Is the PC back?

Gartner’s own press release has an interesting spin:

“After Two Years of Decline, Worldwide PC Shipments Experienced Flat Growth in Second Quarter of 2014, According to Gartner”

Gartner’s actual figure is 0.1% growth. Gartner and IDC measure slightly different quantities as “PC” but they don’t disagree much. IDC still shows declining PC sales at about -1.7%. However both also include the Mac in their accounting of PC. If we were to remove the Mac and measure “Windows PC”[1] Gartner’s figures would show -0.8% drop in PC ex-Mac shipments.

The difference in growth between the Mac and non-Mac PCs is shown in the following graph.

Screen Shot 2014-07-23 at 7-23-5.23.08 PM

As Apple puts it, the Mac grew faster (and hence gained share) for 31 out of the last 32 quarters.  It missed on this perfect record during the fourth quarter of 2012 when the then fresh new iMac was impossible to buy due to production issues.

So as far as the Mac is concerned the slowing of the decline in PC unit shipments isn’t at its expense. What has been discussed as a cause for the moderation of market contraction is the expiration of Windows XP support. Certainly that seems plausible and is supported anecdotally. If it’s true then the PC respite may be transient.

To put a finer point on it, it would be useful to know  revenues and profits  in addition to volumes. Thanks to Charles Arthur for providing most of the data that allows this picture to be drawn:

The revenue pictures shows that (non-Mac) PCs have been declining for almost four years and into the present quarter and operating margin (“profit”) has shrunk to nearly $1 billion (while being generous with “other” PC vendors).

Incidentally, the Mac is nearly the highest revenue PC brand and by far the most profitable. Indeed, it’s more profitable than all the other vendors put together.

If one includes the Mac, the PC industry may be limping along, but if we were to exclude it then this post conforms to Betteridge’s law of headlines.

  1. In quotes because this total includes Linux and Chromebook []
  • It should be noted that Windows XP was EOLd in April:

    This may have caused quite a few PC upgrades, XP-to-Win8, XP-to-ChromeOS, and XP-to-Mac.

  • vincent_rice

    “Incidentally, the Mac is nearly the highest revenue PC brand and by far the most profitable. Indeed, it’s more profitable than all the other vendors put together.”

    People have such a hard time getting their heads around this.

    • SockRolid

      And many people still think Microsoft + Intel somehow “won.”
      Profitability is arguably a better way of keeping score than “market share.”

      • Will

        Why? Why would profits be better than marketshare? Marketshare means people.

        Wintel “won” because *people* used it. No matter how you try to spin history, the fact is everyone knew about it, talk about it and everyone built for it. They delivered what the market wanted. That’s why they “won” back in the day.

        Steve Jobs knew it, MS knew it and eventually everyone stopped caring, moving on to smartphones.

      • “…used it. No matter how you try to spin history…”

        Skate to where the puck is going to be.

        You’re skating to where the puck was. WinTel won the battle, but the war rages on, thankfully.

      • Will


      • “Steve Jobs knew it, MS knew it and eventually everyone stopped caring, moving on to smartphones. Why do you still care who “won”?”

        How often do you read the iPhone/Android is just like the Mac/PC and everyone knows Apple “lost” that war.

        I think they won.

      • Will

        “everyone knows Apple “lost” that war.” — I don’t know who everyone is in this case. If you’re talking about trolls in the comment section yelling “Apple is doomed”, just ignore them. They’re probably 12 yo.

  • ScooterComputer

    ” What has been discussed as a cause for the moderation of market contraction is the expiration of Windows XP support. Certainly that seems plausible and is supported anecdotally. If it’s true then the PC respite may be transient.”

    So perhaps the BIGGER question here is why Apple isn’t attacking during that “respite” and doing better on Mac sales? A two-year-old Mac mini (with no price reduction), in context, is very puzzling. Also is the introduction of a low-end, emasculated iMac rather than reducing prices by $100. Finally, why doesn’t Apple offer Windows as an OEM option? If OS X is “free”, that means its “cost” is already calculated into the price, wholly, of the Mac. They could do a tidy business of Haswell Mac minis with Win7 Pro installed.

    (Can keep going here too…$999 for a display? You’ve got to be kidding me. No 24″ display? Completely missing the boat for business MacBook Air/Pro roadwarriors looking for an in-office “dock” monitor. Apple is letting a terrific opportunity simply pass them by, and I question “Why?”)

    • deemery

      It would be A Very Bad Idea (tm?) for Apple to sell sell Windows. Better to encourage people into the Apple ecosystem.

      Although not discussed, I think there’s potential for the Apple/IBM deal to also help the Mac product line. The argument against Macs from CIO-types is “too hard to manage.” (Now I consider that a strong feature, so the IT Department can’t f-word with my machine the same way they continually screw with Windows boxes, such as launching software updates requiring reboot in the middle of the working day…)

      • ScooterComputer

        Apple hasn’t yet been interested in supporting OS X in the business world, as ESPECIALLY witnessed by the amazingly craptastic display of horrible that and have been, both bug-wise and feature-wise, in Mavericks. The business world REVOLVES around Outlook and Exchange. And Mavericks was a black eye. If that wasn’t bad enough, Apple also managed to screw the pooch with the only good alternative to Exchange for businesses looking to move away from Microsoft: Google Apps. (10.8 and 10.9 Mail’s problems with Google Mail are, at this point, legendary…for all the wrong reasons.)
        So, easy to say…but until you’ve worked up to the experience of actually DOING that (putting Windows businesses into the Apple ecosystem), please be more cautious saying it is a Bad Idea. The better idea is to sell them Macs now and let them slide into the OS X world within 3 years. At the very least, if they don’t go Mac in that time, they have a MUCH higher chance of doing it next time they buy new machines. And Apple has gained a foot-in-the-door and several years of development maturity (hopefully; unless they stupidly regress like they did with Mavericks’ productivity tools). And do yourself a favor, go out and do some pricing on Enterprise-class mini-desktops from the likes of Dell, HP, and Lenovo. The Mac mini is competitively priced, if it were up-to-date. Even the iMac prices well against the business-class all-in-ones.

