Apple prefers halo effect over fears of iPod cannibalization of Macs

Posted:
in iPad edited January 2014
Asked about the potential for iPad sales to cannibalize Mac sales, Apple executives shrugged off the issue as insignificant, then pointed toward the potential of iPads to sell even more Macs and iPhones as part of an overall halo effect.



Apple was widely expected to sell more iPads than Macs this quarter as demand for the new tablet exploded beyond expectations. That resulted in talk of the iPad cannibalizing Mac sales and even of Apple's eventually replacing its desktop operating system with the stripped down iOS.



However, Apple surprised pundits by selling a new record number of Macs this quarter, reaching 3.47 million units. That's a 33% year over year quarterly increase, and kept its desktop platform slightly ahead of the 3.27 million iPads the company sold.



Apple's chief operations officer Tim Cook pointed out that while outsiders like to focus on the negative with talk about cannibalization, Apple prefers to think of iPad sales as an opportunity for spillover "halo" growth.



Cook noted the dramatic rise in Mac sales that accompanied the success of iPod over the past several years, and while saying, "I don't want to predict it," Cook commented on a parallel potential for new Mac sales due to "more customers we can introduce to Apple through iPhones, iPod, and iPad."



At the same time, the upside to having lower market share with the Mac among generic PCs, Cook pointed out, was that the iPad has great potential to cannibalize PCs. "There's a lot of PCs to cannibalize," Cook said.

Comments

  • Reply 1 of 18
    emig647emig647 Posts: 2,408member
    I think it's important to realize that they are completely different beasts. People just want an iPad for quick and dirty media consumption. A computer will always be in a different bracket than the iPad / iPhone. Especially with the way the OS is set up on both.
  • Reply 2 of 18
    Quote:
    Originally Posted by AppleInsider View Post


    Apple prefers halo effect over fears of iPod cannibalization of Macs



    Asked about the potential for iPad sales to cannibalize Mac sales...



    You guys need to hire a proof reader.
  • Reply 3 of 18
    bageljoeybageljoey Posts: 1,752member
    Quote:
    Originally Posted by emig647 View Post


    I think it's important to realize that they are completely different beasts. People just want an iPad for quick and dirty media consumption. A computer will always be in a different bracket than the iPad / iPhone. Especially with the way the OS is set up on both.



    Yes but--in the distant past (before iPad), when someone wanted something for "quick and dirty media consumption" their choices were between a fully functional laptop or an inferior feeling netbook. Many people were buying laptops who really wanted something like the iPad. To say "well, they really are totally different products" misses that point completely.



    I am quite certain that the iPad has cannibalized MacBook sales. However, I am also quite certain that it has cannibalized MORE non-Apple netbooks AND has increased apple's standing in the eyes of the general public (AKA halo).



    I know iPad owners who never owned Mac computers who now have purchased or are talking of purchasing MBs or MBPs for other family members.



    Remember, for a great many people, Macs are still mysterious products. iPods and iPhones have helped, but I think the halo potential of the iPad is much larger because it is closer to a computer in function and use. It really brings home what OSX can offer (and that Windows really isn't necessary).
  • Reply 4 of 18
    ihxoihxo Posts: 562member
    iPad won't cannibalize Mac.



    For me it's for reading and some gaming...
  • Reply 5 of 18
    sacto joesacto joe Posts: 728member
    Quote:
    Originally Posted by AppleInsider View Post


    At the same time, the upside to having lower market share with the Mac among generic PCs, Cook pointed out, was that the iPad has great potential to cannibalize PCs. "There's a lot of PCs to cannibalize," Cook said.



    Besides, if the iPad represents a new wave of computing towards tablets, then it's far better for Apple to be in the forefront of that new wave and cannibalize its own computers than to let some other tablet take the lead. They'd still be eaten but the revenue would be in someone else's pocket....
  • Reply 6 of 18
    I switched to Mac shortly after buying my first iPhone.
  • Reply 7 of 18
    haggarhaggar Posts: 1,568member
    Quote:

    "There's a lot of PCs to cannibalize," Cook said.



