Over 1 million Windows to Mac converts so far in 2005?
The momentum generated by Apple's iPod digital music players and related products continues to translate into new Macintosh sales according to one Wall Street analyst who estimates that over one million Windows users have purchased a Mac in the first three quarters of 2005.
In a research note released to clients on Monday, Needham & Co. analyst Charles Wolf said the number of Windows users purchasing a Mac appears to be far higher than the firm had previously anticipated.
"If we assume that all of the growth in Mac shipments during the past three quarters resulted from Windows users purchasing a Mac, then purchases by Windows users exceeded one million," the analyst said. "Indeed, the number of Windows users purchasing Macs in 2005 could easily exceed our forecast of 1.3 million switchers in 2006."
Needham had previously estimated that 500,000 Windows users would purchase a Mac in 2005, but says its model underestimated the number of Windows users the Mac could capture because it was limited to Windows users who had purchased an iPod.
According to checks with Apple Store Specialists, Wolf also said a larger than expected percentage of Windows to Mac converts appear to be purchasing Apple's higher-end systems and that their transition is fueled by the epidemic of viruses and malware on the Windows platform.
Meanwhile, the analyst believes Apple's redefinition of the music player market with the iPod shuffle, iPod nano and video iPod continues to distance the company from its competition.
"A year ago, there was a constant stream of 'iPod killer' stories. With the introductions of the nano and video iPod, Apple has left its competitors in the dust," Wolf wrote. "Sony is the only major name-brand competitor that appears to have a future in this market, although its product portfolio is now a generation behind the iPod nano and video iPod."
While Needham had previously forecast the that hard drive-based music players would take over the market due to their larger capacities and reduced costs, the firm says Apple's simultaneous introduction of the iPod nano and discontinuation of the iPod mini "changed all of that." Needham is now forecasting that high capacity flash players will represent the largest media category, outpacing hard disk players by a more than 2-to-1 ratio over the next several years.
However, sometime around 2007 the firm expects 1-inch hard drive players -- like the iPod mini -- to make a comeback as their capacities reach 20-gigabytes. At this time, the iPodÂ?s share of the 1-inch hard drive segment should rebound, Wolf said. In the meantime, he believes 1.8-inch hard drive players will continue to play an important role because their high capacities are uniquely suited for video content.
Despite the Needham's positive comments on Apple, the firm on Monday downgraded shares of the company's stock to "Hold," saying it believes Apple shares are now "fully valued."
"WeÂ?re downgrading Apple from a buy to a hold because the companyÂ?s share price has reached our revised price target of $61," Wolf said.Â*"During the past year, in response to the introduction of breakthrough new iPods and Macs and outstanding financial results, weÂ?ve doubled our price target."
Still, the analyst hedges his bets, explaining Apple's "frenetic pace of innovation" could present new opportunities, which could trigger an upgrade at a price thatÂ?s much higher than it is today.
"New products and innovative strategies from Apple should keep coming. However, we canÂ?t quantify them in our valuation model since we donÂ?t know what they are," Wolf said. "The risks in our downgrade stem from what we donÂ?t know as well as the possibility that Windows users are migrating to the Mac platform at a far higher rate than weÂ?ve modeled."
Needham & Co. reiterated its 2006 earnings per share estimate at $1.75.
In a research note released to clients on Monday, Needham & Co. analyst Charles Wolf said the number of Windows users purchasing a Mac appears to be far higher than the firm had previously anticipated.
"If we assume that all of the growth in Mac shipments during the past three quarters resulted from Windows users purchasing a Mac, then purchases by Windows users exceeded one million," the analyst said. "Indeed, the number of Windows users purchasing Macs in 2005 could easily exceed our forecast of 1.3 million switchers in 2006."
Needham had previously estimated that 500,000 Windows users would purchase a Mac in 2005, but says its model underestimated the number of Windows users the Mac could capture because it was limited to Windows users who had purchased an iPod.
According to checks with Apple Store Specialists, Wolf also said a larger than expected percentage of Windows to Mac converts appear to be purchasing Apple's higher-end systems and that their transition is fueled by the epidemic of viruses and malware on the Windows platform.
