Is that what you want? For an Apple machine to be like the Toshiba?
Frankly, I wouldn't mind. I know that Toshibas aren't necessarily beauty queens but I don't want to pay such an exhorbitant premium to pretty it up. For me, the main draw for Apples is the software functionality, something that's not a pain to manage and maintain.
Frankly, I wouldn't mind. I know that Toshibas aren't necessarily beauty queens but I don't want to pay such an exhorbitant premium to pretty it up. For me, the main draw for Apples is the software functionality, something that's not a pain to manage and maintain.
You would have a big fight on your hand then.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
People want their Mac's to look and feel like Macs. The cheap plastics used by most PC makers won't make a Mac any better in most current Mac users eyes.
I think that Apple could still do something to make the design stand out, but that hasn't been accepted.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
People want their Mac's to look and feel like Macs. The cheap plastics used by most PC makers won't make a Mac any better in most current Mac users eyes.
I think that Apple could still do something to make the design stand out, but that hasn't been accepted.
You guys have it all backwards. Apple uses special materials and features on their machines, but THOSE dont cost very much. However, it allows them to charge a ton more because they are the only creative hardware maker. They have very high margin. If Apple dropped those nifty features and made beige box PCs, they would lose massive margin because they can't charge a bundle for the coolness anymore. Not the other way around.
Its like if you are buying a house in a average tract home neighborhood, and one house has fancy architecture, kitchen, etc. If there is only one house , that person will ask a LOT for their house..more than those features cost him. But if everyone on the block got a fancy kitchen and facade, that one guy could no longer charge a premium.
So lowering their prices may increase marketshare, but their profits would fall off the map. SJ has stated he wants profits, not marketshare. Shareholders want profits, too. Apple invents a $5 magnetic latch and pumps their price by $100. Thats margin. You want them to remove the $5 latch and lose $100 per notebook? How many more notebooks do they have to sell to make up for that $5 "cool" latch? Not wise. Cheaper to invent "cool", like a black colored notebook.
A 15" MB would come too close to the price of the low MBP, and a 17 would cost even more.
This is inaccurate. Apple could sell a 15.4" MacBook for $300 more than a 13" one, all other things being equal. So the cheapest 15.4" MacBook would be $1399, which is $600 cheaper than the cheapest MacBook Pro. Is that what you meant by "too close"? The cheapest 17" MacBook could probably be done for $1799, which is $1000 cheaper than the 17" MacBook Pro.
Quote:
Originally Posted by melgross
As I said, Apple is stuck in an odd position. They have to convince people to change OS's, not computers as machines. Once they do that, the machines follow.
I disagree that it is as simple as this. If you "totally" convince someone to switch OS, then they will possibly heavily compromise on the type of machine that they want so that they can run OS X. But that is a very hard sell. Surely it is easier to convince someone to switch OS if they can also buy a machine to run it on that they actually want.
e.g., if someone is looking at say $800 + towers, and Apple offered $999 - $1499 towers, it would be easier for Apple to make the case for switching OSes. As it is now, you have to convince the potential buyer to switch OS and hardware configuration. Harder sell.
Quote:
Originally Posted by melgross
Apple makes a reasonable profit on every machine sold. Dell does not. That is why they are having the problems they are having now.
Dell has problems at the low end. $1000+ laptops are not low-end. Dell's margins are lower than Apple's in the mid-range, but not that much. It's more that Apple's machines in the mid-range are much higher quality. I've shown many times that $999+ towers from Apple are totally realistic margin-wise. They'd still be lower-specced than an equivalently priced Dell, but they'd be a much easier sell than a Mini or a Mac Pro if the potential buyer is after a small affordable tower.
Similarly, there's nothing unrealistic margin-wise about offering 15.4" and 17" options for the MacBook.
Quote:
Originally Posted by melgross
You would have a big fight on your hand then.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
There would be no reason for Apple to stop using polycarbonate or aluminium in all of their computers. I'm sure JeffDM was referring to an expansion of Apple's line-up rather than a ditching of the MacBook Pro and replacing it with some ugly, heavy lump of a laptop.
Having said that, I don't think it would be a good idea for Apple to go after the bottom-end of the market (which would entail the cheaper casework you are referring to), the margins are too slim. Much better to increase their presence in the middle of the market.
I disagree. I don't believe that a lack of a 15" Macbook is of any concern. The price would have to be too close to the low end MBP.
I also don't feel, at this time, that a mid range tower would make much difference, even though I've been one who, since the beginning, has been calling for one.
Apple has been in a strange position from the very beginning.
It isn't the machines that have held them back, as much as it's been the OS.
If Apple was selling XP on the very same machines, I'm sure they would have captured at least double the marketshare they have, possibly three times.
Almost all people I have spoken to over the years on this subject have stated that as the reason. It will continue to be the reason.
I have gone to both Apple stores here in NYC with PC users over the years, and they have all, without exception, liked the iMacs, regardless of the generation. But, it's always been the OS that has stopped them.
To pretend otherwise is to be very naive about the world as it really is.
Apple's OS has to fight for every 0.1% marketshare they can get.
The Mini is proof of that. At first it was thought, even by the majority here, that it would lead the resurgence of Apple's marketshare. But it hasn't. At best, the sales are "ok".
I'm no longer so sure that a fairly weak $995 tower would do much better. And Apple could do no better than that any longer. They can no longer call on a "secret" formula. Their machines are now the same as everyone else's. They would have to offer more, and how can they do that?
I agree with much of your arguments, but you forgot one more very important fact. XP can now run on a Mac. Give it 2 years and watch Apple's market share triple.
