Precisely, and indeed the point of this article: Macs cost a LOT more than PCs, more than twice as much on average. New or used there's no way to escape that.
Fortunately, the cost is offset by them lasting years longer on average as primary machines.
Quote:
HP cut corners to save more than $5 billion, while Steve performed tasks on his unsuitable-for-inhabitation mansion that have absolutely nothing to do with this argument, nor with the amount of money that Apple receives from sales.
Just because they sell these things (with like a 9% market share) does not mean they are fairly priced. They are expensive, and that is reflected in the market share.
Fair pricing is what people will pay. If you can't afford it, don't buy it.
The 'Apple Premium' is hardly 'free', but I get where you're coming from. Macs are expensive because there really is no other system that provides 'computing done right', oddly enough. Since Apple has no real competition in its core value proposition, it can charge whatever the market will bear, and to hell with marketshare.
It's funny that Macs are compared to 'luxury' cars - because the comparison breaks down. Macs don't provide luxury or prestige, they are simply the only computer company that provides basic functionality. The correct analogical comparison is not between a compact car and a luxury sedan - it's more between a 'car' that is a conglomerated mongrel of poorly-fitting parts that frequently breaks down, is theft-friendly, and wildly unsafe to a car that simply 'works'.
About 12 years ago, Neal Stephenson wrote a brilliant little essay on this very topic, called In the Beginning was the Command Line. It's outdated now, as this was pre-OS X, but philosophically, it's still relevant, I think. I highly recommend downloading it. It's very entertaining and enlightening. I've quoted him fairly often in Mac/Windows discussions.
So if they have an average selling price of 1323.40 which yields a profit of 370.55 ...that means it costs Apple 952.85 or 46% more to build a computer than HP sells one for.
If Apple was selling computers at HP's profit margins, that hypothetical average Mac would go for 1029.08. Still substantially more than HPs average and how much extra volume of sales would an average price cut of 300 bucks net?
Doesn't even work with a PC reliably - my PC hasn't been willing to play b-ray over HDMI since i upgraded the G-card, and as far as I can tell it won't unless I fork out 60 bucks for software to breach the DRM - even though the g-card is supposed to conform to b-rays DRM requirements. Oh I could connect to my TV by VGA I suppose, but yuk frankly.
This is a great example of why Apple is winning, they do the system integration so I don't have to.
It's funny that Macs are compared to 'luxury' cars - because the comparison breaks down. Macs don't provide luxury or prestige, they are simply the only computer company that provides basic functionality. The correct analogical comparison is not between a compact car and a luxury sedan - it's more between a 'car' that is a conglomerated mongrel of poorly-fitting parts that frequently breaks down, is theft-friendly, and wildly unsafe to a car that simply 'works'.
Doesn't even work with a PC reliably - my PC hasn't been willing to play b-ray over HDMI since i upgraded the G-card, and as far as I can tell it won't unless I fork out 60 bucks for software to breach the DRM - even though the g-card is supposed to conform to b-rays DRM requirements. Oh I could connect to my TV by VGA I suppose, but yuk frankly.
This is a great example of why Apple is winning, they do the system integration so I don't have to.
Just a quick note, I have heard of this issue with some GPU cards and discovered that it is old drivers supplied with the cards. I would recommend going to either nvidia or AMD/ATI's site and getting the most recent drivers and see if that helps resolve your Blueray DRM issue
HP did not publish the gross margin of the Personal Systems Group (reason kind of obvious), only the operating profits. Rather clever for a 15-yr old (or anyone) to estimate the gross margin the way he did.
So making numbers up and pretending that they have any validity is clever?
You can't reasonably do what he did and expect it to have any validity at all. There is absolutely no basis for the overhead number he came up with so it might as well be a random number.
Quote:
Originally Posted by MacRulez
Precisely, and indeed the point of this article: Macs cost a LOT more than PCs, more than twice as much on average. New or used there's no way to escape that.
That's a silly statement. Boeing airplanes cost more than Gulfstream planes, too. So what?
The only reasonable comparison is comparing similar products. Apple doesn't participate in the $299 crapware segment, so competitors will undoubtedly have a lower average price.
In a number of segments, Apple's prices are well within the average range or only slightly higher:
- 8-12 core MacPro systems. Compare them to dual CPU Xeon systems from other vendors and you'll find that Apple is very close.
- Ultralight systems. The MacBook Air is quite competitive with all but the crappiest ultralights.
- Tablets. No one has offered a significantly better price/feature level than the iPad.
- iMac. You can buy a 27" iMac for a price that no one else is currently matching.
Even when it is possible to buy a competitive product for less, it's almost NEVER less than half of Apple's price. But go ahead and show me a 27" AIO with i5 for under $1 K. Or an ultralight like the MBA for under $500. Or a decent quality dual Xeon system for under $1750. Or a 10" tablet for under $250.
Twice as much, indeed.
Quote:
Originally Posted by MacRulez
HP passed along more than $5 billion in savings to its customers, while Steve renovated his mansion.
Incredibly stupid statement - even for you.
