This has to be the fastest growing thread ever, so I'll toss my WAG into the pile too.
I read "key product transition" as "key transition of existing product lines". They are going to do something to all their products to differentiate them technologically from all competitors, and it is going to cost them margin. This has been a problem for Apple since they switched to Intel... all of a sudden it became much easier to do 'fair' comparisons between Apple hardware and all other PC makers. I can imagine that Apple wants to change that, and do it in a way that doesn't raise their hardware prices beyond where they are right now.
Putting in hardware any manufacturer can buy doesn't accomplish this goal. It also doesn't leverage Apple's tight software/hardware integration. For decades Apple has been experimenting with adding custom hardware chips to the Mac lineup, but they've never done it pervasively. Perhaps now they are about to. They have acquired a couple of hardware design companies to supplement their internal teams and we've seen no obvious fruits from that. The PA Semi acquisition we've been lead to believe is for future iPhone/iPod hardware... but perhaps this hardware equally well applies to Macs. Its also not impossible that a design contract was in place before they were purchased -- often a company will contract another to do work and then buy them when that work turns out to be successful and they want to ensure total control over it. Or this may have nothing to do with PA Semi. Regardless, however, a low power / low cost part that delivers some kind of advanced functionality to be leveraged by components of MacOSX and will be rolled into all Macs simultaneously (or nearly so), possibly including AppleTV. Who knows, it might even be useful in certain iPods and the iPhone (although having just introduced the iPhone 3G I doubt we'll see an update of that for a while). No Macs have been updated since January, and only a few were then so they're all about due anyhow.
What could this mystery chip do? While there are numerous possibilities, I seem to recall rumours about an H.264 chip being added to all Macs floating around a year or two ago. Its also possible that this more than just a hardwired decoder and it might be useful for other data intensive operations in the various OSX system services... this could fit right into Snow Leopard's hints about Grand Central and OpenCL.
Look at an iPod nano. Now remove the click wheel and imagine the entire front being a touch screen. When you double the nano screen real estate, It's not so small anymore.
you have it backwards. the nano was a great compact music only device. with the iPod Touch apple found people like to browse. so their next product will be fitted for browsing. There will never be an iPod touch nano
you have it backwards. the nano was a great compact music only device. with the iPod Touch apple found people like to browse. so their next product will be fitted for browsing. There will never be an iPod touch nano
Yes, the nano touch will have a Safari browser. But most importantly, it will have the "app store."
I like what someone suggested earlier: merging the MacBook and MacBook Pro into one product. I do realize that these are already two separate products for two separate demographics, but I love the idea, especially if the MacBook does indeed switch to aluminum casing.
This "key product transition," and the supposed effect it will have on sales, I think has to do with the iMac, though. Those of you claiming that this "has nothing to do with a computer" are forgetting that "shutting out the competition" could easily refer to all-in-one computers. I know many people who admire and even desire Macs, but cannot afford them. Imagine dropping the cost of an iMac to something well below $1000 (think $500!). WOW. A significantly higher number of people would purchase iMacs (especially considering Apple's growing appeal among customers), but Q4 would fall a few points because the computers would cost less, bringing in "less" money but propagating more sales.
I don't like the idea of an iPod nano touch - that's such a long product name. How many people do you know who already prefer saying (whether consciously or subconsciously) "iTouch" rather than "iPod touch." And an iPod nano? Personally I highly doubt this - If they could make the iPhone any smaller (while sustaining its key features), they would have with the 3G update. It just doesn't sound very appealing - let the iPhone continue to climb what will become a very high mountain.
I just don't see how an iPod "transition" would be brought about in order to shut down competition. The iPod line hasn't had a formidable competitor yet - I don't know the numbers, but come on, people... Until Apple sees a significant decrease in iPod sales / customer interest, I don't see any need for a dramatic "product transition."
This has everything to with Macs, in my opinion. The iMac is going to become more mainstream... Macs, Macs, Macs... We shall see!