You guys have it all backwards. Apple uses special materials and features on their machines, but THOSE dont cost very much. However, it allows them to charge a ton more because they are the only creative hardware maker. They have very high margin. If Apple dropped those nifty features and made beige box PCs, they would lose massive margin because they can't charge a bundle for the coolness anymore. Not the other way around.
Its like if you are buying a house in a average tract home neighborhood, and one house has fancy architecture, kitchen, etc. If there is only one house , that person will ask a LOT for their house..more than those features cost him. But if everyone on the block got a fancy kitchen and facade, that one guy could no longer charge a premium.
So lowering their prices may increase marketshare, but their profits would fall off the map. SJ has stated he wants profits, not marketshare. Shareholders want profits, too. Apple invents a $5 magnetic latch and pumps their price by $100. Thats margin. You want them to remove the $5 latch and lose $100 per notebook? How many more notebooks do they have to sell to make up for that $5 "cool" latch? Not wise. Cheaper to invent "cool", like a black colored notebook.
You're wrong about that. Polycarbonate costs several times as much as the plastics used on most other computers. It also costs far more to work, and the transparent gloss finish also costs more to produce. The heavy gauge aluminum is an expensive material for a computer case. It also costs a good deal to work because the heavy gauge can't be worked the same way that the thin gauge steel, or aluminum can. Look at aluminum cases for PC's. You will be surprised at just how much a name brand model can cost. And they use much thinner aluminum.
Apple doesn't charge $100 for a $5 dollar latch. If the latch costs them $5, it will raise the price by about $15. That's normal. They would make perhaps $1.50 profit on that.
Please don't speak and make things up. Your statements are simply wrong.
This is inaccurate. Apple could sell a 15.4" MacBook for $300 more than a 13" one, all other things being equal. So the cheapest 15.4" MacBook would be $1399, which is $600 cheaper than the cheapest MacBook Pro. Is that what you meant by "too close"? The cheapest 17" MacBook could probably be done for $1799, which is $1000 cheaper than the 17" MacBook Pro.
first of all, you don't know that. Secondly, even if they could, that would price a 15" MacBook at $200 less than the low MBP, just as I said. Too close. The High end Mac Book is $1,500. Add $300 to that. Apple wouldn't put out a low end 15" MacBook. It would be the highest priced model if it were the largest.
The 17" model would be a good deal more than that, if they had one, and would cost more than the low end MBP.
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I disagree that it is as simple as this. If you "totally" convince someone to switch OS, then they will possibly heavily compromise on the type of machine that they want so that they can run OS X. But that is a very hard sell. Surely it is easier to convince someone to switch OS if they can also buy a machine to run it on that they actually want.
e.g., if someone is looking at say $800 + towers, and Apple offered $999 - $1499 towers, it would be easier for Apple to make the case for switching OSes. As it is now, you have to convince the potential buyer to switch OS and hardware configuration. Harder sell.
You are missing the entire point I made about the towers.
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Dell has problems at the low end. $1000+ laptops are not low-end. Dell's margins are lower than Apple's in the mid-range, but not that much. It's more that Apple's machines in the mid-range are much higher quality. I've shown many times that $999+ towers from Apple are totally realistic margin-wise. They'd still be lower-specced than an equivalently priced Dell, but they'd be a much easier sell than a Mini or a Mac Pro if the potential buyer is after a small affordable tower.
Dell also sells $600, and even $500 laptops. That's not low end? And when they sell their low end machines laptops or not, at big discounts, so that they sell for $300, just how much are they losing there?
Dell makes money on their servers and their business services. Apple can't compete in those markets so they have to make good money everywhere else.
But, even mighty Dell is being brought to their knees by the losses they are sustaining from their low end machines, and their predatory sales on their medium priced machines.
Why do you think they came out with a high end line this year? And why do you think they bought Alien?
Apple has no need for this.
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Similarly, there's nothing unrealistic margin-wise about offering 15.4" and 17" options for the MacBook.
I never said there would be a margin problem, just a pricing problem. Apple doesn't want to distract from their MBP sales with closely priced Mac Books.
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There would be no reason for Apple to stop using polycarbonate or aluminium in all of their computers. I'm sure JeffDM was referring to an expansion of Apple's line-up rather than a ditching of the MacBook Pro and replacing it with some ugly, heavy lump of a laptop.
I'm not saying they should necessarally abandon them either. But, if price is a problem they find in their surveys, they should consider it. If they did come out with a lower priced line(s), they would have to do something that won't impact the performance, but would allow the price to come down.
But the heavy, ugly lumps are the cheapest machines around in each catagory, except for the very high performance machines that Apple doesn't seem to be interested in.
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Having said that, I don't think it would be a good idea for Apple to go after the bottom-end of the market (which would entail the cheaper casework you are referring to), the margins are too slim. Much better to increase their presence in the middle of the market.
Well, gee! That's basically what I'm saying. Businesses won't mind, but most of Apple's current user base would.
I agree with much of your arguments, but you forgot one more very important fact. XP can now run on a Mac. Give it 2 years and watch Apple's market share triple.
Well, I'm not so sure that will make a big difference. Most people wanting either XP or Vista will want a regular PC. People who are thinking of switching over to OS X might want to hang on to Windows for a while longer.
But what most people saying that forget, is that they now have to buy Windows in addition to the Mac. If Boot Camp won't work for them, they also have to buy Parallel's software. That will add about $300 to their purchase.
Suddenly a $1,049 Mac Book becomes a $1,349 Mac Book. PC buyers who so often buy on price alone won't be happy about that.
first of all, you don't know that. Secondly, even if they could, that would price a 15" MacBook at $200 less than the low MBP, just as I said. Too close. The High end Mac Book is $1,500. Add $300 to that. Apple wouldn't put out a low end 15" MacBook. It would be the highest priced model if it were the largest.