        As for Managment, Macs certainly do support a lot of the same “f-word with my machine” features that Windows supports; just a lot of Windows-centric IT shops don’t know how to enable them. (And, again, stupidly, Apple has shot themselves in the foot by having shaky quality control problems where features stop working for no go reason. Lack of consistency will NOT engender competitive advantage in the market that IBM can take Apple.)

      • deemery

        I write this on a Mac that is my business machine, in my job as a government contractor. I’ve been a Mac user in corporate environments since 1986 (except for a year I spent inside the Pentagon using a government issued PC.) Sometimes those companies actively supported the Mac, sometimes they tolerated Macs, and sometimes they were actively hostile.

        I agree that could use improvements, and is a mess. That doesn’t mean that Apple should resell Microsoft crap. I know people who dual-boot to Windows or more commonly run WIndows under emulation, on Mac hardware. They prefer the Mac hardware, and often, but not always, prefer Mac OS for everything that does not have to run on Windows.

        IBM has the potential to provide an alternative to Microsoft, that doesn’t have the security/privacy concerns of Google. Blackberry succeeded in part because it provided a turnkey solution that was trusted by CIOs (including the ‘military-industrial complex’)

      • ScooterComputer

        Then you’re the perfect case. Put the Mac in people’s hands **because** it is great hardware (and that’s where Apple makes their profit anyhow). What does it matter what OS they want to run NOW? More important is to sell what makes money and to make customers happy by letting them accomplish what they need to using the tools THEY have chosen. Eventually you’ll find most of those users choosing Mac OS. But Apple has created a barrier of entry to business (and government “business users”) by way of inflexibility (“we won’t help you use a competing OS by offering greatly reduced OEM pricing”, which matters little to HUGE enterprise/govt with MS licensing, but KILLS small and medium businesses), a seeming lack of concern for how well business productivity apps work (aforementioned mess of Mavericks Mail and Calendar with anything but iCloud), and a refusal to create and sell competitively-priced computers and accessories that the business market buys (really, this Mac mini thing is just stupefying, mind-numbingly, jaw-droppingly bizarre in the context of the greatest PC marketplace shift/upheaval in modern times: the WinXP Apocalypse).

      • deemery

        For a small business, in particular, the security threats posted by the Microsoft Monoculture are really significant. If you understand the risks, you spend a ton of time and money and worry handling it. If you’re not IT-literate, you’re basically an accident waiting to happen. I agree Apple could/should target this market (OS X Server would need substantially more investment, but has great potential). A big part of supporting that market is getting trained people to do initial set-up and by-exception system maintenance tasks.

      • charly

        If you are IT literate than Windows is so much better at security that it isn’t funny

      • Tatil_S

        Mail app is far more user friendly and screen efficient than Outlook’s email portion, with that horrible ribbon, and poor search and sort capabilities.

      • Will


    • Tatil_S

      Yeah, why doesn’t Apple abandon its strategy that brings in so much profit and behave more like the other PC makers barely making profit? Mind boggling, ain’t it?

      • ScooterComputer

        Wow, going over your head isn’t it? Did you see where I mentioned that OS X is “free” and priced into the purchase cost of the Mac? That means that Apple makes its profit regardless of if users decide to run Windows instead of the OS X. I didn’t mention a WORD of Apple diving after cheap Windows boxes. The only pricing mention I made was of dropping the iMac $100 rather than shipping $200-off under-powered hardware. The pricing of the Haswell chipset is less than the chipset in the current mini, so Apple could, likewise, update it for the same price as the mini is currently AND INCREASE MARGINS. If a user decided to pay Apple retail price for an OEM-imaged BootCamp partition with Win7 Pro, that’s just more profit for Apple, just like if they’d sell copies of Photoshop pre-installed. So how does that cause them to LOSE money??

        As for the displays, let’s be real: Dell and HP are both shipping very nice 27″ IPS displays for a THIRD of what Apple is selling their behemoth $999 Cinema Display for. That’s a LOT of margin. There is no reason that Apple couldn’t ship a 24″ Cinema Display (which is MUCH closer to the tolerable screen size used in the corporate world…ever worked behind a desk?) and make a nice 36% profit margin on it.

      • LTMP

        If Apple were to offer Windows as a pre installed “app”, they would also need to be able to provide updates through the app store. At the moment, I doubt that MSFT would allow this.

        If Apple were to ship a 24″ cinema display, it is unlikely that they could generate sales without dropping their margins to the 5% to 10% that Dell and HP get. If you think that Apple doesn’t sell any cinema displays, you have never set foot in a design shop. I suspect that developers are also a significant market.

        The cheaper iMac satisfies a specific market. The $100 price reduction you suggest would not be likely to increase sales much at all, since the average Mac buyer is not THAT price sensitive.

        As for the Mini, I really can’t dispute your point. I suspect it has to do with resource allocation.

      • The Mac Mini was conceived as a lower-priced entry point for switchers. If you had an old PC, all you had to do was plug in your monitor, keyboard and mouse into the Mini and you were good to go.

        Now that the iPad has become a replacement device for low-end PCs for a lot of people, it is likely that this market will opt for an iPad rather than the Mini. This decreases sales and thus becomes a lower priority for Apple. It’s surprising that it has not of yet been eliminated from the line-up. But that’s to be determined.

      • LTMP

        I wouldn’t be surprised if you are correct, but I believe that most consumers still use a PC at home, for many tasks, even if they already have an iPad.

