Cheaper Macs for increasing the market share?

[Madhatter32]

Apple tried that once in the 90's, it... didn't go very well. One of the first thing Jobs did when he came back as CEO was kill off the clone program, since the clones were mostly siphoning away hardware sales from Apple instead of bringing new users to the platform.

Regardless, I don't think there's a pressing need for Apple to expand its market share: 15% is way bigger than it used to be, and in the Web App era there's increasing less correlation between market share and software availability. Apart from AAA games, the main areas macOS suffers from lack of native software support are specialized industry applications and drivers (e.g. Solidworks in engineering), where people are ususally buying higher-end hardware anyway.

Also, one of the huge things Apple achieved with the M1 is incredible vertical integration: instead of having to support all the quirks of dozens of different 3rd-party CPUs and GPUs, they now get to control and design almost all of the hardware to work as nicely as possible with macOS. Opening up macOS to third party manufacturers would mean adding a ton more complication to their software testing and support.

You make all legitimate points. I would say the following in rebuttal:

(1) I know the history but the cloning program of the 1990s was incredibly mismanaged as Apple (which was teetering on bankruptcy anyway) lost money on the licensing fee and the clones, many would say, were superior to the computers made directly by Apple (neither would be true today);​

​

(2) the OP asked for ways to Apple to increase market share as a means to increase native software support and development (not whether it needed to do so). Even still, I believe that increasing market share is, in fact, absolutely in the interests of any company for many reasons but especially so in the case of Apple, which is very reliant on its iPhone business; and​

​

(3) vertical integration need not be sacrificed with a tightly controlled licensing program to one or two manufacturers (I am not talking about an open licensing program to everyone) that uses propriety chip sets manufactured by Apple.​

 

[Sydde]

By the way, I was very curious about the "computer in the keyboard" concept that was in the rumour mill recently. I think it could be a neat little entry-level machine for many home users.

It is an interesting thought. Given that ARM devices are low-power, I could see them building a device that has a trackpad integrated into the keyboard (in the space between the main keyboard and the 10-key), using a modified A-series CPU, that could draw its power from the HDMI or TB display cable: plug it into your television or a dedicated monitor with no need for a separate power cord. Such a device might be in the US$450+ range.

 

[southerndoc]

Again, desktops like the ones used in healthcare will have a much longer replacement cycle. They don't break and just sit there.

In a post-COVID world, many more organizations have switched out to notebooks which will push that 48% / 5 year replacement number much lower.

If the USDA and Forest Service are replacing every 5 years, don't you think it's more likely than not agencies with heavier office presence will have a similar if not shorter cycle?

I don't think you read your own articles. No, I do not think agencies with heavier office presence have similar nor shorter life cycles. I am in a government model (county) and this is not my experience, nor has it been my experience with a federal agency. I just texted a friend of mine who is over IT in an intelligence agency. When I asked him when they replace their computers (which are heavily used), he said "when they show signs of failure or aren't running things quickly enough." When pressed, he said an average of every 8-10 years for desktops and 5-7 years for laptops.

You may believe what you want, but I'm staring at reality in my own experiences.

 

[spiderman0616]

Apple is still in the middle of blowing the lid off the entire PC industry. I honestly don’t think they need to do anything other than continue down the path they’re on. The MacBook Air is already kind of the entry level “for most people” notebook and anyone that needs anything cheaper than that can just go for a Mac mini or even an iPad with a keyboard.

 

[satcomer]

The cheaper Mac I thought was the Mac Mini?

 

[Andrea Filippini]

The cheapest entry-level Ferrari is ~10x more expensive than the average new consumer car (in the world, not in wealthy countries). If anything, Apple products are too cheap to qualify even as entry-level products for a high-end brand.

Both Ferrari and Apple are consumer-oriented brand. I can't speak for enterprise computing (aka supercomputers), but for consumer computing Apple is surely a high-end brand.

