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  • Apple Lives in Another Universe!

    October 21st, 2009

    So far, just about everything Apple has done ends up confounding the skeptics. So when they were admonished to cut prices sharply, they sort of responded with the MacBook Pro, but this week introduced new iMacs, a new MacBook and Mac mini lineup, and kept the prices at the same level as their predecessors.

    How can Apple be so foolish as PC makers are fighting to dominate the bottom of the market with cheap gear?

    I suppose Apple could have simply retained their existing product lineup and shaved $200 off each model, and they would have been praised to the skies for their foresight. Instead, they added additional value to the products by offering more powerful processors, more memory, and loads of new features while not raising any prices. So if you wanted the old iMac, it’s no doubt the new iMac will be a far more attractive proposition.

    Indeed, I’m beginning to wonder whether the iMac isn’t going to cannibalize more sales from the Mac Pro, now that there is a quad-core processor option fpr the high-end version. There’s also the ability to add up to four memory modules. All right, 4GB sticks are still quite expensive, even from third-party vendors, but you could get an 8GB iMac from Apple for just $200 more than the standard versions.

    This isn’t to say there’s no market left for a Mac Pro. If you don’t need a display and require the ability to plug in even more memory and extra internal drives, you have no choice. Apple still doesn’t see a fit for a midrange minitower, in the tradition of the compact IIcx of years ago. Since desktop sales continue to decline, I can see why Apple has no incentive to expand the product lineup. At best, the new models may smooth the sales dip, but possibly not eliminate the onward migration to note-books.

    As far as I’m concerned, I still prefer my Mac Pro for most computing chores, but I can see the day where mobile quad-core processors will be nearly as powerful, and sufficiently energy efficient not to reduce battery life substantially. That, and perhaps adding two ExpressCard slots for people who really want to use them, will further reduce the need for a hefty desktop computer. It may happen in the next two or three years, in fact, and Apple might well end up discontinuing all of its desktops except perhaps the Mac Pro for users who still crave the ultimate in processing power regardless of cost.

    The critics and far too many tech companies don’t see the benefits of long-term strategy, however. They are always focusing on the current quarter and perhaps the next, without seeing the larger picture. Here’s where Apple has a demonstrated advantage. Aside from the note-book price cuts earlier this year, which doesn’t seem to have seriously hurt their profit margins, Apple didn’t pay much heed to the current global economic situation. Instead, they say they plan to continue to innovate their way out of the recession, which is something that the competition fails to realize.

    All the good news from Apple comes at an interesting time. Microsoft is still reeling from the failure of its Sidekick servers, where an untold number of customers of this fashionable but low-selling smartphone lost all their data as a result of that notorious server outage. Officially, T-Mobile is now telling customers that they have deployed a recovery tool at their Web site to help you recover your stuff. How successful this scheme will be in the real world is anyone’s guess. After all the aggravation customers suffered, even if all or most of the lost data is restored, it won’t be much compensation for folks who endured days and days of agony wondering if anything would ever be recovered.

    In any case, Microsoft is still moving full steam towards this week’s rollout of Windows 7. There are those silly house parties, ads showing that six-year-old girls love the new operating system, and lots and lots of hype. Indeed, Windows 7 has gotten some pretty good reviews too, even though it may well be that some of the compliments we made simply because it’s not Vista. But at the end of the day, and despite the fake impressions created by Microsoft and its legions of fellow travelers, Microsoft’s “System 7” is not all new, nor anything close to a major upgrade.

    In fact, it’s largely a cleanup of Vista, with some visual eye candy to convey the impression of major change. This is much the same scheme that Microsoft has traditionally employed with other products and services. Take a shave and a haircut and devise a new name, and try to convince people that everything has changed. The same stunt was pulled with their search engine, rebranded as Bing, but still no more successful in grabbing market share against Google than its predecessor — whatever that was called.

    As I write this, Apple’s market cap has exceeded that of Google. If the stock price keeps soaring I can foresee the day when they beat Microsoft too. From crazy Steve Ballmer’s standpoint, that would be the unkindest cut of all.



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