[quote] Microsoft Office is a VERY MINOR piece of business software here in America. Most businesses and industries have thousands of "in-house" or "PC-only" custom software programs that they use on a daily basis.
Hospitals have specific RECORDS software. Libraries have specific INVENTORY software. Engineering firms have specific BOARD LAYOUT software. Et-cetera...
Um, so?
The point is that even IF industry made the shift to the cMac, there would be very FEW developers who could supply them with the necessary software to do their daily jobs.
<hr></blockquote>
I agree, for established businesses with PC-only software already establsihed as part of their business processes, it is going to take more than a cut-price desktop Mac to make them "switch". I don't expect all enterprise customers to suddenly come flocking. But then these people aren't going to be in the market for Xserves either.
The thrust of my argument in starting the discussion on an enterprise-focused cut-price Mac, rather than a cheap consumer offering, is that if Apple is serious about making some inroads into the enterprise market then I think it needs to offer a client machine attractive to businesses as well as the server.
If Apple were to do this, their target customers would clearly not be large enterprise with susbstantial investments in custom PC software, it is going to be start-up businesses or those with more limited requirements for very specialised software. Not everyone needs to run engineering design software.
And as for the records and inventory software you refer to, if you have read the whole of this thread, you will see that we have already discussed how much of this database-type software is moving towards server-fed systems feeding to a simple front-end application or even to just a web browser. This means that once you have your custom server software set-up to handle your central database, eg patient records in a hospital, then the client can be any platform that runs a web browser. This is the way that many developers are moving. I personally know two patient records products that are currently in the process of being re-written from the ground up to work cross-platform through a web-based interface.
It is much harder to make enterprises with huge investments switch - it is simply not feasible in the near future, but the market is much more than established enterprises. There are new businesses starting up every day. It would be nice to think that new businesses starting up with a simple-to-manage Apple server/client set-up would have enough competitive advantage to overtake their established PC-using competitors with their vast IT support requirements. If that was the case Apple wouldn't need anyone to switch to dominate the market, the PC-using companies would simply become extinct. But that would be to overestimate the importance of the desktop computer in delivering a successful business!
<strong>Will someone explain how this works in the wintel world? If you can buy a $399 or $599 or $x99 pc then why does anyone buy a pc for $1,500 or $2,500 or $3,500 or more?</strong><hr></blockquote>
Well, if you're a HARDCORE gamer, then you can very easily rack up some $$$ on your PC purchase.
Consider this. The ATI Radion 9700 Pro and the GeForce 4Ti video cards cost anywhere from $350 to $400. If a gamer were to purchase an entry-level eMachines or Dell for $450, the video card purchase alone would bring them up to around $800 to $850.
But many gamers are not content to settle for a 1.x GHz Pentium IV processor. They want the best. An upgraded chipset and motherboard can cost anywhere from $200 to $400 for the cutting edge 2.x GHz Pentium IV or Athlon. That brings the dollar amount up between $1000 and $1250.
And then, there's the Hard Drive equation. Bar none, the slowest internal device on ANY computer is the HD. So out come the default 40G drives with 2MB cache, and in goes a RAID card with two (or more) 100G drives with 8MB cache. This can cost anywhere from $250 to $400, depending on the HD maker and size. Now, the dollar amounts are $1250 and $1650.
But wait, there's more. You have to get the Dolby Digital 6.1 sound when you're gaming. Any less would be uncivilized. The best audio cards retail between $100 and $200. And the Satellite speaker systems that use them will run $75 to $175. So, upgrading to professional sound will raise the stakes to $1425 and $2025, respectively.
I could keep going, toying with CRT and LCD monitors and Ethernet cards, but you get the point. When it comes to PC technology, the sky's the limit.
And then, there's the Hard Drive equation. Bar none, the slowest internal device on ANY computer is the HD.</strong><hr></blockquote>
Except for the optical drive(s).
[quote]<strong>So out come the default 40G drives with 2MB cache, and in goes a RAID card with two (or more) 100G drives with 8MB cache. This can cost anywhere from $250 to $400, depending on the HD maker and size. Now, the dollar amounts are $1250 and $1650.</strong><hr></blockquote>
There's usually an inverse relationship between storage density and HDD speed, so it's probably a good thing that the really big drives have really big caches. For real speed, of course, you'd go to hardware RAID on Gb fiber channel with 8 or 16 15K drives, and that sends the price up into the tens of thousands of dollars.
