Apple's Jobs: 'There are some customers we choose not to serve'

Another analyst asked Jobs if, in light of Apple's splendid performance during the last quarter with the iPhone 3G against competitors such as Research in Motion, would Apple be likely to explore a netbook in the near future? Remember, in recent months, Apple appeared to be gathering steam for a netbook project -- a kind of tablet-like iPhone, some speculated.

The answer to that question was, over a flurry of words, an emphatic no. "This particular downturn is not creating a market of cheaper computers," Jobs responded. "That market has existed for some time, and there are parts of that market that we choose not to play in. I think when people want a product of the class that we make, over and over again, people have done the price comparisons and we're actually quite competitive. So we choose to be in certain segments of the market, and we choose not to be in certain segments of the market. And the question is, is the downturn going to drive some of our customers to those lower segments of the marketplace, to buy lesser products? And I will be surprised if that happens in large numbers, and I actually think that there are a tremendous number of customers that we don't have in the Windows world or in the other 99% of the phone market that we don't have, who would like to and can afford to buy Apple products.

"So we'll see what the ratio of those two things are, but we're not tremendously worried," he continued. "As we look at the netbook category, that's a nascent category. As best as we can tell, not a lot of them are getting sold. One of our entrants in that category, if you will, is the iPhone, for browsing the Internet and doing e-mail and all the other things that a netbook lets you do, and being connected via the cellular net wherever you are, an iPhone's a pretty good solution for that. And it fits in your pocket. But we'll wait and see how that nascent category evolves, and we've got some pretty interesting ideas if it does evolve."

Later, Jobs was pressed for details as to whether Apple was interested in a kind of tablet computer -- a larger iPhone, but not a "netbook" per se. Jobs repeated his advice that analysts should "wait and see," and again you could hear the smile on Jobs' face as he said it.

Finally, Jobs was asked whether Apple is exploring any other innovative opportunities in the mobile phone space -- implying, perhaps, an entry-level iPhone, or something that appeals to a different set of customers.

"Well, I wasn't alive then, but from everything I've heard, Babe Ruth had only one home run," started Jobs, pausing for effect. "He just kept hitting it over and over again...I think the traditional game in the phone market has been to produce a voice phone in a hundred different varieties.

Then in what could have been a subtle jab in the direction of Android (whose first G1 phone premieres tomorrow), or perhaps in the direction of Nokia (which has taken steps to buy the Symbian platform), he added, "But as software starts to become the differentiating technology of this product category, I think that people are going to find that 100 variations presented to a software developer is not very enticing. And most of the competitors in this phone business do not really have much experience in a software platform business. So we're extremely comfortable with our product strategy going forward, and we approach it as a software platform company, which is pretty different than most of our competitors."