You are missing a subtle point of the argument for 15.4" or 17" MacBook options. I'm talking about ending Apple's ridiculous tying of computer power with screen size. All the current models should have 15.4" and 17" screen options, so the cheapest 15.4" would have the same specs as the current low-end MacBook and cost $1399, and the cheapest 17" one would also have these specs and cost $1799.
It would be nice if they did the same thing with the MacBook Pro (so you could get the low-end MacBook Pro specs but with a 17" screen)
Quote:
Originally Posted by melgross
You are missing the entire point I made about the towers.
You mean the one about "what could Apple offer in a mid-range tower that others do not?"?
simple:
-- Elegance
-- OS X
Quote:
Originally Posted by melgross
Dell also sells $600, and even $500 laptops. That's not low end? And when they sell their low end machines laptops or not, at big discounts, so that they sell for $300, just how much are they losing there?
How does this contradict what I said? I said $1000 + is not low-end. Kind of implying that <$1000 is.
I don't think Dell loses money or has wafer thin margins in $1000+ laptops. I reckon they probably have gross margins around 20%.
Quote:
Originally Posted by melgross
I never said there would be a margin problem, just a pricing problem. Apple doesn't want to distract from their MBP sales with closely priced Mac Books.
I don't see why not, Apple would make about the same amount of money out of either. I would expect the much cheaper models would bring more people to the platform rather than cannibalising the MacBook Pro.
It seems to me that Apple's fear of cannibalisation stops them from doing the very things that would help them in gaining serious market share.
People have to stop thinking of what they would want, and instead think of what the overall market would want.
Then by this reasoning Apple should offer a 15" Macbook and a mid range tower. That is the heart of the market. Right now nearly every Mac is a niche product. Maybe it wouldn't increase market share, you're point about pc users reluctance to switch to OSX is certainly interesting. But my original point is that Apple cannot increase market share significantly without offering a mid range tower and a 15" Macbook as this is the heart of the market.
You are missing a subtle point of the argument for 15.4" or 17" MacBook options. I'm talking about ending Apple's ridiculous tying of computer power with screen size. All the current models should have 15.4" and 17" screen options, so the cheapest 15.4" would have the same specs as the current low-end MacBook and cost $1399, and the cheapest 17" one would also have these specs and cost $1799.
There is no subtle part to that argument. If Apple came out with a bigger screen, they would put it in the most expensive versions. Period. This is what they do, and it would be what they would do.
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It would be nice if they did the same thing with the MacBook Pro (so you could get the low-end MacBook Pro specs but with a 17" screen)
As you know, they wouldn't do that either.
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You mean the one about "what could Apple offer in a mid-range tower that others do not?"?
simple:
-- Elegance
-- OS X
That's far too little. It offers nothing practical to most PC buyers. They don't care about elegance, and you're back to my argument that it's the OS they have to decide they want, not the machine it's in.
If Apple sold a mid tower, it would compete against the hundreds of other mid towers. It would have to suceed as a gaming machine, and how would Apple do that? As part of that it would have to suceed as a performance machine, and how would Apple do THAT?
They won't. And so, the machine will sit there along with all of the other mid towers and will lack most of what makes them attractive to the buyer of those towere. Many graphics cards, tweakability, and performance memory.
But, I already said this.
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How does this contradict what I said? I said $1000 + is not low-end. Kind of implying that <$1000 is.
I don't think Dell loses money or has wafer thin margins in $1000+ laptops. I reckon they probably have gross margins around 20%.
That would be wrong. Dell sells all of their mid machines at large discounts on a regular basis. Just look at the NYTimes, or other papers, or the four color inserts in the papers. That lowers their margins considerably. They also "upgrade" you for free with a larger monitor, more memory, faster cpu, printer, bigger hd, etc.
They also lower the prices on a regular basis. IN January, a machine might cost $1,299. By March it costs $1,099. By May it costs $999. Bu July it might cost $799 before they come out with a newer model.
And all the while it is subject to the incentives I just mentioned.
Does Apple do this? Because it's what PC buyers expect.
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I don't see why not, Apple would make about the same amount of money out of either. I would expect the much cheaper models would bring more people to the platform rather than cannibalising the MacBook Pro.
Apple is concerned with margins. That means as much to them as marketshare. Scully did that as well. Only now that Apple's marketshare is going up, they figure they can get a way with it, even if it slows adoption somewhat.
The price would have to be close to $799 to make much of a difference, and Apple doesn't seem to want to go there, even though it is hurting them in some areas.
They won a school contract a few months ago after the Mac Book came out, for iBooks! Why? Because the school buying committee said that they were cheaper.
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It seems to me that Apple's fear of cannibalisation stops them from doing the very things that would help them in gaining serious market share.
That's one of the things I'm saying. They want a differentiation that's obvious. They don't want to confuse people as had been done in the past with closely priced, or overlapping lines.
They want their lines to look different, perform differently, and to be priced differently.
Anything that will blur any of those those distinctions won't be produced.
Then by this reasoning Apple should offer a 15" Macbook and a mid range tower. That is the heart of the market. Right now nearly every Mac is a niche product. Maybe it wouldn't increase market share, you're point about pc users reluctance to switch to OSX is certainly interesting. But my original point is that Apple cannot increase market share significantly without offering a mid range tower and a 15" Macbook as this is the heart of the market.
Those are your projections.
Read my posts as to why that won't work.
This really has to be thought out, and that doesn't seem to be done here.
