Slim Apple laptop expected at Macworld

As the annual Consumer Electronics Show in Las Vegas winds down to lackluster reviews, Apple is expected to grab the spotlight with an ultra-slim laptop computer and online movie rentals at its biggest annual show next week.

The new products are seen more as enhancements to Apple's current offerings rather than ones that pack the "wow factor" of last year's star attraction, the iPhone.

Next week's annual Macworld event in San Francisco is the favorite venue of Apple Chief Executive Steve Jobs to roll out new products and chart the company's course for the year.

His showman-like pronouncements also increasingly set the agenda for the computer and electronics industries, and have in recent years overshadowed CES, held in Las Vegas around the same time.

Apple gives no hint of what will be announced, so guessing what Jobs has up sleeve is a favorite pastime of analysts and industry executives.

Analysts expect a computer half as thick as Apple's current MacBook lineup, but using flash memory chips like those found in its iPod music players rather than a hard drive.

"The energy seems to be around a smaller-form-factor laptop computer," said Charles Golvin, an analyst with Forrester, a market research firm.

Notebooks have been one of Apple's strongest segments. In its fourth fiscal quarter ended last September, the company sold 1.34 million MacBook and MacBook Pro laptops, up 37 percent from a year earlier.

"What I'm guessing we might see from Apple is something a little more recognizable as a MacBook device, as a derivative of a laptop or tablet rather than a cool new form factor that sits between laptop and mobile phone," Golvin said.

Many also think Jobs will announce that customers will be able to rent downloaded movies from Fox, Warner Bros and others though its iTunes online store, a move that could shake up the $9 billion U.S. movie rental market.

"I think the rentals are a bigger deal," said Shaw Wu, an analyst with American Technology Research. "Apple has just simply not served that market yet and I think that's going to open up a whole new revenue opportunity."

Anticipation that Jobs will wow everyone with groundbreaking new products tends to drive Apple stock higher in the days ahead of Macworld, but can set shares up for a fall if the new products don't live up to expectations.

Although Apple shares, dragged down by mounting fears of a U.S. recession, have fallen about 11 percent since topping $200 on December 26, they rose 4.8 percent on Wednesday to $179.40.

The shares rose 8 percent the day Jobs unveiled the iPhone at last year's Macworld and have risen more than 90 percent over the past year on bullishness over sales of iPhones and Macintosh computers, which have been gobbling up market share.

And Apple has fared better than other computer companies such as Dell Inc, which has fallen 15 percent since the start of the year, and Hewlett-Packard Co.

"Apple's still going to be one of the better names to be involved in in the tougher environment. The product cycles are so strong," said Wu, who has a price target of $210 on Apple shares.

Many industry analysts see the polished message of Macworld as a welcome relief from the chaos of CES and its familiar parade of ever-larger televisions, sharper video cameras and slimmer cell phones.

"Apple didn't need to take thunder from CES, there was nothing to take," Michael Gartenberg, an analyst with Jupiter Research, wrote on the company's blog.

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Dell Unveils Its First Tablet PC

Dell (Dell) on Tuesday introduced its first tablet PC, saying that businesses are ready to consider more flexible types of computers for employees.

The Latitude XT weighs 3.5 pounds and features a 12.1-inch daylight-viewable display built for indoor and outdoor use. The screen enables people to manipulate data with the use of their fingers or a stylus, which can also be used for writing as if on paper. The device can also be operated using a keyboard and mouse.

Tablet PCs have been available for several years. Among the factors that made the time right for a Dell tablet was the entrance of Generation Y in the workplace, Margaret Franco, director of marketing for the Latitude product line, told InformationWeek. The twenty-somethings starting their careers are used to interacting with computers in different ways, having grown up with mobile phones, portable music players, and other handheld devices.

In addition Vista, the latest version of Microsoft (NSDQ: MSFT) Windows, is better equipped than XP for powering a touch-screen environment like a tablet PC, Franco said. Finally, touch-screen technology in general is more mature, giving people the option of using their fingers or a stylus to manipulate data.

With these factors gradually changing the market, Dell believed the time was right to launch its first product. "Corporations will standardize on different types of notebooks to serve the usage models of their diverse workforce," Franco said. "We call it hyper-segmentation that's happening in the mobile market, and the PC market in general."

But the high price tag of the Latitude XT is likely to discourage most businesses from adopting the new device for employees unless they have special requirements that can't be filled by a traditional notebook. Where a regular Dell laptop is available for less than $1,000, Dell's new Tablet PC will sell for $2,500 when it ships at the end of the month.

The XT comes standard with 1Gbyte of memory and a 1.06GHz Intel (NSDQ: INTC) Core 2 Solo ULV processor U2100. The machine also includes a 40Gbyte hard drive, and Wi-Fi technology. The computer is available with Windows Vista or Windows XP, and has a battery life of more than nine hours.

About 1.5 million tablet PCs were sold last year, which is 56% more than 2005, according to Dell's estimates. However, most of the machines were for specialized use, such as by delivery people or warehouse workers. The machines have not caught on with consumers, experts say.

Dell is not new to touch screens. The computer maker introduced the capability for some functionality in its XPS One entertainment computer launched last month.

And even though Dell has yet to ship its first tablet PC, the company is being sued for alleged patent infringement of touch-screen technology. Typhoon Technologies made the allegations in a suit filed last week in a Texas federal court. The developer and licensee of touch-screen technology also named Motion Computing as a defendant in the lawsuit.

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