Apple's Notebook Marketshare Growth and High Margins

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I guess the MacBook is leading the charge on this one. It seems like I see more and more of them every day.

Nothing beats growth, but I am afraid that the increase in sales and Mac ownership is going to cause harm to Apple's service and support, and of course QC methods which have been declining since the switch to Intel.

I would have liked to see the specs of those "average cost" laptops given that Apple's best selling model is the midrange MacBook at $1300 and that many PCs are stripped down to get to $700.

AAPL is down $17/share just today!! Yikes.

MacRumors said:

Apple's success with this high-margin plan.

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Are Apple Notebooks High Priced... or do they have high margin... or both? This post is confusing for using these two different concepts interchangeably.

bommai said:

AAPL is down $17/share just today!! Yikes.

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Holy crap it's time to buy.

I'm seeing that the $999 area of PC notebooks is seeing a lot more refinement and features then it used to be. Anything lower then that and you are going to see budget Intel/AMD processors and integrated graphics.

bommai said:

AAPL is down $17/share just today!! Yikes.

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Bad economy is what it is. Everyone's down from my ticker readings.

Apple's growing share

It is good to know that Apple's high end notebooks are doing well. I'd like to see Apple have a better story for notebooks in the $900-1200 that are equivalently spec-ed. The $700-800 PC laptop will include a DVD burner, dual core processor, ~1GB RAM, integrated graphics and at least a 120GB hard drive, the usual complement of basic ports stereo, USB), wifi. So $700 on the PC side will get you a decent laptop to cover basic user needs.

I know many people who wanted to make their next notebook a macbook, but in reality the $800 notebook met their needs, and spending an additional $400 on a macbook with a DVD burner was a bit too much.

My 2 cents. Apple needs to do a better job to hit the high end of the midrange, and you'll see apples share increase to 1:2 notebooks...and like every large Fortune 500 organization revenue and marketshare are key.

bommai said:

AAPL is down $17/share just today!! Yikes.

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How much are the merchant bank shares down?
Will they be here tomorrow (The Merchant Banks)?

bommai said:

AAPL is down $17/share just today!! Yikes.

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AAPL computers are luxury items. They just got downgraded across the board because of the worsening economy. When people are spending $4-$5 for gas, can't make their mortgage payments, and losing their jobs do you think they are going to splurge on a new ipod much less a Mac? If they NEED a new computer it will be the least expensive one they can find to get the job done.

Analysts are also thinking this could be one of the slowest Christmas seasons in a long time. How many ipods are going to be in stockings this year?

well, i think this is great, and let's hope the new macbooks get here soon and continue to sell great

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Di9it8 said:

bommai said:

AAPL is down $17/share just today!! Yikes.

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How much are the merchant bank shares down?
Will they be here tomorrow (The Merchant Banks)?

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They will probably going to be here because the stock market will take a holiday tomorrow.

carfac said:

Are Apple Notebooks High Priced... or do they have high margin... or both? This post is confusing for using these two different concepts interchangeably.

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It's price (which is relevant to margin), but not "high prices" (that's the myth that's no longer true).

The higher average price is because people buy higher-end Macs than PCs. (And there ARE no bottom-end Mac laptops in the mix at all.)

A given level of Mac costs about the same as a similar name-brand PC, but PC sales include a larger mix of low-end cheap models, thus reducing the average paid.

Macs and College

I work as an IT admin for a state university and can say that we are seeing easily a 2000% increase in Macs on campus. We also serve as a "PC" shop where students can drop off their computers for network configuration and spyware/malware removal. I think I've seen one MacBook in this year for hard drive failure among the sea of malware-infested XP and Vista boxes.


Seeing more students pick the Mac and having more parents ask about them is making this 15-year Mac veteran very happy.

Eidorian said:

Holy crap it's time to buy.

I'm seeing that the $999 area of PC notebooks is seeing a lot more refinement and features then it used to be. Anything lower then that and you are going to see budget Intel/AMD processors and integrated graphics.

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Lower the prices of your notebooks and its a two-for.

Apple Computer Costs

It's such a tired fight already. First it was the Megahertz Myth, now that Apple is using Intel chips it's the price point. Peecee fanboys love to bring up the "high cost" of Apple products, but they never consider the short-term and long-term costs of a Windows machine.

First off, a peecee is never "ready to use" when you take it out of the box, so now you need to spend time with setup, while Macs are ready the instant they are out of the box and turned on. - Set a dollar value for your time

Second, all you get is Windows and some crappy games, plus a bunch of crapware that is difficult to uninstall and is a headache to deal with when you first start you new computer. - So tack on $50 to $210 for Edition upgrades that provide what is almost an iLife suite and an OS comparable to 10.5 Leopard

Third, you don't get a CD/DVD with a clean installation. You have some slipstreamed disc that will put all the junk you spent time removing back on should you need to go back to using it, that's even if you get a disc. - Set a dollar value for your time

Finally, you have to deal with Vista incompatibilities. We dealt with the same thing when we first migrated to OS X; but it's been 9 years for the Server Edition and 7 years for the desktop edition and obviously Microsoft and it's allies didn't learn from Apple's initial experience. - Set a dollar value for your time

That's not even counting headaches from viruses, malware, spyware and other things that make peecees a "pleasure to own."