I assume that most gamers accept a compromise there. Especially since it would be hard to hear the sound coming through your nice 6+1 speaker system with 16 15K drives roaring nearby.
I read about the EU's concern that Microsoft is trying to take over the cell phone market, by making cell phone hardware simply a channel for their software. If this happens, Microsoft controls the phones, and everyone else is in a rat race to build the cheapest hardware for Microsoft's system, just like the PC market today. This made me look at Apple's market share problem in a little different light. I guess Dell figured out how to be king of the cheap hardware rat race in the PC market. I wonder whether Dell even designs their own motherboards? They likely get XP Home Edition for about 40 dollars. With Microsoft's sales volume, they can sell if fairly cheap. Apple has a real problem selling against this kind of competition. The former Mac user I know who just switched to a cheap Dell is very happy with it.
Apple needs to offer something in this low end market but must charge more to stay profitable. Can Apple provide some obvious advantage to offset a slightly higher price tag? In the home market, possibly a cute design would attract enough buyers. In business, possibly something related to the way Microsoft charges fees provides an opportunity for Apple to compete. In education, I don't have any ideas, but Apple needs to find or make more advantages to having Macs in school. Even so, Apple still needs a low end Mac without a monitor.
Some of this discussion has been on dirt cheap computers for the home market, but others stress the need for low cost computers in business and schools. Here is Gateway's latest pitch to the business market.
"The version of the E-2000 with a small chassis starts at $889 and includes a 2GHz Intel Celeron chip, 128MB of RAM, a 40GB hard drive, a CD-ROM drive and a 15-inch monitor. The E-4000 with a small chassis features a 1.8GHz Intel Pentium 4 but not the monitor; otherwise, it is the same configuration. It starts at $739."
The prices are not that low, and the new.com article noted prices from other PC makers, and they are all in this same ballpark. Apple could easily build a Mac to compete with that $739 E-4000 without monitor, and it would likely sell in schools too.
At the current level of market share Apple has, they manage to just break even. Apple has to pay for a lot of R&D on its systems, and the cost that is born by a single sale is inversely proportional to the number of sales.
Conclusion:
If Apple loses anymore market share they will have to raise prices to cover per machine costs ( R&D, adverising etc ). If they raise prices, they will loose sales, and they will enter a sprial of diminishing market share untill they go bankrupt.
The inverse of this applies. If Apple increases market share, they can reduce prices because costs like R&D, and marketing, can be amortised across a larger number of sales.
The critical assumption is that price will significantly impact sales ( positively, or negatively ). I believe this is true. Anecdotaley, many people arent buying Mac's because they cant afford to, not because they dont want to.
I think this points towards Apple's need to get a cheap machine out there for the masses. They have managed to keep the iBook cheap, now they need to push hard on the eMac or iMac.
Not enough. Those cheap machines need to be fully featured, expandable (that means CPU and GPU and choice of monitor) and fast relative to the PC competition.
Right now, the consumer machines, while being too expensive, are also too slow and completely unexpandable. RAM and USB/firewire don't count, all decent PC's come with these as well.
The reason why business and industry are so apt to choose the PC over the Macintosh is that there are Millions of developers and Thousands of private development firms that do nothing but make custom software solutions.
If Apple really wants to break into business and industry, they need to make sure that a Cocoa Programming Solution is taught at every major Community College and University in this country. They need to ENCOURAGE people to take the courses (re: discount on Hardware), and to become certified.</strong><hr></blockquote>
This is a good point. Unfortunately, it's hard to start OS X development courses all over the place if OS X developers are relatively rare. Big Nerd Ranch has the model they have and the prices they have because they aren't exactly mobbed with applicants.
It's a vicious cycle.
I think that's why Apple is pushing Cocoa so hard: It's a RAD platform that scales up nicely to enterprise development. It's why they have Java on board. REALBasic, with its (intentional) similarity to Visual Basic, is another advantage, and so is FileMaker.
All they have to do is get people using them.
Also, their Windows integration still needs some work. If they can make it seamless, it'll be much better than Windows is. I just spent today in an office wired for 100 Base-T, with an 802.11b wireless node covering the whole office on top of that, working on a file on a network share... and I still had to pass data to the guy I was working with on a floppy because no one could figure out how to get his laptop to fully acknowledge the network. No wonder Dell still ships their laptops with the silly things.