Figure out exactly who Apple would satisfy by offering a tower. What market segment would want one, and what Apple would have to offer in one if they did have it. Think of the details, not some general statement of a "mid tower". That's not good enough.
Look at other mid towers and see what they have. Look at reviews of those towers in the enthusiast sites as well as the more staid sites. Look at the reviews Apple's machines get in some of those sites.
Understand that Apple has no interest in playing in that market, cannibalism issues aside.
If Apple came out with a bigger screen, they would put it in the most expensive versions. Period. This is what they do, and it would be what they would do.
I know that. But my point is that they shouldn't because tying screen-size with other features is dumb.
Quote:
Originally Posted by melgross
That's far too little. It offers nothing practical to most PC buyers. They don't care about elegance, and you're back to my argument that it's the OS they have to decide they want, not the machine it's in.
No no no. I'm sure that there are many people out there who don't even begin to consider OS X because they can't get the type of machine that they want. If you're after a 17" laptop for under $2000 or a $1000 ish tower, you're not going to consider OS X for even a second. However if Apple were to offer these sorts of configs, more people would consider the platform in the first place.
Quote:
Originally Posted by melgross
As part of that it would have to suceed as a performance machine, and how would Apple do THAT?
Put Conroe in it.
Quote:
Originally Posted by melgross
They also lower the prices on a regular basis. IN January, a machine might cost $1,299. By March it costs $1,099. By May it costs $999. Bu July it might cost $799 before they come out with a newer model.
That's because Dell, unlike Apple, maintain there % margin on machines. As the components get cheaper, so does the machine. Apple, on the other hand, starts out with a lower than average (for them) % margin when they introduce a new config, so it looks like a pretty sweet deal (for a Mac) and then they maintain the price, so over the months the % margin goes up and the attractiveness of the machine (bang-for-buck-wise) goes down.
I know that. But my point is that they shouldn't because tying screen-size with other features is dumb.
Then Apple would have to come with an even less expensive line, with cheaper cases, etc.
I'm not saying they shouldn't, just that they won't.
I just read an article in the WSJ a few minutes ago. The Mac Books were called "sharp looking" and "phenomenal", and said that Apple "should benefit more this holiday season" (than other makers—my addition).
That's what Apple wants. and therefore, that's what we will get.
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No no no. I'm sure that there are many people out there who don't even begin to consider OS X because they can't get the type of machine that they want. If you're after a 17" laptop for under $2000 or a $1000 ish tower, you're not going to consider OS X for even a second. However if Apple were to offer these sorts of configs, more people would consider the platform in the first place.
I really don't know why you are so sure. You give no real reasons to counter what I've said, only that you think I'm wrong, and here is what you want. That's not helpful. Counter my reasons with some good ones of your own, and I'll be happy to read them. You really have to be specific about features and compare them to towers that Apple would have to compete against. I don't see anyone here who disagrees, doing that. Just a blanket statement that Apple can succeed.
And then you HAVE to be realistic as to what Apple will do. Not what YOU WANT them to do. But, what THEY would do, if they came out with these machines.
You don't seem to be willing to consider that either.
We all have wish lists. Some of mine agree with yours, though I want more on the top end for myself. But I know that Apple simply isn't interested.
Whenever you think of a machine, you must think in the context of what APPLE would do if they came out with it, not what YOU would do.
Otherwise, the discussion simply comes down to the fingers crossed wish list, and we can't dispute anyones wish list. Everyone is entitled to hope for what they want, no matter how unrealistic it may be.
But when we talk about what Apple may come out with, rather than what we want Apple to come out with, we have to look at how they do things, and go from there.
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Put Conroe in it.
That doesn't say anything. Of course, if they came out with a mid line tower they would have to put Conroe in it. But that's only the barest of beginnings.
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That's because Dell, unlike Apple, maintain there % margin on machines. As the components get cheaper, so does the machine. Apple, on the other hand, starts out with a lower than average (for them) % margin when they introduce a new config, so it looks like a pretty sweet deal (for a Mac) and then they maintain the price, so over the months the % margin goes up and the attractiveness of the machine (bang-for-buck-wise) goes down.
No they don't. Dell does not maintain their margins. The prices of parts does not drop the way you think they do. Some parts drop, but others may even go up. Also Dell manufacturers their own machines, unlike Apple. They also invest in parts as Apple does, guaranteeing fixed prices for months or longer.
Dell has already stated publicly that their practice of selling machines for lower prices then they always should, as well as their other sales practices has resulted in their severely diminishes profits. so, this is not in dispute. The have sacrificed profits for marketshare. But, now their direct sales model isn't working.
In that same article I quoted there is another quote I can give:
"Apple Computer Inc., Hewlett Packard Co., and Gateway Inc. are likely to benefit from consumers appetite for notebook computers. PC buyers are willing to buy desktop computers sight unseen but want to touch and feel notebook computers. That bodes well for PC makers with storefronts or relationships with retailers. Dell Inc., however, is at a disadvantage because it sells its computers directly to consumers.
"Notebooks are a much more tactile product than desktops," says Stephan Baker, an analysts at market research firm NPD Group. "Dell is always a little challenged on the notebook side, especially from a consumer perspective.""
This is one of the reasons why Dell so aggressively discounts its notebooks regardless of cost, and why profits are so thin. It's the only way it can make up for the lack of retail presence.
It's also lost its price advantage over Hp, and others, over the past 18 months. This has also been well documented in articles in the papers. So they resort to massive discounting to maintain, and increase marketshare. Except that it hasn't helped. Their growth rate has dropped, for the first time, to the industry average. It's why they came out with a high priced line, and bought Alien, as I mentioned several times already. They are attempting to move to the higher priced spread.