 

[ian87w]

Ill just post that Steve Jobs question and answer segment.

The difference was, Jobs did try to increase marketshare, while still making great products.

Perfect examples of Old Apple:
- mac mini, originally $499, cheapest mac ever at that time.
- when announcing the aluminum iMac, Apple actually reduced the largest 24" model starting price, and replaced the 17" with a 20". So consumers will get more for less.
- iPod mini, and later iPod Shuffle, for $249 and $99 respectively. Watch Apple's keynote for those products, and it's clear Jobs was aiming for increased markethare. Every year, Apple increases the iPod storage and/or reduce price, so consumers will always get more for less.
- Keeping older iPhones, as is, to be the cheaper/entry level iPhone models. Not only this is good for Apple, this is good for consumers as well as they can enjoy the flagship iPhones for less 2 to 3 years later.

Compared those to the current Apple:
- Instead of trying to push the mac mini back to $499 price point, Apple made the Mac Studio instead for $2000.
- Instead of giving more at every refresh, Apple instead focuses huge margins on BTO upgrades.
- Instead of letting the flagship iPhones go down in price year after year, Apple discontinue the Pro iPhones every year so consumers will never enjoy premium features like telephoto lens for less than $1000.
- And instead of letting the cheapest iPhone to be the flagship from 2 to 3 years ago, Apple intentionally made the SE with old design to segregate consumers from the haves and have nots. The same with the iPad.

So the old Apple didn't blindly chase marketshare, but they did make an effort to do so in their own way. But today's apple only chases higher ASP for their quarterly reports.

 

[ian87w]

Brand value? How come iPhone SE with A15 starts at $429 instead of $700, $800, or $1000? How about iPad starting at $329?

You see, that logic already proven wrong.

iPhone SE realistically starts at $550-$600 in other countries except the US.
There are many people around the world that have to pay more and get less for Apple stuff. The fact that people are still willing to buy Apple stuff show the power of the Apple brand.

 

[JPack]

I don't think you read your own articles. No, I do not think agencies with heavier office presence have similar nor shorter life cycles. I am in a government model (county) and this is not my experience, nor has it been my experience with a federal agency. I just texted a friend of mine who is over IT in an intelligence agency. When I asked him when they replace their computers (which are heavily used), he said "when they show signs of failure or aren't running things quickly enough." When pressed, he said an average of every 8-10 years for desktops and 5-7 years for laptops.

You may believe what you want, but I'm staring at reality in my own experiences.

No, I've read it. Sorry to say, but your experience is in direct contravention of publicly available government documents.

Think about what your friend in an "intelligence agency" is saying. He's running computers that are affected by Meltdown, Spectre, and Foreshadow. Computers 10 years ago were running Windows 7 (now EOL), most of which no longer have BIOS updates for Windows 10, much less mitigations for latest attacks.

Your experiences simply don't mirror reality. I have no doubt what you're saying is true, but again it doesn't mirror what is happening in the grand scheme of things in the government.

Michigan - State Lifecycle - Current Status
The average age of deployed PCs is 2.6 years. Still it is not uncommon for desktop workstations and printers to be used past their warranty period. Currently 14% of PCs are beyond their factory warranty.

https://www.michigan.gov/-/media/Project/Websites/dtmb/Law-and-Policies/Legislative-Reports/FY2021/Sec_829_IT_Lifecycle_Report_FY_2021.pdf?rev=a84506c37389480f90f48818ba3df7ab

Minnesota
Standard Desktop Bundles Include: Replacement every five years

Desktop and Laptop Bundles / Minnesota IT Services

mn.gov

Utah
It has been the Department's practice to replace desktop computers on a four-year cycle. This is generally done between when the computers have been in service for four years and when the warranty on the computer expires. This replacement is due to be completed in fiscal year 2022.

