Jobs unveils Intel-based Mac mini
Apple founder makes the latest move in the PC wars, with one eye on the living room.
By Amanda Cantrell, CNNMoney.com staff writer, and Patrick Baltatzis, Business 2.0 magazine

NEW YORK (CNNMoney.com) - Apple CEO Steve Jobs on Tuesday unveiled the latest line of Macs to get Intel processors, the low-cost mini desktop line, in a clear bid to reach consumers in their living rooms.

Making inroads into the home

Speaking at a news briefing at Apple headquarters in California, Jobs said Apple's new minis will contain Intel's (Research) Core processor, a remote control, as well as high-end digital video and audio outputs that allow the machines to connect to digital TVs.

Apple's new Intel-based Mac mini
Apple's new Intel-based Mac mini
The new iPod  HiFi is Apple's entry into the audio market.
The new iPod HiFi is Apple's entry into the audio market.

"Today's news was basically an expansion of Apple's digital home strategy," said Sam Bhavnani, principal analyst for the mobile computing and electronics group at research firm Current Analysis. "In the 1980s, Sony had a stronghold in terms of consumer electronics. Now Apple is doing the same thing."

The new Mac minis that have the 1.5 gigahertz Core Solo chip will run up to three times faster than previous versions and will sell for $599, Jobs said. Versions with Intel's 1.66 gigahertz Core Duo processors, which feature two processors on one chip, will run up to five times faster than the old minis and will retail for $799.

Both are available immediately and will also feature an enhanced version of Apple's Front Row software which will now contain Bonjour, a networking program that allows users to stream and share digital media. This would allow the Mac mini to play music, photos and videos saved on other Macs in a user's home, which Apple hopes will make the mini more appealing as a central entertainment storage unit for the living room.

Charlie Wolf, an analyst at Needham & Company, said he thinks today's announcements are "just the start" of Apple's digital home strategy.

"It's still a little computer, but it's adding a lot of capabilities that will allow it to morph into an entertainment center in the living room," said Wolf.

But Mark McGuire, an analyst at Gartner Group, noted that any digital living room strategy will be fraught with complicated copy right issues surrounding the sharing of files. "There are a lot of undefined standards surrounding the living room space, and with all the copy right issues involved, entering that space will cause problems for any player," said McGuire.

Competing against your supporters

Apple also unveiled the iPod Hi-Fi, a home stereo system with an iPod dock that retails for $349. "The iPod Hifi is home stereo reinvented " Jobs said of the new sound system, which, while not specifically designed to be portable, can also run on six D batteries and can be controlled with the Apple remote.

Bhavnani said with its hefty price tag, Apple's new sound dock is targeted at the same high-end customers that buy Bose products. For the first time, Apple will compete with Bose and others who manufacture speaker systems based around the iPod. "The iPod HiFi is a concern to some of Apple's accessory manufacturers," said Bhavnani. Indeed, Apple also announced today Apple-branded leather iPod cases for $99, another product that will pit Apple directly against the legions of companies devoted to the iPod. To date, the company has sold some 42 million iPods.

Apple (Research) stock fell about 3.5 percent after the announcement.

The company launched its first Intel-based Macs at Macworld in January, and said it will convert its entire Mac line to include Intel chips by the end of the year, significantly ahead of schedule.

Wolf called Apple's announcement today a "mini-event," since the company announced just two of the four or five products were anticipated by Apple fans and investors alike. Wolf thinks this suggests that Apple will hold another event soon, possibly in April, when the company will turn 30.

"They have to roll out the Intel iBook before the school season starts, and they did not do that today," said Wolf. "There is reportedly a video iPod on the way that wasn't introduced today." These are the most likely candidates for near-term launches, in his opinion.

Wolf added that another rumored product, an Apple-branded iTunes phone, won't happen until 2007, and said that he thinks an Apple-branded high definition TV is less likely to happen.

At Macworld in January, Apple unveiled its first two Macs to contain Intel chips: the iMac desktop and the Macbook Pro laptop, both with the dual processors, a design meant to make the machines more efficient while using less power. While announced in January, the Macbook Pro laptops did not begin shipping until February.

Analysts have long touted the Mac mini line as Apple's most likely entry into the digital living room race. A Mac mini featuring Apple's media management software could compete with PCs featuring Intel's Viiv technology, which work with Microsoft's (Research) Media Center software and, like the Mac mini, are small in size.

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Experts find another worm in Apple. Click here.

Needham & Company's Wolf owns shares of Apple, and his firm makes a market in the securities. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.