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Tuesday, May 24, 2005, 08:15 am PT (11:15 am ET)

Apple chief says company holding betting pool over new Yahoo service

Apple chief executive Steve Jobs has cast doubt on Yahoo's new $60-per-year music subscription service, proclaiming that Apple employees have started a betting pool to see when the internet search giant will raise its monthly rates.

Yahoo's $60 price-point is "substantially" below Yahoo's cost to run the service, Jobs said during his interview at Sunday evening's Wall Street Journal "D: All Things Digital" conference. He claims to have entered the pool himself, placing his money on "five months."

Jobs also attempted to dismiss the notion that cell phone service providers are likely to eat at Apple's dominate position in the digital music download market. He said downloading songs from the providers would likely offer "a lousy buying experience" at two or three times the cost of Apple's iTunes Music Store. "It's hard to see their customers as that stupid," he said.

Meanwhile, Jobs expressed his belief in the iPod "halo effect," noting stronger Mac growth over the company's last few quarters. Asked when Apple would reach a 10% market share, he said didn't know. "It's possible," he said. "...if people learn about our products, many of them choose them."

Commenting on security and viruses, Jobs said that since all computer makers face these challenges, it's not in his view to market machines that way. "One thing you never want to do in dealing with security and viruses is be cavalier," he said.

During his interview, Jobs also revealed that iTunes 4.9, a new version of Apple's digital music jukebox software, would add podcast support via a menu item. The menu will allow users to listen to podcasts and subscribe to them. Users of the new version, due out in the next 60 days, will also be able to categorize podcasts and sync them to their iPods, he said.

Additional notes from The Wall Street Journal "D: All Things Digital" conference are available in an earlier AppleInsider report.