State of the Union. It's been one year since I last stood up here and talked about how Apple is doing in the enterprise. And boy, it's been an incredible year. We've had an increasing product line aimed at the enterprise. We've had very aggressive adoption by our partners and some great feedback from our customers and from the industry in general.

To start out, I'd just like to give you a little feel for that. Here's a quote from P.J. Conloy in InfoWorld. And this touches on a very interesting subject. The combination of the cluster node configuration and X-Grid clustering software represents a revolution in how IT looks at computers and builds systems. And if those of you who remember last year, I mentioned that we were... We were going to first see clustering in academia, but the very same things that were driving clustering and its use in research were going to find their way into IT.

And Apple jumped ahead of the curve there and jumped right into clustering in academia and science. And guess what? We're starting to see it in the IT shops as we speak. I'll talk a little bit more about that as we go on. Another quote from Tom Yeager at InfoWorld. If you want a complete productivity platform, you can nickel and dime your way there with Windows. Actually, I think nickels and dimes are probably too small a denomination for that. You can hammer and saw your way there with Linux.

And for anyone who has deployed Linux in the enterprise, I'm sure you know what I mean by hammers and saws or what Tom means by hammers and saws. Or you can hit the ground running with OS X. And that is... That is really the key differentiator. I mean, OS X, if you look at it, is chock full of open source software, runs a lot of open source tools, as you would in Linux.

But the big difference is that Apple, we take the responsibility for integration, for QA, for testing, for security updates. We give you a way to hit the ground running, so it's kind of the best of both worlds. You get the support you would get from a proprietary system, but the full power of taking advantage of the world's ability to create open source software with all of that available on OS X.

Just an incredibly increasing number of enterprise customers over the last year actually in deployment. And we're going to actually hear from some of those guys later today. They'll kind of take you through their decision process and where they are in that process. I think you'll find that very interesting.

So, innovation. You heard about this from Steve this morning. If Apple is anything, Apple is an innovative company. I think we almost stand for innovation in our industry. And you hear about innovation a lot in terms of the consumer side of our business. So the iPod or the iTunes music store and what we've done to the music industry in general.

Or iLife and the consumer products that we make available. However, innovation also translates into the world of IT. And in the world of IT, it's not just innovation around ease of use, although that is important because ease of use translates directly into less calls to the help desk, etc. But innovation in the IT world also translates into ease of deployment. Ease of management.

Ultimately translates into lower total cost of ownership. And that's where we focus our innovation and our skills at innovation in the IT world. Both in the software and in the hardware. Now, I'm a software guy, so I'm going to spend a little bit of time talking about the software side. And innovation here is focused on OS X. And the latest OS X. The latest innovation there is of course OS X Tiger.

Mac OS X Server, this is Tiger Server. What's new in Tiger Server? I'm going to actually go into this in a little bit more detail later on, but just to mention the key aspects that are new. 64-bit applications, that means 64-bit address space, so that you can go beyond the 4-gigabyte barrier.

ACLs or access control lists, big deal in the enterprise. iChat server, run your own instant messaging inside the enterprise securely. Software update server, it gives you control over when systems get updated inside the firewall or inside your enterprise. Weblog server, weblogs are essentially the groupware of the future. You're going to, if you're not already running them inside your company, you're going to be running them inside your company. We integrate a blog server right in with Mac OS X Server.

Junk mail and virus filtering, which is a must for any mail system that's deployed by an enterprise today, and we have some very good products there. Ethernet link aggregation, that's sort of under the hood, but I'll talk about that a bit. And then Xgrid, taking advantage of those unused CPU cycles around your corporation to do high-performance computing.

I mentioned aggressive partner adoption. We've had a huge number of IT and enterprise partners come on over the last year. Just to mention a few, Oracle. We talked about Oracle 10G last year. Oracle 10G is now available. TIBCO, another partner that you're going to hear a bit more about from one of our customers later on. So this momentum continues. People now actually think of us when they think of the IT space. They put us into their procurements in terms of evaluation. I think this momentum is only going to get stronger and continue.

