The future of Apple

[dhdave]

This has probably been raised before, but a couple things occurred to me.

Apple must increase market share to survive. Time and time again when someone wants to argue against the Mac they drag out the example of Dell. Forget for the moment what an unfair comparison that is and ask yourself how Apple could compete with Dell. Of course the answer is market share. With a large percent of the market Apple could charge much less for each machine and still make money. Just like Dell.

The problem is how do you increase market share? The easiest way is by under pricing the competition. But that presents a catch 22. To increase market share Apple needs to lower prices, but to lower prices Apple needs to have increased market share.

So then what? How about a cheap machine? How much does it cost to build the original iMac? Why not sell them for $399? Advertise them like hell. Bring the fruit flavors back. (still the best designs of the bunch in my opinion). I bet they'd sell. I'd buy several. Wouldn't you? I know the argument would be that they would canibalize the sales of the eMac and tft iMac, but isn't that the lesser of two evils here? The important thing is to expand the user base and get them to trade up. The more people using Macs the cheaper they could be for everyone.

Any thoughts?

dh

 

[strider42]

Re: The future of Apple

Originally posted by dhdave
This has probably been raised before, but a couple things occurred to me.

Apple must increase market share to survive. Time and time again when someone wants to argue against the Mac they drag out the example of Dell. Forget for the moment what an unfair comparison that is and ask yourself how Apple could compete with Dell. Of course the answer is market share. With a large percent of the market Apple could charge much less for each machine and still make money. Just like Dell.

The problem is how do you increase market share? The easiest way is by under pricing the competition. But that presents a catch 22. To increase market share Apple needs to lower prices, but to lower prices Apple needs to have increased market share.

So then what? How about a cheap machine? How much does it cost to build the original iMac? Why not sell them for $399? Advertise them like hell. Bring the fruit flavors back. (still the best designs of the bunch in my opinion). I bet they'd sell. I'd buy several. Wouldn't you? I know the argument would be that they would canibalize the sales of the eMac and tft iMac, but isn't that the lesser of two evils here? The important thing is to expand the user base and get them to trade up. The more people using Macs the cheaper they could be for everyone.

Any thoughts?

dh

Apple is a business, their job is to make money for their stock holders. The3y do this by makign a profit. If they make a cheap machine with little margin, and can't sell a lot of them (and they wouldn't sell a lot compared to PC companies, the mac market is just smaller), they will lose money. Look what happened to most of the PC manufacturers out there. thats exactly whatthey did and msot fo them are broke. Increasing amarket share is worthless if you don't make money.

Consider car companies. Luxury brands make as much money as low end manufacturers because they keep their margins high.

Apple ahs publically stated they are not going to sacrifice much of their amrgins for market share. They're willing to do a bit, but not much.

So you see, canabilizing their high margin sales would bankrupt apple in a matter of months. Think about this. Something like 50% of their profits come from the powermac line, but those computers make up much less than that in terms of actual units sold.

additonally, don't forget apple has to do all of its own R&D. they don't use off the shelf components. They ened to have cash available to sink into projects. Low profit margins don't allow you to do that. Low profit margins turn you into a commodity trader, not a company that can innovate and invent things.

 

[ponyboy]

Apple understands that they need to increase their market shre I am sure they understand this better than any of us. Why I love apple so much though is that they think different, sure they could flood the market with an inexpensive computer which is what every other maker of computers does but apple is thinking different they will increase their market share by creating the best software and computer experience out there period, that is their strategy sure it is different but it will work

 

[dhdave]

Originally posted by strider42:

Apple is a business, their job is to make money for their stock holders. The3y do this by makign a profit. If they make a cheap machine with little margin, and can't sell a lot of them (and they wouldn't sell a lot compared to PC companies, the mac market is just smaller), they will lose money. Look what happened to most of the PC manufacturers out there. thats exactly whatthey did and msot fo them are broke. Increasing amarket share is worthless if you don't make money.

My whole point is the only way they are going to make money and thus increase shareholder value is by increasing their market share. The whole point of selling a $399 machine would be that MORE people would by them, the Mac market will become bigger and eventually those people will want to trade up and they'll buy a newer more expensive Mac. The other PC makers out there were all competing against each other. There is only one Apple.

dh

 

[Grokgod]

~ponyboy

It hasnt worked yet! and they have been trying for a LONG time.

