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DECEMBER 17, 2003
By Alex Salkever A G5 Laptop? Maybe Next Year [Page 2 of 2] TINY DYNAMOS. As a result, IBM should soon start using the new, 90-nanometer fabrication processes to build PPC chips. That's nearly a 40% improvement over the current technology, which allows chipmakers to design features and circuits on a silicon wafer only if they stay 130 nanometers apart. To give an idea of how small that is, 100,000 nanometers equal the thickness of a human hair. The upshot? IBM can punch the same circuitry onto a much smaller piece of silicon. That could up the speed of the PPC chips significantly, since the electrons that carry the information would travel smaller distances. The shorter distances also mean less power consumption and heat output, since the so-called pipeline for data processing requests would be physically shorter, too. Further, the small size of the circuit map required means IBM could make more chips from a single silicon wafer and, as a result, PPC 970s should become cheaper to manufacture. IBM has indicated it will increase the available processing speed of the PPC 970 chips to 2.4 gigahertz in the coming year. That would put Apple within shouting distance of the top-level Intel and AMD (AMD ) processors in terms of pure clock speed. BLADE RUNNER. As a side benefit, Apple's nascent server business will likely gain from IBM's moves to push the envelope on its PPC line. Glaskowsky and others expect that Apple will soon be able to offer a blade-server line based on the chip configuration IBM plans to put into its JS20 blade servers. That gets Apple a seat at the table in one of the hardware business' fastest growing segments. Tech tracker IDC found that in the third quarter of 2003, blade-server sales grew by 763% vs. the same quarter last year. That still only totals $164 million, a very small percentage of the $11 billion global server market for that quarter. And Apple sold just 4,800 servers in that quarter, less than half a percent of the total global market. Still, the blade-server market is growing in key areas where Apple has strong niches, such as biotech and special effects and animation for films. While it will probably never come close to Apple's much bigger desktop and laptop business, the server lines promise nice profit margins. "[Apple is] still a pretty small player. But their presence has grown," says Mark Melenovski, a server analyst at IDC. BETTER THIS TIME? So what kind of a boost could Apple expect from the introduction of a G5 laptop? That's hard to predict, but I suspect it would be significant. With the economy rebounding and, in particular, the advertising sector on the mend, some stars appear already aligned for a strong showing of a new Apple laptop line. Consider what happened in 2001, the year Apple introduced the G4 PowerBook. Overall net sales income fell by 33%, but net sales income of portable computers (including the iBook) rose 2%. Some of that was no doubt due to the industry trend toward laptops. But the fact that a new release could completely buck a generally weak economy as well as Apple's abysmal 2001 results could bode well for a big boost from a similar release in 2004.
 Salkever, Technology editor for BusinessWeek Online, is alternating with Charles Haddad on Byte of the Apple Edited by B. Kite
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