        I’d argue that many of the additions in Yosemite prove Apple’s recognition of this, which would indicate that a new Mini would not only add switchers, but might increase sales among current users of older desktop Macs.

        If anything, a new Mini might cannibalize the iMac rather than the iPad.

      • I’m sure the PC still has the lion’s share of computing tasks, but that share is dropping quickly in favor of tablets, but more importantly, smartphones.

        Mini to me still seems like a stopgap. The fact that they haven’t updated in a while shows that they’re not banking on it to get a boost in sales. But you could have said that about the Pro, too. However, there is no replacement for what a Pro does. iPads are very capable replacements for Minis and other low-cost laptops.

        I think the problem is that there is a segment of the population who can’t conceive doing their own kind of work on an iPad, therefore the desktop must continue to exist in its current format and will always be the primary choice of computer users.

        Yes, the desktop isn’t going away. But we no longer live in a world where a person had no choice but a PC to read their email or go to Facebook or watch cat videos or play games. Now all you need is a smartphone, which has none of the headaches of administrating a desktop PC and is very complicated to maintain for the average user.

        That’s why I’m bearish on the Mini. It served its purpose at the time when switching was a thing. Now that we have mobile devices, the argument is harder to support.

      • LTMP

        For me, screen real estate is the big issue. It might just be old habits, but I like to be able to see a few apps at once.

        It will be interesting to see what Apple does.

      • Oh, I agree. I’m a graphic designer and web designer and I need a powerful computer with multiple windows and multitasking.

        But for most people, a phone fulfills pretty much everything they need from surfing the web to texting, tweeting, posting to Facebook, Instagram, taking pictures, messaging, watching videos, music, games. It’s all there and it follows them everywhere they go.

        PCs will never go away. But we are no longer in a world where if you needed to read your email or surf the web, you had no other option.

      • Walt French

        I’ve been thinking for some time that the next compact home computer is the next Apple TV.

        In my mind, it’ll carry design notes that were established by the Mac Pro, have a strong gaming emphasis (with power to match), and be usable as a home base for iPhones, etc, maybe with a Time Capsule-type unit.

        I DON’T see Apple trying to put a browsing session or other productivity type apps on a TV screen. It’s an ugly kluge. But a good CPU/GPU, as well as service offerings, would, if supplemented by an iPhone or iPad, be the likely iMini.

        After the iOS / consumer thrust is established, THEN, there can be an upgrade — maybe almost a slipstream upgrade — to the Mac mini. We should know pretty soon.

      • That’s an interesting theory, though I would be inclined to believe that the television will remain a passive medium because that is what it is best at. iPads and iPhones already act as adjuncts to the television today with tweeting and posting to Facebook during live programming events. The World Cup was the most live-tweeted event in Twitter’s history and there’s reason to believe it will continue to grow with other events like the Olympics, the Super Bowl or the Oscars.

        So in that sense, our phones and tablets are already integrated with our television, if not through one common device, but through the device most people already own and are happily using right now.

        For example, you can take a show like Rising Star on Fox which uses an app to let viewers vote for their favorite singers in real time and have immediate results. That’s using devices that currently exist with no new equipment to buy or learn to use.

      • Tatil_S

        The ability to install Windows alleviates the concerns of potential switchers who are afraid they may not like OSX or they cannot find an app meeting one need or another. Almost none of them actually bother installing it in the end. Making it very easy to stick with Windows will discourage many users who have been used to Windows for all their lives from actually using OSX and getting hooked onto the ecosystem on which Apple makes so much money and with which it generates customer loyalty. That is why selling Macs with Windows pre-installed is not like selling them with Photoshop. In any case, customers who actually want a well made hardware running Windows will most likely not buy it from Apple and pay for the costs of hardware software integration for software they would not be using.

    • Walt French

      @Scooter, you have some very good ideas but the fact remains: Apple did NOT choose to implement them.

      Maybe this was an oversight. The hardware people just plain forgot about the Mac Mini since the last upgrade was kinda a non-event itself.

      And maybe the moon is made from green cheese.

      Methinks it’s not the engineering talent that’s in short supply, but rather, Apple’s bandwidth with the public that they manage so carefully. In an age when analysts are trying to find support for their pet theories in rumors about FoxConn hiring, an actual Apple product announcement is taken as a serious commitment to a strategic direction.

      The mini (and I own one) is an odd beast: a useful manager of a closet full of servers, a local coordinator of updates and/or extra processing oomph, but in the end, a contradiction of Apple’s image of being your systems integrator for you. The mini is used by people committed to the Apple ecosystem, who are NOT the everyman customer. They’re NOT looking for a lot of extra power (the Pro supplies that) and they’re NOT looking for end-user ease and convenience (which you get with the iPad and other Macs).

      We don’t see the split between iMacs, MacBooks’ various forms, and the mini, but I have to presume the mini is an accommodation to Apple’s most valuable customers, rather than a direction they wish to emphasize.

      Ergo, there is zero interest in a high-quality Windows box. Really, there are plenty of inexpensive, perfectly-good-enough Windows machines, and Apple does nothing for its strategic direction (which would be interesting to suss out now that we’re seeing Apple more than half the industry profits) by offering one.

      • LTMP

        Interesting thought about “bandwidth with the public”, I think that is an often overlooked angle.

        However, I think that Apple could see more switchers to the Mac platform with an improved Mini. For consumers who already own a monitor, keyboard, etc., it is an excellent entry to the OS X ecosystem.

        Your implication that Apple would support the Mini better if it were worth it is a fair one, but isn’t it just as possible that they are waiting (as they did with the Mac Pro) until a new and vastly changed product is ready? Personally, I’d love to see a ‘Mac Pro mini’.

      • N

        “I have to presume the mini is an accommodation to Apple’s most valuable customers, rather than a direction they wish to emphasize.”

