- The Washington Times - Wednesday, May 4, 2005

Erin Farker flipped on her personal computer one day last year and got nothing. No power. No error screen. Nothing.

The McLean resident wasn’t too upset, though, figuring this was a golden opportunity to replace her 10-year-old clunker with something cooler from Apple Computer Inc.

Miss Farker had started thinking about buying an Apple a few months earlier, after she got one of the company’s IPod digital music players.

Her graphic artist boyfriend, a longtime Apple enthusiast who works part time at the company’s Tysons Corner Center store, helped her choose an IBook laptop with a 12-inch screen. Apple sells the IBook for between $1,000 and $1,500.

“I love it,” Miss Farker said. Its best feature is that it is more compatible with her beloved IPod, she said.

“You can sync your IPod with a PC, but it’s a lot harder to do. It’s not set up to be friendly.”

Apple executives and industry analysts call this the IPod “halo” effect.

They say it works like this: A consumer such as Miss Farker, who had primarily used computers that operate on a Windows-based operating system, gets an IPod.

They fall in love with it, so much so that they begin buying other Apple products, eventually replacing their PC with a Macintosh, an IBook or another kind of Apple computer.

For now, the halo effect exists primarily as a theory in the minds of executives and some analysts, but evidence is emerging that it is becoming a real phenomenon.

During the quarter that ended March 26, Apple shipped 5.3 million IPods, including the cheaper Shuffle, a new device that randomly will play MP3 music files downloaded from the Internet.

The San Jose, Calif.-based company introduced the IPod in 2001.

Apple also shipped 1.1 million Macintosh computers in the second quarter, 43 percent more than the similar period one year earlier and the best quarterly result for computer sales in four years.

Apple’s net income soared to $290 million, or 34 cents a share, up from $46 million, or 6 cents a share, during the second quarter of 2004. Analysts had expected the company to earn 24 cents a share.

“Apple has an awful lot of momentum, but it’s too early to tell if this is going to be a long-term trend,” said Shannon Cross, an independent research analyst.

In a conference call with reporters, executives said they believe younger customers — particularly college students — have driven the halo effect.

“We certainly think that a number of kids that had a great experience with an IPod opted to take an IBook or a Power Book off to school with them,” said Timothy D. Cook, the company’s executive vice president of worldwide sales and operations.

Ann Dominick, an Oakton resident, came to Apple’s Tysons Corner store on a Saturday morning in late April to browse for a new computer for her teenage daughter, Hallie.

Ms. Dominick liked the idea that an Apple would make it easier for Hallie to upload music on her IPod, but she wasn’t convinced that was reason enough to buy a Mac. “She’s in the seventh grade now, so I want something that’s going to grow with her,” she said.

The company is stepping up its efforts to court families such as the Dominicks.

Last week, it introduced its Tiger operating system, which makes it easier for Apple and Windows users to share files.

In January, Apple began selling the Mac Mini computer, with prices that range from about $500 to $600. The bare-bones machine does not come with its own keyboard or mouse.

“This is an era when people are buying a second or third computer. Apple can make the case, ‘If we can’t be your choice for a first computer, maybe we can be your choice for a second,’” said Michael Gartenberg, vice president for the Jupiter Research information service.

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