kinds of tigers. So that's Wikipedia, which is great, and lastly I want to show you Yahoo just released an updated one on their traffic, and I can put San Francisco, California, here, and there is the traffic updates for San Francisco. So these are just a few of the over 400 Dashboard Widgets that are available now on Tiger that you can go get. And we just released the new site on the OS X tab of Apple.com, which makes it much easier to find these things, so go check them out, they're pretty amazing.

So, OS X Tiger, now what percent does this represent of all Mac OS X users? These 2 million copies that we've delivered so far? They represent already 16 percent of the entire Mac OS X user base, Panther is about half, about a quarter is Jaguar and about 10 percent are the laggards on an early versions of X. And after six weeks this is phenomenal. Now where do we expect to be when we meet again here next year? This time next year, we expect that Tiger is going to be half of the OS X user base. So we're really thrilled about that.

And if we take a look of what we've done over the last five years, we've released five major versions of OS X over the last five years. In that timeframe, of course, Microsoft released XP and looking forward, what do we see? Well, the next, really I'm very pleased to announce, that the next release of OS X is going to be called Leopard and we're not going to be focusing on it at this conference today, but we certainly will in the future and we intend to release Leopard at the end of 2006 or early 2007 right around the time when Microsoft is expected to release Longhorn. So that's what the future looks like and we look forward to telling you about Leopard. So that's what's up for Mac OS X Tiger.

Now, let's go to a big topic, transitions. Let's talk about transitions. The Mac in its history has had two major

transitions so far, right? The first one, 68K to PowerPC and that transition happened about 10 years ago in the mid-'90s. I wasn't here then, but the team then did a great job from everything I hear. And the PowerPC set Apple up for the next decade. It was a good move. The second major transition, though, has been even bigger and that's the transition from OS 9 to OS X that we just finished a few years ago, in the early part of this decade. This was a brain transplant and even though these operating systems vary in name only by one, they are worlds apart in their technology. OS X is the most advanced operating system on the planet and it has set Apple up for the next 20 years.

Today it's time to begin a third transition. We want to constantly be making the best computers for you and the rest of our users and so it's time for a third transition and, yes, it's true. We are going to begin the transition from the PowerPC to Intel processors and we're going to begin it for you now and for our customers next year. Now, why are we going to do this, right? Didn't we just get through going from OS 9 to OS X, isn't the business great right now? Why do we want another transition? Because we want to make the best computers for our customers looking forward. Now, I stood up here two years ago in front of you and I promised you this, and we haven't been able to deliver that to you yet. I think a lot of you would like a G5 in your PowerBook and we haven't been able to deliver that to you yet. But these aren't even the most important reasons. The most important reasons are that as we look ahead, though we may have great products right now, and we've got some great PowerPC product still yet to come, as we look ahead we can of envision some amazing products we want to build for you and we don't know how to build them with the future PowerPC road map. And that's why we're going to do this. When we look at Intel, they've got great performance, yes, but they've got something else that's very important to us. Just as important as performance, is power consumption. And the way we look at it is performance per watt. For one watt of power how much performance do you get? And when we look at the future road maps projected out in mid-2006 and beyond, what we see is the PowerPC gives us sort of 15 units of performance per watt, but the Intel road map in the future gives us 70, and so this tells us what we have to do.

Now this is not going to be a transition that happens overnight, it's going to happen over a period of a few years. Again, we've got great products right now and we've got some great PowerPC products in the pipeline yet to be introduced. But starting next year we will begin introducing Macs with Intel processors in them and over time these transitions will again occur. So when we meet here again this next time next year, our plan is to be shipping

Macs with Intel processors by then, and when we meet here again two years from now, our plan is that transition will be mostly complete. And we think it will be complete by the end of 2007. So this is a two-year transition. So, first transition, 68K to PowerPC, the second transition, OS 9 to OS X. We're going to begin the third transition from the PowerPC to Intel processors.

There are two major challenges in this transition. The first one is making Mac OS X sing on Intel processors, right? Now, I have something to tell you today. Mac OS X has been leading a secret double life for the past five years. There have been rumors to this effect, but this is Apple's campus in Cupertino. Let's zoom in on it and that building right there. We've had teams doing the just-in-case scenario. And our rules have been that our designs for OS X must be processor-independent and that every project must be built for both the PowerPC and Intel processors. And so today for the first time, I can confirm the rumors that every release of Mac OS X has been compiled for both PowerPC and Intel. This has been going on for the last five years.

