In the short term, the problem for Apple is not to kill its sales during the transitional market. In other words, what happens to the left-over PowerPC machines? The company got through this once before when it switched from the 68000 to the PowerPC. It did it with add-on cards, specifically the Power Macintosh Upgrade card. So I expect a similar product this time. Still, this process is going to be bumpy, but with iPod and iTunes mania propping up the company, this is the exact right time to do this. The company can weather any storms in the process.
The iPod may, as Bill Gates thinks, turn out to be a flash in the pan - a big hit before microdrive-enabled cell phones become out portable mp3 players. But that won't happen for probably another couple years. Meanwhile, those fat profits ought to keep Apple afloat during the changeover period.
The big question is, could Mactel