I just don't see how an iPod "transition" would be brought about in order to shut down competition. The iPod line hasn't had a formidable competitor yet - I don't know the numbers, but come on, people... Until Apple sees a significant decrease in iPod sales / customer interest, I don't see any need for a dramatic "product transition."
Of course it does. The very reason the iPod line is still the leader is because they've constantly evolved it. Always a step ahead of the competition. This transition would "shut out" the competition because multi-touch technology is patented by Apple. The competition could never copy it.
The mobile platform is Apple's future. They've already got a great lead with the iPhone/iTouch and all the developers on board with the "app store." Bringing this technology to Apple's best selling mobile device would cement OSX/multi-touch technology as the de facto standard mobile platform.
Besides, how much more can they really innovate the current nano and classic line? It's about as thin and small as it can get. Time for a real "transition" into the next generation of touch mobile devices.
Of course it does. The very reason the iPod line is still the leader is because they've constantly evolved it. Always a step ahead of the competition. This transition would "shut out" the competition because multi-touch technology is patented by Apple. The competition could never copy it.
The mobile platform is Apple's future. They've already got a great lead with the iPhone/iTouch and all the developers on board with the "app store." Bringing this technology to Apple's best selling mobile device would cement OSX/multi-touch technology as the de facto standard mobile platform.
Besides, how much more can they really innovate the current nano and classic line? It's about as thin and small as it can get. Time for a real "transition" into the next generation of touch mobile devices.
I understand your point to a certain extent, but I still see no idea for a DRAMATIC change. I'm not suggesting that Apple rest on its laurels - in fact I'm sure a "refresh" for the iPod line is in the works. But I think what's key to this "product transition" is its relevance to competition. Unless the iPod touch is set to drop to $99, I don't see how a few evolutionary changes to the iPod line would affect Q4 figures as Apple is suggesting.
I'm as stumped as everyone else, but remain convinced that hefty changes (design, price, what have you) to Macs are key, here.
They do know how to stir the pot of rumor and speculation. My guess is they are replacing the chips (possibly in laptops) with chips of their own design. Isn't that why they acquired PA semi? That would be a transition to shut out rivals.
Chuck,
You don't really think things move from acquisition of key personnel through all phases of development (design, prototype, improve, systems integration, system design document, fabrication orders, parts acquisition, manufacturing, & shipping) in just two months do you?
The payoffs from PA Semi are at least two years out. And don't tell me that you don't think Apple looks ahead that far. I guarantee you their draft roadmap goes out at least 5 years.
The thing that makes the most sense is that the Macbook Airs are ALL going to be getting solid state drives (some of them quite large in terms of data storage) and will all be significantly cheaper. This will damage margins in a significant way.
Another prediction. If margins are really going to be damaged to the tune of 3% on the September quarter, then the release of this product is either going to be fairly soon, or it is expected to be a huge launch (or both).
I understand your point to a certain extent, but I still see no idea for a DRAMATIC change. I'm not suggesting that Apple rest on its laurels - in fact I'm sure a "refresh" for the iPod line is in the works. But I think what's key to this "product transition" is its relevance to competition. Unless the iPod touch is set to drop to $99, I don't see how a few evolutionary changes to the iPod line would affect Q4 figures as Apple is suggesting.
I'm as stumped as everyone else, but remain convinced that hefty changes (design, price, what have you) to Macs are key, here.
It's not about dropping prices, it's about keeping prices the same and including mulit-touch.
The current nano starts at $149... If Apple keeps the price the same but adds multi-touch and wifi. It will shut out the competition.. They won't make as much per unit, it will definitely affect their profit margin, but it will bring 10's of millions of new customers into the "app store" and onto Apple's new mobile platform.
This is going to bring even more developers in to the gates, and as I said, it will turn Apple's mobile platform into the de facto standard. Competition could never match what Apple would be doing.
Another prediction. If margins are really going to be damaged to the tune of 3% on the September quarter, then the release of this product is either going to be fairly soon, or it is expected to be a huge launch (or both).
It's not about dropping prices, it's about keeping prices the same and including mulit-touch.