COBI

Utah Legislature Compendium of Budget Information

cobi.utah.gov

 

[southerndoc]

?️

 

[Mr. Dee]

Apple really needs to have a notebook at the $699 price point and a desktop at $499 price point. The G4 Mini was that when they launched it over a decade ago.

Keeping around the M1, which I am sure they plan to support for many decades might actually be the best way to do that. M1 is the same chip they keep up scaling anyway. The visibility of Macs in the enterprise especially where I work is still extremely low. But its just the reality of Windows having a serious lock because of its tight integration with the management tools available like Intune and SCCM.

But if Apple could have a MacBook Air at $700 and the Mac Mini at $499, it could make some serious inroads. Don't cripple it either. We all know 256 GBs would be the minimum storage. But it could open upselling to their services like iCloud, Apple Music and Apple TV+. At 3 trillion dollars, the fact that they are using recycled aluminum, they must can make hardware at that price point that's not 's****'. As Steve Jobs use to say they can't make.

 

[ian87w]

Apple really needs to have a notebook at the $699 price point and a desktop at $499 price point. The G4 Mini was that when they launched it over a decade ago.

Keeping around the M1, which I am sure they plan to support for many decades might actually be the best way to do that. M1 is the same chip they keep up scaling anyway. The visibility of Macs in the enterprise especially where I work is still extremely low. But its just the reality of Windows having a serious lock because of its tight integration with the management tools available like Intune and SCCM.

But if Apple could have a MacBook Air at $700 and the Mac Mini at $499, it could make some serious inroads. Don't cripple it either. We all know 256 GBs would be the minimum storage. But it could open upselling to their services like iCloud, Apple Music and Apple TV+. At 3 trillion dollars, the fact that they are using recycled aluminum, they must can make hardware at that price point that's not 's****'. As Steve Jobs use to say they can't make.

Agreed, and the old Apple might do what you stated. Jobs would started at premium product, but increasing market share was not completely off the table. Perfect example was the iPod, and the fact that Apple made iPod mini, and later iPod Shuffle. Another perfect example was the 2nd redesigned MacBook Air. Jobs started MacBook Air as a premium product, but later Apple made the redesigned 13” and 11” at lower prices. Apple can increase market share with great products if they wanted to.

Current Apple is only interested in increasing their ASP. The old Apple actually innovated even at the lower segment of their products. Current Apple only recycled old designs for the baseline.

 

[JPack]

Agreed, and the old Apple might do what you stated. Jobs would started at premium product, but increasing market share was not completely off the table. Perfect example was the iPod, and the fact that Apple made iPod mini, and later iPod Shuffle. Another perfect example was the 2nd redesigned MacBook Air. Jobs started MacBook Air as a premium product, but later Apple made the redesigned 13” and 11” at lower prices. Apple can increase market share with great products if they wanted to.

Current Apple is only interested in increasing their ASP. The old Apple actually innovated even at the lower segment of their products. Current Apple only recycled old designs for the baseline.

I'd suggest some of the products you mentioned were reactionary rather than intended to increase market share. For iPod mini, there was competition from smaller, cheaper devices like Creative Zen Micro, Dell Pocket DJ, and Rio Carbon. For the MacBook Air, there was serious competition from Chromebooks from that era. Apple stuff wasn't cheap either. The iPod mini was $249 which is $380 in today's dollars. MacBook Air 11-inch was $899 which is $1,100 today.

Apple today is targeting high ASP, but the $329 iPad, $429 iPhone SE, $279 Watch SE, and $999 MacBook Air still do a great job of keeping affordability within reach.

 

[ArkSingularity]

I'd suggest some of the products you mentioned were reactionary rather than intended to increase market share. For iPod mini, there was competition from smaller, cheaper devices like Creative Zen Micro, Dell Pocket DJ, and Rio Carbon. For the MacBook Air, there was serious competition from Chromebooks from that era. Apple stuff wasn't cheap either. The iPod mini was $249 which is $380 in today's dollars. MacBook Air 11-inch was $899 which is $1,100 today.

