Apple to Drop Prices of Notebooks?

[hiimamac]

This is going to make it real hard to not want to get a new MBP. I hope my Nvidia card explodes like it's supposed to and I get a new one for free!!

Well I got my Santa Rosa older $2499 MBP for $1500 or so from a MAC employee which means I saved $1000 so I should still get $1900 at least for it, 5 months old, then I can turn around and either buy another refresh (present $2500 for less) or a newer item from the EPP which he never uses), sometimes wonder, since I like the MBP so much but keep it plugged in if I should get a tower, but then I know the 16 core will come out, a TOWER and Macbook with dedicated GPU would be nice. See Apple, the PRO will always want another machine if the cheaper also has dedicated GPU.

Get it through your head.

HAMMER HAMMER HAMMER! LOL

Should be: 4 core MBP $2499, $1999, 2 core $1499, $1299, (although that would kill present holders, yikes), MB, $799, Mini with dedicated GPU$299
Air, $799, 16 core tower $3000

I can DREAM!!!

 

[Unspeaked]

How come when an analyst makes a comment that's bad (like they predict a product delay or calculate poor sales for a product) no one believes it, but when the same analyst says something good (like a price drop) all the forum posters are euphoric and consider it inevitable?

I think one of the posters on the first or second page that said this is probably just a margin cut due to higher component costs hit the nail on the head.

There is no indication, other than this one comment from this one analyst (where even he admits he's speculating) that there would be a significant price drop on Apple portables.

 

[NC MacGuy]

Personally, I'd rather they upped the quality to meet the price. Hope less expensive isn't cheaper which is usually the way things work these days.

 

[FletchG70]

Apple needs lower cost laptops

Hi All. I went across the street to Staples at lunch just to take a look around at the computers and laptops they have there.

There was an Acer notebook w/Dual Core Athelon 64 with ATI graphics, 2 gb ram, 120 gb hard disk, 14 inch wide screen, built in cam, Vista Professional, DVD burner, plenty of ports, etc...

$547 bucks. I kid you not.

A Compaq Presario with Core 2 Duo Intel, 2 gb, 120 hard drive, DVD burner, and 15 inch screen, Vista Pro, $799

I think out of the 10 or so laptops, only 2 or 3 were above $1K.

As Apple is using the same intel hardware - boards, chips, etc. and industry standard parts, the prices should be more reflective of the marketplace. I don't think the OS premium should be as much as it is.

The entry level MacBook should be like $699. Mid $799 and High end $999. And they should have comparable specs too - no more skimping on Ram and a lower capacity hard drive.

MacBooks are consumer products, and well, folks don't have lots of cash these days and are shopping around.

I would also like to see a sub-notebook similar to the EEE PC but with Mac OS.

Last but not least, while not a laptop, the macmini needs refreshing and needs to be at $499.

FletchG

 

[Mr Maui]

I'm feelin' the love! Can we hold hands and sing Kumbaya? Oh, hell, thoughtful, insightful, and non-judgemental comments in a forum are way overrated, anyway, and totally out of place.

LOL. Agreed!

 

[brendanspah764]

I found pictures of a possible new macbook design
Looks quite realistic!

Also backlit keyboard

Comment says: "2 weeks to go "

Look for yourself

http://flickr.com/photos/33559336@N00/2675984634/in/photostream/

http://flickr.com/photos/33559336@N00/2675984626/in/photostream/

I hoop this will be the real deisgn

The first picture looks really cool. And it looks like it was taken off the future page of the new MacBook, but what are the odds of that really. But the second one, it looks like a picture of the MBA.

 

[Mr Maui]

Hi All. I went across the street to Staples at lunch just to take a look around at the computers and laptops they have there.

There was an Acer notebook w/Dual Core Athelon 64 with ATI graphics, 2 gb ram, 120 gb hard disk, 14 inch wide screen, built in cam, Vista Professional, DVD burner, plenty of ports, etc...

$547 bucks. I kid you not.

A Compaq Presario with Core 2 Duo Intel, 2 gb, 120 hard drive, DVD burner, and 15 inch screen, Vista Pro, $799

I think out of the 10 or so laptops, only 2 or 3 were above $1K.

