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JOHN BORLAND: Apple’s created quite a buzz in the last month or so with the introduction of its iMac and some of the other hardware. You still don’t see quite the same amount of buzz about its Web strategy. What is Apple’s Web strategy, where’s it going?
DON MARUSICH: I guess part of the question is what kind of buzz are you looking for? I mean I think we’ve been really successful with the progress we’ve made on our online store. We’ve gone from not having e-commerce whatsoever, into having a store that is regularly doing $3 million of business in a day. We’ve expanded it into multiple channels. We have a store in Europe. We’re working on expanding that into additional countries in Europe, as well as Japan and other parts of Asia.

In addition to that, we’ve also driven traffic up on the Apple site to well over 10 million sites a day. That’s something that is a huge amount over what Apple’s traffic was at the same period last summer. Last summer I’d say that we were at maybe 20 percent or less the amount of traffic we have now. Maybe 15 percent or lower. I think we had some lows last summer -- before Steve came back -- that were maybe a million hits a day.

BORLAND: Other companies, or other sites that have this kind of traffic are moving toward making their sites a portal, a Web portal. Are there any plans to follow Microsoft or Netscape’s lead down this road?
MARUSICH: I think in general, we want to make sure the Apple site is a destination all Macintosh customers frequent a whole lot. So, I mean, I think we’re doing what we can to make sure we have interesting content there, and we’ll keep trying to improve that.

BORLAND: But you do plan to keep it all Apple, essentially, rather than pointing to other places on the Web?
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"We’re certainly not doing the same things that a lot of other companies are doing, in the sense where they’re trying to build content up on their site just to have traffic, just to have advertising. I think we’re trying to do what’s right for the Macintosh community, and really to support our product strategy."
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MARUSICH: We already point to other places to some degree, right? So, I mean, I guess if what you’re saying is if we actually want to mimic what other people are doing, we have no announced plans for doing that stuff. Right now it’s doing what we can to support what’s going on with the developers and partners that we have, and also making sure we’re pointing at the things that are appropriate for our products. We’re certainly not doing the same things a lot of other companies are doing, in the sense where they’re trying to build content up on their site just to have traffic, just to have advertising, et cetera. I think we’re trying to do what’s right for the Macintosh community, and really to support our product strategy.

BORLAND: Does the website pay for itself in terms of strictly commerce? Or do you plan on launching an outside advertising component as well?
MARUSICH: You know, right now, commerce is primarily the only way that we’re looking at doing business on the site. We don’t have a business model or anything set up for advertising. Interesting idea. Question is really ‘how well is it working out for some companies? And how appropriate is it?' We don’t really have anything that we’ve announced as a strategy necessarily. Apple makes great computers. We’re not an online advertising company. So, I think part of it’s about focus and making sure that whatever we’re doing is supportive of that strategy. Basically, in addition to the store, we worked on seeing the developer back-end as being a commerce piece. Also, we’re starting QuickTime Online, and that was a new thing for us to do to. And that’s been incredibly successful as well.

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BORLAND: You see QuickTime as a direct competitor to NetShow and to RealVideo, to the RealPlayers, correct?
MARUSICH: Yeah, definitely.

BORLAND: Seems in a lot of the coverage of online multimedia it’s really NetShow, Microsoft, and RealNetworks that get the bulk of the attention, and QuickTime is often mentioned as an afterthought, saying this is also a video technology, but it’s not given the same billing as the other two. Why is that at this point?
MARUSICH: I think most of those articles are focusing on online broadcasting and real time serving a video or audio and that’s a feature we’ve already announced for QuickTime 3.5, which will be available early next year.

BORLAND: OK. Does Apple view itself as a Web software company at this point?
MARUSICH: In a couple corners, maybe, but Web Objects is another good example. That’s been one of the facilitating technologies for us to do. Both for online QuickTime sales and the Apple Store. So, we’ve got some technology there that’s really strong and important on the server end. But I think a lot of people are focused on a lot of the flash -- on the plug-ins and other stuff. I think we’ve got QuickTime in there a little bit too. But I don’t think we’re being clearly seen as a Web company yet. I think we’re doing what we can to improve both those products and make them more important. We also have color setting sort of factoring into being an Internet technology now too.

BORLAND: With Web Objects we’ve heard some rumors that the division may be spun off into its own company. Can you comment on this? Is there any truth to it?
MARUSICH: I think everyone at Apple has read the same rumor sites as you have too. And we just kind of wondered where they get their information, because we’ve announced that we’re doing a 4.0 version of the PowerPC and I think a lot of people internally are pretty excited about that. So, I think they’re unfounded.

BORLAND: OK, so the company is committed to keeping that software technology in-house?
MARUSICH: I certainly hope so. We take advantage of it for the online store and for other products we have coming up, you know, in the next few months.

BORLAND: How do you think Apple’s relationship with its Web developers, with the content companies or the actual software developers has changed over the last year?
MARUSICH: I think our relationships with them are both quite a bit stronger. In the case of the actual software developers, like Macromedia or Adobe or Go Live, we’ve done a ton of things to work with them on sales seminars, on promoting their products on our site, on making sure they’re involved in our advertising and in our trade shows. We’ve had folks from Macromedia involved in our developers conference, we have them involved in the videos we show in keynotes -- and the same thing for online.

We’re maybe not as aggressive in that space just yet, because to some degree, it’s a lot easier because Web browsers are pretty compatible with Web content. So, for the most part there’s not much you can say about those things that are Mac specific, but in the case of something like Disney Online and with the block service they just launched, we’ve definitely gone out of our way to make sure we have a good relationship with them. And we’re doing what we can to support their efforts and make sure people know that they’re doing some cool work that’s cool on the Mac for specific reasons.