Just in case. So Mac OS X is cross-platform by design, right from the very beginning. So Mac OS X is singing on Intel processors and I'd just like to show you right now. As a matter of fact?as a mater of fact this system I've been using right here...Let's go have a look. Let's go have a look here. So we've been running on an Intel system all morning and let me just go, you know, do a few simple things. Baseball, you know, boom, all the normal stuff just works. Let's go back to these Dashboard Widgets that we just brought up, there they are and, you know, we can even--let's see here, you know--go find a calendar event here. Very simple! Let me go show you mail. There is mail right here. Safari, here is the new Widget stuff, way to find some new widgets, boom, on Apple.com. Let me show you iPhoto, loading in 4,000 photos, here we are. And let me go ahead and play you a movie. Here it is, let me get rid of this. Here is a movie trailer here. All right, enough of that. So this is Mac OS X running on Intel processors.

We are very far along on this but we're not done, which is why we're going to put it in your hands real soon, so that you can help us finish it. Now, the second major challenge is your apps right? So let's take a look at how you're going to make Intel versions on your apps. You can separate code into kind of four different buckets: Widgets, Scripts, Java, Cocoa Apps, which of course are made with Xcode, Carbon Apps, which can be made from Xcode, and Carbon Apps which can be made from Metrowerks. Now each have different properties. Widgets, Scripts and Java, they just work, right? They just run, nothing to do. Cocoa apps, a few minor tweaks and a recompile and they just work. Carbon with Xcode, more tweaks and a recompile, and they're going to work. And in Metrowerks, the first thing you have to do is move to Xcode.

So, let's take a look at this again: Widgets, Scripts and Java just work. Cocoa apps, literally a few days and your Cocoa app's going to be running with an Intel version. Carbon apps, it's to be a few weeks, a few more tweaks, although there are exceptions to that although we maybe overstating it here, which we'll see in a minute. And and in Metrowerks we don't know, you've got to get to Xcode. So the key here is getting to Xcode.

Now we started evangelizing Xcode 18 months ago, how is everyone doing on Xcode? They're doing well. Our top 100 developers, over half are using Xcode today, over half of our top 100 developers and another 25 percent of them are in the process of switching to Xcode. So, over 80 percent of our top 100 developers are using or are in the process of using Xcode, and less than 20 percent haven't got onboard yet. Now is a good time to get onboard. So Xcode is the key and we've got a new Xcode today to give you, Xcode 2.1. This has got some new fun features as you know Xcodes are a very robust development environment, but the most important new feature,

the giant new feature is when you go to build your app you get a little sheet that pops down, all blown up for you here. What are you going to build for? PowerPC and Intel and you check this box, OK, and you're going to build the universal binary. That's the binary that's going to contain all the bits that run both the architectures and so the loader for each one loads the right set of bits and goes. One binary works on both PowerPC and Intel architecture. So you can ship one CD that supports both processors, and again?we're going to be supporting both these processors for a long time because we've got a very large installed based on the PowerPC that you're going to want to sell your software to and there's going to be a growing installed base on Intel that you're going to want to sell your software to. So we want to support both of these processors into the future and universal binaries is the way to do it. So get on Xcode 2.1 and get your copy today. There will be a copy for everybody at the registration desk immediately following this keynote.

So let's go back?making an Intel version. Now, again, this is nothing like carbonization. This is a lot easier. And I want to focus on one app right here, a Carbon App written in Xcode. This is a developer I've known for a long time. I gave him a call Wednesday night, this last Wednesday night, and I said, "We've got something really secret we're working on in and I can't tell

you what it is, but I want you to put all your source code on a hard disc and fly out here and let's see what we can do." And it was nip and tuck there for a few minutes, but they trusted us enough to do that, and that company was Wolfram Research and that app was not a small app. That app was Mathematica and it is my pleasure right now to introduce Theo Gray, the co-founder of Wolfram Research to tell us what happened in the last five days. Theo, welcome!