The current nano starts at $149... If Apple keeps the price the same but adds multi-touch and wifi. It will shut out the competition.. They won't make as much per unit, it will definitely affect their profit margin, but it will bring 10's of millions of new customers into the "app store" and onto Apple's new mobile platform.
This is going to bring even more developers in to the gates, and as I said, create Apple's mobile platform as the de facto standard. Competition could never match what Apple would be doing.
If it's not about dropping prices, then why would the whole "expensive at first, less expensive later" thing be mentioned? I think this is about making Apple's products (again, I'm vying for Mac products) more accessible to a wider array of people.
The immense success of the App Store (and, as I'm sure you'll agree, I think this thing is really only just beginning to take off) is definitely worth mentioning - and you are right, what with its wild popularity among customers AND developers, I don't think it's something that competitors could even begin to match/copy. But designing a nano with touch capabilities would be both difficult and risky - I'm getting better each day with the "touch keyboard" on my iPod touch, but I still know a good number of people who are put off by the small "keys" and lack of tactile feedback. The iPod nano is a hugely successful product, so it certainly is a key player...
I just feel as though (and maybe this is just a personal preference/bias) Apple's real treasure is its Mac product line. I'm still astounded by how well my iMac functions - I knew NOTHING about Macs and within weeks was getting things done faster and more efficiently due to Tiger. Using the computer has become less of a chore and more of a pleasure. I understand that "the industry" is still controlled by Windows, but why anyone would prefer, in some sort of "blind test", a PC over a Mac is truly beyond me.
Extending this type of enthusiasm from a small percentage of computer-users to those who know Macs only as "cool but expensive" MUST be a goal of Apple's - and significantly slashing the price of iMacs and MacBooks would certainly help them attain it.
[QUOTE=Programmer;1282489] They have acquired a couple of hardware design companies to supplement their internal teams and we've seen no obvious fruits from that. The PA Semi acquisition we've been lead to believe is for future iPhone/iPod hardware... but perhaps this hardware equally well applies to Macs. Its also not impossible that a design contract was in place before they were purchased -- often a company will contract another to do work and then buy them when that work turns out to be successful and they want to ensure total control over it.
That is a really good thought, I never thought about the possibility of apple already being in a position to use a PA Semi hardware. I always thought the rumor of the video conferencing on the iPhone was a Killer application,but thought it probably got pulled because of poor performance. Maybe with the help of PA Semi they will have the power to add this to their new product. iPod web
If it's not about dropping prices, then why would the whole "expensive at first, less expensive later" thing be mentioned? I think this is about making Apple's products (again, I'm vying for Mac products) more accessible to a wider array of people.
The immense success of the App Store (and, as I'm sure you'll agree, I think this thing is really only just beginning to take off) is definitely worth mentioning - and you are right, what with its wild popularity among customers AND developers, I don't think it's something that competitors could even begin to match/copy. But designing a nano with touch capabilities would be both difficult and risky - I'm getting better each day with the "touch keyboard" on my iPod touch, but I still know a good number of people who are put off by the small "keys" and lack of tactile feedback. The iPod nano is a hugely successful product, so it certainly is a key player...
I just feel as though (and maybe this is just a personal preference/bias) Apple's real treasure is its Mac product line. I'm still astounded by how well my iMac functions - I knew NOTHING about Macs and within weeks was getting things done faster and more efficiently due to Tiger. Using the computer has become less of a chore and more of a pleasure. I understand that "the industry" is still controlled by Windows, but why anyone would prefer, in some sort of "blind test", a PC over a Mac is truly beyond me.
Extending this type of enthusiasm from a small percentage of computer-users to those who know Macs only as "cool but expensive" MUST be a goal of Apple's - and significantly slashing the price of iMacs and MacBooks would certainly help them attain it.
Because if you listen to the call, Oppenheimer repeatedly talked about bringing technologies into the un-released product (line) that would shut out the competition.. He said nothing about cutting prices affecting the profit margin, he clearly said the technologies used would affect the profit margin..