As Apple is using the same intel hardware - boards, chips, etc. and industry standard parts, the prices should be more reflective of the marketplace. I don't think the OS premium should be as much as it is.

The entry level MacBook should be like $699. Mid $799 and High end $999. And they should have comparable specs too - no more skimping on Ram and a lower capacity hard drive.

MacBooks are consumer products, and well, folks don't have lots of cash these days and are shopping around.

I would also like to see a sub-notebook similar to the EEE PC but with Mac OS.

Last but not least, while not a laptop, the macmini needs refreshing and needs to be at $499.

FletchG

Why not just buy the $547 laptop then and save the $400. Then you can stop complaining about Apple prices. Apple is not interested in sheer volume to the masses who can't afford them. Those buyers are who Acer and other companies market to. Apple provides unique and stylish computers to a specific sector of the market.

You seem to indicate you want the best OS on a subpar computer at a subpar price. Apple will never do that. Sorry to disappoint you.

 

[iMacmatician]

This irks me. Larger screens often equate to higher resolutions which means smaller icons. Those fogies that want the bigger screens for 'bigger text and icons' are often mislead simply under the notion that 'bigger=better'.

We have some 19 and 21" flat screens at work here running 1280x1024 (not native) because people squint at 1440x900 (16:9) or 1600x1200.

I want resolution independence!

Didn't Apple state in developer notes that developers needed to make their apps resolution independent by 2008? Whatever happened to that?

I'd like to see resolution independence come to Snow Leopard, because that may be one of the factors holding back ultra-high resolution displays like 1920*1200 15.4".

 

[brendanspah764]

Why not just buy the $547 laptop then and save the $400. Then you can stop complaining about Apple prices. Apple is not interested in sheer volume to the masses who can't afford them. Those buyers are who Acer and other companies market to. Apple provides unique and stylish computers to a specific sector of the market.

You seem to indicate you want the best OS on a subpar computer at a subpar price. Apple will never do that. Sorry to disappoint you.

But it wouldn't hurt Apple to lower their prices. Everything $200 off (expect Mac Mini, maybe $100-$150 off)

 

[Mr Maui]

But it wouldn't hurt Apple to lower their prices. Everything $200 off (expect Mac Mini, maybe $100-$150 off)

$200 off of a $1099 Macbook is an 18.2% discount. $200 off the $2799 Macbook Pro is a 7.1% discount. $200 off on a $1999 MacPro is a 10% discount. $100 off the $599 Mini or $200 off on an $1199 iMac is a 16.6% discount, and $150 off on a Mini would be a 25% discount.

First problem with your theory is that there is a major inconsistency in the discounting number(s) you are referencing ... 7% on the most expensive machines (the ones with the higherst profit margins) on up to 25% on the cheapest machines they sell (the ones with the smallest profit margins already).

Second, in response to your statement "it wouldn't hurt Apple ...". Well, what if your boss said I'm gonna give you a 20% pay cut because if won't hurt you.

Would the discounts you mentioned put Apple out of business and force them to be unprofitable? No. But would it hurt them? Absolutely! Their current profit margins are in the 33% range. Cut that by a number between the 7% and 25% figures mentioned above and you decide if it would "hurt" them. I guarantee their stockholders wouldn't appreciate the downturn in the stock price from SIGNIFICANTLY lower profit margins.

Other companies make their profits on low margins and very high volume. Apple has hogher margins and prefers to make theirs on higher-quality, lower volume products.

 

[brendanspah764]

$200 off of a $1099 Macbook is an 18.2% discount and $200off the $2799 Macbook Pro is a 7.1% discount. $100 off the $599 Mini or $200 off an $1199 iMac is a 16.6% discount, and $150 off on a Mini would be a 25% discount. $200 off on a $1999 MacPro is a 10% discount.

First problem with your theory is that there is a major inconsistency in the discounting number you are referencing.

Second, in response to your statement "it wouldn't hurt Apple ...". Well what if your boss said I'm gonna give you a 20% pay cut because if won't hurt you.