If you're a teenager who gets a computer to surf porn, play games and download media, then time isn't worth anything and I can see why spending "extra up front" on a Mac isn't appealing, but as adult who does the buying and whose time is money, then the answer is simple, plus if you are really desperate, you can always run Windows on a Mac.

jade said:

I know many people who wanted to make their next notebook a macbook, but in reality the $800 notebook met their needs, and spending an additional $400 on a macbook with a DVD burner was a bit too much.

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I'm seeing the same thing here.

In many ways the MacBook hardware is superior like mini-DVI, Firewire and typically a faster CPU, and better overall design.

But when even sub $600 "windows" notebooks include 2gb of ram, 160gb drives, DVD burners, larger screens, 4-1 memory slot readers it gets harder for them to justify the Macbook with everyone worrying about the economy... That $400-$600 price difference looms larger than it did 6 months ago...

The Mac OS is of course superior but they are finding it hard to justify it being $500 superior...

Hopefully Apple does something and significantly lowers the price points of the new MacBooks.

eastcoastsurfer said:

AAPL computers are luxury items. They just got downgraded across the board because of the worsening economy. When people are spending $4-$5 for gas, can't make their mortgage payments, and losing their jobs do you think they are going to splurge on a new ipod much less a Mac? If they NEED a new computer it will be the least expensive one they can find to get the job done.

Analysts are also thinking this could be one of the slowest Christmas seasons in a long time. How many ipods are going to be in stockings this year?

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I agree, Macs are (or at least seem) more expensive than an equivalently spec'ed PC. I wonder how much of that is materials, labor, R&D, shipping & advertisement cost & how much is just profit. I remember hearing on a thread a few months ago that Apple has something like 30% margins. While I have no problem w/ Apple (or any company) making some profit, 30% seems excessive. Heck, on a Mac Pro, if you order it on the Apple Store, it'll cost you $9,100 to max out the RAM to 32 GB. If I go to dealram.com, I can get it for not even $2000. Apple should either lower prices on its products or maybe pay all the laborers they use more. Plus, after a while, they would have made up for the R&D costs, but they never lower their prices.

bommai said:

AAPL is down $17/share just today!! Yikes.

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down along with everyone else, so not as if apple is in trouble when others are doing great. the great republican scare will finally be voted on and stocks will stabalize and apple will start climbing again.

great time to buy apple, though!!

happydude said:

down along with everyone else, so not as if apple is in trouble when others are doing great.

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Not that much though. As is being discussed in another thread, two analysts downgraded AAPL today. Normally the news that Apple's margins are so great and they are capturing a third of the dollars spent on notebook computers would be greeted as good news, which objectively, it is. Nobody can claim the the stock markets are objective though, at least not in the short run.

The reason I bought Apple stock was that the company seems to work on a level I understand: build useful, pretty things of excellent quality and sell them at a healthy profit. Their marketing is expensive but effective and they're being rewarded for it in the marketplace with increased share.

That said, with home equity loans down 92% from 2005 levels, consumer credit drying up, and a population terrified about spending money on luxury goods in a time of peril, it's no wonder Apple was downgraded.

I expect this to shake out in a year or so. Personally, if prices continue to do down for a while, I'll pick up more Apple stock. They have a business model that works.

They may be more expensive or not, depends how you look at it, but I've been using my Powerbook G4 17" since 2004 and still like new (I changed the battery once, that's all), so go figure and start counting.

Being a student and knowing many students I can say from personal experience that a fundamental shift is occurring away from PCs and toward Mac's. People are down right fed up with the crap you have to deal with when using a Windows PC. Also, people are catching onto the BS that companies like Dell try to pull when it comes to price and those so called $600 PC's. Those things are absolute paperweights.

It'd be even higher if a new one came out soon

guzhogi said:

I agree, Macs are (or at least seem) more expensive than an equivalently spec'ed PC. I wonder how much of that is materials, labor, R&D, shipping & advertisement cost & how much is just profit. I remember hearing on a thread a few months ago that Apple has something like 30% margins. While I have no problem w/ Apple (or any company) making some profit, 30% seems excessive. Heck, on a Mac Pro, if you order it on the Apple Store, it'll cost you $9,100 to max out the RAM to 32 GB. If I go to dealram.com, I can get it for not even $2000. Apple should either lower prices on its products or maybe pay all the laborers they use more. Plus, after a while, they would have made up for the R&D costs, but they never lower their prices.

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What other company offers an 8-core computer capable of running ANY operating system for under $3,000 besides Apple?