Since Apple has patents on multi-touch, and they've aleady used on it on the top end of the iPod line, incorporating this technology further down the line is into the nano is the logical next step. Especially since it will be so beneficial now that the "app store" is here. This would shut out the competition.
A) The profit margin will stay at 35% until this new product is released.
b) This product won't be announced until August 19th at the earliest.
That means if the plan is to have a 30% unit margin at the end of the quarter, they are going to have something like a 25% margin for the second half of the quarter. Now since they are reducing the margin, we know they are planning to increase the volume. This means the mystery transition cannot be a new product. No product, however cool, is going to sell over a million units in the first month. There is literally no new product that Apple could introduce that would sell enough units within the first month to lower the per unit margins by 10%. So the change must involve some existing product.
I think there are two realistic options here. First, they sell more by reducing the price of the new MacBooks and MacBook Pros. A real possibility. Second, they sell more by keeping the price the same and adding an expensive component to one of their existing products. If the margins do go down because of more expensive components, the only real options are the MBP and the iPod. The iPhone isn't in for an update, and none of the other products ship enough units to have this big of an effect on the unit margins. In terms of components, the options are basically SSD, Blueray, or DDR3 for the MB and MBP and more SSD for the iPod. Blueray and faster RAM are unlikely to generate enough excitement among the general public to increase the units shipped enough to make up for the smaller margins, unless DDR3 uses so much less power that it drastically increases battery life. This is unlikely. So almost certainly what we are looking at here is either a sharp price drop in MBs and MBPs, or else adding SSD to the MB and MBP or else adding massive amounts of SSD to the iPod touch and eliminating the other iPods.
Because if you listen to the call, Oppenheimer repeatedly talked about bringing technologies into the un-released product (line) that would shut out the competition.. He said nothing about cutting prices affecting the profit margin, he clearly said the technologies used would affect the profit margin..
Since Apple has patents on multi-touch, and they've aleady used on it on the top end of the iPod line, incorporating this technology further down the line is into the nano is the logical next step. Especially since it will be so beneficial now that the "app store" is here. This would shut out the competition.
I see your point clearly and do think you are very right - but I stand by my belief that we will see significant price-cuts and modifications to the Mac product line.
A) The profit margin will stay at 35% until this new product is released.
b) This product won't be announced until August 19th at the earliest.
That means if the plan is to have a 30% unit margin at the end of the quarter, they are going to have something like a 25% margin for the second half of the quarter. Now since they are reducing the margin, we know they are planning to increase the volume. This means the mystery transition cannot be a new product. No product, however cool, is going to sell over a million units in the first month. There is literally no new product that Apple could introduce that would sell enough units within the first month to lower the per unit margins by 10%. So the change must involve some existing product.
I think there are two realistic options here. First, they sell more by reducing the price of the new MacBooks and MacBook Pros. A real possibility. Second, they sell more by keeping the price the same and adding an expensive component to one of their existing products. If the margins do go down because of more expensive components, the only real options are the MBP and the iPod. The iPhone isn't in for an update, and none of the other products ship enough units to have this big of an effect on the unit margins. In terms of components, the options are basically SSD, Blueray, or DDR3 for the MB and MBP and more SSD for the iPod. Blueray and faster RAM are unlikely to generate enough excitement among the general public to increase the units shipped enough to make up for the smaller margins, unless DDR3 uses so much less power that it drastically increases battery life. This is unlikely. So almost certainly what we are looking at here is either a sharp price drop in MBs and MBPs, or else adding SSD to the MB and MBP or else adding massive amounts of SSD to the iPod touch and eliminating the other iPods.
Good post. I agree that adding SSD to the Macbook and MBP could create the same profit margin effect..
However, I don't believe a move like this could be seen as "shutting out the competition." Any of Apple's competitors could also add SSD to their notebooks and quite frankly, most of Apple's competitors sell more units and operate on much slimmer profit margins to begin with.. So a move like this would not so much "shut out" the competition as it would bring Apple more in line with the competitions margins.
I'm still convinced it's the iPod line going touch. nano included.