Would the discounts you mentioned put Apple out of business and force them to be unprofitable? No. But would it hurt them? Absolutely! Their current profit margins are in the 33% range. Cut that by a number between the 7% ande 25% figures mentioned above and you decide if it would "hurt" them. I guarantee their stockholders wouldn'e appreciate the downturn in the stock from significantly lower profit margins.

Okay, maybe you're right. Never thought of it in that detail. Almost made my brain hurt. Putting the MacBook to $999 would not hurt Apple (or not as much)

 

[apple.]

i could see this happening.
and maybe in a couple a years id go out and buy one
(i just bought an imac last month and its GREAT)

 

[Nik]

Second, in response to your statement "it wouldn't hurt Apple ...". Well, what if your boss said I'm gonna give you a 20% pay cut because if won't hurt you.

This comparison does not fit at all!
If Apple lowers the prices their products gonna attract more people.
Because of the increase of volume, the profit cut will be peanuts when compared to the increasing market share which occurs more quickly and results in a higher total profit.

 

[Ninja-Mage]

There seems to be some consensus that just because it's apple they're not allowed to play by the rules of capitalism. The Macbook Air is the biggest load of crap i've ever seen the fact that people will actually buy it at a said price of 1.7k is ridiculous, alright you can fit in an envelope big friggen whoop, you've sacrificed your CD drive, more usb ports, and have parts that are only a small step above Asus's EEE.

I know there's the idea that you're paying the extra for the OS, and don't get me wrong OSX leopard made me a believer(I mean I still stick to PC's for desktop only and mac's for laptops) but the hardware in a Macbook is nothing to be proud of, I can get a inspiron for half that price and hack it to run OSX. And again we live in a capitalistic society and even Apple has to play by it's rules, which is one of the reasons Apple nearly tanked in the 90's, if it wasn't for the iPod there would probably be no Apple anymore. Maybe it's the problem that people think if you lower the price of mac's you'll lower the quality but that couldn't be any further from the truth. You lower the price you just add more consumers, with more consumers comes more money and more need for support.

 

[Mr Maui]

This comparison does not fit at all!
If Apple lowers the prices their products gonna attract more people.
Because of the increase of volume, the profit cut will be peanuts when compared to the increasing market share which occurs more quickly and results in a higher total profit.

What kind of price cuts are you referencing? If Apple were to cut profit margins in half (34% down to 17%), they would have to IMMEDIATELY begin AND MAINTAIN selling TWICE AS MANY computers as at their current level. Last quarter they already sold a record number of Macs. Do you thing cutting prices would immediately double sales? Give something to support your position.

 

[Mal]

There seems to be some consensus that just because it's apple they're not allowed to play by the rules of capitalism. The Macbook Air is the biggest load of crap i've ever seen the fact that people will actually buy it at a said price of 1.7k is ridiculous, alright you can fit in an envelope big friggen whoop, you've sacrificed your CD drive, more usb ports, and have parts that are only a small step above Asus's EEE.

I know there's the idea that you're paying the extra for the OS, and don't get me wrong OSX leopard made me a believer(I mean I still stick to PC's for desktop only and mac's for laptops) but the hardware in a Macbook is nothing to be proud of, I can get a inspiron for half that price and hack it to run OSX. And again we live in a capitalistic society and even Apple has to play by it's rules, which is one of the reasons Apple nearly tanked in the 90's, if it wasn't for the iPod there would probably be no Apple anymore. Maybe it's the problem that people think if you lower the price of mac's you'll lower the quality but that couldn't be any further from the truth. You lower the price you just add more consumers, with more consumers comes more money and more need for support.

Actually, the fact that Apple can sell them at that price is a perfect example of capitalism. Capitalism doesn't mean cheaper stuff, it means that those who sell products have the right to price them however they like; that's balanced by the fact that people will only buy a product at the price they feel is worth it to them. In the case of the MacBook Air, it is worth $1799 or more to the people that pay that for it, and those to whom it is not worth it don't buy it. You have absolutely no right to demand the price come down, only the ability to choose not to buy it until it does. In a capitalistic society, a smart manufacturer will price the product as high as possible while still maintaining the highest possible supply and demand ratios in their favor (don't sweat the details in the terminology, I'm a bit out of practice). Thus, Apple's pricing at $1799 for the MBA reflects the value they believe it holds for the number of people they wish to buy it. If selling to more people means taking a smaller profit overall, that's not really worthwhile. If you can drop the price and sell to more people and still make more money overall, then it is worthwhile.

