The NeXT deal was
finalized on February 9, 1997, bringing Jobs back to Apple as an advisor.
On July 9, 1997, Amelio was ousted by the board of directors after overseeing a
three-year record-low stock price and crippling financial losses. Jobs acted as
the interim CEO and began restructuring the company's product line; it was
during this period that he identified the design talent of Jonathan Ive,
and the pair worked collaboratively to rebuild Apple's status.
At the 1997 Macworld Expo, Jobs
announced that Apple would join Microsoft to release new versions of Microsoft
Office for the Macintosh, and that Microsoft had made a $150 million investment in non-voting Apple stock. On
November 10, 1997, Apple introduced the Apple Online Store, which was tied
to a new build-to-order manufacturing strategy.
On August 15, 1998, Apple introduced a
new all-in-one computer reminiscent of the Macintosh 128K: the iMac.
The iMac design team was led by Ive, who would later design the iPod and
the iPhone. The iMac featured modern technology and a unique design, and
sold almost 800,000 units in its first five months.
During this period, Apple completed
numerous acquisitions to create a portfolio of digital production software for
both professionals and consumers. In 1998, Apple purchased Macromedia's
Key Grip software project, signaling an expansion into the digital video editing
market. The sale was an outcome of Macromedia's decision to solely focus upon
web development software. The product, still unfinished at the time of the
sale, was renamed "Final Cut Pro" when it was launched on the retail
market in April 1999. The development of Key Grip also led to Apple's release
of the consumer video-editing product iMovie in October 1999. Next,
Apple successfully acquired the German company Astarte, which had
developed DVD authoring technology, as well as Astarte's
corresponding products and engineering team in April 2000. Astarte's digital
tool DVDirector was subsequently transformed into the
professional-oriented DVD Studio Pro software product. Apple then
employed the same technology to create iDVD for the consumer market. In 2002, Apple purchased Nothing Real for
their advanced digital compositing application Shake, as well as Emagic for the music
productivity application Logic. The purchase of Emagic made Apple the
first computer manufacturer to own a music software company. The acquisition
was followed by the development of Apple's consumer-level GarageBand application. The release of iPhoto in the same
year completed the iLife suite.
Mac OS X, based on NeXT's OPENSTEP and BSD
Unix, was released on March 24, 2001, after several years of development. Aimed
at consumers and professionals alike, Mac OS X aimed to combine the stability,
reliability and security of Unix with the ease of use afforded by an
overhauled user interface. To aid users in migrating from Mac OS 9, the
new operating system allowed the use of OS 9 applications within Mac OS X via
the Classic Environment.
On May 19, 2001, Apple opened its first
official eponymous retail stores in Virginia and California.
On October 23 of
the same year, Apple debuted the iPod portable digital audio player.
The product, which was first sold on November 10, 2001, was phenomenally
successful with over 100 million units sold
within six years. In 2003, Apple's iTunes Store was introduced.
The service offered online music downloads for $0.99 a song and
integration with the iPod. The iTunes Store quickly became the market leader in
online music services, with over five billion downloads by June 19, 2008.
Two years later, the iTunes Store was the
world's largest music retailer.
