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Apple Should Get Out of Hardware?

SQLGuru writes to mention an analyst recommendation being reported on ZDNet. Despite a BusinessWeek article about Apple's record breaking hardware sales, the folks at Gartner think Apple should get out of the hardware business. Calling for the company to license its hardware to Dell, the analyst company says that gains in Apple's hardware sales are simply not sustainable. From the article: "Apple's margins for its Mac business, currently around 40 percent, are only sustainable because component makers such as Intel choose to prop up the business, Gartner claimed. Given that HP has forced Intel to offer it comparable pricing to Dell, Intel is unlikely to continue to subsidise Apple, the analyst argues. 'As a result of permanently changed market conditions, Intel has been forced to restructure and, in our opinion, cannot go on supporting Apple (or any other customer) indefinitely.'"

7 of 730 comments (clear)

  1. Apple Get Out of Hardware? by ackthpt · · Score: 5, Interesting

    Seems they tried that before and Apple was in such dire straits Jobs returned to salvage the company and close down the external Mac builders. Let's face it, Apple has survived because the dictatorial nature of product development at Apple means they can establish the trends and bail on those that don't do well, without worrying about maintaining a library of drivers even an orangitan couldn't keep up with (Ook) The PC/Windows path has Microsoft trying to keep an overweight operating system working on a staggering array of hardware combinations. Small wonder very few actually know what the heck is going on with things and most problems are countered with "did you try updating the drivers" or "Have you tried disconecting things until it works" or "You need to do a full re-install"

    I wouldn't agree with having Dell make the machines, either. Their quality isn't a shade of what it once was. Dell made their name with competitively priced hardware which was built almost as solidy as IBMs. Now it's all cranked out in China and is as good as anything else cranked out in China, so there's no real advantage over competitors.

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    A feeling of having made the same mistake before: Deja Foobar
  2. Re:Clue by ronanbear · · Score: 4, Interesting
    No kidding. Gartner says that Apple sales growth is unsustainable because their margins are too high. Even if margins drop to normal levels it wouldn't necessarily effect sales. It might effect profits though. The latest market share figures but Apple's worldwide share at about half of their share of the US market.

    I don't think people are predicting that Apple are going to overtake Dell anytime soon but they're growing and profitable. Even if Apple were to license to Dell (or HP) their hardware is unique and desirable. The latest sales figures prove that Apple don't need Dell. What's most surprising is that almost 2/3rds of Apple's computer sales come from only 3 models of laptop. Maybe that's the reason that Gartner are missing as to why Apple have such a high margin and not anything to do with Intel discounts. Top of the line laptops typically have higher margins than beige boxes discounted in their thousands.

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  3. Re:I haven't heard this one in a while. by Hes+Nikke · · Score: 4, Interesting
    When none of the PC manufacturers jumped onto USB, Apple did. The same with Firewire.

    it's this kind of rewritting of history that pissess me off. Apple came to the USB game late. what they did different was that they dropped all legacy support at the same time. USB was intoduced in January 1996. the iMac shipped (with ONLY USB ports) in August 1997.

    Firewire (an apple created technology!) took even longer for apple to adopt! it was introduced in 1995, and shipped built-in in 1999. Sony may have even beaten apple to that game!

    Hell, I think they should produce more hardware - like a Newton successor, preferably something small and that can slide into a PCMIA slot to do the syncing and charging.

    You missed an apple adoption of technology that the rest of the industy has ignored - ExpressCard. No apple computer ships with a PCMIA [sic] slot. The MacBook Pro has an ExpressCard/34 slot, so a PCMCIA sized PDA wouldn't fit anyway.
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  4. Re:For the record... by drinkypoo · · Score: 4, Interesting

    Strongly disagree. If you compare prices on similar Apple and Dell systems, you will usually find that the prices are higher on the Apple side, but only 10-20%, and that in the high end the margin disappears and your most powerful systems cost about the same either way. Of course, a clone is always cheaper, regardless of what market you're talking about, and to me that's the bottom line and the reason I don't buy Apple. Actually, there is another reason, which is that Apple does their best to bury their mistakes to help the iFanboys forget that they ever made them. I got rid of it long ago, but I had a First Generation B&W G3 that had the UDMA data corruption problem. Apple's official recommendation was to buy FWB toolkit to reduce the drive down to PIO mode which is slower and makes the IDE chip consume TONS more CPU, which IDE is bad about already; or to buy an IDE ATA card and move your drive to that. A clear Apple fuckup, which they even admitted, and they STILL didn't offer a logic board replacement to the Rev.2, where they didn't make the same mistake. This is a chip used in TONS of other hardware including UltraSparc systems (like the Ultra 1 and 2) so it's not the chip, it's Apple's inability to implement the chip.

    But this isn't the part that's most upsetting - the thing that gets me is that when Apple folded their old knowledge base into the new library, they included documents both older and newer than the one I'm talking about, but that one didn't make it in. It is clearly a deliberate omission on Apple's part to try to cover up both the fact that they fucked up a computer, and that they were unresponsive to customers who purchased it. This is of course simply a further illustration of the fact that it's a very bad idea to purchase any first-generation Apple hardware, laptop desktop or otherwise, but it also explains why. Apple's customer support is legendarily bad when they think they can get away with it.

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  5. Re:Clue by ericdano · · Score: 5, Interesting

    Being a user of both Windows and Macs, I'd say that I'd always get Apple's hardware. It might be a little more expensive than a build your own machine, but, it will last longer. The PowerMac 9500 I bought in 1996 I just recently retired. But the Windows machine I put together in 1997 got retired in 2000, then then next one was built, and retired in 2003, and the next one was built, and will be retired for a new iMac 20".

    The iMac is wonderful machine. Elegant, quiet, fast. Ok, sure, you can't open it up and add in a card. But who does? I can add a firewire/usb2 audio interface, or hard drives.

    I dunno. Looking though the last Dell catalog I got, I didn't see anything I'd buy. And the prices aren't all that much greater than Apple's stuff.

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  6. Re:Clue by not-enough-info · · Score: 5, Interesting
    Apple, on the other hand, only has to support a handful of models that they have produced themselves. They literally can have a single room somewhere with an example of every computer that their software needs to support.

    And, in fact, they do.
    http://developer.apple.com/labs/index.html
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  7. Re:For the record... by necrogram · · Score: 3, Interesting

    If that was the case, comapnies would be buying boat loads of Inspirons instead of lattitudes. Dimentions instead of Optiplex's. The reason comapny;s buy opti's and latti's are the fact its a enterprise supportable platform. If you have a D series Latti, then you just have to stock D series gear. One of our captains had his D600 replaced with a D620, didnt have to change the docking stations he had, his floppy, or any of the accessories. You dont get that with platforms like Inspiron, or Macbooks. I'm not a fanboy or mac-bashing (i think the new macbooks are damn sexy), but apple isnt an enterprise platform. There's no managment frame work that come close to openmanage or hp's insight. the fact you can have SMS push out a bios or firmware update to a few hundred desktops is why you have corperations buying them by the pallet.