Originally Posted by rickag
Apple's Workstation, the Mac Pro, is less expensive than Dell's, in some price comparisons done online it is as much as $1000 less expensive in certain configurations. That's huge. Apple can accomplish this in one of two ways. Either their manufacturing efficiency is that much greater or they are sacrificing margins. Your argument is wrong.
You said it and I quote," Its just that all the competitors have the same or higher margins within that bracket and don't have a huge cost advantage.
. So Apple lowers their margins in order to sell workstations, yes or no? And I completely dispute your statement that Dell's dont have a huge cost advantage, heck, the aluminum tower alone gives them a huge cost advantage.
Apple does not "sacrifice" its margins on the Mac Pro. Dell simply cannot be profitable without having some high margin items in its lineup. It has high margin items in its workstation and servers. Apple competes with Dell only in these areas. Not where the margins are thin. Why? Because it fits their corporate strategy and strenghts.
How is this hard to understand? Apple targets 28% margins across the entire lineup, higher ASPs and smaller volume. Dell shoots for higher volume, low ASPs and margins that range from razor thin in the $300 PC market all the way beyond Apple levels at the high end.
It is highly unlikely that Apple (or anyone) can get 28% margins in the $1000 tower market and it sure as hell is true that Dell ISN'T getting 28% margins in their $1000 towers. Yet most if not every proponent of the xMac INSISTS that Apple can magically make $1000 towers at 28% margins and gain share.
Makes them appear much larger to Intel, what you think Intel can't add? I don't presume to know the price breaks that Intel offers, as you do, but there are computer manufactures out there smaller than Apple that compete very well.
It has been documented that Intel has stated they make no discounts except on volume to avoid any more legal entanglements.
Intel can add. That's the entire point. They can see that 2M units of mobile parts is larger than 1.5M units of mobile parts. They don't CARE if Apple uses them for notebooks or AIOs. All they care about is volume.
Dell and HP make more notebooks than Apple. Their notebook growths are also no anemic. The 500K notebooks/qtr only helps level the field and delay the inevitable.
I didn't miss anything and I read it. It makes no sense, unless you subscribe the "milk the faithful reasoning."
It is the IMPLICATION that YOU BROUGHT UP that Sony has decided to target the upscale AIO market, that Apple currently only offers in higher end consumer computers, that is relevant to my statement,"So now there is possibly a huge corporation that is going to try and go head to head against Apple's target market AND IS WILLING TO DO SO AT LOWER MARGINS. Not a good thing.".
Sony has had an AIO in their line up for a long time. Thier AIO is far less capable than the iMac and more expensive. That's hardly "willing to do so at lower margins".
The article does not speak to the AIO but rather the towers they had and their media centric strategy.
The point is that only the AIO remains and not the towers...not even the Sony faithful purchased Sony towers and they were actually pretty nice.
Sony's AIO may survive. But their RM series will be still born. $3500 for a Intel Core 2 Duo processor and no FireWire 800 port. This product is priced for the professional but is configured for the hobbyist. The only thing I can gather is that Sony is so screwed up now as to be useless for discussion.
Sony had mid-priced VAIO towers. Just look at reviews for them in the 2000-2004 timeframe.
PS Don't like being "milked"? Don't buy. Let the market decide. Somehow though, it seems Apple is doing awesome with its current strategy.