New MacBook/Pro refresh with 4 cores and Snow Leopard at a killer price. Maybe a discount or even free for Snow Leopard upgrade. New Cinema displays - Dell is killing Apple there. A subsidized AppleTV with enhanced features, including "home server" - Not too long ago Jobs hinted at that.
Comments
I read "key product transition" as "key transition of existing product lines". They are going to do something to all their products to differentiate them technologically from all competitors, and it is going to cost them margin. This has been a problem for Apple since they switched to Intel... all of a sudden it became much easier to do 'fair' comparisons between Apple hardware and all other PC makers. I can imagine that Apple wants to change that, and do it in a way that doesn't raise their hardware prices beyond where they are right now.
Putting in hardware any manufacturer can buy doesn't accomplish this goal. It also doesn't leverage Apple's tight software/hardware integration. For decades Apple has been experimenting with adding custom hardware chips to the Mac lineup, but they've never done it pervasively. Perhaps now they are about to. They have acquired a couple of hardware design companies to supplement their internal teams and we've seen no obvious fruits from that. The PA Semi acquisition we've been lead to believe is for future iPhone/iPod hardware... but perhaps this hardware equally well applies to Macs. Its also not impossible that a design contract was in place before they were purchased -- often a company will contract another to do work and then buy them when that work turns out to be successful and they want to ensure total control over it. Or this may have nothing to do with PA Semi. Regardless, however, a low power / low cost part that delivers some kind of advanced functionality to be leveraged by components of MacOSX and will be rolled into all Macs simultaneously (or nearly so), possibly including AppleTV. Who knows, it might even be useful in certain iPods and the iPhone (although having just introduced the iPhone 3G I doubt we'll see an update of that for a while). No Macs have been updated since January, and only a few were then so they're all about due anyhow.
What could this mystery chip do? While there are numerous possibilities, I seem to recall rumours about an H.264 chip being added to all Macs floating around a year or two ago. Its also possible that this more than just a hardwired decoder and it might be useful for other data intensive operations in the various OSX system services... this could fit right into Snow Leopard's hints about Grand Central and OpenCL.
Oh yes, it is. I've got fairly small thumbs... and I just don't see that happening.
Wait a few weeks. You will.
The new, unnamed product will continue to have "technologies and features that others can't match," according to the CFO.
Those words are very powerful.
yes, and the technologies are Apple's patented Multi-touch technologies.
Look at an iPod nano. Now remove the click wheel and imagine the entire front being a touch screen. When you double the nano screen real estate, It's not so small anymore.
you have it backwards. the nano was a great compact music only device. with the iPod Touch apple found people like to browse. so their next product will be fitted for browsing. There will never be an iPod touch nano
you have it backwards. the nano was a great compact music only device. with the iPod Touch apple found people like to browse. so their next product will be fitted for browsing. There will never be an iPod touch nano
Yes, the nano touch will have a Safari browser. But most importantly, it will have the "app store."
This "key product transition," and the supposed effect it will have on sales, I think has to do with the iMac, though. Those of you claiming that this "has nothing to do with a computer" are forgetting that "shutting out the competition" could easily refer to all-in-one computers. I know many people who admire and even desire Macs, but cannot afford them. Imagine dropping the cost of an iMac to something well below $1000 (think $500!). WOW. A significantly higher number of people would purchase iMacs (especially considering Apple's growing appeal among customers), but Q4 would fall a few points because the computers would cost less, bringing in "less" money but propagating more sales.
I don't like the idea of an iPod nano touch - that's such a long product name. How many people do you know who already prefer saying (whether consciously or subconsciously) "iTouch" rather than "iPod touch." And an iPod nano? Personally I highly doubt this - If they could make the iPhone any smaller (while sustaining its key features), they would have with the 3G update. It just doesn't sound very appealing - let the iPhone continue to climb what will become a very high mountain.
I just don't see how an iPod "transition" would be brought about in order to shut down competition. The iPod line hasn't had a formidable competitor yet - I don't know the numbers, but come on, people... Until Apple sees a significant decrease in iPod sales / customer interest, I don't see any need for a dramatic "product transition."