Just as the CEO of HP is entitled to do whatever he wants with his personal wealth, so is Jobs. Oh, and btw, Jobs took a salary of $1 last year. I guess HP's CEO was ripping off its customers because he took home more than $1 M last year.
Furthermore, Apple (or any company ) doesn't exist to pass along savings to its customers. Its purpose is to make money. If passing along savings helps to make money, it's good for the corporation. And, as far as making money, Apple is doing better than anyone else in the industry.
The consumer's perspective (at least the intelligent consumer rather than the frothing at the mouth rabid Apple haters like you) is to evaluate products that they would like to buy and decide which one best meets their needs at a price they want to pay. Apple's customer base has been skyrocketing, so Apple is presumably doing something that is making customers happy.
Just a quick note, I have heard of this issue with some GPU cards and discovered that it is old drivers supplied with the cards. I would recommend going to either nvidia or AMD/ATI's site and getting the most recent drivers and see if that helps resolve your Blueray DRM issue
I did but it was 6 months back so fingers crossed maybe this time I'll be lucky.
But this article is focused on profit margins, not quality. Profit comes from markup.
As is usual for you, you don't even have the most basic facts right. Can you please explain to me why you insist on constantly posting nonsense about topics you don't understand? (Other than, of course, the fact that you're apparently a paid shill).
High markup does not guarantee a profit, nor does low markup mean that there won't be a profit.
Look at oil companies. Their gross margin is relatively modest compared to most industries (15-20%). Yet they make money hand over fist.
Other companies have very high gross margins. For example, I know a couple of companies locally (primarily service companies) with gross margins in the 80-90% range - but who are losing money.
Profit comes from a combination of gross margins (your use of the term markup is further indication that you really don't understand business finances) and operating expenses. Neither one alone has any real meaning.
Comments
Try that with a Mac.
Okay. Done. Next?
Precisely, and indeed the point of this article: Macs cost a LOT more than PCs, more than twice as much on average. New or used there's no way to escape that.
Fortunately, the cost is offset by them lasting years longer on average as primary machines.
HP cut corners to save more than $5 billion, while Steve performed tasks on his unsuitable-for-inhabitation mansion that have absolutely nothing to do with this argument, nor with the amount of money that Apple receives from sales.
Fixed!
Just because they sell these things (with like a 9% market share) does not mean they are fairly priced. They are expensive, and that is reflected in the market share.
Fair pricing is what people will pay. If you can't afford it, don't buy it.
HP passed along more than $5 billion in savings to its customers, while Steve renovated his mansion.
MacRulez, your posts get more and more bizarre. What's with this passive-aggressive nonsense? Don't you (seriously) get tired of it?!
This only shows how Apple makes their products too expensive.
(points at you)
Apple has 800 million little green portraits of Ben Franklin that says you're wrong.
The 'Apple Premium' is hardly 'free', but I get where you're coming from. Macs are expensive because there really is no other system that provides 'computing done right', oddly enough. Since Apple has no real competition in its core value proposition, it can charge whatever the market will bear, and to hell with marketshare.
It's funny that Macs are compared to 'luxury' cars - because the comparison breaks down. Macs don't provide luxury or prestige, they are simply the only computer company that provides basic functionality. The correct analogical comparison is not between a compact car and a luxury sedan - it's more between a 'car' that is a conglomerated mongrel of poorly-fitting parts that frequently breaks down, is theft-friendly, and wildly unsafe to a car that simply 'works'.
About 12 years ago, Neal Stephenson wrote a brilliant little essay on this very topic, called In the Beginning was the Command Line. It's outdated now, as this was pre-OS X, but philosophically, it's still relevant, I think. I highly recommend downloading it. It's very entertaining and enlightening.
If Apple was selling computers at HP's profit margins, that hypothetical average Mac would go for 1029.08. Still substantially more than HPs average and how much extra volume of sales would an average price cut of 300 bucks net?
Seven times as many? I doubt it.
Try that with a Mac.
Doesn't even work with a PC reliably - my PC hasn't been willing to play b-ray over HDMI since i upgraded the G-card, and as far as I can tell it won't unless I fork out 60 bucks for software to breach the DRM - even though the g-card is supposed to conform to b-rays DRM requirements. Oh I could connect to my TV by VGA I suppose, but yuk frankly.
This is a great example of why Apple is winning, they do the system integration so I don't have to.
It's funny that Macs are compared to 'luxury' cars - because the comparison breaks down. Macs don't provide luxury or prestige, they are simply the only computer company that provides basic functionality. The correct analogical comparison is not between a compact car and a luxury sedan - it's more between a 'car' that is a conglomerated mongrel of poorly-fitting parts that frequently breaks down, is theft-friendly, and wildly unsafe to a car that simply 'works'.
Ok - an early 1980s compact car versus a BMW?
Retail Price "of the Beast".
WOW, A sub-$1000 desktop from apple that is upgradable! I was so excited that I called to order one and was sad to discover the number disconnected
Dont think it woulda had the power to run Final Cut Pro x, but hey its only $666!
