Twenty years ago today (February 27, 1998), Apple announced that…

Apple Discontinues Development of Newton OS

CUPERTINO, California–Feb. 27, 1998–Apple Computer, Inc. today announced it will discontinue further development of the Newton operating system and Newton OS-based products, including the MessagePad 2100 and eMate 300.

“This decision is consistent with our strategy to focus all of our software development resources on extending the Macintosh operating system,” said Steve Jobs, Apple’s interim CEO. “To realize our ambitious plans we must focus all of our efforts in one direction.”

Apple is committed to affordable mobile computing, pioneered by the eMate, and will be serving this market with Mac OS-based products beginning in 1999.

Apple will continue to market and sell its current inventory of MessagePad 2100 and eMate 300 computers, as well as to provide support for their installed base of users. The Company is committed to working with its customers and developers to ensure a smooth transition to Mac OS-based products.

Apple Computer, Inc. ignited the personal computer revolution in the 1970s with the Apple II, and reinvented the personal computer in the 1980s with the Macintosh. Apple is now recommitted to its original mission – to bring the best personal computing products and support to students, educators, designers, scientists, engineers, businesspersons and consumers in over 140 countries around the world.

The statements in this document regarding future products and strategy are forward looking and subject to risk and uncertainty. Potential risks and uncertainties include, without limitation, the demand from consumers and businesses and competitive factors. For a detailed discussion of factors that may affect the Company’s operating results, interested parties should review the Company’s SEC reports, including Apple’s Annual Report on Form 10-K for the year ended September 26, 1997, as well as the Form 10-Q for the quarter ended December 26, 1997.

Press Contacts
Tami Begasse
Apple Computer, Inc.
(408) 974-2042
email: begasse@apple.com

Katie Cotton
Apple Computer, Inc.
(408) 974-7269
email: katiec@apple.com

NOTE TO EDITORS: For additional information visit Apple’s website (http://www.apple.com/pr/), call Apple’s Media Helpline at (408)974-2042, or contact Cara Lewis at our PR agency, Niehaus Ryan Group, Inc., (650)827-7052.

Apple, the Apple logo, Macintosh and QuickTime are registered trademarks and of Apple Computer, Inc. Additional company and product names may be trademarks or registered trademarks of the individual companies and are respectfully acknowledged.

Newton Technology FAQ

What did you announce regarding Newton Technology, the MessagePad and eMate?
Consistent with Apple’s strategy to focus all of our software development resources on extending the Macintosh operating system, we announced we would discontinue further development of the Newton operating system and Newton OS-based products, including the MessagePad 2100 and eMate 300. We will continue to market and sell our current inventory of MessagePad 2100 and eMate 300 products, as well as to provide support for our installed base of users.

Why did you make this decision?
After an extensive analysis of the business, we concluded that the market opportunity targeted by Newton was not aligned with our new business strategy. We are committed to affordable mobile computing, pioneered by the eMate, and will be serving this market with Mac OS-based products beginning in 1999.

What is Apple’s new business strategy?
To return to growth and sustained profitability, we have to create outstanding Macintosh products for our core customers in design & publishing, education and consumer markets. We believe we have made significant progress in recent months with the most successful hardware product launch in Apple’s history–Power Macintosh G3; and the most successful software product launch in Apple’s history–Mac OS 8. Our strategy today is to concentrate on products for our core markets and aggressively market our unique brand and product strengths to our customers.

What does this mean for Apple customers?
We will continue to market and sell our current inventory of eMate 300 and MessagePad 2100 products, as well as to provide support for our installed base of users. Additionally, we are committed to working with our customers and developers to ensure a smooth transition to Mac OS-based products.

Why should customers stick with the Mac?
Today the Macintosh continues to be the standard by which other personal computer technology is evaluated for elegance, ease-of-use and sheer power. And, the lower total cost of ownership of the Macintosh makes it the optimum choice for customers everywhere. Staying with Macintosh is the right decision.

What will happen to your Newton licensing program?
We do not anticipate extending our current licensing program and are working with our licensees on a transition strategy.

Will you continue to support Newton Developers’ efforts?
We will continue to support our Newton Developers for 120 days via our Newton Developer web pages at www.newton.apple.com/dev/index.html. After that time, we will determine what level of support is needed.

Will you continue to manufacture Newton OS-based products?
We are giving our large customers a last buy opportunity if they place a non-cancelable purchase order with us for 1,000 or more MessagePad 2100 or eMate units within the next 30 days.

Where can I buy a MessagePad 2100 or eMate 300?
We will continue to sell Newton OS-based products through existing channels, as well as direct through the Apple Store at www.apple.com.

Will you lower prices of your Newton OS-based products?
We have no current plans to lower the price of the eMate, however, we continue to review pricing with all Apple products. We did reduce the price of our MessagePad 2100s on Feb. 14, 1998. The current price of the MessagePad 2100 is $799.00 at the Apple Store, www.apple.com.

Will you have a trade-in program for Newton OS-based products?
We do not have plans for a trade-in program at this time.

Will customers be able to buy products from Apple licensees?
No. The MessagePad products our licensees market are significantly different, and there has never been a licensee product based on the eMate 300.

Will third-party accessories and software continue to be carried on the Apple Price list?
We will continue to carry eMate accessories and software on our education price list. Newton accessories will continue to be available, but individual accessory availability will vary.

What happens to the data in my MessagePad or eMate?
You can synchronize your data in Newton OS-based products with the applications on a Macintosh or Windows-based PC using Newton Connection Utility (NCU). More information on NCU is available atwww.newton.apple.com/product_info/SW/ncu.html.

Will I continue to receive technical support for my eMate or MessagePad?
We will honor existing product warranty policies. In the U.S. this means 90-days support for software and one year for hardware.

Can I return my Newton OS-based product?
Our return policies vary: If you are an education customer, returns are only accepted on an exception basis as outlined in your Apple policy. If you purchased a Newton OS-based product direct through the Apple Store, a 30-day return policy applies. If you purchased a product from a retail store or Apple Authorized Reseller, that store’s individual return policy applies.

Will you honor extended service agreements?
We will honor extended service agreements and will continue to offer extended services agreements within the first year of product ownership.

The statements in this document regarding future products and strategy are forward looking and subject to risk and uncertainty. Potential risks and uncertainties include, without limitation, the demand from consumers and businesses and competitive factors. For a detailed discussion of factors that may affect the Company’s operating results, interested parties should review the Company’s SEC reports, including Apple’s Annual Report on Form 10-K for the year ended September 26, 1997, as well as the Form 10-Q for the quarter ended December 26, 1997.

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