    Now if Apple can just get over their fear of cannibalizing iMac sales, which is one of the rationalizations offered by Apple defenders for Apple not making a midrange Mac minitower (NOT the Mac Mini).
  • Reply 8 of 18
    Can't speak to sales numbers, but iPads and iPhones have most certainly cannibalized Mac news and discussions. Portability is obviously where the industry is headed, so there's not much to say, but the Mac side of Apple has definitely become a second class citizen.



    Cool as they are, I have little use for Apple's smaller gadgets. I miss the days when desktop updates were hot, if only because the pressure was higher to make the experience that much better and more useful.
  • Reply 9 of 18
    paulmjohnsonpaulmjohnson Posts: 1,380member
    I'm just delighted to see Mac stories back on Apple Insider. Much though I love my iPad, iPod, Apple TV etc. I have been missing news about the Mac.
  • Reply 10 of 18
    addicted44addicted44 Posts: 822member
    Quote:
    Originally Posted by Haggar View Post


    Now if Apple can just get over their fear of cannibalizing iMac sales, which is one of the rationalizations offered by Apple defenders for Apple not making a midrange Mac minitower (NOT the Mac Mini).



    I have no clue why Apple does not create a headless mac. I suspect its because Apple does not want to deliver a consumer product where the consumer can tinker with the insides. This would make financial sense, since the customer service costs on this would be much higher than on any of their current offerings (The Mac Pro is only bought by professionals, who pay a large premium, so customer service costs is not a big issue).



    However, I can assure you that cannibalization is the last reason they are worried about this. Like Steve Jobs said, if their products are going to be cannibalized they would prefer they are cannibalized by their own products.
  • Reply 11 of 18
    cvaldes1831cvaldes1831 Posts: 1,832member
    It may surprise you but Apple does indeed make a headless consumer Mac: it's called the Mac mini. Very nice computer. They also make a small company/workgroup server version of this machine that includes Snow Leopard Server (unlimited clients). I'm using one of the latter right now.



    Perhaps it's time for you to visit www.apple.com in your web browser and peruse their product offerings. Good luck!
  • Reply 12 of 18
    daharderdaharder Posts: 1,580member
    Given that the iPad is not even a fully-autonomous computing device, and is (in fact) a media player/peripheral that requires an actual computer to function, these false concerns are all essentially moot.
  • Reply 13 of 18
    -ag--ag- Posts: 123member
    Quote:
    Originally Posted by addicted44 View Post


    I have no clue why Apple does not create a headless mac. I suspect its because Apple does not want to deliver a consumer product where the consumer can tinker with the insides. This would make financial sense, since the customer service costs on this would be much higher than on any of their current offerings (The Mac Pro is only bought by professionals, who pay a large premium, so customer service costs is not a big issue).



    However, I can assure you that cannibalization is the last reason they are worried about this. Like Steve Jobs said, if their products are going to be cannibalized they would prefer they are cannibalized by their own products.



    As mentioned the mini is a basic headless mac, but i get where you are coming from.



    Basically you want a Mini Mac Pro,



    So compared to the current pro offering this in the base mode...



    One 2.66GHz Quad-Core Intel Xeon "Nehalem" processor

    3GB (three 1GB) memory

    640GB hard drive 1

    18x double-layer SuperDrive

    NVIDIA GeForce GT 120 with 512MB



    You and many others want to see something like...



    One Intel® Core? i7 Extreme Edition-980X processor, 3.33 GHz

    4GB (2x2GB) memory (expandable to 32GB)

    2TB hard drive 1 (expandable to 4)

    18x double-layer SuperDrive

    NVIDIA GeForce GT 120 with 256MB



    If they could build something like this into a case that is smaller than the current pro but keeping the same style it probably would sell well.
  • Reply 14 of 18
    cjlaczcjlacz Posts: 33member
    Quote:
    Originally Posted by -AG- View Post


    As mentioned the mini is a basic headless mac, but i get where you are coming from.