Meanwhile, the analyst believes Apple's redefinition of the music player market with the iPod shuffle, iPod nano and video iPod continues to distance the company from its competition.
"A year ago, there was a constant stream of 'iPod killer' stories. With the introductions of the nano and video iPod, Apple has left its competitors in the dust," Wolf wrote. "Sony is the only major name-brand competitor that appears to have a future in this market, although its product portfolio is now a generation behind the iPod nano and video iPod."
While Needham had previously forecast the that hard drive-based music players would take over the market due to their larger capacities and reduced costs, the firm says Apple's simultaneous introduction of the iPod nano and discontinuation of the iPod mini "changed all of that." Needham is now forecasting that high capacity flash players will represent the largest media category, outpacing hard disk players by a more than 2-to-1 ratio over the next several years.
However, sometime around 2007 the firm expects 1-inch hard drive players -- like the iPod mini -- to make a comeback as their capacities reach 20-gigabytes. At this time, the iPodÂ?s share of the 1-inch hard drive segment should rebound, Wolf said. In the meantime, he believes 1.8-inch hard drive players will continue to play an important role because their high capacities are uniquely suited for video content.
Despite the Needham's positive comments on Apple, the firm on Monday downgraded shares of the company's stock to "Hold," saying it believes Apple shares are now "fully valued."
"WeÂ?re downgrading Apple from a buy to a hold because the companyÂ?s share price has reached our revised price target of $61," Wolf said.Â*"During the past year, in response to the introduction of breakthrough new iPods and Macs and outstanding financial results, weÂ?ve doubled our price target."
Still, the analyst hedges his bets, explaining Apple's "frenetic pace of innovation" could present new opportunities, which could trigger an upgrade at a price thatÂ?s much higher than it is today.
"New products and innovative strategies from Apple should keep coming. However, we canÂ?t quantify them in our valuation model since we donÂ?t know what they are," Wolf said. "The risks in our downgrade stem from what we donÂ?t know as well as the possibility that Windows users are migrating to the Mac platform at a far higher rate than weÂ?ve modeled."
Needham & Co. reiterated its 2006 earnings per share estimate at $1.75.
Comments
I found the following from the article to be quite powerful:
"According to checks with Apple Store Specialists, Wolf also said a larger than expected percentage of Windows to Mac converts appear to be purchasing Apple's higher-end systems and that their transition is fueled by the epidemic of viruses and malware on the Windows platform."
Apple's compelling operating system and hardware are driving the transistion. It's just the beginning.
Originally posted by Barabas
So I can play games again.
Check this out to find mac gaming info:
http://www.insidemacgames.com/
Now, I'm seeing many more 10? 15?
I can't bear to bring out my Windows (work) laptop when I'm waiting there now.
The shift... it's happening.
With Intel guts, dual boot capability, a juicier mini and wicked laptops, it will be an interesting next year.
Originally posted by fahlman
I was at my office Friday when a client and his young daughter came in to pick up a couple of tickets to the Fort Wayne Komets, of the UHL, opening night hockey game in our corporate suite. His daughter commented that she liked the computer that sat on the desk in the reception area, a grape iMac. The father asked if it was an Apple. I told him that it was and we started taking about Macs. I made a comment about how his daughter probably wanted an iPod for Christmas. He said he had 60 GB and she had a 20 GB and that when it came time for a new computer he was considering getting a Mac because he liked his iPod so much.
Small world. I grew up in Fort Wayne and still have a lot of family in the area. Unless things have changed in the past few years, there aren't very many places in Fort Wayne to get mac stuff. Unless, you drive down I-69 to Indy.
Originally posted by wymer100
Small world. I grew up in Fort Wayne and still have a lot of family in the area. Unless things have changed in the past few years, there aren't very many places in Fort Wayne to get mac stuff. Unless, you drive down I-69 to Indy.