BTW, only Apple can decide that. Not you.

jW

 

[Mr Maui]

There seems to be some consensus that just because it's apple they're not allowed to play by the rules of capitalism. The Macbook Air is the biggest load of crap i've ever seen the fact that people will actually buy it at a said price of 1.7k is ridiculous, alright you can fit in an envelope big friggen whoop, you've sacrificed your CD drive, more usb ports, and have parts that are only a small step above Asus's EEE.

I know there's the idea that you're paying the extra for the OS, and don't get me wrong OSX leopard made me a believer(I mean I still stick to PC's for desktop only and mac's for laptops) but the hardware in a Macbook is nothing to be proud of, I can get a inspiron for half that price and hack it to run OSX. And again we live in a capitalistic society and even Apple has to play by it's rules, which is one of the reasons Apple nearly tanked in the 90's, if it wasn't for the iPod there would probably be no Apple anymore. Maybe it's the problem that people think if you lower the price of mac's you'll lower the quality but that couldn't be any further from the truth. You lower the price you just add more consumers, with more consumers comes more money and more need for support.

Apple is an example of Capitalism at its best. Make a product, and sell it at the highest price that the market will accept. Mac sales are at record levels and the prices remain "high" in the opinion of some people. However, Apple is still growing in loyalty and marketshare, WITHOUT lowering their prices. If they cut prices to the level of some PC manufacturers (i.e Acer, Compaq, etc as referenced earlier in this thread), they would likely have to sacrifice design and quality to meed the sheer volume you seem to anticipate they would suddenly start rolling in. Additionally, they would not have the resources they currently have to continue to feed R&D and design the way they have. Apple's business model has worked great for them for the past 10+ years. If it ain't broke, don't fix it.

If you want to see the price of something fall, simply stop buying it. Don't continue to buy it in record numbers. Kinda like the current crude oil and gasoline situation.

Actually, the fact that Apple can sell them at that price is a perfect example of capitalism. Capitalism doesn't mean cheaper stuff, it means that those who sell products have the right to price them however they like; that's balanced by the fact that people will only buy a product at the price they feel is worth it to them. In the case of the MacBook Air, it is worth $1799 or more to the people that pay that for it, and those to whom it is not worth it don't buy it. You have absolutely no right to demand the price come down, only the ability to choose not to buy it until it does. In a capitalistic society, a smart manufacturer will price the product as high as possible while still maintaining the highest possible supply and demand ratios in their favor (don't sweat the details in the terminology, I'm a bit out of practice). Thus, Apple's pricing at $1799 for the MBA reflects the value they believe it holds for the number of people they wish to buy it. If selling to more people means taking a smaller profit overall, that's not really worthwhile. If you can drop the price and sell to more people and still make more money overall, then it is worthwhile.

BTW, only Apple can decide that. Not you.

jW

Thank you. It's nice to see that others have a similarly intelligent recognition of what Apple is doing. They are pricing at what the market allows.

 

[viniciusc]

Hell, wasn't I just thinking about that a few days ago? I thought how attractive the MacBook Pro is for a huge public, yet $2,000 isn't an attractive price at all. Maybe 1799$ for the entry-level Pro, $1999 for the mid-level and $2299 as for the 17"? And for the MacBook, $999, $1199 and $1299 (will Apple finally give up on the $149 difference for the color and slightly bigger hardrive?).

 

[Sander]

Then ... lower the price by $500 to $1999 for the same computer to become "more competitive".
estimated profit $124
(6.6% of $1875 actual cost ... which would remain the same ... $1875 + $124 = $1999)

BUT ... $624 divided by $124 (old profit divided by new) =

5.032258

CONCLUSION:

Apple would now have to sell approximately 5,032,258 MBP 15" mid range notebooks per quarter to make the same profits they had been successfully making on 1,000,000.

