Apple Begins Bargain Rollout

SAN FRANCISCO -- Apple(AAPL) CEO Steve Jobs opened MacWorld here on Tuesday, debuting a slew of new products, including a new bargain-priced Macintosh and a flash-based iPod.

Rumors of both products had been swirling for weeks.

The news wasn't enough for the stock to offset the struggles of the broader market, however; shares were recently down $2.27, or 3.5%, to $66.69.

The new Macintosh, dubbed the Mac Mini, will be available later this month at a starting price of $499. The computer comes in a small lunch box-sized case, but doesn't include a monitor, keyboard or mouse. However, it has built-in connections to hook the computer up to industry-standard peripherals, including ostensibly those made for PCs with Microsoft's(MSFT) operating system.

The base model for the Mac Mini comes with a 40-gigabyte hard drive, 256 megabytes of random access memory and a G-4 processor. In addition, Apple is offering a higher-end model for $599 that includes a faster G-4 processor and an 80-GB hard drive.

The new iPod, called the iPod shuffle, is available immediately for $99. The base model has 512 MB of RAM, which will hold about 120 songs. Unlike previous iterations of the iPod, the Shuffle has no screen and comes in a much slimmer package. Apple also is offering an upgraded version for $149 that has 1GB of RAM. Both models include a USB-2 connection.

Other new products unveiled by Jobs include a new verision of Mac OS X, dubbed Tiger; an updated version of iLife, Apple's multimedia suite of editing programs; and iWork, a new two-program office suite that includes Keynote -- Apple's PowerPoint program -- and a word processor.

The new version of OS X includes an integrated desktop search feature, along the lines of offerings from Microsoft and Google(GOOG). But Jobs made the point the new search feature is integrated into the operating system, allowing it to be built into applications.

In contrast, Microsoft, which plans a similar setup with the next version of its operating system, won't have an integrated desktop search feature until the system's expected debut in 2006.

>To order reprints of this article, click here: Reprints