[quote]<strong>Would a less-expensive Macintosh be able to sell more easily to more consumers who would, in turn, purchase more Macintosh products in the future and "sell" the MacOS platform to others?</strong><hr></blockquote>
Maybe, but if Apple can get into business, and claw themselves back into growing their market share in education, they can convince more people to consider Macs for their own use, and vice versa. Network effects trump prices.
Can you imagine what would happen if Apple introduced a G3 box for $799? Or even a G4 box for $1099? The flood of orders would be overwhelming...there are an awful lot of 8660/9600/B&W towers out there that are just waiting to upgrade. Sadly, and as mentioned above, there is not enough chip differentiation to prevent the cannibalization of the iMac nor G4 tower market should Apple follow that path. It would sure boost market share but, at the expense of profits. Thus, it would be suicidal. If Apple raised the curtain on such an inexpensive box you can bet that a 970 based machine sits beside it behind yet another curtain.
If rumors start to surface of a cheap headless Mac coming at MWSF then it ought to tip everyone to the fact that the 970 will also debut.
Personal Mac history: Plus, Centris 610, 4400, 8600, B&W , 970. In case anyone cares.
<strong>Can you imagine what would happen if Apple introduced a G3 box for $799? Or even a G4 box for $1099? The flood of orders would be overwhelming...there are an awful lot of 8660/9600/B&W towers out there that are just waiting to upgrade. Sadly, and as mentioned above, there is not enough chip differentiation to prevent the cannibalization of the iMac nor G4 tower market should Apple follow that path. It would sure boost market share but, at the expense of profits. Thus, it would be suicidal. If Apple raised the curtain on such an inexpensive box you can bet that a 970 based machine sits beside it behind yet another curtain.
If rumors start to surface of a cheap headless Mac coming at MWSF then it ought to tip everyone to the fact that the 970 will also debut.
Personal Mac history: Plus, Centris 610, 4400, 8600, B&W , 970. In case anyone cares.</strong><hr></blockquote>
I disagree. There'd be no flood of orders. If they were half what WinTel is, which would be $200 per box, they still wouldn't get to 15% market share.
Frankly "some" people need to get the idea, this is business.
Using scavy terms like "elasticity" and "profit margins" basically economic and business terms works to a person's creditbility in this case because it show they have an idea what plays out in a comference room. WHERE THEY DISCUSS THIS.
Yes even the(IMHO) majorly flawed senerio of "Stagflation Steve" get discussed in conferences before getting hands down rejected. Firstly. Dell's a repackager Apple is clearly not. Second, Dell is an economy of scale company, Apple isn't. Thirdly business models don't get done in in 4 WEEKS. Missing the buying season by far.
Apple main goal, if they wish to counter this, is to think smart, and think different. There is a basical principal that PRICE CUTTING is the LAST opinion in a counterattack for any BUSINESS.
This issue is much to complex even without the facts. But the obvious choice already shows(as with past history) don't follow Dell unless you're Dell. Many companies learned this the hard way.
You don't slam into a 500 pound gorrilla because it's slamming into you.
I disagree. There'd be no flood of orders. If they were half what WinTel is, which would be $200 per box, they still wouldn't get to 15% market share.</strong><hr></blockquote>
Would you care to explain the flood of orders for the new $999 iBook?
When Apple fights on price, they have no difficulty selling Macs, there is no reason to believe their ability to sell credible notebook wouldn't be mirrored if they were to come to the table with a credible desktop
Remember, it worked with the original iMac, unfortunetly the market changed and Apple didn't change with it, thus it's current position.
[ 11-20-2002: Message edited by: Stagflation Steve ]</p>
Unless Apple offers a competitive entry level desktop they are screwed, Apple has no trouble offering competitive notebook systems,
If Apple can make an inexpensive and competitive laptop, why the **** can't they make a desktop?
my customers ask me that day-in-day-out
Take the guts out of the iBook, stick it in a white box, sell it without a monitor for $599 and everyone is happy!</strong><hr></blockquote>
First off, I agree with you that Apple needs a lower priced desktop. I know of many large orders sold to education accounts were going for around $1K 2 years about and were about $900 last year. I don't know about this year, but I wouldn't be surprised if it was around your $599 price. This is a moving figure. Next year it may be $500 or maybe the Gateway $399 as mentioned in this tread title. It also could go up. Quite a few people don't seem to understand that although the general trend in computers is to go downward in price, and upward in features and power, that prices also sometimes go higher. The PC industery is not immune to the laws of supply and demand. PC manufacturers, especially Dell, are better at concealing these price increases as they tend to discontinue older cheaper products and replace them with higher priced models when prices go up. I do suspect that prices will go to higher levels once the market bottoms out and enough companies go out of business. Fewer companies producing products=less supply. However, I do not believe that prices will ever return to the high levels Apple is used to.