DH is right, its time to try something other than selling OLD tech for insane prices. Its time to get a realistic price for current hardware and when you snag new users that even more people to GOUGE with $129 upgrade to half made OSes. And even more people to fool into Free email for life into buying an iTOOLs account! Just those two items equals Millions of dollars and what what cost ?

NOTHING! merely charging a fair price for a low ranged computer,

I think that PURE ego is stopping APPLE from moving forward.

I guess having an EGO that huge is a full time JOBs!

 

[mmmdreg]

Does Apple have to convert people just to keep their market share level? because say everyone kept buying the brand they got brought up on as a kid in these days, the PC side would be multiplying faster and therefore changing the proportion of MacC users...

 

[dhdave]

mmmdreg,

Yeah I'm pretty sure that converting people to stay level is a given. You are right as new people come into the market the percentages are constantly changing.

By the way, sorry for the spelling mistakes everybody, I've been up since 3:30 am. -Y-A-W-N-


dh

 

[Pepzhez]

The future of Apple is pretty obvious - and it's already here. Apple is increasingly falling behind technologically and we've seen no concerted effort on their part to reverse this process. Recent decisions smack of desperation and lack of any clear market plan:

1. Falling market share, so choose to gouge the Mac faithful for lack of any other alternative (other than the abyss). (.mac, 10.2 at full-price, etc.)

2. Attempt to sell peripherals and gadgets to Windows users. (I seriously doubt that ipod sales to non-Mac users will really be all that substantial, nor will it convert people to buy a Mac.)

3. Emac is an education-only computer! No wait! It isn't! Well??? Is ANYONE - schools or individuals buying this thing at all? It's fairly obvious that the emac was hastily conceived, poorly and confusedly, half-heartedly marketed. In other words, more desperation.

4. Jobs: "We're going to innovate our way out of this downturn." If THAT isn't the mark of desperation, I don't know what is. Who does he think he is fooling? Actually, it sounds more like a man desperate to convince himself.

Look, the current Apple product line is one big confusing mess, no matter which way you look at it: overpriced and technologically staid G4 towers, flat panel imacs not moving, new widescreen imac to confuse matters further, emacs that no one, least of Apple, can really say what the hell they are for, etc., etc.

I for one do not believe we'll see a G5 in the next year, and even if we do, expensive pro machines are NOT going to increase Apple's market share, no matter how much you might think they would. (Yes, I'd buy one and you'd buy one, but very few non-Macrumors readers would need or want such a thing.)

So, this brings us to ... what? What exactly are Jobs & co. "innovating"? What really strikes me about the recent software updates and introductions is how unbelievably slipshod and half-assed it all is. (I'd expect that from, say, Microsoft, but this is extremely unusual for Apple!) The perfect example of the right hand not seeming to know what the left hand is doing. And not seeming to care much either. Why, for instance, hype AAC audio so much, then come out with an iTunes update that doesn't even feature it??? Big deal, you say, it's a relatively inconsequential, trivial matter. Problem is, THIS is about the biggest thing Apple has come up with lately! THAT is the only thing Apple has been crowing about. What else do they have? If shoddy implementations of audio and video codecs and sticking widescreen LCD monitors on imacs that they can't even sell are the big "innovations" then I see very dark days ahead for the company, much as it pains me to say that.

Yes, it's a bad economy; yes, the entire tech industry is in the doldrums. Of course, of course. All true. But not only does Apple not seem to know what they are doing - they obviously lack any sort of vision at the moment, but even more disturbing is that they don't really seem to care.

 

[dhdave]

Originally posted by Pepzhez:

Emac is an education-only computer! No wait! It isn't! Well??? Is ANYONE - schools or individuals buying this thing at all? It's fairly obvious that the emac was hastily conceived, poorly and confusedly, half-heartedly marketed. In other words, more desperation.

I may be wrong, but I'm fairly certain that at one time the eMac was an iMac replacement. Before Steve did the about face and had it redesigned. Since they sank money in it already they decided to bring it to market anyway as an education system where they are steadily loosing market share to dell. To be honest, this move makes sense to me. The thing proved to be very popular and Jobs himself got tons of email begging for it. So they relented and released it to consumers. Again, I think this was a good idea. More choice. More price points.

