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Jobs may well be cooking up an improved iteration of AppleTV. But the fact is, this time he isn't creating the next cultural phenomenon, but racing to catch up to it. Without the kind of exclusive content partnerships he had with the iPod--and here he's arguably behind Microsoft's Xbox franchise, TiVo, and the video-on-demand and DVR offerings from cable giants such as Comcast and Time Warner --he has to rely on reputation and fashion alone to carry him through.

Open vs. Closed

Apple is at a moment of choice: If it can stay hot and produce breakout couture hardware indefinitely, it can hold onto its closed model, elite pricing, and huge margins. In many ways, the world would be a prettier place if it did.

But in an age of convergence and simplification, customers are ever more insistent that computers, phones, TV, and music systems work together. For them, being "open" isn't about sharing patent information or computer code but about compatibility and seamlessness, from the phones in their pockets to the movies playing on their flat screens. Now that the race for an end-to-end system has begun in earnest (significantly, it doesn't look all that different from the race to own the desktop years ago), Apple needs either to win that race outright, or to get comfortable with being simply part of the solution. Winning outright is a very tall order, of course. It means coming up with a self-contained system so beautifully functional that a critical mass of consumers are willing to enter that world and never leave. But the viability of AppleTV is an open question, and the iPhone may never be the $10 billion market Jobs anticipates.

So what if Jobs has built only a two-legged chair? The iPod and Mac may be great businesses but not enough, in all likelihood, to meet the giddiness currently reflected in Apple's stock price. And clearly, some Apple watchers are expecting gravity to assert itself over the coming years. The 23% annual earnings growth Wall Street analysts are predicting for the company is an excellent number for most mortals, but far from the 150% growth rate Apple has delivered in each of the past five years. Actually, it's basically identical to the forecast for the personal-computer industry as a whole.

Jobs may have to accept that Apple's next wave of growth--or energy, as Einstein might have put it--depends on syncing up his products and platforms with those of his competitors. Apple was already forced to open up the iPhone in order to enter the French market, and the recent deal Microsoft struck with the European Union suggests that a transparent philosophy will win out permanently across the continent, where much of Apple's expansion plan is centered. Yet there are risks, too, in tearing down this wall. If the company's success has flowed from the trendy, gleaming exclusivity of its machines, then diluting that quality could erode the very foundation of the franchise. This is the box Jobs is in. And it's a tight box--just sleeker, so far, than anyone else's.