Economy, opportunity seen leading to $599 Apple netbook

Posted:
in Future Apple Hardware edited January 2014
Faced with the perfect storm of a bleak market and a boom in ultra-budget portables, Apple is believed by some to be readying its own take on the netbook for the first half of 2009.



Analyst Ezra Gottheil from Technology Business Research (TBR) cautions that Apple may no longer have the luxury of keeping its notebook pricing high when many buyers are much more concerned about price than they were even a few months ago.



The company has until now insisted on keeping its prices largely unchanged and instead has upgraded the specifications of its systems to maintain that price. That has kept its average selling price high but has also all but locked the company out of the entry-level and developing-world markets; these are now being joined by cash-strapped customers even within the US, making it that much less likely any of them will pay Apple's minimum asking price. At $999, the least expensive MacBook is twice or more the cost of the most frugal Windows alternatives, Gottheil says.



Gottheil dismisses the notion of an artificial premium on Apple products, noting that they often compete well for the features, but is certain that the Cupertino, Calif.-based company has reached a breaking point where perceived quality can't override genuine financial woes from customers.



"It is too much to ask consumers to pay more than twice as much for a PC in these times," the analyst says.



Moreover, the market is also understood to be shifting away from the Mac's traditional price range. The sudden explosion in the popularity of netbooks -- portables with 10-inch or smaller screens that are often based around low-power processors and meant for basic Internet use -- has pushed the price of a notebook to as little as $300. Apple can't ignore this, Gottheil claims.



But while the Mac maker's chief Steve Jobs has argued that the iPhone is netbook-like in fulfilling many of the same online roles, the researcher believes that the desire for a keyboard ultimately the usefulness of the iPhone for certain software and that something more is necessary.



Instead, he and TBR are confident that Apple will release a computer in the netbook class within the first half of next year, but one that doesn't obey many of the rules dictated by the industry. Like the MacBook Air ultraportable, this future system would be at least as thin and light as others in its category but would potentially have a larger surface area to allow a larger display or more comfortable input. Netbook owners carry their systems "in stacks with papers and books" and care more about thickness than footprint, according to Gottheil.



Crucially, he also takes to heart Jobs' assertion that $500 systems are typically "junk" and believes that Apple will price the system at $599. The figure would be just low enough to draw customers who would pass over the plastic MacBook but high enough to avoid the risk Apple's co-founder perceives in dropping the price particularly low.



As with most Windows PC makers, Apple would reportedly have to accept the risk of cannibalizing sales for some of its more lucrative notebook models but could theoretically maintain its profit margins and continue to grow its Mac shipments ahead of the industry curve.



While the market conditions are widely accepted and are potentially supported by rumors of an unknown device being tested at Apple that would more closely fit the bill, Gottheil's statements do contradict some of Jobs' own beliefs about netbooks and Apple's role in the marketplace. He believes netbooks are part of a "nascent" category that may not pan out and has said he would be "surprised" if large volumes of notebook buyers shifted to the very bottom of the price spectrum and created problems for Apple.



Still, TBR's analyst warns that buyers, including those looking at Macs, were "more cautious" even in the summer and that Apple in its current position would gain share mainly at the expense of its revenue as users opt for less expensive models whenever possible.
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Comments

  • Reply 1 of 256
    tofinotofino Posts: 697member
    nothing to see here...
  • Reply 2 of 256
    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!
  • Reply 3 of 256
    A netbook will never happen from Apple i think, why? who the heck is gonna buy the $1700 Macbook air then?
  • Reply 4 of 256
    satchmosatchmo Posts: 2,699member
    Given that the MacBook Air is Apple's idea of a 'netbook', my guess is we're more likely to see a touch based Tablet instead. Something in the 6x8 inch size.



    It's a natural extension and would further build on the touch interface of both iPhone and multi-touch gestures of the MacBooks.



    Going this route would go counter to simply miniaturizing laptops as current netbooks are. By going 'touch', this perceived premium will allow Apple to charge more in the $600-$800 range.
  • Reply 5 of 256
    Am I the only person getting tired of netbooks? Fine, they make ultraportable notebooks intended solely for browsing the Internet and responding to email. Great! Why do we keep hearing about how great they are? They're narrow-use products. I'm already tired of the term netbook, just like how I got tired of the terms like "Web 2.0" and "blog" years ago. Enough.



    Snow Leopard and a rumored $99 iPhone are bigger deals than an Apple netbook.
  • Reply 6 of 256
    boogabooga Posts: 1,081member
    Quote:
    Originally Posted by ipodrulz View Post


    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!



    My Touch costed less than $900. My guess is that Apple would love to sell Touches at $600. It will be interesting to see if they can make that a viable proposition by turning a Touch into a NetBook.
  • Reply 7 of 256
    Quote:
    Originally Posted by desides View Post


    just like how I got tired of the terms like "Web 2.0" and "blog" years ago. Enough.

    .