Comments
Is that what you want? For an Apple machine to be like the Toshiba?
Frankly, I wouldn't mind. I know that Toshibas aren't necessarily beauty queens but I don't want to pay such an exhorbitant premium to pretty it up. For me, the main draw for Apples is the software functionality, something that's not a pain to manage and maintain.
Frankly, I wouldn't mind. I know that Toshibas aren't necessarily beauty queens but I don't want to pay such an exhorbitant premium to pretty it up. For me, the main draw for Apples is the software functionality, something that's not a pain to manage and maintain.
You would have a big fight on your hand then.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
People want their Mac's to look and feel like Macs. The cheap plastics used by most PC makers won't make a Mac any better in most current Mac users eyes.
I think that Apple could still do something to make the design stand out, but that hasn't been accepted.
You would have a big fight on your hand then.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
People want their Mac's to look and feel like Macs. The cheap plastics used by most PC makers won't make a Mac any better in most current Mac users eyes.
I think that Apple could still do something to make the design stand out, but that hasn't been accepted.
You guys have it all backwards. Apple uses special materials and features on their machines, but THOSE dont cost very much. However, it allows them to charge a ton more because they are the only creative hardware maker. They have very high margin. If Apple dropped those nifty features and made beige box PCs, they would lose massive margin because they can't charge a bundle for the coolness anymore. Not the other way around.
Its like if you are buying a house in a average tract home neighborhood, and one house has fancy architecture, kitchen, etc. If there is only one house , that person will ask a LOT for their house..more than those features cost him. But if everyone on the block got a fancy kitchen and facade, that one guy could no longer charge a premium.
So lowering their prices may increase marketshare, but their profits would fall off the map. SJ has stated he wants profits, not marketshare. Shareholders want profits, too. Apple invents a $5 magnetic latch and pumps their price by $100. Thats margin. You want them to remove the $5 latch and lose $100 per notebook? How many more notebooks do they have to sell to make up for that $5 "cool" latch? Not wise. Cheaper to invent "cool", like a black colored notebook.
A 15" MB would come too close to the price of the low MBP, and a 17 would cost even more.
This is inaccurate. Apple could sell a 15.4" MacBook for $300 more than a 13" one, all other things being equal. So the cheapest 15.4" MacBook would be $1399, which is $600 cheaper than the cheapest MacBook Pro. Is that what you meant by "too close"? The cheapest 17" MacBook could probably be done for $1799, which is $1000 cheaper than the 17" MacBook Pro.
As I said, Apple is stuck in an odd position. They have to convince people to change OS's, not computers as machines. Once they do that, the machines follow.
I disagree that it is as simple as this. If you "totally" convince someone to switch OS, then they will possibly heavily compromise on the type of machine that they want so that they can run OS X. But that is a very hard sell. Surely it is easier to convince someone to switch OS if they can also buy a machine to run it on that they actually want.
e.g., if someone is looking at say $800 + towers, and Apple offered $999 - $1499 towers, it would be easier for Apple to make the case for switching OSes. As it is now, you have to convince the potential buyer to switch OS and hardware configuration. Harder sell.
Apple makes a reasonable profit on every machine sold. Dell does not. That is why they are having the problems they are having now.
Dell has problems at the low end. $1000+ laptops are not low-end. Dell's margins are lower than Apple's in the mid-range, but not that much. It's more that Apple's machines in the mid-range are much higher quality. I've shown many times that $999+ towers from Apple are totally realistic margin-wise. They'd still be lower-specced than an equivalently priced Dell, but they'd be a much easier sell than a Mini or a Mac Pro if the potential buyer is after a small affordable tower.
Similarly, there's nothing unrealistic margin-wise about offering 15.4" and 17" options for the MacBook.
You would have a big fight on your hand then.
A couple of years ago when I suggested that apple go to standard cases, and stop using polycarbonate, because it would allow them to lower prices by a good $200 across the board, I was plastered and insulted.
There would be no reason for Apple to stop using polycarbonate or aluminium in all of their computers. I'm sure JeffDM was referring to an expansion of Apple's line-up rather than a ditching of the MacBook Pro and replacing it with some ugly, heavy lump of a laptop.
Having said that, I don't think it would be a good idea for Apple to go after the bottom-end of the market (which would entail the cheaper casework you are referring to), the margins are too slim. Much better to increase their presence in the middle of the market.
I disagree. I don't believe that a lack of a 15" Macbook is of any concern. The price would have to be too close to the low end MBP.
I also don't feel, at this time, that a mid range tower would make much difference, even though I've been one who, since the beginning, has been calling for one.
Apple has been in a strange position from the very beginning.
It isn't the machines that have held them back, as much as it's been the OS.
If Apple was selling XP on the very same machines, I'm sure they would have captured at least double the marketshare they have, possibly three times.
Almost all people I have spoken to over the years on this subject have stated that as the reason. It will continue to be the reason.
I have gone to both Apple stores here in NYC with PC users over the years, and they have all, without exception, liked the iMacs, regardless of the generation. But, it's always been the OS that has stopped them.
To pretend otherwise is to be very naive about the world as it really is.
Apple's OS has to fight for every 0.1% marketshare they can get.
The Mini is proof of that. At first it was thought, even by the majority here, that it would lead the resurgence of Apple's marketshare. But it hasn't. At best, the sales are "ok".
I'm no longer so sure that a fairly weak $995 tower would do much better. And Apple could do no better than that any longer. They can no longer call on a "secret" formula. Their machines are now the same as everyone else's. They would have to offer more, and how can they do that?