Where I totally agree with you is the marketing. Is it me or does Apple's marketing just suck lately?? I mean, I like the switch campaign, but why are they the only ads? Money? They need to bolster the switch ads with product ads. At these prices the designs don't sell themselves. I haven't seen one eMac add and except for the two original iMac ads, there hasn't been anything since. C'mon Apple plaster the tv with commercials. Emacs, iMacs, PowerMacs, iPod, even iTunes and iCal (which I still don't get). You are selling a lifestyle here. Where are the lifestyle ads??? (I'm available if you need a good copywriter )

dh

 

[Gelfin]

Originally posted by Pepzhez
1. Falling market share, so choose to gouge the Mac faithful for lack of any other alternative (other than the abyss). (.mac, 10.2 at full-price, etc.)

Insofar as it is possible to gauge these things accurately, Apple's market share is rising, not falling.

2. Attempt to sell peripherals and gadgets to Windows users. (I seriously doubt that ipod sales to non-Mac users will really be all that substantial, nor will it convert people to buy a Mac.)

Even diehard Windows magazines and sites raved about the iPod when it arrived. Their only complaints were that it required a Mac and it only had a 5G drive compared to 20G on Archos' big clunky USB unit. Both of those problems have been resolved. Ergo the iPod is now king. There's nothing better out there. Portable music players require computers, but they're basically consumer products. If Apple can sell into the entire market, why wouldn't they, whether it converts people to Macs or not?

3. Emac is an education-only computer! No wait! It isn't! Well??? Is ANYONE - schools or individuals buying this thing at all? It's fairly obvious that the emac was hastily conceived, poorly and confusedly, half-heartedly marketed. In other words, more desperation.

How quickly we forget how this played out. When the new iMacs shipped, people were impressed, but it raised the price bar. People (on this board and elsewhere) said that they just wanted a regular iMac with a bigger CRT. Educators in particular were hardest hit, because the original iMac was an excellent and affordable little self-contained computer that worked very well in a classroom. So they make a machine targeted directly at that education market. Because people demanded it. As soon as that shipped, people (on this board and elsewhere) started asking, "where can I get one if I'm not in education?" Again, in response to consumer demand, they offered the eMac to the general public. Now they COULD have stuck by their "no more CRTs" policy, and they COULD have tried to force the LCD iMac down everyone's throat (education, the general publc or both). I guess what you see as ambivalent desperation, I see as responding to customer demand.

4. Jobs: "We're going to innovate our way out of this downturn." If THAT isn't the mark of desperation, I don't know what is. Who does he think he is fooling? Actually, it sounds more like a man desperate to convince himself.

Are you sure you fully understand the definition of "desperation?"

Look, the current Apple product line is one big confusing mess, no matter which way you look at it: overpriced and technologically staid G4 towers, flat panel imacs not moving, new widescreen imac to confuse matters further, emacs that no one, least of Apple, can really say what the hell they are for, etc., etc.

Education         Mid-range Consumer        Pro Workstation
       Low-end Consumer         High-end Consumer        Server
===============================================================
[---eMac $1099---]
      [---iMac ($1399-1799)---]
                        [---Widescreen iMac $1999---]
                                 [---G4 Tower ($1600-4K+)---]
                                                         [Xserve]

Now what about this confuses you?

I for one do not believe we'll see a G5 in the next year, and even if we do, expensive pro machines are NOT going to increase Apple's market share, no matter how much you might think they would. (Yes, I'd buy one and you'd buy one, but very few non-Macrumors readers would need or want such a thing.)

I'm just an engineer and even I know market share isn't everything. Even the companies with big market share make MOST of their revenue selling expensive machines to customers with deep pockets.

So, this brings us to ... what? What exactly are Jobs & co. "innovating"? What really strikes me about the recent software updates and introductions is how unbelievably slipshod and half-assed it all is.