Apple today is targeting high ASP, but the $329 iPad, $429 iPhone SE, $279 Watch SE, and $999 MacBook Air still do a great job of keeping affordability within reach.

I have the watch SE, and was surprised they were making them that cheap. It's missing some of the minor bells and whistles of the Series 7, but all in all, it's a great watch.

Apple hasn't really forgotten about their entry level segment lately (if anything, they've kinda expanded it in recent years). Macs are still pricey to get into at $999, but the Air is a ridiculously powerful machine worth every penny. The storage upgrades are still well above market price, but Apple's closest competition is probably the Microsoft Surface and the Surface is even more expensive in terms of storage than the Macs are these days. (The Surface is basically absurd if you want to get 512GB of storage. They make you upgrade several things at once and you end up paying upwards of $600 extra just to go from 256GB to 512GB).

 

[Mr. Dee]

Agreed, and the old Apple might do what you stated. Jobs would started at premium product, but increasing market share was not completely off the table. Perfect example was the iPod, and the fact that Apple made iPod mini, and later iPod Shuffle. Another perfect example was the 2nd redesigned MacBook Air. Jobs started MacBook Air as a premium product, but later Apple made the redesigned 13” and 11” at lower prices. Apple can increase market share with great products if they wanted to.

Current Apple is only interested in increasing their ASP. The old Apple actually innovated even at the lower segment of their products. Current Apple only recycled old designs for the baseline.

Considering the rumors about iPhone becoming a subscription, its either that or they make cheaper models. Because growth will eventually slow down. The hardware last longer and people keep it longer. I don‘t see myself buying another MacBook or Mac in general until 2025.

 

[ian87w]

Considering the rumors about iPhone becoming a subscription, its either that or they make cheaper models. Because growth will eventually slow down. The hardware last longer and people keep it longer. I don‘t see myself buying another MacBook or Mac in general until 2025.

True.
Apple would rather opt for a rent/subscription model than making a cheaper iPhone. Apple want to maintain that their "current" design is premium. You can get something cheaper, but it won't "look" as good (iPhone SE, base iPad). Segmentation.

Then as Apple keep pushing prices upward, and inflation as happening worldwide, it's inevitable for the rent/subscription model so people can still afford Apple products.

 

[ian87w]

I have the watch SE, and was surprised they were making them that cheap. It's missing some of the minor bells and whistles of the Series 7, but all in all, it's a great watch.

Apple hasn't really forgotten about their entry level segment lately (if anything, they've kinda expanded it in recent years). Macs are still pricey to get into at $999, but the Air is a ridiculously powerful machine worth every penny. The storage upgrades are still well above market price, but Apple's closest competition is probably the Microsoft Surface and the Surface is even more expensive in terms of storage than the Macs are these days. (The Surface is basically absurd if you want to get 512GB of storage. They make you upgrade several things at once and you end up paying upwards of $600 extra just to go from 256GB to 512GB).

I disagree. The current Apple has less and less interest in the entry level.

Let's take Apple under Jobs during the iPod era. Apple has the main iPod. Then to enter the lower segments, Apple innovated with the iPod mini, and later the iPod Shuffle. The same when Apple introduced the mac mini. Another example is the Macbook Air. It started as a premium and expensive thin-n-light, but then Apple innovated with the redesign, making it even cheaper with the 11" model.

The current Apple has no innovation at all in terms of design on the entry level, only relying on outdated old designs. Take the Apple Watch S3. That model is obviously way outdated, but Apple just couldn't be bothered to innovate something for that price point. Also, instead of pushing the S4, S5, and S6 downwards, Apple discontinue all of them and maintain the SE when they announced the S7.

We will see what they will do with the M1 Macbook Air when M2 is out. I'm guessing they'll keep it at the same $999 price with the same low config (for the price). 2 years out, and the only thing Apple wants to do is up their ASP.

