The hall is already filling up as Apple aficionados gather to hear Apple CEO Steve Jobs' keynote speech. The speech is expected to begin at 2pm (UK time). Attendees are currently listening to a medley of Beach Boys tunes.

2:03: Attendees are being treated to a medley of Mac stories taken from teenage Switchers.

2:06: Apple CEO Steve Jobs climbs the stage. “We got some great stuff this morning as well, it's going to be a long show, but a good show.”

He launches into a discussion of the Switch campaign. “In a month since June 10, we have had 1.7 million users to the Switch site since then, and about a million of them use Windows.

Introduces new product, Move2Mac, $59, this product sucks software and files from the Mac and puts it onto a Mac. Response has been off the scale.

Mac stores have seen 100,000 visitors per week in recent weeks - that's one hundred Macworld Expos every year - some are buying more than one Mac as they visit. Opening 32nd store tomorrow (Thursday). This store will be in New York's SOHO district in an old, one hundred year old post office.

Let's get to the technology. “I want to start with Mac OS X.” Referring to Microsoft's statements earlier in the week, Jobs said all the evidence points to 2.5 million active OS X users. The company expects 5 million active OS X users by the end of the year. 77 per cent of new Mac buyers are choosing to use Mac OS X as their boot-up OS after purchase. 20 per cent of the user base in a few months - the fastest transition in history. “We are pretty proud of that,” said Jobs. There are 3,500 applications today.

Jobs introduces Maya 4.5, to be announced at the show. The Mac version of the software has risen to account for 25 per cent of that company's business today. WarCraft, and Adobe Photoshop Elements also discussed.

Jobs introduces Rob Glasier, CEO of RealNetworks. Real introduced its Mac OS X beta Player at the show today.

“We now have 280(?) million Real Players out there today,” said Glasier.

2:16: Jobs begins to discuss Jaguar (Mac OS X 10.2). “Jaguar has over 150 new features, Apple has begun the number one Unix supplier worldwide, bigger than anyone,” he claimed. “We think we have the most advanced Unix out there, we are now number one.”

We have added VPN, Active Browsing and SMBA functions for better connection with Windows.” Jobs also announces the return of Spring loaded folders and more.

Introduces VP worldwide marketing, Phil Schiller.

2:18: Schiller demonstrates use of spring-loaded folders to place files - it will spring through an existing file structure; also works to navigate throughout the system in the Finder window.

Schiller demonstrates the new integrated search facility in Finder. Search tool integrated in the ToolBar.

The final feature: “We have a new desktop picture system preference panel.” I can click on any image and make it my Desktop, I can set up the picture, or get the image to change every five seconds. “So while I'm working, my kids can be with me all day long”.

That's the new Finder.

:22: QuickTime 6. Built into Jaguar. In a day and a half, Apple has seen over 1 million downloads of QuickTIme 6, the first MPEG-4 player on the market.

Jobs begins to discuss the impact of Jobs begins to discuss the impact of standards on the industry. TCP/IP, for example. “Standards bind our industry together,” says Jobs. MPEG-4 the next big thing, says Jobs. “Everyone will jump on board, except Microsoft,” says Jobs. Audience laughs.

Schiller begins to guide audience through QuickTIme 6. “For the first time today, half of the live audience are watching using 6”, says Schiller. Begins side-by-side tests of QuickTime's AAC audio codec.

The AAC audio track offers superior audio quality, claims Schiller after the demo.

Now contrasts two video clips, and moves on to demonstrate QuickTime Broadcaster.

Schiller trying to impress the audience with QuickTIme's Instant-on streaming, which drastically reduces the buffering time for streaming video. “It works just like it's on my local machine.” Audience applauds.

2:29: “Sherlock”, says Jobs - we have rewritten Sherlock, and here's Sherlock 3. This version is about “Internet services for the rest of us,” says Jobs. The application can now track stock information, and refresh prices every 30 seconds. The application will also track all the news. “All my information about stocks in one window” said Jobs. The application will track movies playing in the local area, and can even play movie trailers in the Sherlock window. Also has the ability to buy tickets, for example.

Sherlock 3 also offers the facility to track auctions. Jobs then demonstrates the application's ability to search the internet for images. “It will do this, and most of the images it comes up with are something like what you are looking for”, said Jobs. Showing a contemporary twist, he searches for images of Homer Simpson.

“Sherlock 3, Internet services for the rest of us, we think it's going to be really popular,” said Jobs.

2:35: Rendezvous. Jobs discusses this new network-friendly feature of Mac OS X 10.2. Jobs demonstrates how Rendezvous lets iTunes users share playlists and music libraries.

2:39: Apple's Phil Schiller is discussing printers. Big printer manufacturers – Epson, HP and Lexmark will be building support for this into their network printers. Rendezvous will automatically discover other devices on IP networks with no configuration requirements.

Jobs begins run-through of Apple's Mail application. This now offers the capacity to filter junk mail. Other updated features include an image-supporting Address Book.
Mac OS X 10.2 also has Bluetooth support built-in. A Bluetooth enabled Mac can dial a number using a Bluetooth-enabled phone. Also send SMS text messages - straight from your Mac.

2:52: Apple CEO begins a demonstration of iChat, the system wide IM application. Example: Fred can send a message, which is kind of cool (if we are still online). Jobs begins to hit technical problems. “It's possible to send URL's with messages,” promises Jobs. Jobs can search tha Adress Book, get a map and send it. Jobs can build a “Rendezvous Buddy list”, with iChat, simply drag a message over the icon and send.