Finally, or one more story that's of interest and sort of centers around not just 24/7 availability, is the army.mil website. It's actually about 60 different websites that the Army runs and these are deployed on XSERVs and XSERV raids. The interesting thing about this is, as you can imagine, these sites get attacked occasionally by hackers.

And they've been running these sites on Mac OS X since, for about the last five years and the result is no successful attacks. So not only do they have a site that just stays up and keeps running, but there have been no successful hacker attacks on this site. The other interesting thing is that they serve over a terabyte per day.

This is not just a static website. They actually make heavy use of streaming. And Apple has a lot of great server-side products for quick time streaming. That's part of their solution. And so this is a very heavy traffic site. It's a heavy amount of bits streaming out of it, getting hacked all the time. It just keeps on running. So a great example of Macs being deployed into a very mission-critical environment.

This one is fun. This is UCLA physics and astronomy department. These examples just keep coming up of clusters getting deployed of max. Clusters of 64, 128, 256, 1024 clusters of max. It turns out to be just a great solution. In this case, they're using it, they've got 256 dual processor XSERVs and the result is they can do 4 trillion double precision floating point operations per second.

They use this to do fusion research at UCLA and one of the most fun things whenever one of these gets deployed is, especially in a university environment, is when everyone sort of gets together to assemble the thing. And this is a very interesting example. And in this case, they did some time lapse movies and put together a little film showing it kind of getting built from the ground up. And I thought I would just share that with you because it's kind of a, it's fun to watch.

I guess what I can say is they're a federal contractor and that's probably all I can say. But they have a need for large-scale, high-performance computational clusters for hypersonic research. And that's exactly what they do. They are currently the largest Mac cluster. They have 1,566 dual processor, 2 gig G5 servers, backed up with XSERVs and XSAN systems. And they simulate hypersonic flight. I'm not sure exactly what's going on here, but I think this is something you don't actually want to have happen during hypersonic flight.

But another example of just the rate at which cluster computing is catching on. So year in review, again, a growing enterprise product line. Our product line continues to grow both software, hardware and support products. Aggressive partner adoption, guys like the developers who come to this conference continuing to port to Mac OS X. And then finally, some great customer feedback as they begin to deploy into their environments.

Now what I'd like to do is introduce some real-life customers to give you, in their own words, some of their experiences and where they are in deploying Mac solutions. First of all, I'd like to welcome Vijay Sonty, who's the Chief Information Officer for Broward County School District. Now, you don't necessarily maybe think of a school juristic as being like a Fortune 500 CIO position.

Vijay has extensive experience as CIO. He was named actually CIO of the new century by Business 2.0 Magazine, has managed multi-million dollar projects. Broward County is like a Fortune 500 enterprise deployment, and he's going to go into some detail on that. So without further ado, I'd like Vijay to come on up and tell you about what they're doing.

Again, let's get started with some very interesting facts. As you can see, Broward is a very large organization. We are the sixth largest school district in the US and we have over 274,000 students, an operating budget of $4.2 billion and 39,000 plus employees. So clearly, it's the size of a very typical Fortune 500 organization.

So let's look at some other statistics which present the education enterprise. And in an education, we are faced with the same challenges other industries face. Our goal is clearly to create an enterprise architecture that will unify our applications, our databases, streamline our information delivery and finally create an integrated system.

So we are clearly using some of the leading technology. We use SAP for our ERP. We are 80% Apple shop. We have over 150,000 network devices. And the list goes on. I think we have almost every vendor product in Broward. We are working with IBM, SAP, Cisco, Microsoft and the list goes on.

What you see here is a very interesting slide and this kind of shows the complexity of the educational enterprise. And mind you, it also resembles a typical Fortune 500 company. What you see here is an ERP system and if you look in detail, you will see that there are a lot of legacy systems and these are mission-critical applications. You see decentralized applications and databases. In a nutshell, it's a fragmented technology. landscape.