 

[ian87w]

I'd suggest some of the products you mentioned were reactionary rather than intended to increase market share. For iPod mini, there was competition from smaller, cheaper devices like Creative Zen Micro, Dell Pocket DJ, and Rio Carbon. For the MacBook Air, there was serious competition from Chromebooks from that era. Apple stuff wasn't cheap either. The iPod mini was $249 which is $380 in today's dollars. MacBook Air 11-inch was $899 which is $1,100 today.

Apple today is targeting high ASP, but the $329 iPad, $429 iPhone SE, $279 Watch SE, and $999 MacBook Air still do a great job of keeping affordability within reach.

I would watch the old keynotes of those products. Whether it was reactionary or not, Steve Jobs clearly stated the goal was to gain more marketshare. My point was Apple started at the high end (iPod Classic), but instead of ignoring the lesser segments and going upwards, they innovated with great products for the lesser segments.

I'm not seeing the same thing with the current Apple. The current Apple model is only using outdated old designs to cover the entry levels, and spend almost no efforts to do anything more. The current Apple only cares about moving upwards in the price segment. 14/16" Macbook Pros, Mac Studio, iPad Air/Pro, etc.

 

[BanjoDudeAhoy]

While I’d like to see a lower priced MacBook, I think there’s another factor.
A lot of people (even a good number of tech enthusiasts) have a very specific image of Apple, its users and the ecosystem.

They see it as a lifestyle/hipster brand that sells overpriced hardware, and the software (primarily macOS since we’re mainly talking about Macs) is seen as locked down and doing less than Windows.
There’s also no willingness to learn as someone else already mentioned. A lot of people are just too used to Windows to ever consider anything else - let alone a product they see as aimed at hipsters.

Trying to explain the pricing with materials used, quality of the components etc will often led to… nothing. This “it’s overpriced, i can get the same thing for way less with Windows” is too fixed in their minds.
That “same thing” would largely be plastic, with lower quality displays, trackpads and keyboards - but cheaper, and those people wouldn’t have to learn anything new while saving money.

I think you really can’t understate that point about learning something new that, in a lot of people’s minds, doesn’t do as much as Windows or is directed at artsy folk.

I was in that camp myself until my partner got an old MacBook Pro for work at a time when I was getting increasingly frustrated with Windows (10).
So there was a free MacBook around that I could play around with and I was already curious. Neither is the case for a lot of people, I would argue.

 

[Xiao_Xi]

A lot of people (even a good number of tech enthusiasts) have a very specific image of Apple, its users and the ecosystem.

They see it as a lifestyle/hipster brand that sells overpriced hardware, and the software (primarily macOS since we’re mainly talking about Macs) is seen as locked down and doing less than Windows.

Apple marketing sells that image.

in a lot of people’s minds, doesn’t do as much as Windows or is directed at artsy folk.

What jobs did Apple show working with the Mac Studio during the presentation?

 

[ian87w]

While I’d like to see a lower priced MacBook, I think there’s another factor.
A lot of people (even a good number of tech enthusiasts) have a very specific image of Apple, its users and the ecosystem.

They see it as a lifestyle/hipster brand that sells overpriced hardware, and the software (primarily macOS since we’re mainly talking about Macs) is seen as locked down and doing less than Windows.
There’s also no willingness to learn as someone else already mentioned. A lot of people are just too used to Windows to ever consider anything else - let alone a product they see as aimed at hipsters.

Trying to explain the pricing with materials used, quality of the components etc will often led to… nothing. This “it’s overpriced, i can get the same thing for way less with Windows” is too fixed in their minds.
That “same thing” would largely be plastic, with lower quality displays, trackpads and keyboards - but cheaper, and those people wouldn’t have to learn anything new while saving money.

I think you really can’t understate that point about learning something new that, in a lot of people’s minds, doesn’t do as much as Windows or is directed at artsy folk.