        This is insightful and likely true given the companies that actually host Mac minis in data centers. Our company runs on Mac minis. We definitely fall into the category of Apple’s most valuable customers with company-issued iPads and iPhones (not to mention Apple TVs for birthday presents plus we all use Apple products at home). Having an SSD matters more than the CPU these days for white collar work (we’re not Pixar) so we don’t notice any speed issues on our 2011 and 2012 Mac minis. If anything, the 2011 model feels zipper because of its discrete GPU.

    • I too question the wisdom of not taking advantage of the decline in Windows PC to boost Mac sales. However, one can reasonably argue that the iPad is the reason for the decline, so they are attacking quite heavily in that respect. I would further add that the Continuity features being added to iOS and OS X offer huge incentive to switch to Mac and/or iPad, which I am now seriously considering. It could be the pivot point Apple has been planning. I agree there are some tactics Apple could have adopted to more aggressively push Mac (like filling the gaps in the lineup), but I suspect playing the long game will ultimately pay out.

      • Interesting thought. The iPod provided a halo effect for the Mac. The iPod brought us iTunesMS. The iTunesMS brought us iPhone. The iPhone will now be the halo device for the Mac.

        I agree the continuity looks sweet if they can pull it off.

    • SockRolid

      “Incidentally, the Mac is nearly the highest revenue PC brand and by far the most profitable. Indeed, it’s more profitable than all the other vendors put together.”

      Mac sales increased 18% year-over-year last quarter, with only MB Air price adjustments and a new low-end iMac model. And yet Mac sales represented only 15% of Apple’s total revenue last quarter. So does it make sense to expend massive amounts of time, effort, and money to squeeze more money out of the PC market? When Apple is “more profitable than all the other vendors put together”? I don’t think so.

      Of course, everything can always be better. There are rumors that Apple will release some kind of 4K display and/or iMac as soon as this year. You’ll probably get your 24″ display then. But is that a “terrific opportunity”? Probably not. If it were really important to them, Apple would have done it already. That’s “Why?”

      • Nevermark

        It makes sense because Apple needs to continue growing and they still have only a small unit share of the PC market. They could grow significantly if they aggressively pursue a PC OS war 2.0.

        To win a rematch with Microsoft, I think Apple should start designing their own mid-range laptop processors. A9 or A10 chips would give Apple the ability to charge less, while increasing their design advantages and maintaining high margins.

        Lower priced high quality laptops from Apple would vacuum up unit, revenue, and profit share from both Microsoft and Intel and all their OEMs in the middle.

        High customers would still want Intel Macs, but the vast majority of users would be well served by a successor to the A8.

      • charly

        Software for Arm is problem. I think a good definition of a high end customer in todays PC market is one that buys (or even pirates) software. So or you don’t get software for OS X Arm or it eats the Intel Macs.

      • Shameer Mulji

        “Software for Arm is problem.”

        So what do you think iOS and the iOS App store is, if not software for ARM? If anything, Apple is schooling the tech industry on how to do software for ARM.

        “So or you don’t get software for OS X Arm or it eats the Intel Macs.”

        Apple has never been afraid of cannibalizing its own products. That’s something Steve Jobs instilled in Apple’s culture.

      • charly

        You forget the Android store. It is also full of ARM software.

      • charly

        PC market is future proof. It will still be massive in 20 years. Even the legacy market will be large. Iphone market is less reliable (see Nokia or Blackberry) and the ipad market already seems to be shrinking

      • plcm123

        Please explain why PC market is future proof.

      • Kizedek

        Do yo see how you switch from “PC Market” (generic), to “iPhone” and “iPad ‘market'” (specific examples of phones and tablets)?

        You might as well say “the phone market is future proof”. I happen to also think “the tablet market is future proof”, too.

        So let’s get specific about the PC market, too. In a generic context, “PC” includes Macs, since they are desktops and laptops that are distinguishable from tablets.

        The Mac is doing extremely well. In fact, it looks like the Am

        Now, Nokia and Blackberry have lost their once large parts of the phone markets for very specific reasons. If you have done any reading here at all, then you know the reasons have little application to Apple.

      • charly

        What are the specific reasons that Nokia & Blackberry lost and why can that not happen to Apple? Both lost because of a new phase in phone technology. Same could happen to Apple (or Samsung) I don’t see any special Apple feature that makes that impossible especially because i don’t believe that there is wont be new phone technologies.

        Apple’s PC market is relatively safe though Chrome OS will eat into it. Tablet market will shrink but seems to have some legacy. Phone market on the other hand isn’t safe

      • Kizedek

        For one thing, it’s not about “phones” any more, it’s about “computers”. Anyway, there are all sorts of reasons, including the ways Apple plans and executes and is willing to disrupt itself. It’s not about any one “special” Apple feature, whether you see it or not. Besides, Apple has already “lost” a couple of times in its history, and now operates differently, having learned some things; it has agility that allows it to act like a “startup”. Others have tried to emulate this, and fail to. But you know all this since you are a regular reader and prolific commenter.

    • Though Apple is aware of how the market is trending, they generally don’t significantly alter their strategies in reactive ways. Apple is already making more profits from Mac desktops and laptops than most of the major PC OEMs combined. So I’m not sure how much more they can do. It seems their strategy has been working up to this point.

      I don’t believe Apple sets as a goal to annihilate the competition just for its own sake. It’s not about beating anyone else. That would be a loss of focus on creating great products.

      OS X isn’t offered as a premium add-on to juice sales. It is integral to the product line. So it’s a false analogy to assume that they’re a computer box maker that runs multiple OSes in the vein of a PC OEM. By selling Windows 7 preinstalled on a Mac, Apple would be diluting the brand and playing in the same league as the lower-end PC manufacturers, a league of low margins and commoditized products where there are more losers than winners.

