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Apple Dominates "Premium PC" Market
itwbennett writes "Macs made up a whopping 91 percent of the $1,000-and-up computer market in June. Not so long ago, $1,000 got you an entry-level machine. Today the average computer sells for $701, while the average Windows machine sells for only $515. Still, Macs only make up 8.7% of PC sales. But is that really such a bad position to be in? Consider an Apples to Apples, that is, Macs to iPhones comparison: the iPhone takes only a sliver of the phone market but a much larger share of the profits."
Apple dominates the premium priced market, not the premium PC market.
Apple's appeal is that OSX is a generally better OS than Windows, particularly in the area of usability. That, not "marketing" or "aesthetics" is why people will pay more for the same hardware.
I find it amusing that people don't understand that the software itself has value.
The cake is a pie
"Premium" is sorta "more expensive" by definition. It does not necessarily mean higher quality. It just means it can summon a higher price on the market, for whatever reason.
Don't blame me, I voted for Baltar.
People that are willing to put $1,000 into their PC probably don't want the limited choices offered by OEMs. They are going to build it from parts.
That's right. When comparing the price/value of computer hardware, the cost of software does not matter. Your $700 mid-range (or upper middle or however you want to measure it) hardware is $700 worth of hardware regardless of how much you spend on software.
For the obligatory car analogy, if you buy a cheap second hand car and then put a $50,000 sound system in it, you still have a cheap second hand car. It just has a nice sound system.
Either way, time will tell.
We've been hearing this line for almost a decade now, and time has told to a tune of nearly 6-fold gain in shareholder value since 2000, giving Apple today a larger market cap than Google, HP, and Dell. I keep waiting for this grand charade to end, but Apple keeps raking in $8 billion dollars a quarter.
They've succeeded by every rational metric of business.
Don't blame me, I voted for Baltar.
It is probably more reasonable to talk about the $1.2 billion that they earn each quarter, rather than their revenues:
http://finance.yahoo.com/q/is?s=AAPL
For instance, when Google has a good quarter, they make more than that, on 70% of the revenues:
http://finance.yahoo.com/q/is?s=goog
And HP manages to only make a little more than Apple, on 340% of the revenues:
http://finance.yahoo.com/q/is?s=hpq
Nerd rage is the funniest rage.
No, I won't compare Apple's market share to Mercedes' . But just think in absolute terms : even if Macs cost double more than an average PC, the difference is only a few hundredths of dollars, which is the extra price you pay to have a "luxury" item. Now think of cars : how many people spend thousands of dollars (or your favourite currency) to have a flashier car ?
I spend much more time in front of my computer than driving my car. Hence, I am ready to spend a little more to have a luxury computer...
I've been using different GUI front ends for programming and work for over 10 years now - and Apple laptops for the last 5 years of so.
Open office is now a fully acceptable spreadsheet and word processor. Gimp is fully functional for photos. Most other services are web based. VLC, media playing, etc are all working on Linux too. Issues that used to be common are now well supported in the open-source community with networking, video acceleration, disks, USB, drivers, etc.
Apple with it's BSD-based kernel and more open culture than Microsoft, could openly embrace the open source community, however, it seems to be working actively to prevent open access to a large number of their software-hardware combinations, and refuses to embrace and support the console-using, computer-hacking crowd (like me). It is understandable from a short-term financial standpoint, but long term, I think this is a mistake for Apple. I think taking the position at the genius bar of "if you open Terminal, we won't help you" alienates the most dedicated and supportive users in the marketplace. It is that community that could rocket Apple forward with more contributions and functionality - but now they continue to be pushed to support Linux instead.
It is disappointing to me that we live in a world where large companies like Apple still grow primarily based on marketing, selling and distributing physical things over digital products, or from monetizing the support and services (and maintaining a community) around increased productivity.
