Fred Anderson and the iMac

Posted:
in General Discussion edited January 2014
I'm listening to the conference call, and Fred Anderson has been hammering home the point that Apple's gross margin on the iMac is worse than it was on the old iMac; that they expect it will never be as good; and that Apple is willing to sacrifice gross margin to grow market share.



Also, the CRT iMac will continue for as long as it's the only way to meet the sub-$1K price points.

Comments

  • Reply 1 of 18
    They will still sell a boatload of the old CRT models anyway. Apple isnt dumb and they will get outrageous margins from the sub 1k CRT's.
  • Reply 2 of 18
    imacfpimacfp Posts: 750member
    I think we'll see the lowend LCD iMac get down to $1,100 or maybe $1,000 even and the high end go down one or two hundred. But it might take awhile for LCD prices to allow sub $1,000 prices.
  • Reply 3 of 18
    g4dudeg4dude Posts: 1,016member
    Aren't LCD prices going UP? If anything, Apple will be hard pressed to keep the prices so low.
  • Reply 4 of 18
    Anderson said LCD prices went up in November and have since stabilized. He also stated that margins will never be the same as the old CRT iMac but can eventually come close. This quarter margins will be low because they will be air freighting the iMacs to meet demand. When they start shipping by boat, margins will increase.
  • Reply 5 of 18
    brussellbrussell Posts: 9,812member
    [quote]Originally posted by MacsRGood4U:

    <strong>Anderson said LCD prices went up in November and have since stabilized.</strong><hr></blockquote>Yes but G4dude is right that they're expected to, if anything, go up in the short term, partially because so many more people are buying them now.



    But yes, I did think that was interesting that they're willing to make smaller margins on these iMacs. Now they just have to sell a ton. They really are betting the farm on this thing.
  • Reply 6 of 18
    fran441fran441 Posts: 3,715member
    [quote]Aren't LCD prices going UP? If anything, Apple will be hard pressed to keep the prices so low.<hr></blockquote>



    It won't make a difference if Apple has locked in at an LCD price. That way, regardless of whether price goes up or down, they have a set price for the LCDs.
  • Reply 7 of 18
    [quote]Originally posted by Fran441:

    <strong>



    It won't make a difference if Apple has locked in at an LCD price. That way, regardless of whether price goes up or down, they have a set price for the LCDs.</strong><hr></blockquote>



    I am sure they probably do infact have a locked in deal with the manufacturer.
  • Reply 8 of 18
    amorphamorph Posts: 7,112member
    Also, the prices on the rest of the components are either fixed or going down, which will help to offset any increase in LCD and RAM prices.



    And, as Fred pointed out, there are the usual gains in operational efficiency once a product is fully ramped up.



    He sounded upbeat throughout the whole thing, and you could tell he was grinning ear to ear when he dodged a particularly clever attempt to pry a statement about a PowerMac rev out of him.
  • Reply 9 of 18
    Don't they OWN part of the LCD manufacturer? Isn't it like they're making them for themselves? Can't they, therefore, undercut the market price?
  • Reply 10 of 18
    brussellbrussell Posts: 9,812member
    [quote]Originally posted by Fran441:

    <strong>It won't make a difference if Apple has locked in at an LCD price. That way, regardless of whether price goes up or down, they have a set price for the LCDs.</strong><hr></blockquote>But if they got a locked-in price right now, it wouldn't have been a very good price, because they're expected to go up in price in the future.
  • Reply 11 of 18
    applenutapplenut Posts: 5,768member
    I'm not sure how you interpreted his comments as meaning the imac CRT will be staying. he said that they are there "for now" and that hopefully they'll be able to get the LCD iMac to that price point in the future.



    I don't expect iMac CRTs to survive past MWNY, if that long. Why else would they be trying to sell them off to schools for clearance at 400 dollars a piece?



    [ 01-16-2002: Message edited by: applenut ]</p>
  • Reply 12 of 18
    crusadercrusader Posts: 1,129member
    Apple owns a small chunk of samsung.
  • Reply 13 of 18
    buonrottobuonrotto Posts: 6,368member
    I think Apple sold their shares of

    Samsung about a year ago actually.
  • Reply 14 of 18
    amorphamorph Posts: 7,112member
    [quote]Originally posted by applenut:

    <strong>I'm not sure how you interpreted his comments as meaning the imac CRT will be staying.</strong><hr></blockquote>



    He said that they were there to address price points that the LCD iMac couldn't reach, and they'd be there for as long as the LCD models stayed over $1K. He refused to proffer a time when they would be phased out, which is not surprising given the discussion about whether rising component costs would make the LCD models even costlier.



    If the report is true, and Apple just ordered 800,000 CRTs from Hon Hai, then I don't think the CRT iMac is going anywhere soon. It'll stick around until Apple can push the LCD iMac down to $800 or so. MWSF 2003 maybe? or even later.
  • Reply 15 of 18
    I thought the positive message from the call was demand for the new iMac. Anderson said Apple hasn't seen the volume of pre-orders for the new iMac since the original was introduced. I searched CNET and found that Apple announced 150,000 pre-orders of the original. If the new iMac is doing anywhere near that, Apple will be doing just fine...
  • Reply 16 of 18
    applenutapplenut Posts: 5,768member
    [quote]Originally posted by Amorph:

    <strong>



    He said that they were there to address price points that the LCD iMac couldn't reach, and they'd be there for as long as the LCD models stayed over $1K. He refused to proffer a time when they would be phased out, which is not surprising given the discussion about whether rising component costs would make the LCD models even costlier.



    If the report is true, and Apple just ordered 800,000 CRTs from Hon Hai, then I don't think the CRT iMac is going anywhere soon. It'll stick around until Apple can push the LCD iMac down to $800 or so. MWSF 2003 maybe? or even later.</strong><hr></blockquote>



    doubt it.



    main reason to doubt that report.. 800,000 CRT imacs.



    Apple hasn't sold that many iMacs since 1999 when the imac was a hit. why the hell would they expect to sell that many when it is now the runt of the product lineup and not even marketed by Apple anymore?



    if true then apple is dumber than I thought
  • Reply 17 of 18
    brussellbrussell Posts: 9,812member
    [quote]Originally posted by applenut:

    <strong>main reason to doubt that report.. 800,000 CRT imacs.



    Apple hasn't sold that many iMacs since 1999 when the imac was a hit.</strong><hr></blockquote>No, they've been selling well over a million a year, even in the past year. This recent quarter was their worst iMac performance ever, I believe, and for the quarter it was still well over 200,000.



    800,000 does seem high though, with the new iMac around now. If true, maybe they expect demand to really pick up over the next year, and they'll sell lots of both the new and the old iMac still.
  • Reply 18 of 18
    applenutapplenut Posts: 5,768member
    [quote]Originally posted by BRussell:

    <strong>No, they've been selling well over a million a year, even in the past year. This recent quarter was their worst iMac performance ever, I believe, and for the quarter it was still well over 200,000.



    800,000 does seem high though, with the new iMac around now. If true, maybe they expect demand to really pick up over the next year, and they'll sell lots of both the new and the old iMac still.</strong><hr></blockquote>





    I guess the eMac answers our doubts about the order
Sign In or Register to comment.