      Apple just doesn’t cater to the same market as the mass-production PC OEMs. If you think Macs are overpriced, then you’re certainly welcome to buy a Windows machine. No one’s forcing you to pay a premium price for a premium product. If the market can’t sustain Apple pricing, then Apple will lose sales.

      But guess what? They’re not losing sales. They’re gaining sales. And profits. You can’t say that about any PC manufacturer.

      So maybe they’re onto something?

      • charly

        Apple looks so profitable because the profit in the Windows OEM licenses aren’t included but the profit for MAC OSX OEM is. If you include the profit Microsoft makes on Windows OEM than it doesn’t look so bad

        The average price of a windows PC is near the price of the cheapest Mac so it is obvious a different market

        problem for Apple is the continual price drop of SSD. If you wanted a laptop with an SSD than an Apple wasn’t that expensive. Next year the cheap laptops will have a SSD and with it Apple becomes expensive

      • You can’t really count software licensing, such as Microsoft collects on its OS, as part of the PC manufacturing revenue. That’s why in the PC world, you’re far better off being Microsoft than an OEM. Microsoft’s success doesn’t show up at the bottom line at HP, Toshiba or Acer.

        OS X is not a standalone revenue generator the way Windows is. It’s a completely different business model. The article is focused on hardware manufacturers, so you have to compare various manufacturers to one another. Microsoft has become an OEM recently with its Surface hardware, but as we all have seen, it barely registers compared to traditional OEMs.

        Apple’s strategy as a PC manufacturer is very different from the rest of the industry, and as such has been exceptionally successful in the way the others have not. And it’s all the more remarkable given that they make premium, higher-priced products while commoditization has made it difficult for Windows OEMs to differentiate themselves from their competitors and has resulted in softening sales with already rock-bottom, break-even margins.

        There are still MacBooks available with traditional hard drives, so there exists already lower cost options today for people who want to buy a Mac and spend a little less than an SSD model. When the industry moves to SSD across the board, Macs will continue to sell at a premium, but for the same reasons they were always more expensive when everyone was using regular hard drives. They are premium, differentiated products that people believe provide a superior experience, reliability, customer satisfaction and support that is second to none. You can reasonably disagree, but that won’t keep a person who is loyal to Apple from buying their products.

      • charly

        Going pure hard disk saves you what? $100 on a $1000 Mac. I think that is an example of being foolish

      • 13-inch MacBook Pro with 500 GB HD = $1199
        13-inch MacBook Pro with 512 GB SSD = $1799

        The SSD model does come with a Retina display and twice the RAM, but I guarantee the SSD adds more than a $100. In any case, going with a sizable SSD is a costly option.

      • charly

        A 120GB SSD is only $150 more but if you you choose another model (2.4 GHz instead of 2.5 but Retina & better graphics & 120GB SSD, IMHO a much better model than 2.5GHz) than the price is $1299. I’m not that well educated in Apple laptops but my guess it is the much better option.

      • I love my new MacBook Pro with SSD. It’s super fast and responsive. Like night and day compared to my former MacBook Pro. Price tag: Just over CAD$3000.

        But there was no way I would go from a 500 GB HD to a 120 GB SSD. Where would all my stuff go?

        SSD is the future. Definitely. Price-wise, though, we’re talking significant price differences for comparable capacities. And for now, budget-minded people may hold off on the new technology till the price falls much lower.

        With MacBooks, you unfortunately can’t customize the configuration as much as you want to get a targeted price point. You pay more, you get more, you pay less, you get less. But if you’re willing to go whole-hog, man, you get a killer machine.

      • obarthelemy

        The future is probably smallish SSD for the OS and key apps, **and** a HD for media. There are already mixed drives, or dual-drive solutions (some Asus T100 models)

      • But why have regular hard drives in the future?

      • charly

        Cost. SSD cost go up almost linear with capacity. Hard disk cost is more independent of capacity so the multiple GB disk drives will stay cheaper than SSD for the foreseeable future

      • But from the trends, you can see that that’s not going to be the case forever, right?

      • obarthelemy

        1- the lastest data points to SSD prices not falling much faster than HD:

        2- SSDs are still nowhere near the capacity of HDDs

      • Right now, yes. You’re right. But it’s likely that SSD prices will continue their downward trend to where they’re comparable to HDs and then render them obsolete. Eventually, HD will go the way of the floppy and optical media.

      • charly

        Those HDD factories are already build so they can keep up with SSD prices for the foreseeable future. But you are right. HDD will go the way of film.

        ps. Floppies and optical are IMHO wrong examples because they hardly improved. Floppies with from a few 100k to 2.44MB and optical from 700MB to 100GB which is not much over 20 years especially because it includes things like going double sided, multi layered and some improvements in error correction.

      • Well, I only brought up floppies and optical media in that they eventually disappeared (or will disappear) much to the consternation of those who wished to hang on despite all indications that they were slated for decommission.

        Maybe I’m a little ahead of time, but I can see the writing on the wall. It’s often better to skate to where the puck is going to be.

      • charly

        Everything will be obsolete ones but for online storage it will be the cheapest option per GB in this decade and the next one is to far away.

      • obarthelemy

        the mere fact that the article is focused on manufacturers is very biased. Value-add happens mostly in software and services. This a akin to comparing mobile homes on one side, and building companies as a proxy for the real estate industry on the other.

      • Why is it biased? If you’re Asus or Acer or HP or some other OEM, you don’t make software or services. Your main business is hardware and trends in the manufacturing space is having an impact on these kinds of companies. Who will make the hardware if it is no longer profitable?

      • charly

        Screwing a PC together isn’t exactly rocket science. Especially how the design is mostly done by Microsoft & Intel

      • Well, neither Microsoft nor Intel are actually PC makers. You may point to Surface or the Ultrabook program, but neither has been a success.