In addition to the challenges enterprises face, we also have our own educational challenges. One key challenge is the No Child Left Behind Act, which Congress had passed in 2002. If I were to compare this act, I would compare it to the quest of Congress in the 1960s to put man on moon.

It's a very pressing, demanding law that looks at accountability and by year 2014, the goal is to make sure that we're improving academic performance at all levels for all students and eradicate illiteracy completely by the year 2014. So that poses some unique challenges and we are faced with the need to have very strong testing protocols in place, reporting requirements and finally accountability. So our goal at Broward is by using Apple's technology to effectively integrate these silos of information and move towards a complete total solution.

To make this happen, we are taking a very systematic approach. We are using a building block approach where we are layering our technology. We are starting at the foundation with infrastructure and we have deployed Apple Xers in all our schools. That's 251 schools and increasing day by day. We have laid a solid foundation and our goal is to build advanced applications on top of that and effectively integrate people, process and technology resources. Our goal is to reach to the top of the pyramid and that's the knowledge layer.

To get there, to get to the portal layer or the knowledge management environment, we are embracing open standards and this is where Apple is a good fit. Apple's OS X Tiger is embracing open standards and open technology and works very well with our goal to take our diverse legacy applications and effectively integrate it into our educational enterprise.

So here we go. Our goal is Project Nexus and Project Nexus is Broward's enterprise portal. Our goal is to have available a single gateway to personalize information which will help our key constituents make the right decisions. We're able to create a unified view of information and finally knit together and streamline all our processes.

So here's something we're trying to do right now. I think we're working with Apple engineers and my staff is also very working aggressively to create some very unique widgets. We're looking at-- A phone directory which would have presence awareness and instant messaging built into it. We're looking at school calendars which will show students' lesson plans at the start of the day. We're looking at being able to quickly look at attendance reports. Be able to look at the books that are overdue and also alert students as to the new books that are available in library.

And finally the little bitty handy helpers which go a long way. I think in schools we have some very large volumes of binders of information which deal with policies and procedures. We're able to quickly give our students, teachers, and parents, and administrators the policies at their fingertips all with the push of a function key.

So in closing, I think I would like to call to action all the developers out here and ask their cooperation in building these true enterprise widgets. I think you can build widgets that not only extend to the educational enterprise, but also go and help other industries. For example, being able to get a dashboard view of all your key reports and statistics. Being able to look at your NOC, Network Operations Center, or other system management monitors.

Being able to look at your KPIs, or being able to quickly monitor your hosted applications. Looking at bandwidth and looking at effective utilization and availability. And finally, with presence awareness and also looking at hardware integration widgets, you're able to manage and monitor your whole enterprise. So in a nutshell, what we see here is we have achieved our goal of enhancing, or increasing the utilization of technology all with Apple products. And I'm very happy to say that we are the leading technology school district and we plan on being there forever. Thank you.

Well thank you Vijay and I'm sure that any of you who are in Fortune 500 IT shops find a lot of this very familiar in that the message of open standards really rings true here. Next I'd like to introduce Joe Duemel from Aozora Bank and he's the joint general manager there. Joe Duemel: Hi, this is Dan. This is a bank. This is a more typical IT enterprise shop and he would like to share with you some of his experience with Apple and with Mac and ideas about open source and open standards. So Joe, welcome.

So I'm sure the first question you have, since you're probably not up to date on all your Japanese banks, is what is Azora Bank? Azora Bank is a successful and profitable bank in downtown Tokyo. They're primarily a commercial and special finance bank. Azora recently turned over its management team. And as part of that, we looked at the challenge of how do we manage systems, technology and people that were relatively stuck in the 1990s.

Like some of the other presenters, I also have everything in my data center. I have stacks of IBMs. I have the old tape drives you see on old sci-fi movies. I have a pretty scary data center. The room that you're looking at there is a tape library. It's a robotic tape library. It manages a whole 1.2 terabyte of data.

