Here's an interesting rumor: Apple may cancel Rhapsody, despite spending over $400 million on NeXT to get the technology. In articles in Time and Newsweek magazine this week, Apple's Steve Jobs emphasized that Apple has only two big assets: it's name, and the MacOS (not Rhapsody). This is a surprising comment from the man who shepherded Rhapsody into Apple, and it speaks volume about his strategy to save Apple. Jobs wants it made clear that he purposefully didn't mention Rhapsody during his keynote address last week at MacWorld in Boston.

"Apple's about the Mac operating system...the strategy has to be to enhance and extend the MacOS," he said. "A lot of Rhapsody will be in the MacOS, rather than the other way around."

Avie Tenanian, Apple's director of software engineering, and the architect of NextStep/Rhapsody, denies rumors that Apple will abandon the next generation operating system, however. And an internal document about the new OS suggests that it will effectively compete with Windows NT. According to this document, Rhapsody will support virtual desktops so that users can log in from any machine on a network and get the same settings. An integrated security system will grant the proper user access to these mobile users as well. The most important feature, however, and a telling one, is that Rhapsody will be easy to use, combining features of the present MacOS with NextStep/OpenStep. In the document, the stated UI goals of the Rhapsody are: simple to understand, minimalist, extensible, and replaceable.

According to the document, "the MacOS has long-suffered from a series of inappropriate extension mechanisms." Rhapsody will keep such extensions from threatening the stability of the system, apparently. It also moves away from the "one size fits all" mentality of the Mac OS, by allowing users to replace any element within the system that they choose. This sort of componentized  architecture is attractive for several reasons, such as speed, ease of programming, and size.

Though Rhapsody will resemble the current MacOS with a menu bar running along the top of the screen, it will also feature a toolbar along the right side of the screen, call the tray, that will be used to control applications and contain the trashcan. This will be similar to the dock used in NextStep/OpenStep.

As for the market this OS addresses, Apple intends to target publishing, entertainment, and "new media." This overlaps with Apple's market for the current MacOS, which will be developed alongside Rhapsody: education and "content creators."

In other Apple news, the company reported to the SEC today that it expects to lose money again this quarter. Apple stock plummeted at the news, after hitting a 52-week high of $30 the day after the Microsoft/Apple deal was announced last week. Separately, in a memo to Apple employees, Steve Jobs today announced a new plan to make Apple "a more egalitarian, entrepreneurial company." The cost-cutting moves include revamped stock options and severance plans, elimination of Apple's sabbatical program (Apple needs "all hands on deck"), constraints on corporate travel, and a consolidation of employees into the former R&D Campus, which was today renamed "the Apple Campus."

"As we restore Apple's fortunes, our public shareholders and our employee stock option holders will all benefit in harmony," Jobs wrote. And as a final bit of Apple trivia, the magazines "MacWorld" and "MacUser" will merge, beginning with the November issue, and continue on as "MacWorld.