I agree with much of your arguments, but you forgot one more very important fact. XP can now run on a Mac. Give it 2 years and watch Apple's market share triple.
You guys have it all backwards. Apple uses special materials and features on their machines, but THOSE dont cost very much. However, it allows them to charge a ton more because they are the only creative hardware maker. They have very high margin. If Apple dropped those nifty features and made beige box PCs, they would lose massive margin because they can't charge a bundle for the coolness anymore. Not the other way around.
Its like if you are buying a house in a average tract home neighborhood, and one house has fancy architecture, kitchen, etc. If there is only one house , that person will ask a LOT for their house..more than those features cost him. But if everyone on the block got a fancy kitchen and facade, that one guy could no longer charge a premium.
So lowering their prices may increase marketshare, but their profits would fall off the map. SJ has stated he wants profits, not marketshare. Shareholders want profits, too. Apple invents a $5 magnetic latch and pumps their price by $100. Thats margin. You want them to remove the $5 latch and lose $100 per notebook? How many more notebooks do they have to sell to make up for that $5 "cool" latch? Not wise. Cheaper to invent "cool", like a black colored notebook.
You're wrong about that. Polycarbonate costs several times as much as the plastics used on most other computers. It also costs far more to work, and the transparent gloss finish also costs more to produce. The heavy gauge aluminum is an expensive material for a computer case. It also costs a good deal to work because the heavy gauge can't be worked the same way that the thin gauge steel, or aluminum can. Look at aluminum cases for PC's. You will be surprised at just how much a name brand model can cost. And they use much thinner aluminum.
Apple doesn't charge $100 for a $5 dollar latch. If the latch costs them $5, it will raise the price by about $15. That's normal. They would make perhaps $1.50 profit on that.
Please don't speak and make things up. Your statements are simply wrong.
This is inaccurate. Apple could sell a 15.4" MacBook for $300 more than a 13" one, all other things being equal. So the cheapest 15.4" MacBook would be $1399, which is $600 cheaper than the cheapest MacBook Pro. Is that what you meant by "too close"? The cheapest 17" MacBook could probably be done for $1799, which is $1000 cheaper than the 17" MacBook Pro.
first of all, you don't know that. Secondly, even if they could, that would price a 15" MacBook at $200 less than the low MBP, just as I said. Too close. The High end Mac Book is $1,500. Add $300 to that. Apple wouldn't put out a low end 15" MacBook. It would be the highest priced model if it were the largest.
The 17" model would be a good deal more than that, if they had one, and would cost more than the low end MBP.
I disagree that it is as simple as this. If you "totally" convince someone to switch OS, then they will possibly heavily compromise on the type of machine that they want so that they can run OS X. But that is a very hard sell. Surely it is easier to convince someone to switch OS if they can also buy a machine to run it on that they actually want.
e.g., if someone is looking at say $800 + towers, and Apple offered $999 - $1499 towers, it would be easier for Apple to make the case for switching OSes. As it is now, you have to convince the potential buyer to switch OS and hardware configuration. Harder sell.
You are missing the entire point I made about the towers.
Dell has problems at the low end. $1000+ laptops are not low-end. Dell's margins are lower than Apple's in the mid-range, but not that much. It's more that Apple's machines in the mid-range are much higher quality. I've shown many times that $999+ towers from Apple are totally realistic margin-wise. They'd still be lower-specced than an equivalently priced Dell, but they'd be a much easier sell than a Mini or a Mac Pro if the potential buyer is after a small affordable tower.
Dell also sells $600, and even $500 laptops. That's not low end? And when they sell their low end machines laptops or not, at big discounts, so that they sell for $300, just how much are they losing there?
Dell makes money on their servers and their business services. Apple can't compete in those markets so they have to make good money everywhere else.
But, even mighty Dell is being brought to their knees by the losses they are sustaining from their low end machines, and their predatory sales on their medium priced machines.
Why do you think they came out with a high end line this year? And why do you think they bought Alien?
Apple has no need for this.
Similarly, there's nothing unrealistic margin-wise about offering 15.4" and 17" options for the MacBook.
I never said there would be a margin problem, just a pricing problem. Apple doesn't want to distract from their MBP sales with closely priced Mac Books.
There would be no reason for Apple to stop using polycarbonate or aluminium in all of their computers. I'm sure JeffDM was referring to an expansion of Apple's line-up rather than a ditching of the MacBook Pro and replacing it with some ugly, heavy lump of a laptop.
I'm not saying they should necessarally abandon them either. But, if price is a problem they find in their surveys, they should consider it. If they did come out with a lower priced line(s), they would have to do something that won't impact the performance, but would allow the price to come down.
But the heavy, ugly lumps are the cheapest machines around in each catagory, except for the very high performance machines that Apple doesn't seem to be interested in.
Having said that, I don't think it would be a good idea for Apple to go after the bottom-end of the market (which would entail the cheaper casework you are referring to), the margins are too slim. Much better to increase their presence in the middle of the market.
Well, gee! That's basically what I'm saying. Businesses won't mind, but most of Apple's current user base would.
I agree with much of your arguments, but you forgot one more very important fact. XP can now run on a Mac. Give it 2 years and watch Apple's market share triple.
Well, I'm not so sure that will make a big difference. Most people wanting either XP or Vista will want a regular PC. People who are thinking of switching over to OS X might want to hang on to Windows for a while longer.
But what most people saying that forget, is that they now have to buy Windows in addition to the Mac. If Boot Camp won't work for them, they also have to buy Parallel's software. That will add about $300 to their purchase.