“File transfer is really, really simple with iChat. We think it's the best IM experience in the whole world,” proclaims Jobs.

Jaguar will cost $129. Less than a dollar for each feature. Jaguar will ship early – on shelves August 24.

$19.99 gets recent Mac buyers upgraded to Jaguar.

“The people who love Mac OS X will be users and developers, but it will also benefit us, as we get to develop new features faster.”

2:58 “Next stop, iTools.”

Jobs takes a look at the competition - Yahoo is charging, HotMail is charging, other services are bust. From September 30, iTools will be no more, and we will be charging for the service.

“.Net claim they are going to be doing online services, we've been doing it a long time, we are calling it .Mac.”

The service costs $99.95, $49.95 for existing customers. “Extend your digital life, with .Mac.”.

3:02 Jobs introduces .Cal – See all the calendars that make up your life. This is a single window app that's easy to use, and understands the difference between Work, Personal and other life. “The calendars that make up your life” said Jobs.

It's possible to share these calendars over the Internet. First new feature of .Mac – iCal hosting, host a calendar online, and allow others to access it from anywhere in the world.

“We have built-in subscription”. It lets users subscribe their calendar to other calendars, updated so a user can schedule in time for hobbies, interests, regular meetings.

Jobs guides attendees through the possibilities of iCal. How to publish it, how to publish changes. The calendar offers a series of different views.

Jobs also looks at publishing calendar's, how to set the application up to refresh, and how it's possible to exchange Calendars over iChat. “That's iCal”.

“See all the calendars that make up your life.” said Jobs. “As simple or as complex as you like”. Free download, ships in September.

3:09: Jobs returns to the digital hub. “We all have these great digital devices in our life, and it dramatically enhances our value because we have written these great devices, like iTunes. This has been a great strategy for us – there is nothing like it in the Windows space.

Jobs looks at iPhoto - the 'digital shoebox'.

In the first six months we distributed over four million copies of iPhoto. 14 million copies of iTunes in last 18 months.

3:12: Jobs introduces iTunes 3.

One new feature - can rate songs and see how many times songs have been played. support introduced.

ITunes 3 offers a series of nice improvements, but the biggest improvements are playlists – Jobs introduces 'smart playlists'. These are set-up with rules. Jobs looks at one feature, my 25 most-played songs. He shows how complex these rules can be - by genre, by year, by size. “It's sweet” said Jobs.

Jobs sets up a playlist - rules are 'artists contains Bob Dylan'. He shows this can be limited to ten songs selected at random, for example. Jobs can also limit it so only four or five-star rated Dylan songs get put on the playlist.

Jobs then moves on to another track, The Beatles' Hard Days Night. This instantly transfers to his 60's music playlist. Also shows the ability to randomise playlists.

“That is a preview of iTunes 3.” Ease of use, smart playlists, ratings, “a really wonderful product, Mac OS X only - a free download, starting today.”

3:20 - Jobs announces $100 price drop on 5Gb and 10GB iPod's - also made them thinner and made other design improvements and a remote control and case. “We get a lot of requests for this too.” All bundled with 10GB iPod.

Introduces 20GB iPod, case, remote and more for $499.

Whole host of additional features for iPods, genre and composer support, ability to listen to stopped tracks where you stopped them, playlists, can browse by album, song, artist, and now, genre and composer.

We've added something new to iPod called Extras. This contains Contacts, and also now iCal compatible calendars, a clock, and made the built-in iPod game easier to find. “I encourage you to look at the new iPod software. Prices now start at $299, in store next month. Existing iPod customers can get add-ons for $39.

3:26: Jobs introduces iPod for Windows. Same models, same prices, in store late August.

3:28: Jobs introduces iSync, an application that lets users take their info with them when they are not near their Mac. It's a GPRS compatible phone-compatible application.

“Whole new generation of cellphones running SyncML, an industry standard we have joined.”

“Wouldn't it be cool if Calendar's, phones and Palm's could synch their data.”

What if you lose your phone? These are three of the best reasons for iSynch.

This application can synch up all such devices however they are attached to the Mac - Firewire, Bluetooth… Users can synch up certain calendar's or just some of them, phone books, or other data…

The application can synch up all this data to a users requirements with a single button. Can also synch up contact info, and more.

.Mac lets Mac users synchronise their life with a single button, says Jobs. iSync ships in September, runs on Mac OS X 10.2, and will be a free download.

Jobs believes there is no equivalent free software to iTunes, or iSync in the Windows world - they are all free. Promises iApps will be an important feature in the Switch campaign.

Jobs announces the introduction of the 17-inch landscape display iMac.

This 800MHz iMac will offer 1,440-x-900 pixel resolution, host an Nvidia GeForce4 MX graphics card. It carries 256MB RAM, an 80GB hard drive and a SuperDrive. The unit costs $1,999.

Apple has cut the price of the existing iMac to $1,799.

Jobs finishes the keynote with a promise: “Apple will invest and innovate through the economic downturn. The Mac is more than a machine to do spreadsheets and word processing on.”

Jobs finishes the keynote with a promise: “Apple will invest and innovate through the economic downturn. The Mac is more than a machine to do spreadsheets and word processing on.”

“We believe the personal computer is undergoing a rapid evolution, and we have never been more excited about this stuff.”

“The best future lies ahead,”

Keynote Ends.