    I hate the term Web 2.0, it's so stupid.
  • Reply 8 of 256
    benroethigbenroethig Posts: 2,782member
    Quote:
    Originally Posted by ipodrulz View Post


    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!



    http://store.apple.com/us/browse/hom...ni?mco=MTE3MTA



    You're many years too late. Apple released its first $799 Mac in 2001.
  • Reply 9 of 256
    paxmanpaxman Posts: 4,705member
    Quote:
    Originally Posted by AppleInsider View Post


    The sudden explosion in the popularity of netbooks -- portables with 10-inch or smaller screens that are often based around low-power processors and meant for basic Internet use --



    Really? Numbers please.
  • Reply 10 of 256
    nebagakidnebagakid Posts: 2,692member
    no. no.
  • Reply 11 of 256
    Quote:
    Originally Posted by ipodrulz View Post


    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!



    People like you are the reason there's a lot of hate for Mac users out there.
  • Reply 12 of 256
    hmurchisonhmurchison Posts: 12,353member
    like always Apple has to be the BASF of Netbooks. They don't have to be the creator

    they simply have to make the Netbook category better.



    Price is a factor. If Apple can get away with a fairly stripped Macbook then it begs the question "just how much connectivity does the average person need?"



    I think Apple's been planning a device like this for a while.



    Quicktime X

    Remote Disc

    Cocoa Touch

    LLVM/CLANG

    P.A Semi/ Papermaster



    All point to not necessarily just new iPhone models but rather a new class of portable computing devices.
  • Reply 13 of 256
    Want an Apple netbook? Get a 12" PowerBook refurbished. Inexpensive, small processor, and practical. Maybe a smidge too big but none the less, it'll do the trick just the same.
  • Reply 14 of 256
    begbeg Posts: 53member
    In other news released today, it has been found that 100% of so-called analysts are "complete f*****g morons"
  • Reply 15 of 256
    mactelmactel Posts: 1,275member
    Quote:
    Originally Posted by ipodrulz View Post


    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!





    Mac Mini? Though it hasn't been updated for over a year and is pretty crappy specs-wise.
  • Reply 16 of 256
    Quote:
    Originally Posted by HyteProsector View Post


    Want an Apple netbook? Get a 12" PowerBook refurbished. Inexpensive, small processor, and practical. Maybe a smidge too big but none the less, it'll do the trick just the same.



    The only problem I see with the 12" Powerbook is that they (probably) won't be able to run 10.6 or any future OS X release. Some of them (800MHz) can't even run 10.5.
  • Reply 17 of 256
    ouraganouragan Posts: 437member
    Quote:

    Analyst Ezra Gottheil from Technology Business Research (TBR) cautions that Apple may no longer have the luxury of keeping its notebook pricing high when many buyers are much more concerned about price than they were even a few months ago.



    The company has until now insisted on keeping its prices largely unchanged and instead has upgraded the specifications of its systems to maintain that price. That has kept its average selling price high but has also all but locked the company out of the entry-level and developing-world markets; these are now being joined by cash-strapped customers even within the US, making it that much less likely any of them will pay Apple's minimum asking price. At $999, the least expensive MacBook is twice or more the cost of the most frugal Windows alternatives, Gottheil says.



    Gottheil dismisses the notion of an artificial premium on Apple products, noting that they often compete well for the features, but is certain that the Cupertino, Calif.-based company has reached a breaking point where perceived quality can't override genuine financial woes from customers.



    "It is too much to ask consumers to pay more than twice as much for a PC in these times," the analyst says.



    [...]



    Still, TBR's analyst warns that buyers, including those looking at Macs, were "more cautious" even in the summer and that Apple in its current position would gain share mainly at the expense of its revenue as users opt for less expensive models whenever possible.





    I fully agree. It's great to see that some analysts analyse instead of speculate or push a stock in what is called a 'pump and dump' operation.



  • Reply 18 of 256
    Like nearly all "journalists" this guy has no experience or financial education.



    All economic slowdowns/recessions have a finite life. In the US the longest recession, since WWII, lasted 18 months. This one is now 12 months old. That means this has only 6 months to go before it too fades into our memories. That duration isn't anywhere near long enough to cause Apple any concern about "cash strapped" consumers.



    This is just another bullsh*t article based on nothing more than the author's desire to generate hits.
  • Reply 19 of 256
    teckstudteckstud Posts: 6,476member
    Quote:
    Originally Posted by paxman View Post


    Really? Numbers please.



    You don't need numbers- walk into any computer store or computer department-other than Apple.
  • Reply 20 of 256
    teckstudteckstud Posts: 6,476member
    Quote:
    Originally Posted by ipodrulz View Post


    I would hate it if Apple released anything below 900$. It just makes the Apple brand look cheap, and crappy. And it allows all these other people to be carrying around a fruit logo when they shouldn't be. In the end Apple will just dilute their brand. Please Steve Jobs - don't do it!



    Well don't crap out when those $99 Walmart iPhones go on the market.
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