Got a little robot in there, zips back and forth. It was replaced by something that looks about that high. We have a new management team. Part of the charter of the new management team is they wanted to create an environment of knowledge workers. They wanted to get rid of a paper-based environment.

They wanted to be an energetic or genki, is the Japanese word for it, bank. They brought us on board and we looked at this thing and we said, okay, we don't want to deploy Windows. So we started with some rules and the first rule is it's got to contribute to good karma. And nobody gets good karma with Windows.

We also discovered that we were really building from the ground up. As we started this process, we thought, okay, you know, we'll replace the desktops, put, you know, maybe some Linux in the back end and we'll be fine. We started looking at replacing the desktops and discovered we needed to upgrade our network.

Okay, I found out I had hubs underneath the floors. I wouldn't have put them there, but that's okay. We pull up the floors, we look at the floors, we're like, okay, we need a full recable. We start the recable effort, we say, okay, now I need new switches. It's time to go to Cisco, get all new switches, do this right, because I don't want to do it again.

As we did that, we looked at our power requirements. I didn't have enough power per floor to run my Cisco switches. So I said, okay, we went to our power distribution and we upgraded that and they said, well, you know, you only got about five, ten minutes of UPS. Okay, that doesn't really work either. We started pouring concrete in the basement to put in new UPSs so that we could put in the power distribution units, so we could put in the switches, so we could build a data center.

Fundamentally, what we're looking at doing is creating an IT revolution. We were going to replace every single desktop unit. We were going to take the 75 different vendors in our data center, consolidate them down to maybe four. We were going to streamline our systems and processes, make it a manageable thing, get rid of access databases and Excel spreadsheets, holding customer information, etc. So as we sat down and discussed it, we decided we needed some rules.

The first rule was education. We did not want to end up being beholden to any vendor. We wanted to own our own environment. All our employees, all the guys who run the stuff daily are Japanese. You know, when you deal with a U.S. vendor, you have to make sure that you have the right education. So we made education a very high priority. We wanted our people to run their systems.

Design Design was really important to us. Design of the work environment, design of the systems environment, design of the business processes. Design was important to get right because without it we were back to the bad karma thing and it wasn't looking good. Partnership We knew that we couldn't do this alone.

We knew that we had to go to the industry leaders, people like Apple, people like Cisco, people like EMC Documentum, people like TIBCO for integration. We needed this stuff to work and we needed to go to the people who knew it best. So as you look at this, this is a pretty big IT investment. We're spending $30, $40 million trying to get this right and that's just the first cut. So we wanted to do it right. We knew that partnership was going to be really important. More rules.

First thing about partners, they have to be an innovation leader. They have to own their space. When you mention their name, people have to go, yeah, networking, they got it. Apple, yeah, desktops, they got it. They have to train our people in their intellectual property. Again, one of the things that really broke earlier was that it was really hard to separate our people from the vendor armies that kept giving me consulting bills. So it was important for me to actually really own my enterprise.

Mutual non-disclosure. As you work in any of these partnerships, you find that you need to plan ahead five to ten years. Planning ahead five to ten years means you need to know what your vendors are going to do and they need to know what you're going to do. So mutual non-disclosure became really important to us. And the last one is executive level sponsorship.

As you do a partnership like this, whether it's a partnership with Apple, partnership with Cisco, stuff's going to go wrong. It's not all perfect, it never is. It's important to be able to go to someone and say, hey, look, help me make this work. And share an idea with them. And share an idea with them. on both our successes and our problems.

So, as I described this to our management committee and as we worked together, the question we kept hearing was, why Apple? The answer we thought was really clear. Undeniably, they're the leader in the field in innovation, both hardware, software, both for the enterprise and the desktop. They really had it.