The difference in price between all these products is small compared to the value of ones times spent dealing with issue that arise. Regardless of how one values their own time - after any major screw ups taking many, many hours to fix - you have already surpassed any difference in price between the systems. Reliability, functionality, and real security (and how much time you have to spend later to get those) are the real value of owning a laptop for several years, not just the initial price.
But all in all, lack of Apple support for hacking means I'll be looking seriously at a Linux-based laptop (at 1/2 the price and more open standards) for my next laptop.
They have tried, through various schemes, to compete in this market and have come up bubkis.
I believe the reason for this is it's hard to compete in the low AND high end markets at the same time, at least under the same brand.
Dell tries to do this, but the world knows dell for cheap PCs.
Cisco/Linksys is my favorite example. They keep those two brand names very separate for a good reason. What IT dept would shop Linksys for their company firewall, and who would imagine they could afford/use a Cisco at home?
Apple is known for quality, longevity, and higher price. There's nothing to gain from them trying to get any sizable portion of the low-end market. The only reason they sell the mac mini is to get PC converts, not because they want a foot in the low end market.
I work for the Department of Redundancy Department.
Where do you get that idea from? My whole company switched to Macs and productivity is up as we spend so much less time on desktop maintenance.
What desktop maintenance were you spending so much time on? Because if you were spending THAT much time on desktop maintenance you were doing it wrong.
In the last few years most of my friends have switched to Macs and they all say they're easier to use.
Yeah, a new PC out of the box from apple is setup better than same from an OEM. That's not Apple vs Microsoft. That's Apple vs HP and Sony. HP and Sony etc really need to pick up the ball to deliver a much better out of box experience.
They need to dump the shovelware, trialware, and utter crap, and invest in good quality productivity options.
I know one high level executive who's arguing with his IT department to let him use his Mac and iPhone on the corporate network because he prefers their usability and productivity.
And I know one high level executive who switched back to PC after he got tired of having to remote access or virtualize 4/5ths of the stuff he wanted to do because there was no mac equivalent, and it drove him nuts. He'd have his mail running on his Mac, then launch VMware to run the accounting software, pull up a report, and then have to jump through hoops to paste it into his email... because outlook supports OLE and when he pastes the spreadsheet bit in, he can edit it... but not on his mac, where it comes through as an image... so now he gets to copy it from the vm accounting to excel on the mac, tweak it some more, and paste it again to mail...
And now he gets to run Mac OS software update, AND windows update. Productivity dropped into the toilet. Not to mention the burden on IT as they have to handle everything they do with him as separate case.
He curses at it all day, but its what he wanted.
Don't forget: For a while, PPC *was* better than Intel. And for new users (i.e. anyone who hadn't grown up with using mice), 1 button was less confusing than two. But you know what? Things changed. Intel got off their ass and made great chips (while Moto/IBM sat on their ass with PPC) and the number of people who knew how to use a mouse became a majority of their market.
And windows users don't have to do any of those things either. Every piece of anti-virus software under the sun updates itself, completely without any human intervention, at some god awful time of night so as to avoid doing it while you may be using your computer. Similarly, right out of the box windows runs a scheduled weekly disk degrag at something like 3 am every wednesday or some other silly time. These things happen and I do nothing to cause them, I didn't even set them up originally -- they were just pre-configured that way and if I don't like them I can change them.
Nor do I have to reinstall windows yearly -- Vista on this machine has been installed for 18 months and everything is as snappy as the day I brought it home.
Try to understand, when you buy a mac you're not choosing between OS 10.5 and Windows 95. There's really major selling point of Mac over Windows at this point other than simple preference.
If you PREFER MacOS, by all means by a Mac -- but don't kid yourself into thinking you're getting something the rest of us aren't getting. We're all getting the OS of our choice and more or less the same feature set. Your preference costs more, but if you prefer it, and are willing to pay the money, then go for it.
It's common in the car market, too: Japanese car firms have done very well with their pairings of Honda/Acura, Toyota/Lexus, Nissan/Infiniti.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
Targeting some of the richest and yet least security-aware computer users could be a very profitable niche indeed.