Apple 2007 Annual Report Download - page 5

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and development of the entire personal computer—from the hardware and operating system to sophisticated software applications. This, along
with its products' creative industrial designs, intuitive ease-of-use, and built-in graphics, multimedia and networking capabilities, positions the
Company to offer innovative integrated digital lifestyle solutions.
Expanded Distribution
The Company believes a high-quality buying experience with knowledgeable salespersons who can convey the value of the Company's products
and services greatly enhances its ability to attract and retain customers. The Company sells many of its products and resells certain third-party
products in most of its major markets directly to consumers, education customers, and businesses through its retail and online stores. The
Company has also invested in programs to enhance reseller sales, including the Apple Sales Consultant Program, which places Apple employees
and contractors at selected third-party reseller locations. The Company believes providing direct contact with its targeted customers is an
efficient way to demonstrate the advantages of its Mac computers and other products over those of its competitors.
At the end of fiscal 2007, the Company had opened a total of 197 of its own retail stores, including 174 stores in the U.S. and a total of 23 stores
in Canada, Japan, U.K. and Italy. The Company has typically located its stores at high-traffic locations in quality shopping malls and urban
shopping districts.
One of the goals of the retail initiative is to expand the Company's installed base through sales to customers who currently do not already own
the Company's products. By operating its own stores and locating them in desirable high-traffic locations, the Company is better positioned to
control the customer buying experience and attract new customers. The stores are designed to simplify and enhance the presentation and
marketing of the Company's products and related solutions. To that end, retail store configurations have evolved into various sizes in order to
accommodate market-specific demands. The stores employ experienced and knowledgeable personnel who provide product advice and certain
support services. The stores offer a wide selection of third-party hardware, software, and various other accessory products and peripherals
selected to complement the Company's own products.
Education
Throughout its history, the Company has focused on the use of technology in education and has been committed to delivering tools to help
educators teach and students learn. The Company believes effective integration of technology into classroom instruction can result in higher
levels of student achievement, especially when used to support collaboration, information access, and the expression and representation of
student thoughts and ideas. The Company has designed a range of products and services to address the needs of education customers. These
products and services include the Company's Mac computers, iPods, iTunes, and Apple TV, in addition to various solutions for video creation
and editing, wireless networking, professional development, and one-to-one (1:1) learning. A 1:1 learning solution typically consists of a
portable computer for every student and teacher along with the installation of a wireless network.
Creative Professionals
Creative professionals constitute one of the Company's most important markets for both hardware and software products. This market is also
important to many third-party developers who provide Mac-compatible hardware and software solutions. Creative customers utilize the
Company's products for a variety of activities including digital video and film production and editing; digital video and film special effects,
compositing and titling; digital still photography and workflow management; graphic design, publishing, and print production; music creation
and production; audio production and sound design; and web design, development, and administration.
The Company designs its high-end hardware solutions, including servers, desktops, and portable Mac systems, to incorporate the power,
expandability, and features desired by creative professionals. The Company's operating system, Mac OS X, incorporates powerful graphics and
audio technologies and
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