I do recall some rumors last year of very low Macs that could only run OSX. I wonder what happened to them. The were probably bogus, but I wonder if there is/was some truth to them.
I do believe one of the biggest missed opportunies of Apple is that they have a much closer relationship to IBM and Motorola through AIM than Intel has with its customers. Apple could have had a custom G3 made simular to the embeded PowerPCs and did an end run to go where Intel won't go, but VIA did, to make a very low cost Mac. Sadly that just isn't something in Apple's blood.
There has been some comment of Mac users switching to Wintel. I suspect that many of them are OS 9 users who see the change to OS X as big as the change to Windows and it is a good time to jump ship.
Something to remember. Dell, Intel, and Microsoft are not doing what they are currently doing for your benefit, they are doing it for their own. What has happened to the computer industry is freaking awesome for the consumer, but it won't last. We are being played.
There has been some comment of Mac users switching to Wintel. I suspect that many of them are OS 9 users who see the change to OS X as big as the change to Windows and it is a good time to jump ship.
</strong><hr></blockquote>
I know several who switched, and they all had the same reason, price. They have simple computer needs, and use their computer to do email, word processing and run preschool kid games in some cases. They all had older PPC and 68K Macs and felt a need to upgrade a bit -- bigger hard drive, faster modem and all the little things that have improved over the last few years. They liked the Mac, but a low priced Windows PC was irresistible.
Economies of scale are there for anyone who can create the neccessary scale. IF Apple, with money in the bank, and an exceedingly loyal customer base (one now distilled nearly to its most fanatical followers) finds this proposition too risky, then it's too risky for anyone. 2 out of every 3 computer makers should already be out of business by that logic. And who knows, they may be shortly, but let's keep it brief for now.
Competing on price never killed anyone except those who proved unable to do it. That means you can't get stupid, sell at a loss, not have alternate revenue streams in place (software, services, support, institutional, etc etc). If Apple does not have those structures in place, that's not Steve's fault, it's Apple's, and it points to poor long range forcasting on their part.
Comments
Hospitals have specific RECORDS software. Libraries have specific INVENTORY software. Engineering firms have specific BOARD LAYOUT software. Et-cetera...
Um, so?
The point is that even IF industry made the shift to the cMac, there would be very FEW developers who could supply them with the necessary software to do their daily jobs.
<hr></blockquote>
I agree, for established businesses with PC-only software already establsihed as part of their business processes, it is going to take more than a cut-price desktop Mac to make them "switch". I don't expect all enterprise customers to suddenly come flocking. But then these people aren't going to be in the market for Xserves either.
The thrust of my argument in starting the discussion on an enterprise-focused cut-price Mac, rather than a cheap consumer offering, is that if Apple is serious about making some inroads into the enterprise market then I think it needs to offer a client machine attractive to businesses as well as the server.
If Apple were to do this, their target customers would clearly not be large enterprise with susbstantial investments in custom PC software, it is going to be start-up businesses or those with more limited requirements for very specialised software. Not everyone needs to run engineering design software.
And as for the records and inventory software you refer to, if you have read the whole of this thread, you will see that we have already discussed how much of this database-type software is moving towards server-fed systems feeding to a simple front-end application or even to just a web browser. This means that once you have your custom server software set-up to handle your central database, eg patient records in a hospital, then the client can be any platform that runs a web browser. This is the way that many developers are moving. I personally know two patient records products that are currently in the process of being re-written from the ground up to work cross-platform through a web-based interface.
It is much harder to make enterprises with huge investments switch - it is simply not feasible in the near future, but the market is much more than established enterprises. There are new businesses starting up every day. It would be nice to think that new businesses starting up with a simple-to-manage Apple server/client set-up would have enough competitive advantage to overtake their established PC-using competitors with their vast IT support requirements. If that was the case Apple wouldn't need anyone to switch to dominate the market, the PC-using companies would simply become extinct. But that would be to overestimate the importance of the desktop computer in delivering a successful business!