You say that, but you don't back it up. I don't get where you're coming from. From my point of view they're pulling off the Digital Hub concept quite well. So far they seem to be grasping what people are using their systems for and playing to their own strengths as a company to make those things come together in a really excellent user experience. And it really seems to me that they're the first company to step up to the plate and try to do this in a cohesive way. Yes, I'd call them innovative. If I had to find fault, I'd have to say the company is overdependent on innovation.

Yes, it's a bad economy; yes, the entire tech industry is in the doldrums. Of course, of course. All true. But not only does Apple not seem to know what they are doing - they obviously lack any sort of vision at the moment, but even more disturbing is that they don't really seem to care.

You have got the most bleak, negative, pessimistic outlook I could possibly imagine, and I just don't think it's supported by fact. Perhaps a nice antidepressent for you?

 

[iGav]

Gelfin....... I salute you...... you just saved me half an hour responding to a crap post......

I salute you....

 

[Grokgod]

Gelfin~

You don't see the half- asses software?

Perhaps you need a intellect boosting pill.

Half assed is this.

An OS that doesnt have an AUDIO or MIDI for Audio companys to work with.

An OS that doesnt scroll a browser window properly!

An OS where you cant save changes to window views.
AN OS htat needs to be finished so that it has the basics for work flow.

Half baked programs like iCHat called the best in the world, when its been done and better by ICQ ages ago!

Half delerious statements of being the best while the entire PRO community is waiting for decent hardware.

Jesus, I could go on and on but this is all obvious!

iCAL isnt going to help my editing work render faster or load files quicker.
I dont give a damn about half-asses programs to help the LAMEsumer control his pitiful life! How about an iCalculator to help MOM work on bills. FOr gods sake give me a fuhreakin break, this is retarded!

FLY to MacWorld and see our new iAPPs for the iLamer!

If you turn you head away from the reality of the situation and stare at false idealism, reality is still going to affect you. This isnt a pessimistic view, its a realistic one based on the facts that have occurred.

I am into reality not occlusion, and Not into being CONNED by anyone.

If someone lies to you, its a lie NOT a change of mind.
Unless your afraid to call a LIE, A LIE.

Well are you afraid,?
are you?

 

[AlphaTech]

Originally posted by iGAV
Gelfin....... I salute you...... you just saved me half an hour responding to a crap post......

I salute you....

I'm with you iGavina.

I firmly believe that the main thing keeping Apple from releasing both a G5 and DDR into their main products is motorola. Before anyone starts saying how Apple can force them to do anything, get real. Apple is at the mercy of motorola to produce the processors, and make them stable. IBM is doing great work with the G3 chip, and we don't see any lack of those. Motorola could have hit another wall at 1GHz, just as they did a while ago. But, because Apple is a minor part of their business, they are not devoting enough resources to the chip development and advancement as [we think] they should.

I think this is going to be an interesting year (between now and the next MWNY). Who really knows what Apple will release?? Except for Apple that is.

 

[ponyboy]

I second that Gelfin, apple does know what they are doing and it makes perfest sense to me

 

[iGav]

Originally posted by Grokgod
Gelfin~

You don't see the half- asses software?

Perhaps you need a intellect boosting pill.

Half assed is this.

An OS that doesnt have an AUDIO or MIDI for Audio companys to work with.

An OS that doesnt scroll a browser window properly!

An OS where you cant save changes to window views.
AN OS htat needs to be finished so that it has the basics for work flow.

Half baked programs like iCHat called the best in the world, when its been done and better by ICQ ages ago!

Half delerious statements of being the best while the entire PRO community is waiting for decent hardware.

Jesus, I could go on and on but this is all obvious!

iCAL isnt going to help my editing work render faster or load files quicker.
I dont give a damn about half-asses programs to help the LAMEsumer control his pitiful life! How about an iCalculator to help MOM work on bills. FOr gods sake give me a fuhreakin break, this is retarded!

FLY to MacWorld and see our new iAPPs for the iLamer!

If you turn you head away from the reality of the situation and stare at false idealism, reality is still going to affect you. This isnt a pessimistic view, its a realistic one based on the facts that have occurred.

I am into reality not occlusion, and Not into being CONNED by anyone.

If someone lies to you, its a lie NOT a change of mind.
Unless your afraid to call a LIE, A LIE.

Well are you afraid,?
are you?

