Pages, Keynote, Numbers, Garage Band, iBook, PhotoBooth, iMovie, iDVD, all great programs from Apple. So, what happened?
iPhone became the most important product to Apple. iDevices became most of Apple's revenues & profits. Thus, almost all focus shifted to the most important, most profitable products.
Apple made decisions to "reinvent" many Mac products for iDevices even if that meant dropping features that work well/better on Macs. Thus a terrific program like Pages '09 was feature gutted so that there was feature parity between the iOS and Mac version of the "new" Pages. Conceptually, this is good because much more numerous iDevice users could be migrated toward Macs where compatibility with their iDevice creations might be very important to them. However, those who create on Macs can be frustrated at the "dummy-ing down" of Mac apps to support that objective.
Apple could have gone the alternative way and made a Pages Jr. and similar (or kept Pages for Macs and created something else) for their iDevices but that would imply the better experience or more robust capabilities were not available on the most important product, but on the niche product that (relatively) doesn't sell very well. Why do that and imply that iDevices are weaker? It seems that would require Apple to prioritize Macs or present Macs as the pinnacle of the Apple experience. Yet, the marketplace appears (and appeared) to be turning to mobile devices as the high-demand, high-profit opportunity with desktops & laptops becoming "the trucks" of the industry.
As is so often slung around here as a default tool for rationalizing anything Apple wants to do: "record revenues show that the people do want <whatever Apple wants to serve>" so apparently the dollars prove that people do want a dummied down iWork suite, dummied down iLife suite and so on. "Revenues do not lie." From the Mac user's- maybe the Mac power user's- perspective, this is the other edge of that double-edged sword.
In short: Apple puts it's focus where it's primary revenue & profits are. While Macs still matter enough to exist and get updates (though even that feels a bit "salt in the wound" right now), it appears they are somewhat in a iDevice hand-me-downs trap instead of getting the dedicated focus to fully exploit their much more powerful capabilities... especially for content creators. Instead of iDevices looking for ways to keep up with powerful things that Macs could do, the ongoing effort is to make Mac software be more and more like iDevice software so that iDevice users feel more at home when they encounter Macs.
Personally, I wish Apple would set aside teams & resources charged with treating Macs like they were Apple's ONLY product and not revolving seemingly all development around supporting iDevices. A program like Pages '09 was a terrific and simple DTP application that could be revived as maybe MacOS Publisher or something like that. Of course, that doesn't mean that it would be good to sever the relationship between Macs & iDevices. Instead, the idea would be more about the freedom to exploit the individual advantages of each platform to their fullest... rather than favoring one so much more than the other that the one undermines the potential of the other.
But what do I know: "record revenues do not lie" and "99% don't need..." and "...but who had the most profitable _______", etc.
