The second in the series comes from Apple who are in the process of developing a new generation computer-entertainment device, according to industry analysts.

The hard-luck computer-maker is looking for a new hit to revive its fortunes after pulling the plug on its Newton handheld computer and seeing market share decline for its personal computers.

"There are signs that Steve Jobs, over the next 120 days, will shake up the computer industry by introducing a very low-cost system," said Richard Doherty, director of the Envisioneering Group in Seaford, New York.

Doherty said Jobs, Apple's co-founder and interim chief executive, is spearheading the bid to develop a low-cost portable device combining a set-top cable TV box, Internet access and a CD or DVD player. Jobs has been heavily exposed to the entertainment side as an investor and chief executive of Pixar, the successful computer animation company that produced the film Toy Story.

"It looks like every single person at Apple is working on this project," Doherty said. "It's the 'Manhattan Project' of Apple Computer."

"Think about all the pieces they have, the PowerPC (chip), QuickTime (for multimedia content creation)," said Louis Mazzucchelli, a Gerard Klauer & Mattison analyst. "They have the Pippin experience under their belt and they learned something with the Newton."

Doherty said Apple had not laid off many members of its Newton team and they were now working on the new project. Apple is currently adding staff, after laying off staffers last year as it moved to cut costs and restructure the company amid big losses and a steep market share decline.

Doherty said the new device is aimed at providing low-cost access to the Internet for the educational market and would include more entertainment features. But there's no telling when details may be announced.

(c) Wired News