(Theo Gray's address)

(Jobs): So the key...thank you, Theo. The key message here is to get to Xcode, get to Xcode 2.1 and create a universal binary and this is what's going to let us bring all of our apps over and I think that you're going to find that the tools are really, really good to do this. I think you're going to be very pleasantly surprised. But even with all of this effort, not every application is going to be universal on day one. So what are we going to do? We've got an awesome technology called Rosetta we're going to be shipping with these new machines, and Rosetta allows us to translate PowerPC to Intel. It lets us run existing PowerPC binaries on Intel. So existing apps run. It is a dynamic binary translator. It runs existing PowerPC apps. It is transparent to users. It's nothing like Classic, where you're loading a whole operating system. This is totally transparent. You just click on a PowerPC binary it starts translating and that's it. Users don't even know. It's lightweight, no big memory footprint and it's pretty fast, so most users will not even know that they're running it, which is fantastic.

So I'd like to show this to you right now if I could. Let me just go over here and I've got some apps right here. So, I'm just going to open a Word document and this is a Word document right here and let me go up and it just thinks its running on a PowerPC, boom, boom, boom, whatever it's doing. Let me open another one here, boom, very simple. Let me open an Excel spreadsheet. Now let me open Quicken, boom, you know, let me open Photoshop. Now you'll notice when Photoshop is opening it's also loading in all the plug-ins and all the plug-ins again are all translated, so they all work fine. There is Photoshop. Let me open another photo, let's see how fast it, boom, and again you can? go through stuff and do whatever you want to do. So that is Rosetta.

These PowerPC apps just run and that's what we're going to have for our users because every app isn't going to be universal from day one. So, OS X singing on Intel processors, Xcode 2.1 to generate universal binaries, and Rosetta to run PowerPC apps before they are universal. How do you get your hands on all this stuff? We want you to have your hands on this stuff now, so you can help us finish it and so you can get started creating your universal binaries and we have created a developer transition kit for you. This developer transition kit has got a:

* 3.6GHz Pentium 4 in it, inside a Power Mac
* OS X 10.4.1, our pre-release of the Intel version
* Xcode 2.1 to generate universal binaries
* A universal binary porting guide that's quite good

It is a development platform only. This is not a product, this will never be shipped as a product, it's just for you guys to get started in development and actually you have to return them by the end of 2006 because we don't want them floating around out there. These are not products, but we're going to get them to you now. They are for Select and Premier ADC members only and we're going to price it at $999 and you can order them today. We'll be shipping them within two weeks so you don't have to carry them home and we'll get them out to you real fast. So that's the development environment and you should be able to take all this and create a universal versions of your apps.

Now, most of you are hearing about this for the first time today, unless you read the Wall Street Journal, I guess, but we have talked to a few developers this past week. You heard from Theo at Wolfram Research and I'd like to invite another one up on stage that we've briefed on this and of course that's Microsoft because Microsoft Office is very important to us all. We have a great relationship with Microsoft and I'd like to invite Roz Ho, the general manager of the Macintosh Business Unit at Microsoft, up on-stage right now. Let's give her a warm welcome!

(Roz Ho's address )

Jobs: Thanks, Roz. One of our other partners as you know is Adobe. They are close by us,

we work very closely with them and we've been working with Adobe for over 20 years as well and it's my pleasure to invite up Bruce Chizen, the CEO of Adobe.

(Bruce Chizen's address)

Jobs: Thank you, Bruce. And now, you know, we've obviously been working with Intel these last several months evaluating what we were going to do leading up to this decision. And we found we've kind of gotten deeper in discussions with them than ever before and we found something pretty amazing, which is they're kind of like us. They're passionate about their products. They're an engineering-driven culture that is passionate about their products and we didn't always view them that way. But that's what we found. And our engineers have gotten along famously with their

engineers and we've had an extremely productive working relationship as we've come to learn about their road maps--what we could do with their technology. It's been? it's been great and it's my pleasure to introduce Paul Otellini, the president and the CEO of Intel. I invited him here because I wanted you to hear directly from him what he thinks about all this.

Otellini: I suspect there's a whole bunch of you that never thought that you'd see that logo on this stage. I was one of them for a while and not any more obviously. We are so excited at Intel to be given the opportunity to work with Apple to bring you some really great products. I thought I would try to explain how we got here today and I would do it in the context of telling you a story, and the story is really about Apple and Intel and I call it A Silicon Valley Story and it goes back a ways, in fact it goes back almost four decades.