<strong>Will someone explain how this works in the wintel world? If you can buy a $399 or $599 or $x99 pc then why does anyone buy a pc for $1,500 or $2,500 or $3,500 or more?</strong><hr></blockquote>
Well, if you're a HARDCORE gamer, then you can very easily rack up some $$$ on your PC purchase.
Consider this. The ATI Radion 9700 Pro and the GeForce 4Ti video cards cost anywhere from $350 to $400. If a gamer were to purchase an entry-level eMachines or Dell for $450, the video card purchase alone would bring them up to around $800 to $850.
But many gamers are not content to settle for a 1.x GHz Pentium IV processor. They want the best. An upgraded chipset and motherboard can cost anywhere from $200 to $400 for the cutting edge 2.x GHz Pentium IV or Athlon. That brings the dollar amount up between $1000 and $1250.
And then, there's the Hard Drive equation. Bar none, the slowest internal device on ANY computer is the HD. So out come the default 40G drives with 2MB cache, and in goes a RAID card with two (or more) 100G drives with 8MB cache. This can cost anywhere from $250 to $400, depending on the HD maker and size. Now, the dollar amounts are $1250 and $1650.
But wait, there's more. You have to get the Dolby Digital 6.1 sound when you're gaming. Any less would be uncivilized. The best audio cards retail between $100 and $200. And the Satellite speaker systems that use them will run $75 to $175. So, upgrading to professional sound will raise the stakes to $1425 and $2025, respectively.
I could keep going, toying with CRT and LCD monitors and Ethernet cards, but you get the point. When it comes to PC technology, the sky's the limit.
Regards,
-theMagius
<strong>
And then, there's the Hard Drive equation. Bar none, the slowest internal device on ANY computer is the HD.</strong><hr></blockquote>
Except for the optical drive(s).
[quote]<strong>So out come the default 40G drives with 2MB cache, and in goes a RAID card with two (or more) 100G drives with 8MB cache. This can cost anywhere from $250 to $400, depending on the HD maker and size. Now, the dollar amounts are $1250 and $1650.</strong><hr></blockquote>
There's usually an inverse relationship between storage density and HDD speed, so it's probably a good thing that the really big drives have really big caches. For real speed, of course, you'd go to hardware RAID on Gb fiber channel with 8 or 16 15K drives, and that sends the price up into the tens of thousands of dollars.
I assume that most gamers accept a compromise there. Especially since it would be hard to hear the sound coming through your nice 6+1 speaker system with 16 15K drives roaring nearby.
Apple needs to offer something in this low end market but must charge more to stay profitable. Can Apple provide some obvious advantage to offset a slightly higher price tag? In the home market, possibly a cute design would attract enough buyers. In business, possibly something related to the way Microsoft charges fees provides an opportunity for Apple to compete. In education, I don't have any ideas, but Apple needs to find or make more advantages to having Macs in school. Even so, Apple still needs a low end Mac without a monitor.
"The version of the E-2000 with a small chassis starts at $889 and includes a 2GHz Intel Celeron chip, 128MB of RAM, a 40GB hard drive, a CD-ROM drive and a 15-inch monitor. The E-4000 with a small chassis features a 1.8GHz Intel Pentium 4 but not the monitor; otherwise, it is the same configuration. It starts at $739."
The prices are not that low, and the new.com article noted prices from other PC makers, and they are all in this same ballpark. Apple could easily build a Mac to compete with that $739 E-4000 without monitor, and it would likely sell in schools too.
[ 11-20-2002: Message edited by: snoopy ]</p>
[ 11-20-2002: Message edited by: Paul ]</p>
<strong>this thread(the idea of this thread) is in the news: <a href="http://www.cnn.com/2002/TECH/ptech/11/20/cheap.pcs.ap/index.html"; target="_blank">CNN</a>
[ 11-20-2002: Message edited by: Paul ]</strong><hr></blockquote>
The Dell 2300 was too cheap to pass up.
At the current level of market share Apple has, they manage to just break even. Apple has to pay for a lot of R&D on its systems, and the cost that is born by a single sale is inversely proportional to the number of sales.