The second was access to the best and brightest minds. It was really important to us to be able to go to the people at Apple that make things work and go, how do I do this here? Because it doesn't make sense. One of the things we looked at is as we were trying to pull all our systems together is, you know, okay, I got Java, I got Unix, I got 3270, I've got some legacy Windows stuff that runs in terminal servers, I've got X Windows, how do I make it work? The nice thing with OS X? It all just works. Don't have to do a whole lot different to make it work. Highly internationalized.

My kanji's really bad. I'm really happy that I can flip into an English screen. A lot of the Japanese employees are really happy that I'm not trapping them in an English screen. The fact that OS X is internationalized from the ground up, that Apple is built with a view towards being internationalized, is critically important to us. And Apple's really energetic, and that was real important.

So I told you earlier I was going to show you what our employees work at. Basically everybody has their very own three and a half feet of linear space, which they share with whatever books and coffee cups they want to put on their desk. They sit next to each other. They're separated by a file cabinet.

This is not a knowledge worker environment. So we destroyed it. and David Right now I have 20 floors in my headquarters, I have six floors in my data center and I'm progressively destroying it floor by floor and replacing it. Here's what we're replacing it with. This is prior to our first rollout.

One of the scarier sites I've ever seen in my life, every one of those ended up VESA mounted in cubicles. And as you VESA mounted them, you take the old stand off. We stacked the stands from one side of the floor to the other. It was kind of interesting.

So some of the challenges we're looking at. We're a bank. We are legally responsible for our customers' information. It's very important in Japan that customer information never get out. We don't quite get the same option that they might have in the US as saying, "Oops, I lost it." You say, "Oops, I lost it." They say, "You lost your banking license." My management says, "That's bad." We have a high need of integration. I mean, we do have a bunch of systems. When we first looked at this, we were going to use Mac on the desktop, not in the server room. We had to get this stuff working. I have tons of paper on every floor.

We're actually lightening our building's earthquake load because we're moving the paper into Documentum, which gets backed up into big, you know, terabytes and terabytes of storage, etc. But I needed to make Documentum, TIBCO, Oracle, everything work right. When we started this process, it didn't all work on Apple. So we had to go to TIBCO and say, "Hey, we need some help." TIBCO responded. They worked with Apple.

Apple and TIBCO got together. They got together a beta version of their messaging product, their system management tool and I'm pretty happy to say that they're now generally available. They've been released, which means I can run them in production, which is a good thing. Also, they've also--TIBCO is also committed to porting the rest of their product stack to OS X by the end of the year, so that really helps me as well.

So the question I get asked from the Apple people is when are you going to Tiger? So I'm kind of weird. My management asked me why I'm going to Apple, why Apple? Apple asked me when am I going to Tiger? The answer is I started out on Tiger. I had no choice. Tiger has the only security model that would work. All my clients are net boot with encrypted swap. I do not have any customer data on any disk on the floor. To me that was absolutely critical.

It's that banking license thing. They seem to care. The second thing is card services. My security model is pretty tight. It's a combination of what you have, which is your physical key card, and what you know, which is your password. So basically that key card also controls the ability to come in and out of the building.

If you go to the restroom, you pull out the key card. The Mac flips using, I think at the moment it's a user switch to a screen saver. You go to the bathroom, come back in, plug it back in, you're back in. The next thing is the ACLs.

You've kind of heard a lot from them. They were critical for us. I do full role-based authentication. I know when anybody touches any data. And I really needed the ACLs and client lockdown based on roles. The other thing that really, really hit us is manageability. Tokyo real estate is a little expensive. It was important for me to be able to put my help desk out in Fuchu. Fuchu is our data center, about 30 kilometers, maybe 40 kilometers outside of Tokyo. But I had executives and executives need help.

It was important that my help desk guys could help my executives. So what we've done is every single map has got an iSite on top of it. We support video conferencing for every employee. We're kind of hoping to tweak the interaction model a little bit. And our help desk will use that. Our help desk basically will initiate a video chat, ask permission to take over the desktop with Apple Remote Desktop and then basically show them how to start Word, start Mail, find their document for them.

