Is Apple poised to make a serious move in PC market share?
Mar 17, 2006 at 3:03 AM Thread Starter Post #1 of 24

Graz

500+ Head-Fier
Joined
Apr 3, 2004
Posts
726
Likes
15
Disclaimer: I am not an Apple fanboy, quite the opposite actually. I've never owned an Apple PC. I've been employed by the same "major PC company", doing notebook PC development for over 11 years (don't ask me which one, but it's not Apple).

With Apple's recent move to Intel, IMO they're poised to start making serious waves in the world of PC market share. Dell and HP are the current heavyweights in both the desktop & notebook PC world with respect to worldwide market share, constantly nip & tuck between the #1 & #2 spots. Acer is rising like a rocket in the worldwide notebook PC space, having recently claimed the #3 market share spot (again, this is worldwide market share I'm talking about).

Apple, over the years has been an also-ran with respect to market share, consistently hovering around 3-5% market share, and nowhere in sight of the market share leaders. When I sit in meetings reviewing market share numbers, Apple doesn't even show up on the chart. They are routinely lumped into a category labeled "Other". This is not a dis or a slam on Apple! This is exactly where they have chosen to be with their slick, pricey electrical & mechanical designs. They play in the niche market, lower-volume-but-higher-profit-margin space, and it's worked extremely well for them. They have arguably one of the world's most recognized brands. Despite their consistently small market share, their marketing presence is as strong or stronger than any other PC brand. Many companies drool with envy at the strength and power of the Apple brand, and customer loyalty is arguably unparalleled.

So what's stopping Apple from playing the market share game with the big boys? IMO, not much...and the rest of the PC world should be more than a little worried.

My theory...
If Apple:
- transitions the majority (if not all of) their PC line-up over to an Intel-based/compatible architecture (allowing for potentially even the use of AMD CPU's)
- (gasp!) offers Windows to their customers, at least as an option
- keeps the same slick look and feel of their products, but in a somewhat cost-reduced way that would enable them to be more price competitive with the mainstream PC makers...

...you've got a formula for some very serious dent-making into the current global PC market share structure, even at the expense of alienating some of their fanatically loyal customer base.

IMO, if Apple seriously wanted to grab PC market share in a big way, they almost certainly could do it while still maintaining profitability.

Peace,

Graz
 
Mar 17, 2006 at 3:15 AM Post #2 of 24

granodemostasa

Headphoneus Supremus
Joined
Nov 19, 2005
Posts
3,760
Likes
12
thinking that the price/performance thing for apple has a chance of going down to PC levels is like thinking the grado price/performance thing will go down to beyer/akg levels.... apple seems to like their place as a premium computer company, even if they dont' sell as many.
 
Mar 17, 2006 at 3:28 AM Post #3 of 24

braillediver

Headphoneus Supremus
Joined
Jun 9, 2002
Posts
4,547
Likes
22
No. They sell ipods.

They never made any money with their PC’s and when you are a solid 2% market share well it’s still 2% market share.

“and the rest of the PC world should be more than a little worried.”
Why? If it wasn’t for the Ipod Apple would never of been profitable.

Mitch
 
Mar 17, 2006 at 3:37 AM Post #4 of 24

Wodgy

Headphoneus Supremus
Joined
Feb 24, 2002
Posts
4,657
Likes
12
Is BMW poised to make a serious move into Toyota/Honda's market share?

It's the same type of question. Apple is a premium, niche brand and it has been working well for them. They're on the upswing in sales and have picked up 2% more of the PC market over the last couple years (they were 4.5% of the worldwide PC market in the last quarter), but there is no reason for them to attempt to go mainstream, any more than there is a reason for BMW to have a go at the mainstream.

Looking at Apple as just a box vendor is largely missing the point. The ownership experience of a Mac is different. I didn't really fully grasp this until I bought my first Mac as a lark ten months ago. The premium is, in my opinion, well worth it, but there will always be reasons for people to buy a Ford or Hyundai instead of a BMW. They're all vehicles.
 
Mar 17, 2006 at 3:42 AM Post #5 of 24

Graz

500+ Head-Fier
Joined
Apr 3, 2004
Posts
726
Likes
15
Quote:

Originally Posted by braillediver
No. They sell ipods.

They never made any money with their PC’s and when you are a solid 2% market share well it’s still 2% market share.

No PC’s will never be profitable to Apple. PC’s to the vast majority of the people are dirt cheap and Apple will never be able compete on those terms. Apple’s a religion not a viable option to the masses. I’ve always known one or 2 Apple fanatics but beyond that 99.99% of the people I ever met used Windows by choice.


Mitch



I respectfully disagree with just about all of this. Make no mistake...Apple is absolutely making a profit on PC sales, and at a significantly higher margin than most of the industry.

Yes, PC's are dirt cheap but the major companies selling them are still generally making a profit at it, or at least trying to (again, I have to say that I do know this to be a fact). They're not in business to lose money. Dell is making money. HP is making money.

Apple is absolutely a viable option to the masses...as evidenced by ipod sales. Ask most 12-17 year old kids & they absolutely know what an Apple ipod is. Tell those same kids that Apple PC's don't have Intel CPU's and/or don't run Windows...they couldn't care less, but chances are they'd still like to have one.

Peace,

Graz
 
Mar 17, 2006 at 4:10 AM Post #6 of 24

Danamr

100+ Head-Fier
Joined
Dec 2, 2002
Posts
267
Likes
13
Quote:

Originally Posted by braillediver
No. They sell ipods.

They never made any money with their PC’s and when you are a solid 2% market share well it’s still 2% market share.