Intel was founded in 1968 by Gordon Moore and Bob Noyce. Bob was the co-inventor of the integrated circuit. We started out building memories--first product was an SRAM, we invented the DRAM and a few years later we invented the world's first microprocessor, the 4004 and we were in Mountain View. Well, sort of eight years later, five miles away in Cupertino, Apple was founded, and you can see the picture of Steve and Woz there. You can also on the right hand side see a picture of Steve and Bob Noyce on the right hand side having dinner. I asked Steve last night as an aside, "Was that the last time you wore tie?" He said, "No it's the last time I wore a moustache, though."

But what you may not know is that our connection between Intel and Apple started around the same time. Bob and Andy Grove actually were early investors in Apple Computer and in fact Ann Bowers was Bob Noyce's wife and she was Apple's first VP of HR. So there were some early signs of genetic connection.

Paul Otellini
CEO, Intel

It didn't quite work out the way we had hoped, and in fact Apple started in 1976 with a chip from MOS Technology. Well our microprocessor business in the PCs came quite after that. In 1981, IBM chose the 8088 to go in their first PC and things went along for quite some time. And as Steve has pointed out in 1993, two events happened. Well, Apple switched in the 68K to PowerPC and Intel launched the Pentium processor and started ramping it in earnest. And for the next couple of years competition really heated up quite a bit. It got pretty intense. It got so intense that in 1996, Apple--they set fire to our bunny person! And I know some of you may not be as old as this commercial, but I thought I would rather run it for you anyway in case you haven't seen this.

Now you know, we didn't have a grudge about that. We just thought it was a not-so-subtle message that Apple thought our processors were too hot and they wanted us to run a lot cooler. Well, by the time we got to 2005, in fact, the processors are running a lot cooler and we are so happy that the world's most innovative computer company and the world's most innovative chip company have finally teamed up. I thought I would give you my perspective on this partnership: I think that this brings together the skills and the opportunities and the engineering excellence of two great companies and they combine our strengths and they play on our respective strengths. Apple has a legendary capability in hardware and software engineering, in design and in innovation. You all know that, but what you may not be familiar with is us. Our strengths are a little bit different but they're entirely complementary. We are all about computer architectures, we're about scale and scope and being able to deliver in high volume the world's best technology and the world's best processors, and what we are most about is the relentless advancement of Moore's Law to give you better and better machines year after year. And so after almost 30 years, Apple and Intel are together at last and I don't think of this as a fairytale with a happy ending. I think of this much more as an exciting and important story with a very, very happy beginning. Thank you very much.

(Jobs:): Thanks Paul, that was great!

So where does that leave us? Well, Apple is strong, Apple is pretty strong right now, and the Mac is strong. We saw this. So this is great. This is a great time to start building for the future to make us even stronger. We know transitions. We're been through two of them and they've kept our platform at the forefront and we're going to continue to be bold and begin the third transition today as far as the developers are concerned to make the best machines we know how to make in the future.

This transition isn't going to happen overnight. Again, we're making awesome machines right now, we've got a lot of great PowerPC products in the pipeline, but we're also working to design some Intel-based Macs and when we're here next year, we plan to have them in the marketplace and there will be a transition over the next two years. We're getting ready. We've done a lot of work as you've seen today. OS X is running fantastic on Intel processors. Xcode 2.1 is in your hands today. Rosetta, for our customers for those apps that are not universal on day one. We've already made a big investment in this and we're fairly far along. It's time for you to get ready too now and what do you have to do to get ready? One thing, create universal binaries of your apps. We've got a lot of stuff going on at the conference to help you today.

Over 90 of the 95 presentations that we've got here today include content about universal versions. A hundred developer systems in seven labs and the labs are open every night until least 9 p.m., I think tomorrow night they are open till midnight, so go see if you can beat Theo and his team on Mathematica. Five hundred Apple engineers onsite, so if you brought your source code, go for it. And when we meet again here next year we will have Macs with Intel processors entering the market. I suspect a lot of you will be shipping universal binaries and we will be very excited to keep pushing the frontiers and tell you about Leopard when we meet again here next year because more than even the processor, more than even the hardware innovations that we bring to the market, the soul of the Mac is its operating system and we're not standing still. So I'll see you all here next year and I look forward to a lot of universal binaries. Thank you very much!