        In any case, the article is indicating that if you’re a company that builds computer boxes, you’re not in a growth market (except for Apple). That should be worrisome for people who buy PCs. If manufacturers pull out, product prices will rise as competition wanes.

      • charly

        Microsoft has the designed for Windows 8 program and Intel has reference designs. Add an Intel made motherboard to an Intel CPU. Look up what memory it uses in the technical and you have a computer

    • charly

      MACs with windows factory installed may lead to most people running Windows on Apple hardware. That is not a position Apple wants to be in

      • ScooterComputer

        It isn’t? Funny, have you not heard of a component that Apple ships with every Mac called ‘Boot Camp’? Let’s users run Windows on Apple hardware…pretty easily. The painful part is the licensing fees paid to one of Apple’s competitors, Microsoft. But see, therein exists an opportunity: Apple could sell users a completely unsupported (no more supported than Boot Camp is now) OEM license of Windows for $100 via Build To Order imaged to an additional partition on the drive, easily making $30 on the sale (the same cut they take from Devs selling any other apps through the App Store). Why? Because users want Apple hardware, they want the potential of Mac OS X, they’re willing to pay the price Apple is asking, but they find themselves in a business situation whereby they can’t or aren’t comfortable yet jumping into the deep end of the pool without those little floaty things on their arms. Apparently most of you out there aren’t actually familiar with the PC marketplace; you obviously aren’t in sales, or aren’t very good at it if you are. Because I meet a LOT of these kinds of people in the small/medium business space, and they’re hesitant to leave the Windows ecosystem, as bad as it is, as malware/virus scary, because they’re afraid or uncomfortable. But you’d do well to listen to the very words of Tim Cook, one CEO of Apple, from yesterday (paraphrasing): once we put an Apple product into people’s hands, they’re bound to stay an Apple user.

        Here are the economics, that apparently many of you out there are unable to grasp: If a user is currently running Windows XP, I assure you they are looking to buy a new computer. They’re frustrated, they aren’t happy with Microsoft and Windows right now, and they mostly don’t understand the circumstances (if they did, they’d likely have been on Win7 two years ago). They are, by and large, going to walk into an Apple Store and walk out with a $1700 iMac setup. How do I know that? Because they’re still sitting on a shitty Win XP system, that’s why. (And don’t immediately call these people names, they’re nearly 30% of the installed base. Their computing needs are likely just different than yours; and they are potential customers!) So they’re not going to buy an iMac. Just unlikely. They’re used to buying cheap Windows boxes because that’s the life they’ve led. But, contrary to the name calling, they’re also not dumb. They know that Windows is problematic, they likely have needs and momentum of skillset (which means they have a bit of fear of the unknown), but they know that Windows has problems. A significant number of them can become interested in the Mac really quickly when you say, “What AntiVirus did you run on Windows?” and cut them off before they can answer with “I have never run antivirus on my Mac, it has malware protection built in…I’ve never had nor know anyone who ever has gotten a virus or malware on the Mac. It just doesn’t affect them.” I guarantee you’ll find yourself in a conversation just that quick. At this point, they might go iPad, but I find that unlikely in my own experience. They’re still in the PC mindset, and if they’re doing business work, it is understandable. You start talking budget numbers with them, and talk about the Mac mini. Here is where Apple’s folly with the mini is hurting them; it is almost 2 years old, doesn’t have a competitive amount of RAM (nor value) and the specs don’t measure up to the cheapo PC boxes that cost $200 less. Right off, this is a hard sale. And it shouldn’t be. If Apple would simply have rev’d the Mac mini with the iMacs or MacBooks, this wouldn’t be an issue at all. But it is FOLLY to believe customers are dumb, or “don’t care about specs”. They don’t understand them, but they surely are looking for ANYTHING that tips them off that one system is better or worse than the others, and Apple hands it to them on a platter. So Strike One. Apple loses sales right here. So regardless of the excuses everyone here has given over the Mac mini’s stagnation, they are all bullshit. A company sitting on the cash that Apple is with the engineering resources that Apple has could have and should have put a updated mini on the market MONTHS ago. Questions need to be asked. Even still, there are customers who will still be with us past that outdated specs and the uncompetitive pricing. They’re tired of Windows; perhaps they are iPhone or iPad users; they are those proverbial Steve Jobs example “users in Hell” just waiting to be shown a glass of ice water. I’d say about 1 in 3 users are still with me at this point. That’s good odds. Apple is almost 20% of the US retail non-enterprise market. Surprisingly I can get about half of those “1 in 3″ to buy an iMac, and half of them will run Windows in some capacity (which means they’re buying that Windows license anyhow, just not from Apple). If that 1 in 3 is divided into 4s, 2 buy an iMac (that’s 2 our of 12, for those maths challenged) and 1 will buy a mini. The other will slink off and either buy a Dell or set about upgrading their WinXP piece of shit. For the count, that’s 3 out of 12, or 25% I just sold a Mac. Apple makes that money, and the profit. If the mini was more competitive, it would be 4 out of 12, or 5 out of 12. If an OEM license of Windows was available, it would be 5 or 6, maybe even 7, out of 12…Apple makes the profit on the Mac AND 30% (~$30) of a cut of a Windows license (probably more than Microsoft profits). So who gives a fig if Apple sells that license? Their market share, AT THE SAME PROFIT LEVEL, is now doubling simply by actually listening to the needs of 30% of the current PC market and taking a chance on an opportunity and keeping their offerings competitive.