The other thing that was kind of helpful, I mean I've never personally figured out, you know, how do you manage 2,000 of these things? Apple has. Work Group Manager and Server Administrator or Server Admin, been great for it. One of the weird things that happened after we'd made the decision is some of our quants, and for those people not in finance, these are the people that really like numbers and are relatively boring to talk to.

They came to us and said, we need you to build a supercomputer. And we're like, okay. Never quite done that. But instead, what we're going to probably do is use XGrid. And we're going to use XGrid and use some of the unused CPU models and then look at building a supercomputer. I don't think we can do as cool with video, but hopefully we'll get by a little bit.

So here's what I wanted to end with. This is floor one done. This is the 16th floor in our headquarters. I only have 19 more floors to do and a whole data center. But we're creating switchers 110 at a time every three weeks. So thank you very much.

Thanks a lot, Joe. So I think I like the switcher aspect of that. Next, from Rotech Healthcare, we have Albert Prast, who is both the Chief Information Officer and the Chief Technology Officer. And he's going to tell us about their experience. You may not have heard of Rotech, but he'll explain that there is probably a Rotech near you somewhere. And he'll talk about his experience with the Mac and with open standards and open source.

So, Al? Thank you. Thank you. I'm glad to be here. This is the first time I've been to an Apple event and I'm very impressed.

Junk mail and virus filtering. Spam Assassin is the open source project that we have integrated in. It's a very high quality spam killer, both in terms of adaptively identifying spam and getting rid of it at the server and taking blacklist feeds to remove spam from blacklists which are available on the internet.

Virus protection via Clam AV, another open source project integrated in with our mail server. We'll return or delete or quarantine or whatever you want to do with those viruses if they come in. Not that those viruses will affect your Macs, but you don't want to be passing them on to Windows machines as well.

Xgrid, you heard an example of, you know, IT CIO gets told, hey, we want a supercomputer, our quants need something like that. Take a look at Xgrid. It's built into both client and server, so it's there on every single system of Tiger, whether it's server or client. Secure, you don't have to run a node as an Xgrid node. You can enable it, though, and it gets authenticated and will only run the jobs that you want it to run.

And then finally, XSAN version 1.1, available on Tiger. So it's really XSAN for Tiger. It's available for Tiger and Panther. The benefits are large-scale storage consolidation. So 64-bit file system, up to two petabytes in size of storage, virtually no performance or volume or scalability limitations in this. Consolidate literally hundreds of thousands of files. And it's available for hundreds of XSERV RAIDs for increased performance. And best of all, it's a free update. All users of XSAN 1.0 will get XSAN 1.1 for free.

And to wrap up, I just want to call your attention to a few very good sessions to go to. Apple Data Center, First Flow Moscone West, right down below. Take a visit there. Look at an example of an Apple IT Data Center. Interactive panel discussion at 7 p.m. on Tuesday. Don't miss that. O'Reilly brown bags are great. If you've got an interest in Python, PHP, Perl, MySQL, I love O'Reilly. O'Reilly's great. Go to the brown bags. Late night labs.

Again, Apple experts in areas of Mac OS X server. How do you put a Mac OS X server in a heterogeneous environment? What's Apple Remote Desktop all about? How do you deploy an XAN, web objects, et cetera? So these late night labs are incredibly valuable time you can spend with Apple experts in these areas. And then finally, Oracle Database 10G on Mac OS X server. Friday, June 10th at 10.30 at Second Level, Alcove 3, across from Enterprise IT Lab.

Talk to Oracle. People learn about Oracle 10G on Mac OS X. And finally, as I mentioned, 40% of the attendees are IT-related at this conference. And so we have a ton of sessions. They're in your notebook that you got handed out. They're in your notebook that you got handed out with your badge. So, you know, I'm not going to go through all these, but I'll just click through them. And finally, thank you very much for coming to Worldwide Developer Conference 2005.