It doesn't work exactly like this; there is one effect in favor of lowering the prices. If you expect to ship more machines, you can give off purchase commitments to your supply chain for larger numbers of components, which will drive prices down (sometimes significantly). So the "actual cost" in your example above will go down.

This effect is probably not enough for the huge price cut in your example, though.

 

[Ninja-Mage]

touche x2 I guess

 

[KingYaba]

This means the resale value of my Macbook Pro goes down.

 

[im_noahselby]

I have a feeling that Apple will keep current MacBook Pro prices the same. Especially if they are going to introduce a new revision and not simply a speed bump. I can't remember the last time Apple actually lowered the cost of their portables after a completely fresh revision. Apple has a lot of momentum right now and they are doing extremely well, unlike a lot of other companies. I don't think they will lower the price of this series until they see that it is in their best interest to do so. I don't believe that now is this time.

I think with the MacBook they could lower the price by $100 on this series and it would do fantastic. A $999 MacBook would appeal to a lot of people and is closer to the realm of possibility then a $300 price drop for their MacBook Pro line.

 

[iMacmatician]

I have a feeling that Apple will keep current MacBook Pro prices the same. Especially if they are going to introduce a new revision and not simply a speed bump. I can't remember the last time Apple actually lowered the cost of their portables after a completely fresh revision.

And the cheapest standard Power Mac G5 / Mac Pro has actually increased in price over time.

 

[captnfun]

Does market share matter?

Your reasoning is sound based simply on profits 'right now'. The question is does market share matter in the long run?

Lets say Steve Jobs does retire(it will happen someday), or becomes Bill Gates partner in philanthropy, and some new bumbling idiot becomes CEO and bets the Apple farm on some ill advised product. If Apple stays in single digits in market share they are that much more vulnerable. Right?

I'm all for Apple staying profitable, but at some point don't they have to try and crawl back into the race for market share? Wouldn't the best way to do that among the masses is reduce the price discrepancy between the PC and the MAC?

Lets face it, if the new MacbookPro has the specs I want Apple is going to get my $2500.

 

[Mr Maui]

It doesn't work exactly like this; there is one effect in favor of lowering the prices. If you expect to ship more machines, you can give off purchase commitments to your supply chain for larger numbers of components, which will drive prices down (sometimes significantly). So the "actual cost" in your example above will go down.

This effect is probably not enough for the huge price cut in your example, though.

It's definitely not enough to offset, and though I understand you point, Apple is already a huge component purchaser, likely garnering great deals from its suppliers already, something it is know for because of it's large cash position and the Apple team's negotiating power.

touche x2 I guess

LOL

Your reasoning is sound based simply on profits 'right now'. The question is does market share matter in the long run?

Lets say Steve Jobs does retire(it will happen someday), or becomes Bill Gates partner in philanthropy, and some new bumbling idiot becomes CEO and bets the Apple farm on some ill advised product. If Apple stays in single digits in market share they are that much more vulnerable. Right?

I'm all for Apple staying profitable, but at some point don't they have to try and crawl back into the race for market share? Wouldn't the best way to do that among the masses is reduce the price discrepancy between the PC and the MAC?

Lets face it, if the new MacbookPro has the specs I want Apple is going to get my $2500.

Well, Steve Jobs WILL retire (or move on to iHeaven or ... uh ... the "other" iPlace), and someone new WILL take over at Apple eventually (sooner or later, who can say). It is true that Apple should always work to gain marketshare, but, as a point of reference, within the past 2-3 years, Apple's marketshare has grown from approximately 4.5% to 8.6%, with more significant leaps recently. If I remember correctly from the quarterly results, Apple shipped 38% more Macs year over year in Q3. Apple is proving that OSX (and Macs with their link to iPod and iPhone) can take marketshare just like it is. They have been slowly gaining marketshare and not giving it back, while others are losing marketshare and not gaining it back.

While I concur there are ways to grab marketshare faster, you also want to maintain quality and the customer loyalty you already have in place, which is what I believe SJ has the company doing now and poised to do in the future. Take and maintain. Take more and maintain. Time will tell if this strategy changes when new leadership eventually steps in, but it is working right now.