        Past that, if they offer things like 24” monitors, and more competitively priced accessories, they’d be selling MORE of that stuff. And you can’t say “oh you just want them to sell profitless Windows crap”…because NO I DO NOT! I’m saying offer SOMETHING. Right now, if you want a nice monitor to go with a Mac mini, I have three choices: a $1000 no-way-in-hell Cinema Display, push them to a $1299 iMac, or buy a third party monitor. You know what they do? Well, I told you early, thanks to the mini’s specs being so outdated, I actually get that iMac sale half the time. But it is a HARD sale, and takes a lot of MY time and promises, not Apple’s. But 9 out of 12 times, the user is spending money somewhere else. That is Apple NOT making money, on hardware, what they make money on. The 1 out of 4 (1 out of 12) that I get to buy that mini? They’re usually more staid office/business folks. The mini is as close to what they know a computer “is” as they’re comfortable straying from. Those users? They sit as desks. They’re lawyers. They’re accountants. They’re Directors of lobbying groups. They have chairs in front of their desks that people sit in that they want to talk to. A 27″ huge honkin’ LCD “billboard” is NOT what they want. So Apple is just not even competing in this market at all…all lost “profits”, for not even having TRIED. Not tried and failed, not can’t make margins, just simply don’t even care, leaving money on the table.
        And let’s get back to those Mac mini buyers, those 1 out of 4 (again 1 out of 12 overall, which would maybe be 3 or 4 out of 12 if the mini was updated and competitive): thus far, in 5 years, I have seen pretty close to a 60% conversion rate from that Mac mini to an iMac within 2 years, often much sooner. I can’t make that conversation happen at the time of the initial sale, and obviously neither can Apple. But it DOES happen. Inside of 2 years is SUBSTANTIALLY ahead of the 3 to 5 year PC refresh cycle. That’s why it is SO important that Apple be making the mini “value” competitive; which should NOT be confused with “price competitive”!
        Taken a step further, I’m at 50% conversion rate from Windows to Mac at the 3 year cycle refresh (that’s for users who stuck with Windows vs jumping into Mac OS X feet first), and have had NO customers either go to Windows 8 OR move from Mac back to other PC vendors.

        So…do your own math there. I’m just 1 guy. And that’s just my experience. But there is a WHOLE lot of upside opportunity for Apple RIGHT now to expand their Mac market share without cannibalizing iPad, and without expending significant resources or costs; merely keeping their product line-up technologically competitive and being more PROACTIVE with what the market needs. A lot of you seem to confuse going after Windows users as somehow INSTANTLY being a loss leader, or requiring significant cost or margin loss. That simply isn’t true. Apple’s marketshare is still very small. Adding 1 or 2 more sales out of that 12 I talked about would have market-shaking consequences. And by catering, for now, to some of those users still with one foot, even both feet in the Windows world, Apple profits from the hardware sale, gets paid for OS X development for 3 years to hopefully add features intriguing and important to business users, could get 30% of a Windows license, might pickup an extra couple of bucks on more competitive display and keyboard offerings/value, expands their Retail “marketshare”, and, best of all, like Tim Cook said, is sitting pretty with a “shadow” user base who will likely become full-time Mac users by 3 years. All with products/prices/margins they should be selling right now.

        Again, I’m not trying to make the moon out of cheese, I want questions asked and answers given…why is Apple simply letting this significant PC market event/opportunity be wasted?

      • obarthelemy

        I’m wondering if MS are trying to replace most desktops and laptops with tablets. If you’re looking to replace a 5+ year old PC, a $350 Asus T100 is probably an upgrade specs-wise, and it is a tablet, and a laptop, and a desktop. Other models/OEMs fill the gap between that and the $1k-2k Surface, and $100-$200 models are coming soon.

    • Sacto_Joe

      I haven’t read all the answers here, but I’ll give this a shot: Apple is waiting where the puck is going. The “puck” in this instance is computer sales. But the definition of “computer” has changed dramatically in the last several years. Apple now sells a whole range of computers, all the way from pocket computers up to heavy duty desktops. And there are at least two synergies going on between these computers. First, they “talk” very well together, and are getting better at that by the year. Second, they’re extremely “sticky” because they’re so well designed, which means that a person who buys in at the low end and find his needs increasing has a natural tendency to stay with Apple all the way to the high end (assuming their needs get them that far).

      Thus, Apple has created a “magnet” of sorts that is almost literally drawing the “puck”, that is, computer sales, in its direction. As long as it can continue to stay on the cutting edge with its products, that “magnet” is going to suck PC sales and everything else in its direction.

      Concentrating on PC sales is like building up one arm; it’s only worthwhile if that arm is all you need. But Apple needs all its appendages in order for the “magnet” to stay powerful. It is therefore not concentrating just on PC’s. Heck, it’s not even concentrating on its present stable of products! It’s literally out there developing new products to add to that stable.

      Which is exactly what it should be doing.

  • poke

    The Windows PC is facing an existential crisis. It has only ever been cheap and fast because of the volume of sales. Intel is already struggling to produce the next generation of processors now it’s in a declining market. Microsoft is already looking to change strategy. My guess is that Windows/x86 doesn’t have a future. At some point the platform will become uncompetitive. It will no longer be cheap or fast. The enterprise will start looking for alternatives. Those will be mobile solutions for most workers, workstations for creatives and dumb terminals for data entry. Apple can benefit from the first two. I think at some point they’ll dump x86.

    • peter

      Based on what happened to the mainframe market in the past, I would guess that Windows and PC hardware will be with us for a long time to come.

      I do agree with you though that a platform that is starved for profits is ultimately not going to fund cutting edge processor development. The corollary of Moore’s Law (your fabs keep doubling in price) in combination with the shift to mobile deprives Intel from a lot of profit by now. There is a real risk they might enter into a downward R&D and Capex spiral.

      • charly

        PC is a combination of Intel, some other generic hardware and Windows software. The Intel & microsoft part aren’t exactly profitless and those to have in fact made the design decisions for PC’s in the last 20 years.