Conclusion:
If Apple loses anymore market share they will have to raise prices to cover per machine costs ( R&D, adverising etc ). If they raise prices, they will loose sales, and they will enter a sprial of diminishing market share untill they go bankrupt.
The inverse of this applies. If Apple increases market share, they can reduce prices because costs like R&D, and marketing, can be amortised across a larger number of sales.
The critical assumption is that price will significantly impact sales ( positively, or negatively ). I believe this is true. Anecdotaley, many people arent buying Mac's because they cant afford to, not because they dont want to.
I think this points towards Apple's need to get a cheap machine out there for the masses. They have managed to keep the iBook cheap, now they need to push hard on the eMac or iMac.
Right now, the consumer machines, while being too expensive, are also too slow and completely unexpandable. RAM and USB/firewire don't count, all decent PC's come with these as well.
<strong>The Alternative?
The reason why business and industry are so apt to choose the PC over the Macintosh is that there are Millions of developers and Thousands of private development firms that do nothing but make custom software solutions.
If Apple really wants to break into business and industry, they need to make sure that a Cocoa Programming Solution is taught at every major Community College and University in this country. They need to ENCOURAGE people to take the courses (re: discount on Hardware), and to become certified.</strong><hr></blockquote>
This is a good point. Unfortunately, it's hard to start OS X development courses all over the place if OS X developers are relatively rare. Big Nerd Ranch has the model they have and the prices they have because they aren't exactly mobbed with applicants.
It's a vicious cycle.
I think that's why Apple is pushing Cocoa so hard: It's a RAD platform that scales up nicely to enterprise development. It's why they have Java on board. REALBasic, with its (intentional) similarity to Visual Basic, is another advantage, and so is FileMaker.
All they have to do is get people using them.
Also, their Windows integration still needs some work. If they can make it seamless, it'll be much better than Windows is.
[quote]<strong>Would a less-expensive Macintosh be able to sell more easily to more consumers who would, in turn, purchase more Macintosh products in the future and "sell" the MacOS platform to others?</strong><hr></blockquote>
Maybe, but if Apple can get into business, and claw themselves back into growing their market share in education, they can convince more people to consider Macs for their own use, and vice versa. Network effects trump prices.
If rumors start to surface of a cheap headless Mac coming at MWSF then it ought to tip everyone to the fact that the 970 will also debut.
Personal Mac history: Plus, Centris 610, 4400, 8600, B&W , 970.
<strong>Can you imagine what would happen if Apple introduced a G3 box for $799? Or even a G4 box for $1099? The flood of orders would be overwhelming...there are an awful lot of 8660/9600/B&W towers out there that are just waiting to upgrade. Sadly, and as mentioned above, there is not enough chip differentiation to prevent the cannibalization of the iMac nor G4 tower market should Apple follow that path. It would sure boost market share but, at the expense of profits. Thus, it would be suicidal. If Apple raised the curtain on such an inexpensive box you can bet that a 970 based machine sits beside it behind yet another curtain.
If rumors start to surface of a cheap headless Mac coming at MWSF then it ought to tip everyone to the fact that the 970 will also debut.
Personal Mac history: Plus, Centris 610, 4400, 8600, B&W , 970.
I disagree. There'd be no flood of orders. If they were half what WinTel is, which would be $200 per box, they still wouldn't get to 15% market share.
Frankly "some" people need to get the idea, this is business.
Using scavy terms like "elasticity" and "profit margins" basically economic and business terms works to a person's creditbility in this case because it show they have an idea what plays out in a comference room. WHERE THEY DISCUSS THIS.
Yes even the(IMHO) majorly flawed senerio of "Stagflation Steve" get discussed in conferences before getting hands down rejected. Firstly. Dell's a repackager Apple is clearly not. Second, Dell is an economy of scale company, Apple isn't. Thirdly business models don't get done in in 4 WEEKS. Missing the buying season by far.
Apple main goal, if they wish to counter this, is to think smart, and think different. There is a basical principal that PRICE CUTTING is the LAST opinion in a counterattack for any BUSINESS.
This issue is much to complex even without the facts. But the obvious choice already shows(as with past history) don't follow Dell unless you're Dell. Many companies learned this the hard way.
You don't slam into a 500 pound gorrilla because it's slamming into you.