“and the rest of the PC world should be more than a little worried.”
Why? If it wasn’t for the Ipod Apple would never of been profitable.

Mitch



Wrong.
Apple is a very profitable company that has had tons of cash in hand even in the worst of times. What things like iPod and the itune music store have done is added even more to their bottom line and make them even more profitable. 2% to 4% of all the computers sold in the world is a lot of hardware, and Apple has a much better profit margin than Dell or HP.
So to the question of is Apple poised to make a big market gain, I don't think they really care.
 
Mar 17, 2006 at 5:04 AM Post #7 of 24

ScubaSteve87

1000+ Head-Fier
Joined
Dec 5, 2004
Posts
1,033
Likes
10
no because I really don't think thats what they want. They arn't looking to take over the PC market place, they are just looking to make money on what they can. Apple isn't stupid, PC's arn't going to go away with a big flashy apple marketing campaign. Sure some people are converting and apple will just keep selling to those people and all the other apple obsessed.
 
Mar 17, 2006 at 5:22 AM Post #8 of 24

Blitzula

Headphoneus Supremus
Joined
Aug 24, 2004
Posts
2,394
Likes
38
I don't think Apple can make big inroads into the PC market. There haven't been enough Mac changes (nor are there any Apple could make) that will make people flock to Apple or software vendors suddenly develop for their platform en masse. If it was as easy as the OP suggested, I'm sure Apple would have gone that route long ago.

I don't think they want to anyway...PC margins are so slim nowadays and they're doing just fine with the Ipod and their higher margin niche.
 
Mar 17, 2006 at 8:57 AM Post #9 of 24

Gabe Logan

1000+ Head-Fier
Joined
Mar 10, 2005
Posts
1,393
Likes
11
What if some sort of not too powerfull bargin Mac for those who want a tast of the Apple without spending a bunch.Does this sound like a good idea?I just got off work and am very tired so i could be making no sence
tongue.gif
.
 
Mar 17, 2006 at 9:08 AM Post #10 of 24

Wodgy

Headphoneus Supremus
Joined
Feb 24, 2002
Posts
4,657
Likes
12
Quote:

Originally Posted by Gabe Logan
What if some sort of not too powerfull bargin Mac for those who want a tast of the Apple without spending a bunch.Does this sound like a good idea?I just got off work and am very tired so i could be making no sence
tongue.gif
.



That's the Mac Mini. I would never have bought one had they not come out with the Mini.
 
Mar 17, 2006 at 10:42 AM Post #11 of 24

Graz

500+ Head-Fier
Joined
Apr 3, 2004
Posts
726
Likes
15
Quote:

Originally Posted by Blitzula
I don't think Apple can make big inroads into the PC market. There haven't been enough Mac changes (nor are there any Apple could make) that will make people flock to Apple or software vendors suddenly develop for their platform en masse.


Isn't the move to Intel chipset/CPU's enough of a change? What if they decide to offer Windows as an option? Software vendors wouldn't have to develop for their platform.

I'm not saying Apple should or even would decide to go after the mainstream...but what's really stopping them? The desire to maintain a prestige, high-end, niche market type of product line-up? I look at a the new Mini at a starting price point of $599, and I find that argument a little hard to agree with.

What if Apple markets one or two notebook PC's with Intel/Windows, and a sexy Apple exterior at a 15-20% premium over the mainstream notebooks with similar specs. Wouldn't people flock to that sort of product? Man, I gotta think yea, they would. When I think about the reasons why current buyers end up NOT buying an Apple when they shop for PC's...cost, compatibility, whatever...and you wipe out those reasons, I think maybe you've got some kind of formula for potential success going there.

Peace,

Graz
 
Mar 17, 2006 at 10:51 AM Post #12 of 24

fewtch

Headphoneus Supremus
Joined
Jul 23, 2003
Posts
9,559
Likes
31
I agree with the naysayers... the PC market is far too mature for Apple to make large inroads. Apple's rep as an upscale company is too ingrained, and has worked too well for them to try something different. Not gonna happen.

*However* ... I can envision them inventing some new/different and clever type of computing device that starts eating away at the market share for PCs.
 
Mar 17, 2006 at 2:24 PM Post #14 of 24

bangraman

Headphoneus Supremus
Joined
Oct 3, 2002
Posts
10,275
Likes
30
They certainly got my market share. After a long time, I've decided to fully make the switch. I'd sort of made little inroads into Apple before, but I began to see that it wouldn't really work unless you actually went all-out. I would view dual boot capability as a bonus, but honestly if I wanted something more Windows orientated I'd buy a PC. Now that access to my work is PC/Mac agnostic, I am in the middle of making a near wholesale change to Apple. I'm holding off ordering a laptop for a bit, at least until next month. I'm creating a gaming / backup PC hybrid which will probably end up being the only Windows desktop in the house.
 
Mar 17, 2006 at 5:31 PM Post #15 of 24

Meyvn

Headphoneus Supremus
Joined
Mar 5, 2006
Posts
1,992
Likes
12
Despite being a "fanboy" and an investor myself, I do not believe that Apple's switch to Intel will mean a permanent takeover of the market share. They're still mostly staying in the professional and prosumer portion of the market. The Mac mini is currently a fantastic bargain, but it's still not as cheap as the average Dell, and probably never will be. I think their market share will increase, but I don't think they will ever be poised to go after the public as a whole, simply because it's not what the company is designed to do. Perhaps after Jobs retires, someone with that mindset will take over the company. Hell, in 1997, Michael Dell said Apple should close up shop and give its investors their money back, and look at it now. But for the time being, I'm guessing a steady, small increase in market share is in order, and little else.
 

Users who are viewing this thread

Top