It's pretty much the same in central Illinois, isn't it? I'm not too sure about the situation in Peoria (small world, indeed), but there's but a single store here in Bloomington-Normal that supports Mac stuff, and I believe they might only be in the hardware business. It'd really be nice if this platform shift has an effect on the focus of local computer retail businesses...
Originally posted by wymer100
Small world. I grew up in Fort Wayne and still have a lot of family in the area. Unless things have changed in the past few years, there aren't very many places in Fort Wayne to get mac stuff. Unless, you drive down I-69 to Indy.
Yeah, not too many places to get Macs. There used to be a place called MicroAge on Anthony Blvd and a place called Carper Graphic. MicroAge closed down many years ago and Carper Graphic has recently merged with Pixelcreek Technologies out of South Bend. I'm waiting for an Apple Store to be put in Jefferson Pointe, in case apple is listening.
Originally posted by wymer100
There isn't much in Peoria either unless you drive to Chicago or St Louis. It seems like Apple is still targeting the larger cities for Apple stores, particularly ones with large universities. So, I figure it'll be a few more years (if ever) before Fort Wayne or central IL gets something like an Apple store. Jefferson Point would be a nice place to put one, but I doubt it's on Apple's radar.
Heck, I'll be satisfied if the Best Buy here would just start carrying Mac software. I'm not even going to think about hoping for an Apple Store to pop up anywhere around central IL
Originally posted by amac4me
I found the following from the article to be quite powerful:
"According to checks with Apple Store Specialists, Wolf also said a larger than expected percentage of Windows to Mac converts appear to be purchasing Apple's higher-end systems and that their transition is fueled by the epidemic of viruses and malware on the Windows platform."
Apple's compelling operating system and hardware are driving the transistion. It's just the beginning.
Gee, why do you think so many windows users are buying high-end macs? Do you think its because they're so used to being able to change out video cards, adding PCI stuff, etc, or just wanting to use their own monitor, and Apple refuses to give their users that ability unless they spend $2000?
Oh, and how many more converts could they then have if they dared offer some degree of upgradability in the mid-range (you know, a cheap tower - oh, and that crappy 1.8GHz single G5 doesn't count, as it was overpriced [or underpowered, depending on your point of view] and was only in there to say "See, we got something at the $1500 level!")
All-in-ones are a plain waste of money in my view (get a new computer, throw out the monitor, yeah, that makes sense). But a mini is just way too underpowered for what I want. So I basically need to save for 4-5 years to afford a new mac. If apple made 'em cheaper to what most users want, they'd not only sell more to PC people, they'd probably sell more often to the Mac community.
Originally posted by AppleInsider
"If we assume that all of the growth in Mac shipments during the past three quarters resulted from Windows users purchasing a Mac, then purchases by Windows users exceeded one million," the analyst said. "Indeed, the number of Windows users purchasing Macs in 2005 could easily exceed our forecast of 1.3 million switchers in 2006."
Got to love that logic. Any growth must be coming from the Windows market. Gee, and how much of that could be Mac users wanting to upgrade before classic compatibility disappears, or just getting in before the initial Intel machines start being sold, causing all sorts of compatibility and stability issues. No, its got to be windows users, people who bought an ipod and go "Gee, I like this MP3 player. Now I think I should spend three times as much on a computer from the same company!" (Man, look at all the business Creative, Rio, etc, are missing out by not selling computers, since people must like their MP3 players, and, as such, would just love to buy a computer from the same company).
Originally posted by Louzer
Got to love that logic. Any growth must be coming from the Windows market. Gee, and how much of that could be Mac users wanting to upgrade before classic compatibility disappears, or just getting in before the initial Intel machines start being sold, causing all sorts of compatibility and stability issues. No, its got to be windows users, people who bought an ipod and go "Gee, I like this MP3 player. Now I think I should spend three times as much on a computer from the same company!" (Man, look at all the business Creative, Rio, etc, are missing out by not selling computers, since people must like their MP3 players, and, as such, would just love to buy a computer from the same company).