This has everything to with Macs, in my opinion. The iMac is going to become more mainstream... Macs, Macs, Macs... We shall see!
I just don't see how an iPod "transition" would be brought about in order to shut down competition. The iPod line hasn't had a formidable competitor yet - I don't know the numbers, but come on, people... Until Apple sees a significant decrease in iPod sales / customer interest, I don't see any need for a dramatic "product transition."
Of course it does. The very reason the iPod line is still the leader is because they've constantly evolved it. Always a step ahead of the competition. This transition would "shut out" the competition because multi-touch technology is patented by Apple. The competition could never copy it.
The mobile platform is Apple's future. They've already got a great lead with the iPhone/iTouch and all the developers on board with the "app store." Bringing this technology to Apple's best selling mobile device would cement OSX/multi-touch technology as the de facto standard mobile platform.
Besides, how much more can they really innovate the current nano and classic line? It's about as thin and small as it can get. Time for a real "transition" into the next generation of touch mobile devices.
Of course it does. The very reason the iPod line is still the leader is because they've constantly evolved it. Always a step ahead of the competition. This transition would "shut out" the competition because multi-touch technology is patented by Apple. The competition could never copy it.
The mobile platform is Apple's future. They've already got a great lead with the iPhone/iTouch and all the developers on board with the "app store." Bringing this technology to Apple's best selling mobile device would cement OSX/multi-touch technology as the de facto standard mobile platform.
Besides, how much more can they really innovate the current nano and classic line? It's about as thin and small as it can get. Time for a real "transition" into the next generation of touch mobile devices.
I understand your point to a certain extent, but I still see no idea for a DRAMATIC change. I'm not suggesting that Apple rest on its laurels - in fact I'm sure a "refresh" for the iPod line is in the works. But I think what's key to this "product transition" is its relevance to competition. Unless the iPod touch is set to drop to $99, I don't see how a few evolutionary changes to the iPod line would affect Q4 figures as Apple is suggesting.
I'm as stumped as everyone else, but remain convinced that hefty changes (design, price, what have you) to Macs are key, here.
They do know how to stir the pot of rumor and speculation. My guess is they are replacing the chips (possibly in laptops) with chips of their own design. Isn't that why they acquired PA semi? That would be a transition to shut out rivals.
Chuck,
You don't really think things move from acquisition of key personnel through all phases of development (design, prototype, improve, systems integration, system design document, fabrication orders, parts acquisition, manufacturing, & shipping) in just two months do you?
The payoffs from PA Semi are at least two years out. And don't tell me that you don't think Apple looks ahead that far. I guarantee you their draft roadmap goes out at least 5 years.
The thing that makes the most sense is that the Macbook Airs are ALL going to be getting solid state drives (some of them quite large in terms of data storage) and will all be significantly cheaper. This will damage margins in a significant way.
Another prediction. If margins are really going to be damaged to the tune of 3% on the September quarter, then the release of this product is either going to be fairly soon, or it is expected to be a huge launch (or both).
Thompson
I understand your point to a certain extent, but I still see no idea for a DRAMATIC change. I'm not suggesting that Apple rest on its laurels - in fact I'm sure a "refresh" for the iPod line is in the works. But I think what's key to this "product transition" is its relevance to competition. Unless the iPod touch is set to drop to $99, I don't see how a few evolutionary changes to the iPod line would affect Q4 figures as Apple is suggesting.
I'm as stumped as everyone else, but remain convinced that hefty changes (design, price, what have you) to Macs are key, here.
It's not about dropping prices, it's about keeping prices the same and including mulit-touch.
The current nano starts at $149... If Apple keeps the price the same but adds multi-touch and wifi. It will shut out the competition.. They won't make as much per unit, it will definitely affect their profit margin, but it will bring 10's of millions of new customers into the "app store" and onto Apple's new mobile platform.