Boy do you have 'issues'.......

 

[Eliot]

Originally posted by Grokgod


An OS that doesnt have an AUDIO or MIDI for Audio companys to work with.

Half delerious statements of being the best while the entire PRO community is waiting for decent hardware.

Jesus, I could go on and on but this is all obvious!

[/B]

While I can't comment on non-audio matters, I'm quite sure you've comprehensively lost the plot , or more likely never had it in the first place, in respect of pro-audio.

Virtually all pro-audio is accomplished on the Mac. How do you explain this in the light of your strange comments? Does the need to buy a simple Midi interface present any obstacle to the serious engineer? (Most of these, I believe, are still on OS9, until all OS X issues are sorted. It isn't stopping anyone from recording).

I am sure, having spent two thirds of my life in and out of studios, that it doesn't. On what experience and with what qualifications do you base your complaints?

 

[dhdave]

Originally posted by Grokgod:

iCAL isnt going to help my editing work render faster or load files quicker. I dont give a damn about half-asses programs to help the LAMEsumer control his pitiful life! How about an iCalculator to help MOM work on bills. FOr gods sake give me a fuhreakin break, this is retarded!

I feel your pain, really. I don't understand iCal either, BUT apparently someone does cause it's getting some nice reviews. What it boils down to, I think, is that the LAMEsumers buy a lot of preconfigured systems and this is one way to get them to buy.

I have to say, I have never seen the Mac community more dissatisfied as a whole with the actual hardware. Time and time again I'm hearing about bus speeds, DDR and ATA/133 not to mention processor mhz. I'm used to the pc world where even the cheaper boards support what Intel's top-line boards support because of the chipsets involved.

I was planning on buying the education only PowerMac in September, then I read a thread where someone mentioned it had no level three cache and you'd be crazy to buy one. Kind of took the wind out of my sails. Whether parity among any of the various hardware specs is really necessary doesn't seem to matter. What matters is the consumers perception. I think AMD has shown, somewhat successfully, that you can still sell a lot of chips without matching Intel Mhz for Mhz. I think Apple can be successfull at this too, but some of the other hardware issues must be addressed. Bus speed is the number one issue I think as it doesn't matter how fast the processor is if the system bus is a bottleneck.

By the way, if anybody has that education only PowerMac and wants to comment I would definitely welcome it. Upgrading from my 7500 (and leaving behind my Wintel box) is a huge investment for me, and I could use the reassurance that the G4 733 is plenty fast and reliable. I need for the normal things plus I'll be running Virtual PC so I can code in Visual Basic. I figured as long as I have a ton of memory (756mb to 1GB) I'd be ok.

dh

 

[strider42]

Originally posted by dhdave


My whole point is the only way they are going to make money and thus increase shareholder value is by increasing their market share. The whole point of selling a $399 machine would be that MORE people would by them, the Mac market will become bigger and eventually those people will want to trade up and they'll buy a newer more expensive Mac. The other PC makers out there were all competing against each other. There is only one Apple.

dh

Maybe you haven't noticed, but apple is making money, and is one of the only computer makers to make money nowadays. Having a larger market share does not mean you are making money. Those are two totally separate concepts. Losing money to increase market share on the hopes people will trade up probably won't work. It hasn't worked for anyone else, why would it work for apple. It also assumes more people would buy a mac if its cheaper. I'm not sure there is a lot of evidence for that. People don't buy macs because they are entrenched in windows, and perceived performance gaps. a mac will never be as cheap as a thrown together PC without taking away almost all of the profit margin and using cheaper materials and not putting money into R&D. It just doesn't work. Apple has publically acknowledged they won't sacrifice profit margin for market share. they know what they're doing. Now, if they can upgrade the performance of their machines, particularly in the pro line (which is where about 50% of their profits come from), then you have a rela chance to sell more machines at a higher profit margin, and that is how you make money. Apple knows it. Look for some serious performance gains in the pro line over the next year or two. Hopefully they'll catch and surpass whats out there for high end PC systems.

 

[dhdave]

Originally posted by strider42:

Maybe you haven't noticed, but apple is making money, and is one of the only computer makers to make money nowadays. Having a larger market share does not mean you are making money. Those are two totally separate concepts.