I was in that camp myself until my partner got an old MacBook Pro for work at a time when I was getting increasingly frustrated with Windows (10).
So there was a free MacBook around that I could play around with and I was already curious. Neither is the case for a lot of people, I would argue.

I kinda agree as well, especially when we talk about performance. Eg. to match/exceed the M1 performance, one would need at least an i7, and the prices of i7 laptops are pretty much within the ballpark of Apple's pricing. However, Apple still skimps on RAM and storage, as usual (ie at the base $1000 price point, a Windows laptop tend to offer at least 16GB/512GB). But I agree that a well-made Windows laptop is not cheap either.

The issue is that Apple doesn't seem to be willing to go below $1000 for their laptop segment. Seems like if you're looking for a cheaper Macbook, Apple's solution is for you to get an iPad instead. I mean imagine if Apple made a cheaper Macbook with the A12Z (which is capable enough as shown by the DTK units). But Apple has decided that to join the Macbook club, $1000 is the minimum price of entry.

 

[senttoschool]

People here still don't get it.

• Apple can make a $750 Macbook SE and still make a decent profit because of Apple Silicon
• Previously, Apple relied on IBM/Intel chips, which made sub $1,000 Macbooks impossible for an Apple-standard experience
• Apple clearly wants market share with cheap iPhones, Watches, iPads. There is absolutely no reason why they wouldn't pursue the same strategy with Macs now that they have Apple Silicon
• Just targeting the premium market isn't enough for a $3 trillion company. They want to dominate the mass market too. There are also a ton of benefits for capturing the mass market because those users will eventually upgrade.
• A $750 laptop isn't at the bottom of the market. It's the average selling price of laptops. This is where Apple will draw the line. Apple isn't going to compete with $350 bargain bin laptops. No one is saying this. A $350 Macbook would hurt the brand. A $750 Macbook would not.
• A well-segmented Macbook SE would not cannibalize Macbook sales. After all, the market share in the US is only 15% and only 8% worldwide. There's plenty of market share that Macs can capture.
• The affordable Mac must be a laptop to make an impact. A keyboard Mac is a great replacement for a Mac Mini but laptops are the mass market.

 

[senttoschool]

Your idea of selling cheap iMac and MacBook would make the leadership team at Apple wince because they spent decades building the Apple brand to where it is.

Just no. Apple has ditched the "premium-only" or "luxury-only" brand a long time ago.

Apple now competes in the low-mid-end market in addition to the premium market. This is where the $400 iPhone SE, $250 Watch SE, $330 iPad 10.2, $100 Homepod Mini live.

None of these products have hurt Apple's brand.

This is also where a $750 Macbook SE makes perfect sense.

 

[senttoschool]

Apple today is targeting high ASP, but the $329 iPad, $429 iPhone SE, $279 Watch SE, and $999 MacBook Air still do a great job of keeping affordability within reach.

Apple's highest profit margin business is its services. In order to sell more services, they need to capture more market share.

Hence, Apple has dipped its toes into the mid-low-end segment with SE products.

There is no reason why Apple would suddenly stop this strategy when it comes to Macs now that Macs have Apple Silicon.

You can argue that a $1,000 Macbook Air is the lowest Apple can go. I argue that a $1,000 Macbook Air is still too expensive to be the entry-level Macbook. I believe a $750 Macbook SE is the answer because the average selling price of a PC laptop is $730. If Apple puts an M2 chip into a Macbook SE (using current MBA chassis), it'd be a killer product and would take market share fast.

 

[JouniS]

Both Ferrari and Apple are consumer-oriented brand. I can't speak for enterprise computing (aka supercomputers), but for consumer computing Apple is surely a high-end brand.

Apple is a mass market brand, while Ferrari is exclusive. Ferrari sells ~10k cars/year. Their market share is something like 0.015%. There are no high-end brands like Ferrari in consumer computing, because R&D costs are too high. If you want to make profit from custom cutting-edge technology, you must sell mass market products.