    Basically you want a Mini Mac Pro,



    You and many others want to see something like...



    One Intel® Core? i7 Extreme Edition-980X processor, 3.33 GHz

    4GB (2x2GB) memory (expandable to 32GB)

    2TB hard drive 1 (expandable to 4)

    18x double-layer SuperDrive

    NVIDIA GeForce GT 120 with 256MB



    If they could build something like this into a case that is smaller than the current pro but keeping the same style it probably would sell well.



    I used to build all my computers so something like this appeals to me on some level, but realistically, I don't think it would sell well. It would end up being too expensive and most customers would end up with an iMac, if only for the lack of cables. 4 drives is optimistic on a smaller machine. I imagine it would be 2 max. Current Apple designs don't like a lot of dead space in the machines. I imagine it would also make it resemble a typical PC box too closely.



    When it comes down to it, there are two things I'm interested. A better video card, but my 3 year old Macbook Pro still plays my games reasonably well, so I'm probably just suffering from upgrade syndrome here. It also sounds like there is a lot of optimization in drivers that could increase performance by at least 50%. The second would be fast access. I have 6x2TB drives configured as RAID-6 in an external box. External SATA would be my wish. Putting that on the next Mac Mini would probably be a better machine for me though. (For the lack of noise compared to what this machine would generate)
  • Reply 15 of 18
    nceencee Posts: 836member
    and if they would come out with some new desk top units, they would sell even more Mac (Computers).



    Skip
  • Reply 16 of 18
    charlitunacharlituna Posts: 7,215member
    Quote:
    Originally Posted by emig647 View Post


    I think it's important to realize that they are completely different beasts. People just want an iPad for quick and dirty media consumption. A computer will always be in a different bracket than the iPad / iPhone. Especially with the way the OS is set up on both.





    That is a very good point as well. It is (pardon the pun) Apples and Oranges. Some like only one, some like both.



    Some folks are being a little forced into getting a Mac due to the apps thing but I would imagine that a few folks that love their ipads/iphones are stopping and taking a look since they need to replace the home computer anyway.
  • Reply 17 of 18
    mknoppmknopp Posts: 257member
    Quote:
    Originally Posted by DaHarder View Post


    Given that the iPad is not even a fully-autonomous computing device, and is (in fact) a media player/peripheral that requires an actual computer to function, these false concerns are all essentially moot.



    This right here is why nobody has to really worry about the iPad cannibalizing anyone's computer sales.



    Until Apple adds some things to the iOS and the iPad in particular it isn't a viable computer alternative.



    They need to make the iPad completely autonomous. That means they need to make file transfer possible/easier without the need to hook to a computer. This one I see them already working towards with iDisk. However, they also need an easy and built-in way to transfer files from the iPad to a computer and from an iPad to another iPad while away from a network connection.



    They need to enable the ability to print directly from the iPad. A USB connection would be nice, but I could see them forcing Bluetooth or wifi connectivity, which wouldn't be perfect, but would be acceptable.



    They need to either add Flash support or really start pushing/pay-off others to switch to HTML5 quicker. Just like last night my little girl wanted to play WebKinz on my iPad and I had to tell her it wouldn't work.



    They need to add a camera for video chat. I see this one coming as soon as the next version given their push for Facetime.



    For the majority of the average users, if these things were addressed the iPad could actually serve as a viable computer replacement. It could then do the big four: email, web, pictures, and simple letters well enough.



    Add on the ability to perhaps "dock" the iPad to a larger screen and a keyboard and there really wouldn't be any need for the majority of users to buy another computer.



    However, until that time I don't see it really cannibalizing too many computer sales.
  • Reply 18 of 18
    futurepastnowfuturepastnow Posts: 1,772member
    More likely people are buying iPads instead of netbooks, and Apple doesn't have any other products in that space.
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