Somebody needs to take a chill pill
The thing is, the Windows/PC/Linux/Suse/HP/Compaq/Whatever world is a joke. Steve said it best in his recent Time interview: you've got someone making the hardware, someone writing the main GUI, others trying to sport applications that "play nice" with eachother... its all a mess.
Apple is coming upon a time where they've got major public support (and interest) in seeing where a great product line is headed: they've got consumers willing to follow, and anything away from the spyware/malware/virus fest of the PC world (for the past 4 or so years) will seem like a God-send.
Originally posted by psychboy
Heck, I'll be satisfied if the Best Buy here would just start carrying Mac software. I'm not even going to think about hoping for an Apple Store to pop up anywhere around central IL
That'd be great, but I'm not holding my breath. We can always dream our little dream!
Originally posted by Krob81
I've converted 11 people to Mac.
Of local and personal issue...
Intel is the largest employer in Oregon and I have a couple of family members who work there. I have spent the past few years in friendly banter over Wintel and IBMacs with me getting the advantage each and every time until they bring up price and games for the kids. Well last year, my PowerBook with iTunes blew away their desktop full of games even with the kids, and I could feel a shift in the wind. The Intel-ites started looking more envious and as they started using their cheapo mp3 players and using bad software with their cheapo digital cameras, they began thinking a switch was at least a metaphysical possibility if not a realistic probability. My brother-in-law even says that closet Mac users are outing themselves at work now!!
Well now that Apple is a partner of Intel and no longer a competitor, my relatives are almost giddy with the thought of switching. Multiply that by all of the s/w and hardware engineers working for Intel world-wide and you get an idea of a market that will "come from nowhere" next year. Just with that I'd buy more stock for the jump in sales that will be occuring. And the trickle down to other companies as they make components and periferals for MacTels will create a small but significant snowballing of switchers, too.
These people are also usually the most influencial word-of-mouth proponents to their friends who want suggestions on "what should my next computer be?"
I assume the upside with Intel employees should compensate for the downside with IBM workers at the Fishkilll plant.
Originally posted by Barabas
Even though I could do everything on PC - clean out spyware, defrag and other fun things - I no longer had to on my new powerbook and lots of time has been saved. Now I'm looking forward to a new dualcore Mactel Powerbook with dualboot XP installed. So I can play games again.
gaddam right! I manage a dual platform network and spend WAY more time troubleshooting windows' issues.
Here's a juicy Insider-tidbit I got from a local Mac Specialist:
One of the primary reasons that Longhorn changed names to Vista and was delayed a year on its release is due to Mac OS X.
A Longhorn developer, realizing the Longhorn build was based on a version of BSD, decided for kicks to see it Panther would run on it.
It did. Perfectly.
Once his findings got out, they switched the kernel to a FreeBSD relative and began applying "fixes" to keep Mac OS X from running on Wintel boxes. As that creates an all new build, Vista was born.
Set them back a year, whilst viruses and malware continue to spread on XP. How funny is that?!
Originally posted by sharp_spot
Here's a juicy Insider-tidbit I got from a local Mac Specialist:
"Specialist", eh.
One of the primary reasons that Longhorn changed names to Vista and was delayed a year on its release is due to Mac OS X.
"Longhorn"'s name wasn't changed. Longhorn was the codename of Windows Vista, just like Whistler was the codename of Windows XP. Longhorn was never intended to be the release name of a public product.
A Longhorn developer, realizing the Longhorn build was based on a version of BSD, decided for kicks to see it Panther would run on it.
Windows uses various network tools that are derived from BSD, but it is a huge stretch to say that Windows as a whole is "based on a version of BSD". Even saying that the networking stack of Windows is "based on a version of BSD" is a stretch.
It did. Perfectly.
Run on what? Run on top of the Windows command shell? Uh, no. Run on Windows' kernel? No. The Windows NT ABI is vastly different from the Apple Darwin ABI.
Once his findings got out, they switched the kernel to a FreeBSD relative and began applying "fixes" to keep Mac OS X from running on Wintel boxes. As that creates an all new build, Vista was born.
I want some of your drugs. I'm sure we can come to a good deal.