Suddenly a $1,049 Mac Book becomes a $1,349 Mac Book. PC buyers who so often buy on price alone won't be happy about that.
first of all, you don't know that. Secondly, even if they could, that would price a 15" MacBook at $200 less than the low MBP, just as I said. Too close. The High end Mac Book is $1,500. Add $300 to that. Apple wouldn't put out a low end 15" MacBook. It would be the highest priced model if it were the largest.
You are missing a subtle point of the argument for 15.4" or 17" MacBook options. I'm talking about ending Apple's ridiculous tying of computer power with screen size. All the current models should have 15.4" and 17" screen options, so the cheapest 15.4" would have the same specs as the current low-end MacBook and cost $1399, and the cheapest 17" one would also have these specs and cost $1799.
It would be nice if they did the same thing with the MacBook Pro (so you could get the low-end MacBook Pro specs but with a 17" screen)
You are missing the entire point I made about the towers.
You mean the one about "what could Apple offer in a mid-range tower that others do not?"?
simple:
-- Elegance
-- OS X
Dell also sells $600, and even $500 laptops. That's not low end? And when they sell their low end machines laptops or not, at big discounts, so that they sell for $300, just how much are they losing there?
How does this contradict what I said? I said $1000 + is not low-end. Kind of implying that <$1000 is.
I don't think Dell loses money or has wafer thin margins in $1000+ laptops. I reckon they probably have gross margins around 20%.
I never said there would be a margin problem, just a pricing problem. Apple doesn't want to distract from their MBP sales with closely priced Mac Books.
I don't see why not, Apple would make about the same amount of money out of either. I would expect the much cheaper models would bring more people to the platform rather than cannibalising the MacBook Pro.
It seems to me that Apple's fear of cannibalisation stops them from doing the very things that would help them in gaining serious market share.
People have to stop thinking of what they would want, and instead think of what the overall market would want.
Then by this reasoning Apple should offer a 15" Macbook and a mid range tower. That is the heart of the market. Right now nearly every Mac is a niche product. Maybe it wouldn't increase market share, you're point about pc users reluctance to switch to OSX is certainly interesting. But my original point is that Apple cannot increase market share significantly without offering a mid range tower and a 15" Macbook as this is the heart of the market.
You are missing a subtle point of the argument for 15.4" or 17" MacBook options. I'm talking about ending Apple's ridiculous tying of computer power with screen size. All the current models should have 15.4" and 17" screen options, so the cheapest 15.4" would have the same specs as the current low-end MacBook and cost $1399, and the cheapest 17" one would also have these specs and cost $1799.
There is no subtle part to that argument. If Apple came out with a bigger screen, they would put it in the most expensive versions. Period. This is what they do, and it would be what they would do.
It would be nice if they did the same thing with the MacBook Pro (so you could get the low-end MacBook Pro specs but with a 17" screen)
As you know, they wouldn't do that either.
You mean the one about "what could Apple offer in a mid-range tower that others do not?"?
simple:
-- Elegance
-- OS X
That's far too little. It offers nothing practical to most PC buyers. They don't care about elegance, and you're back to my argument that it's the OS they have to decide they want, not the machine it's in.
If Apple sold a mid tower, it would compete against the hundreds of other mid towers. It would have to suceed as a gaming machine, and how would Apple do that? As part of that it would have to suceed as a performance machine, and how would Apple do THAT?
They won't. And so, the machine will sit there along with all of the other mid towers and will lack most of what makes them attractive to the buyer of those towere. Many graphics cards, tweakability, and performance memory.
But, I already said this.
How does this contradict what I said? I said $1000 + is not low-end. Kind of implying that <$1000 is.
I don't think Dell loses money or has wafer thin margins in $1000+ laptops. I reckon they probably have gross margins around 20%.
That would be wrong. Dell sells all of their mid machines at large discounts on a regular basis. Just look at the NYTimes, or other papers, or the four color inserts in the papers. That lowers their margins considerably. They also "upgrade" you for free with a larger monitor, more memory, faster cpu, printer, bigger hd, etc.
They also lower the prices on a regular basis. IN January, a machine might cost $1,299. By March it costs $1,099. By May it costs $999. Bu July it might cost $799 before they come out with a newer model.
And all the while it is subject to the incentives I just mentioned.
Does Apple do this? Because it's what PC buyers expect.
I don't see why not, Apple would make about the same amount of money out of either. I would expect the much cheaper models would bring more people to the platform rather than cannibalising the MacBook Pro.
Apple is concerned with margins. That means as much to them as marketshare. Scully did that as well. Only now that Apple's marketshare is going up, they figure they can get a way with it, even if it slows adoption somewhat.
The price would have to be close to $799 to make much of a difference, and Apple doesn't seem to want to go there, even though it is hurting them in some areas.
They won a school contract a few months ago after the Mac Book came out, for iBooks! Why? Because the school buying committee said that they were cheaper.
It seems to me that Apple's fear of cannibalisation stops them from doing the very things that would help them in gaining serious market share.
That's one of the things I'm saying. They want a differentiation that's obvious. They don't want to confuse people as had been done in the past with closely priced, or overlapping lines.
They want their lines to look different, perform differently, and to be priced differently.
Anything that will blur any of those those distinctions won't be produced.
Then by this reasoning Apple should offer a 15" Macbook and a mid range tower. That is the heart of the market. Right now nearly every Mac is a niche product. Maybe it wouldn't increase market share, you're point about pc users reluctance to switch to OSX is certainly interesting. But my original point is that Apple cannot increase market share significantly without offering a mid range tower and a 15" Macbook as this is the heart of the market.
Those are your projections.
Read my posts as to why that won't work.
This really has to be thought out, and that doesn't seem to be done here.