You are correct the company is making a profit, but that's not the same thing as increasing shareholder value. Just as a larger market share does not mean you are making money, making a profit does not mean you are making the shareholders any money. A public company is in business to increase the wealth of it's shareholders.

Perhaps you haven't noticed the share price. In order to make money for investors a company must have growth. Growth dictates increased market share. This is just academic. The two are intertwined. If the share price is dropping the investors aren't making any money no matter what the balance sheet says.

I realize that analyzing the share price now is totally unfair due to the unbelievable softness in the market (Dow at 8000 and probably going lower) but stock performance has been lackluster for some time. Steve Jobs and the rest of the executives at Apple know this.

dh

 

[puffmarvin]

apples new ad campaign

i have a wonderful idea for apples new ad campaign...

get rid of the whiney bitc|-|es. make the switch. go ahead. we dont want you anymore.

 

[strider42]

Originally posted by dhdave


You are correct the company is making a profit, but that's not the same thing as increasing shareholder value. Just as a larger market share does not mean you are making money, making a profit does not mean you are making the shareholders any money. A public company is in business to increase the wealth of it's shareholders.
dh

You are quite right of course, thanks for adding to the discussion.

While growth is important, growth at the expense of profits does little. Telecom companies have long battled for market share, often expanding too fast and getting buried under the costs associated with growth. So while intertwined as you say, growth for the sake of growth is not the answer, as neither is market share for the sake of market share. A company has to find a happy medium between growth, market share, and profits. Apple is doing a decent job of this right now, particularly with their consumer line. Their pro line is where they are going to find real growth and profits in my opinion. Drastically increasing the performance in that arena is where I think they'll increase shareholder value, not in trying to undersell computer makers who sell computers as a commodity.

 

[iH8Quark]

My $.02

I think Apple has done a miserable job marketing OS X. I'm not just saying that because I read it somewhere else. Their marketing of OS X has been a total disaster. Ask any PC person out there, almost every single one has no idea that the mac OS has changed completely. They have no idea it's UNIX, or that you can actually access that UNX core. They have no clue about the open standards the Mac supports fully, and are even more clueless about OS X's much improved, platform independent networking (which is why the Xserve has been a dismal failure).

They may be holding off on marketing OS X because it isn't quite finished, and has numerous bugs still. That makes sense. The key to Apple gaining market share is marketing their OS. I have yet to see a single ad about the OS. Oh, and they also need an enterprise strategy in a MAJOR way. But I've said that before, many times.

And, like it or not, that M$ eHome thingy that's coming out this year is f*cking sweet. It's exactly what the mac "digital hub" strategy is trying to be, except it's all wrapped up into one package with a remote. I think it's going to be a monster success. (even if it does work like sh*t).

just my thinking, take it or leave it.

 

[D*I*S_Frontman]

I would second the comments from IH8Quark.

It seems to me that Apple is approaching its latest marketing thrusts in a very delicate and tentative fashion. The "switch" ads don't really discuss anything relative to the hardware, OS, or available software of Apple's computers--only on the nebulous, subjective, emotional anecdotes. And their comsumer-productivity-enhancement software push fits with this marketing scheme--who cares if most of these programs are simple little tidbits which use a miniscule fraction of the computer's actual potential if Apple can make people's lives easier.

This all looks to me like a company treading water, waiting for the next huge wave of hardware to be ready for release. Jobs already knows he can't ride on this current hardware platform much longer and is just trying to milk the last remaining unit sales out of this depressed economic environment before the big bombs hit--new PowerMac designs with beefier processors/mobos.

As far as the greater volume/marketshare vs. higher per unit net profit % argument goes, it seems that Apple wants both and the path to achieving both is a very slow one (vs mere price slashing). You have to create an aura, a perception of clear superiority people are willing to pay extra for, a great user experience, a chic/hip factor, an us-vs.-the-world mindset, and a perceived user identity people want to identify with. Once you have succeeded on all of these fronts you can name your price and people will pay it.