This is going to bring even more developers in to the gates, and as I said, it will turn Apple's mobile platform into the de facto standard. Competition could never match what Apple would be doing.
Chuck,
Another prediction. If margins are really going to be damaged to the tune of 3% on the September quarter, then the release of this product is either going to be fairly soon, or it is expected to be a huge launch (or both).
You mean like iPods?
It's not about dropping prices, it's about keeping prices the same and including mulit-touch.
The current nano starts at $149... If Apple keeps the price the same but adds multi-touch and wifi. It will shut out the competition.. They won't make as much per unit, it will definitely affect their profit margin, but it will bring 10's of millions of new customers into the "app store" and onto Apple's new mobile platform.
This is going to bring even more developers in to the gates, and as I said, create Apple's mobile platform as the de facto standard. Competition could never match what Apple would be doing.
If it's not about dropping prices, then why would the whole "expensive at first, less expensive later" thing be mentioned? I think this is about making Apple's products (again, I'm vying for Mac products) more accessible to a wider array of people.
The immense success of the App Store (and, as I'm sure you'll agree, I think this thing is really only just beginning to take off) is definitely worth mentioning - and you are right, what with its wild popularity among customers AND developers, I don't think it's something that competitors could even begin to match/copy. But designing a nano with touch capabilities would be both difficult and risky - I'm getting better each day with the "touch keyboard" on my iPod touch, but I still know a good number of people who are put off by the small "keys" and lack of tactile feedback. The iPod nano is a hugely successful product, so it certainly is a key player...
I just feel as though (and maybe this is just a personal preference/bias) Apple's real treasure is its Mac product line. I'm still astounded by how well my iMac functions - I knew NOTHING about Macs and within weeks was getting things done faster and more efficiently due to Tiger. Using the computer has become less of a chore and more of a pleasure. I understand that "the industry" is still controlled by Windows, but why anyone would prefer, in some sort of "blind test", a PC over a Mac is truly beyond me.
Extending this type of enthusiasm from a small percentage of computer-users to those who know Macs only as "cool but expensive" MUST be a goal of Apple's - and significantly slashing the price of iMacs and MacBooks would certainly help them attain it.
That is a really good thought, I never thought about the possibility of apple already being in a position to use a PA Semi hardware. I always thought the rumor of the video conferencing on the iPhone was a Killer application,but thought it probably got pulled because of poor performance. Maybe with the help of PA Semi they will have the power to add this to their new product. iPod web
If it's not about dropping prices, then why would the whole "expensive at first, less expensive later" thing be mentioned? I think this is about making Apple's products (again, I'm vying for Mac products) more accessible to a wider array of people.
The immense success of the App Store (and, as I'm sure you'll agree, I think this thing is really only just beginning to take off) is definitely worth mentioning - and you are right, what with its wild popularity among customers AND developers, I don't think it's something that competitors could even begin to match/copy. But designing a nano with touch capabilities would be both difficult and risky - I'm getting better each day with the "touch keyboard" on my iPod touch, but I still know a good number of people who are put off by the small "keys" and lack of tactile feedback. The iPod nano is a hugely successful product, so it certainly is a key player...
I just feel as though (and maybe this is just a personal preference/bias) Apple's real treasure is its Mac product line. I'm still astounded by how well my iMac functions - I knew NOTHING about Macs and within weeks was getting things done faster and more efficiently due to Tiger. Using the computer has become less of a chore and more of a pleasure. I understand that "the industry" is still controlled by Windows, but why anyone would prefer, in some sort of "blind test", a PC over a Mac is truly beyond me.
Extending this type of enthusiasm from a small percentage of computer-users to those who know Macs only as "cool but expensive" MUST be a goal of Apple's - and significantly slashing the price of iMacs and MacBooks would certainly help them attain it.
Because if you listen to the call, Oppenheimer repeatedly talked about bringing technologies into the un-released product (line) that would shut out the competition.. He said nothing about cutting prices affecting the profit margin, he clearly said the technologies used would affect the profit margin..