Figure out exactly who Apple would satisfy by offering a tower. What market segment would want one, and what Apple would have to offer in one if they did have it. Think of the details, not some general statement of a "mid tower". That's not good enough.
Look at other mid towers and see what they have. Look at reviews of those towers in the enthusiast sites as well as the more staid sites. Look at the reviews Apple's machines get in some of those sites.
Understand that Apple has no interest in playing in that market, cannibalism issues aside.
If Apple came out with a bigger screen, they would put it in the most expensive versions. Period. This is what they do, and it would be what they would do.
I know that. But my point is that they shouldn't because tying screen-size with other features is dumb.
That's far too little. It offers nothing practical to most PC buyers. They don't care about elegance, and you're back to my argument that it's the OS they have to decide they want, not the machine it's in.
No no no. I'm sure that there are many people out there who don't even begin to consider OS X because they can't get the type of machine that they want. If you're after a 17" laptop for under $2000 or a $1000 ish tower, you're not going to consider OS X for even a second. However if Apple were to offer these sorts of configs, more people would consider the platform in the first place.
As part of that it would have to suceed as a performance machine, and how would Apple do THAT?
Put Conroe in it.
They also lower the prices on a regular basis. IN January, a machine might cost $1,299. By March it costs $1,099. By May it costs $999. Bu July it might cost $799 before they come out with a newer model.
That's because Dell, unlike Apple, maintain there % margin on machines. As the components get cheaper, so does the machine. Apple, on the other hand, starts out with a lower than average (for them) % margin when they introduce a new config, so it looks like a pretty sweet deal (for a Mac) and then they maintain the price, so over the months the % margin goes up and the attractiveness of the machine (bang-for-buck-wise) goes down.
I know that. But my point is that they shouldn't because tying screen-size with other features is dumb.
Then Apple would have to come with an even less expensive line, with cheaper cases, etc.
I'm not saying they shouldn't, just that they won't.
I just read an article in the WSJ a few minutes ago. The Mac Books were called "sharp looking" and "phenomenal", and said that Apple "should benefit more this holiday season" (than other makers—my addition).
That's what Apple wants. and therefore, that's what we will get.
No no no. I'm sure that there are many people out there who don't even begin to consider OS X because they can't get the type of machine that they want. If you're after a 17" laptop for under $2000 or a $1000 ish tower, you're not going to consider OS X for even a second. However if Apple were to offer these sorts of configs, more people would consider the platform in the first place.
I really don't know why you are so sure. You give no real reasons to counter what I've said, only that you think I'm wrong, and here is what you want. That's not helpful. Counter my reasons with some good ones of your own, and I'll be happy to read them. You really have to be specific about features and compare them to towers that Apple would have to compete against. I don't see anyone here who disagrees, doing that. Just a blanket statement that Apple can succeed.
And then you HAVE to be realistic as to what Apple will do. Not what YOU WANT them to do. But, what THEY would do, if they came out with these machines.
You don't seem to be willing to consider that either.
We all have wish lists. Some of mine agree with yours, though I want more on the top end for myself. But I know that Apple simply isn't interested.
Whenever you think of a machine, you must think in the context of what APPLE would do if they came out with it, not what YOU would do.
Otherwise, the discussion simply comes down to the fingers crossed wish list, and we can't dispute anyones wish list. Everyone is entitled to hope for what they want, no matter how unrealistic it may be.
But when we talk about what Apple may come out with, rather than what we want Apple to come out with, we have to look at how they do things, and go from there.
Put Conroe in it.
That doesn't say anything. Of course, if they came out with a mid line tower they would have to put Conroe in it. But that's only the barest of beginnings.
That's because Dell, unlike Apple, maintain there % margin on machines. As the components get cheaper, so does the machine. Apple, on the other hand, starts out with a lower than average (for them) % margin when they introduce a new config, so it looks like a pretty sweet deal (for a Mac) and then they maintain the price, so over the months the % margin goes up and the attractiveness of the machine (bang-for-buck-wise) goes down.
No they don't. Dell does not maintain their margins. The prices of parts does not drop the way you think they do. Some parts drop, but others may even go up. Also Dell manufacturers their own machines, unlike Apple. They also invest in parts as Apple does, guaranteeing fixed prices for months or longer.
Dell has already stated publicly that their practice of selling machines for lower prices then they always should, as well as their other sales practices has resulted in their severely diminishes profits. so, this is not in dispute. The have sacrificed profits for marketshare. But, now their direct sales model isn't working.
In that same article I quoted there is another quote I can give:
"Apple Computer Inc., Hewlett Packard Co., and Gateway Inc. are likely to benefit from consumers appetite for notebook computers. PC buyers are willing to buy desktop computers sight unseen but want to touch and feel notebook computers. That bodes well for PC makers with storefronts or relationships with retailers. Dell Inc., however, is at a disadvantage because it sells its computers directly to consumers.
"Notebooks are a much more tactile product than desktops," says Stephan Baker, an analysts at market research firm NPD Group. "Dell is always a little challenged on the notebook side, especially from a consumer perspective.""
This is one of the reasons why Dell so aggressively discounts its notebooks regardless of cost, and why profits are so thin. It's the only way it can make up for the lack of retail presence.
It's also lost its price advantage over Hp, and others, over the past 18 months. This has also been well documented in articles in the papers. So they resort to massive discounting to maintain, and increase marketshare. Except that it hasn't helped. Their growth rate has dropped, for the first time, to the industry average. It's why they came out with a high priced line, and bought Alien, as I mentioned several times already. They are attempting to move to the higher priced spread.
Which is where Apple is already.