Harley Davidson is a perfect example:
AURA--toughness, dangerous, free-spirited
SUPERIORITY--over-engineered, ruggedly built, unchanging design, "the good ol' days"
USER EXPERIENCE--loud exhaust note, low torque mean pull to the engine
CHIC/HIP--instant access to the "Easy Rider" mystique of the cool, free, rootless drifter
US VS THEM--"American Made"..."no rice burner"... etc.
USER IDENTITY--tough, freedom-loving unconventional rebel who doesn't follow the crowd.

BTW--just how old and out-of-date is Harley's technology? Several decades? Why do people buy them? SUCCESSFUL BRANDING. People pay $10K+ for a bike with two air-cooled coffee-can-sized pistons that idles like a sputtering lawnmower. Japanese manufacturers make sophisticated bikes that run like Rolexes, purr like kittens, never leak oil, and can smoke any Harley ever made 0-60 without leaving 2nd gear. Does anyone here think Harley gives a tinker's damn about marketshare when people will preorder a tricked-out Softtail for $50 Gs sight unseen?

Where this illustration breaks down, however, it that Apple is KNOWN for innovation and it is part of their claims of superiority. During this time of hardware challenges, Apple is dramatically losing this perception. Apple is also known for being the "creative professional's computer," the "content authoring machine," but a few more months with our current PM lineup and more of those professionals are going to be buying Athlons to remain competitive as far as their production turnarounds go.

Steve Jobs knows all of this. He is probably screaming daily at his production teams to get the new PMs online so the company's image is not further tarnished in the professional community. Steve know that in this market, image is everything--if Apple becomes "the slow computer with the glitzy OS, funky case, and is 3x more expensive" they're dead.

And pumping out a million $399 old iMacs that cost you $350 to make, assemble, and ship will not fix the problem, but rather exasperate it--"Apple: the company that gives you a cheap, slow, candy-colored desk pig that's years out of date." Apple is wise to NEVER be tempted to enter the "computers-as-commodities" market, as it is a sure money loser.

You are watching a company fighting against timing glitches. OSX 10.2 done early but PMs running behind. Shake ready but no monster platform to run it on. If we would have had some big iron come out when Jaguar did, we would not be paying $129 for it now--it would be shipping with all new machines or $19.99 online as an upgrade (or free @ CompUSA). But Apple needs income, so we must suffer for the delay. Same with iTools. It was a crappy PR move necessitated by the lack of new innovative PMs to sell. I can't even imagine what the PM unit sales look like now--anyone who knows ANYTHING about this company or the technology of their current lineup is not buying. Waiting.

When Steve Jobs unveils the new line of PowerMacs, I predict that his upbeat pitch will have a note of relief--".. ahh... we've made it!" Once another industry-leading hardware platform for the amazing potential of the OS is released, Apple will command respect again. Market perception will be bolstered and this perception will filter down to consumer lines. Apple ads will have teeth again. And, without dropping profit percentages at all on any of the product lines, Apple will make sizable market share gains.

Oh, and Microsoft will be afraid... very afraid... especially if AppleWorks goes on steriods and becomes a real competitor to Office and Apple develops it's own OS-native browser.

But if this takes another year to happen, Apple will be marginalized. Marketshare will dwindle to nothing. A $40 billion war chest can disappear quite quickly when no one is buying.

 

[dhdave]

D*I*S_Frontman,

What a well written, thoughtful post. Sadly, though I can literally think of dozens of people who would buy and benefit from a $399 iMac, I fear you are correct. It does seem to boil down to a matter of perception. Consumers, being who they are, would inevitable buy the machine and attempt to use it for purposes for which it was never intended or just horribly unsuited.

I guess the thing that got me thinking of this is that on my nightstand instead of a lamp, sits a Macintosh Plus circa 1986. I use it for all my word processing (I've gone back to college after a decade) and after a stressful day going to bed a little early and playing a few hands of solitaire til dawn is a real treat. It occured to me that just as this machine, obsolete so very long ago, is still quite useful to me, the iMac could be a viable machine for quite some time. I believe that IBM intends to push the G3 past the 1Ghz mark so with sufficient processor and memory upgrades it could be sold for at least the next two years (and not be the backward machine my Plus is )

dh

 

[Grokgod]

D*I*S Frontman

I enjoyed that post, thanks.

I agree with you and the sentiment behind it.

well written and conceived.