Since Apple has patents on multi-touch, and they've aleady used on it on the top end of the iPod line, incorporating this technology further down the line is into the nano is the logical next step. Especially since it will be so beneficial now that the "app store" is here. This would shut out the competition.
A) The profit margin will stay at 35% until this new product is released.
b) This product won't be announced until August 19th at the earliest.
That means if the plan is to have a 30% unit margin at the end of the quarter, they are going to have something like a 25% margin for the second half of the quarter. Now since they are reducing the margin, we know they are planning to increase the volume. This means the mystery transition cannot be a new product. No product, however cool, is going to sell over a million units in the first month. There is literally no new product that Apple could introduce that would sell enough units within the first month to lower the per unit margins by 10%. So the change must involve some existing product.
I think there are two realistic options here. First, they sell more by reducing the price of the new MacBooks and MacBook Pros. A real possibility. Second, they sell more by keeping the price the same and adding an expensive component to one of their existing products. If the margins do go down because of more expensive components, the only real options are the MBP and the iPod. The iPhone isn't in for an update, and none of the other products ship enough units to have this big of an effect on the unit margins. In terms of components, the options are basically SSD, Blueray, or DDR3 for the MB and MBP and more SSD for the iPod. Blueray and faster RAM are unlikely to generate enough excitement among the general public to increase the units shipped enough to make up for the smaller margins, unless DDR3 uses so much less power that it drastically increases battery life. This is unlikely. So almost certainly what we are looking at here is either a sharp price drop in MBs and MBPs, or else adding SSD to the MB and MBP or else adding massive amounts of SSD to the iPod touch and eliminating the other iPods.
Because if you listen to the call, Oppenheimer repeatedly talked about bringing technologies into the un-released product (line) that would shut out the competition.. He said nothing about cutting prices affecting the profit margin, he clearly said the technologies used would affect the profit margin..
Since Apple has patents on multi-touch, and they've aleady used on it on the top end of the iPod line, incorporating this technology further down the line is into the nano is the logical next step. Especially since it will be so beneficial now that the "app store" is here. This would shut out the competition.
I see your point clearly and do think you are very right - but I stand by my belief that we will see significant price-cuts and modifications to the Mac product line.
Two assumptions:
A) The profit margin will stay at 35% until this new product is released.
b) This product won't be announced until August 19th at the earliest.
That means if the plan is to have a 30% unit margin at the end of the quarter, they are going to have something like a 25% margin for the second half of the quarter. Now since they are reducing the margin, we know they are planning to increase the volume. This means the mystery transition cannot be a new product. No product, however cool, is going to sell over a million units in the first month. There is literally no new product that Apple could introduce that would sell enough units within the first month to lower the per unit margins by 10%. So the change must involve some existing product.
I think there are two realistic options here. First, they sell more by reducing the price of the new MacBooks and MacBook Pros. A real possibility. Second, they sell more by keeping the price the same and adding an expensive component to one of their existing products. If the margins do go down because of more expensive components, the only real options are the MBP and the iPod. The iPhone isn't in for an update, and none of the other products ship enough units to have this big of an effect on the unit margins. In terms of components, the options are basically SSD, Blueray, or DDR3 for the MB and MBP and more SSD for the iPod. Blueray and faster RAM are unlikely to generate enough excitement among the general public to increase the units shipped enough to make up for the smaller margins, unless DDR3 uses so much less power that it drastically increases battery life. This is unlikely. So almost certainly what we are looking at here is either a sharp price drop in MBs and MBPs, or else adding SSD to the MB and MBP or else adding massive amounts of SSD to the iPod touch and eliminating the other iPods.
Good post. I agree that adding SSD to the Macbook and MBP could create the same profit margin effect..
However, I don't believe a move like this could be seen as "shutting out the competition." Any of Apple's competitors could also add SSD to their notebooks and quite frankly, most of Apple's competitors sell more units and operate on much slimmer profit margins to begin with.. So a move like this would not so much "shut out" the competition as it would bring Apple more in line with the competitions margins.
I'm still convinced it's the iPod line going touch. nano included.