Doesn't even work with a PC reliably - my PC hasn't been willing to play b-ray over HDMI since i upgraded the G-card, and as far as I can tell it won't unless I fork out 60 bucks for software to breach the DRM - even though the g-card is supposed to conform to b-rays DRM requirements. Oh I could connect to my TV by VGA I suppose, but yuk frankly.
This is a great example of why Apple is winning, they do the system integration so I don't have to.
Just a quick note, I have heard of this issue with some GPU cards and discovered that it is old drivers supplied with the cards. I would recommend going to either nvidia or AMD/ATI's site and getting the most recent drivers and see if that helps resolve your Blueray DRM issue
Ooh - with a 70s style voice over on the trailer?
Only if we can have an obnoxious early 80s synthesizer chirping away on the opening credits
HP did not publish the gross margin of the Personal Systems Group (reason kind of obvious), only the operating profits. Rather clever for a 15-yr old (or anyone) to estimate the gross margin the way he did.
So making numbers up and pretending that they have any validity is clever?
You can't reasonably do what he did and expect it to have any validity at all. There is absolutely no basis for the overhead number he came up with so it might as well be a random number.
Precisely, and indeed the point of this article: Macs cost a LOT more than PCs, more than twice as much on average. New or used there's no way to escape that.
That's a silly statement. Boeing airplanes cost more than Gulfstream planes, too. So what?
The only reasonable comparison is comparing similar products. Apple doesn't participate in the $299 crapware segment, so competitors will undoubtedly have a lower average price.
In a number of segments, Apple's prices are well within the average range or only slightly higher:
- 8-12 core MacPro systems. Compare them to dual CPU Xeon systems from other vendors and you'll find that Apple is very close.
- Ultralight systems. The MacBook Air is quite competitive with all but the crappiest ultralights.
- Tablets. No one has offered a significantly better price/feature level than the iPad.
- iMac. You can buy a 27" iMac for a price that no one else is currently matching.
Even when it is possible to buy a competitive product for less, it's almost NEVER less than half of Apple's price. But go ahead and show me a 27" AIO with i5 for under $1 K. Or an ultralight like the MBA for under $500. Or a decent quality dual Xeon system for under $1750. Or a 10" tablet for under $250.
Twice as much, indeed.
HP passed along more than $5 billion in savings to its customers, while Steve renovated his mansion.
Incredibly stupid statement - even for you.
Just as the CEO of HP is entitled to do whatever he wants with his personal wealth, so is Jobs. Oh, and btw, Jobs took a salary of $1 last year. I guess HP's CEO was ripping off its customers because he took home more than $1 M last year.
Furthermore, Apple (or any company ) doesn't exist to pass along savings to its customers. Its purpose is to make money. If passing along savings helps to make money, it's good for the corporation. And, as far as making money, Apple is doing better than anyone else in the industry.
The consumer's perspective (at least the intelligent consumer rather than the frothing at the mouth rabid Apple haters like you) is to evaluate products that they would like to buy and decide which one best meets their needs at a price they want to pay. Apple's customer base has been skyrocketing, so Apple is presumably doing something that is making customers happy.
Just a quick note, I have heard of this issue with some GPU cards and discovered that it is old drivers supplied with the cards. I would recommend going to either nvidia or AMD/ATI's site and getting the most recent drivers and see if that helps resolve your Blueray DRM issue
I did but it was 6 months back so fingers crossed maybe this time I'll be lucky.
Which Mac model are you using for Blu-ray?
Any of them. I'd recommend an Intel machine, as I don't think any of the PowerPCs could handle it.
Have you found a way around Steve's "bag of hurt" to simply play them from disk with the software provided with your computer,
Yes and no. Yes, you can play directly from the disc, but no, the software doesn't come with your Mac. It's free, though.
or do you need to use at least two other third-party packages, or just one of them if you have the time and space to rip the entire disk to your HD to compensate for this arbitrary limitation?
Please stop the FUD. You can rip them to 4GB MP4 files. That's not something worthy of a "the time and space" line.
The bottom line here is pretty simple:
But this article is focused on profit margins, not quality. Profit comes from markup.
As is usual for you, you don't even have the most basic facts right. Can you please explain to me why you insist on constantly posting nonsense about topics you don't understand? (Other than, of course, the fact that you're apparently a paid shill).
High markup does not guarantee a profit, nor does low markup mean that there won't be a profit.
Look at oil companies. Their gross margin is relatively modest compared to most industries (15-20%). Yet they make money hand over fist.
Other companies have very high gross margins. For example, I know a couple of companies locally (primarily service companies) with gross margins in the 80-90% range - but who are losing money.
Profit comes from a combination of gross margins (your use of the term markup is further indication that you really don't understand business finances) and operating expenses. Neither one alone has any real meaning.
WOW, A sub-$1000 desktop from apple that is upgradable! I was so excited that I called to order one and was sad to discover the number disconnected
Dont think it woulda had the power to run Final Cut Pro x, but hey its only $666!
Haha! You forgot to mention it is "Design by Apple and Assembled by Apple in California."