~Kuku
<strong>
I disagree. There'd be no flood of orders. If they were half what WinTel is, which would be $200 per box, they still wouldn't get to 15% market share.</strong><hr></blockquote>
Would you care to explain the flood of orders for the new $999 iBook?
When Apple fights on price, they have no difficulty selling Macs, there is no reason to believe their ability to sell credible notebook wouldn't be mirrored if they were to come to the table with a credible desktop
Remember, it worked with the original iMac, unfortunetly the market changed and Apple didn't change with it, thus it's current position.
[ 11-20-2002: Message edited by: Stagflation Steve ]</p>
<strong>Dell is an economy of scale company, Apple isn't</strong><hr></blockquote>
If Apple were to get off it's ass and begin to make even a passive credible attempt to sell macs, Apple to could benefit from the economics of scale
<strong>
Unless Apple offers a competitive entry level desktop they are screwed, Apple has no trouble offering competitive notebook systems,
If Apple can make an inexpensive and competitive laptop, why the **** can't they make a desktop?
my customers ask me that day-in-day-out
Take the guts out of the iBook, stick it in a white box, sell it without a monitor for $599 and everyone is happy!</strong><hr></blockquote>
First off, I agree with you that Apple needs a lower priced desktop. I know of many large orders sold to education accounts were going for around $1K 2 years about and were about $900 last year. I don't know about this year, but I wouldn't be surprised if it was around your $599 price. This is a moving figure. Next year it may be $500 or maybe the Gateway $399 as mentioned in this tread title. It also could go up. Quite a few people don't seem to understand that although the general trend in computers is to go downward in price, and upward in features and power, that prices also sometimes go higher. The PC industery is not immune to the laws of supply and demand. PC manufacturers, especially Dell, are better at concealing these price increases as they tend to discontinue older cheaper products and replace them with higher priced models when prices go up. I do suspect that prices will go to higher levels once the market bottoms out and enough companies go out of business. Fewer companies producing products=less supply. However, I do not believe that prices will ever return to the high levels Apple is used to.
I do recall some rumors last year of very low Macs that could only run OSX. I wonder what happened to them. The were probably bogus, but I wonder if there is/was some truth to them.
I do believe one of the biggest missed opportunies of Apple is that they have a much closer relationship to IBM and Motorola through AIM than Intel has with its customers. Apple could have had a custom G3 made simular to the embeded PowerPCs and did an end run to go where Intel won't go, but VIA did, to make a very low cost Mac. Sadly that just isn't something in Apple's blood.
There has been some comment of Mac users switching to Wintel. I suspect that many of them are OS 9 users who see the change to OS X as big as the change to Windows and it is a good time to jump ship.
Something to remember. Dell, Intel, and Microsoft are not doing what they are currently doing for your benefit, they are doing it for their own. What has happened to the computer industry is freaking awesome for the consumer, but it won't last. We are being played.
<strong>
There has been some comment of Mac users switching to Wintel. I suspect that many of them are OS 9 users who see the change to OS X as big as the change to Windows and it is a good time to jump ship.
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I know several who switched, and they all had the same reason, price. They have simple computer needs, and use their computer to do email, word processing and run preschool kid games in some cases. They all had older PPC and 68K Macs and felt a need to upgrade a bit -- bigger hard drive, faster modem and all the little things that have improved over the last few years. They liked the Mac, but a low priced Windows PC was irresistible.
If Apple were to get off it's ass and begin to make even a passive credible attempt to sell macs, Apple to could benefit from the economics of scale
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Sorry, but that proves it, Stagflation Steve is talking up its rear.
Please revise and review basic knowledge of economic principals (If you took it before even).
I think most people can ignore this poster, it's like picking on the defenseless.
~Kuku
[ 11-21-2002: Message edited by: Kuku ]</p>
Economies of scale are there for anyone who can create the neccessary scale. IF Apple, with money in the bank, and an exceedingly loyal customer base (one now distilled nearly to its most fanatical followers) finds this proposition too risky, then it's too risky for anyone. 2 out of every 3 computer makers should already be out of business by that logic. And who knows, they may be shortly, but let's keep it brief for now.
Competing on price never killed anyone except those who proved unable to do it. That means you can't get stupid, sell at a loss, not have alternate revenue streams in place (software, services, support, institutional, etc etc). If Apple does not have those structures in place, that's not Steve's fault, it's Apple's, and it points to poor long range forcasting on their part.