Jobs: Microsoft must build MP3 player this year to compete

Following his keynote speech last week at Macworld Expo, Apple CEO Steve Jobs spoke to Newsweek in an exclusive interview. While the majority of the excerpts pertain to the new Intel-based Macs, Jobs does talk about iPod competition and Apple’s record-breaking 14 million iPod shipment number.

“The problem is, the PC model doesn’t work in the consumer electronics industry, where you’ve got all these companies and some do one thing and another does another thing. It just doesn’t work,” Jobs said. “What’s going to happen is that Microsoft is going to have to get into the hardware business of making MP3 players. This year. X-player, or whatever.”

Jobs also said that Apple could have sold more than 14 million iPods during the holiday quarter if it had received more components.

“We couldn’t get enough flash memory, we couldn’t get enough of everything [to meet all the demand],” Jobs said. “We had to call the numbers six months in advance. So we sat around and had some meaningful discussions about what that number should be, and we ended up picking the highest of the numbers. You’ve got to admit, picking 14 million in the spring of last year, when the most you’ve ever sold was four and half million, was a pretty big bet. But it turned out that that number was too low.”

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