    • SockRolid

      “Good, fast, cheap. Pick any two.”
      – old engineering saying

      PC makers have chosen fast and cheap, but fast isn’t really a critical parameter any more. The average business and home user doesn’t need a hugely expensive top-of-the-line Intel chip to get their work done. Their workload has remained the same. So the “good enough” mentality has hit PC hardware the way XP hit Microsoft: no need to upgrade because the old system can handle the workload.

      But the average Wintel PC maker can’t switch from “fast and cheap” to “fast and good” or “good and cheap” because “good” inevitably results in “expensive.” And they’ve spent decades cutting corners and brainwashing Wintel users into having very low expectations. How’s that Ultrabook Initiative going, guys? Burn through that $300 million Intel seed money yet? Yup, thought so.

      Another reason why Intel doesn’t really need to bust their balls to get to a 14nm process (for performance) is because they’ve already killed off AMD as a serious x86 competitor. The MHz race is over. The average consumer simply doesn’t care any more.

      • LTMP

        I’m a great anecdote for your point. My main machine is a mid 2007 iMac. It is unusual for me to feel that I could make use of a faster machine. Offhand, I’d say that 95% of my usage wouldn’t see a significant improvement even going to a Mac Pro.

      • Sacto_Joe

        We need to be careful with this analogy. “Fast” in the original saying meant delivered quickly. Thus, you could have it delivered quickly and cheaply, but the product wouldn’t be perfect. Or you could have it delivered quickly and perfectly, but it wouldn’t be cheap. Finally, you could have it delivered perfecty and cheaply, but it wouldn’t be delivered quickly.

        Still, it sort of works. Apple goes to great extents to approach perfection, even to the point where it is sometimes neither delivered quickly nor cheaply.

        Interestingly, the result of that labor is not actually caught in any of the graphs that Horace shows. It WOULD show up if we could somehow graph the cumulative effect. That is, if we could indicate the extent computers stay in circulation, doing jobs. I can’t prove it, but my hunch is that we’d see Apple devices, like the Energizer Bunny, just keep going and going, long after the competition is relegated to electronic recycling.

  • SockRolid

    Interesting that Apple’s Mac sales increased 18% YOY for the quarter. All without any significant model changes. Just minor performance boosts and price drops in the MacBook Air lines and a new low-end iMac. Is there really *that* much of a demand for low-end iMacs, and is the MB Air market really that price-sensitive?

    Or is it that consumers feel that the economy really has turned a corner? I have wondered, for years, what Apple could do when the economy heats up again.

    • neutrino23

      I suspect it is the growing realization that there is a huge difference between Macs and PCs. Even our IT group (F500 company) is on the verge of making Macs Peers with PCs. Possibly this has something to do with the falling need for Office. Sure, some people on business need Excel, but most people can easily get by with something else.

    • Which economy?

    • obarthelemy

      Maybe MS’s fumbles with Win 8 have an impact too ?

  • r.d

    Why is mac mini not updated in 2 years.
    answer is quite simple.
    Intel charges $300 for 28 Watt 2 core i5 processors.
    so some 60% of the cost of current mac mini would go to Intel just
    for chips. and Apple uses the more powerful chip on mac mini which costs
    more than $450-$600.

    So unless you want to pay something like $700 for the
    least expensive mac mini, you have to wait for Intel to reduce its prices
    when Broadwell comes out.

    As for why Apple didn’t reduce margins of Mac to get more market
    share. Don’t be ridiculous. Macs have lower margin than ipads.
    Apple simply chose to go with SSD and thinner devices instead.

    May be Apple will use core m processor to sell you cheaper Macbook Air
    but that is doubtful because it will be retina so all the savings will be
    put onto the display.

    • charly

      That is the per 1000 units price Intel asks for without any negotiation. I doubt a big customer like Apple pays that price even without the kick backs Intel gives to its big buyers.

      SSD’s price for a useable size (at least 60GB) will dip below the price of cheap hard disk (smallest mainstream size) within 12 months so all cheap computers will go SSD for C: This will hurt Apple

      • obarthelemy

        SSD is not evidently superior to HD in many cases: specifically 60GB is a squeeze, so the SSD doesn not *replace* the HD, id comes on top of it for OS and key apps. You still need a HD for media, and maybe even some apps.

      • charly

        Make it 80GB + a USB hard drive if you store things. 80 GB is enough if you are not a gamer (or somebody else than needs an expensive computer)

    • ScooterComputer

      As charly points out, these numbers aren’t correct. Considering that the Mac mini has ALWAYS used similar chipsets to the MacBook Pro, and margins have been consistent, I can assure you that Apple isn’t selling the mini at a loss, or anywhere near that. And the Haswell chipset is slightly less expensive than the IvyBridge it replaced, so moving to a more technologically competitive chipset would actually increase margins.

  • Gene Grush

    The Mac has the potential to be a large growth area for Apple in the future. If I was Apple, I would be developing an Intel equivalent chip to drive the price downward. They maximize their control of the design on both the IPhone and IPad. Why not the Mac? This will allow them to continue to lower the Mac price with the same margins. Their Chip design capability has come a long way on the IPad/IPhone line. Why can’t they make and Intel equivalent chip. Globally they have 7.5-8.5% usage as measured by StatCounter and 15.5-17.5% domestically. They have the potential to at least triple their global market share if they can drive the price lower by 10-20%. By controlling more of the design they can achieve this. And by giving the software for free, the consumer will see the cost of ownership as the same or lower than Windows. Especially now that Microsoft is trying to get an annual fee from you for Office. The tipping point would be when many Niche programmers stop ignoring the Mac such as the major CAD suppliers. With a market share reaching 10% globally and 20% domestically these Niche programmers won’t be able to do that for much longer. A triple market share will give them greater than 15 billion in a quarter. Not at IPhone levels, but IPad and Macs would be on equal footing with the IPhone.

    • The idea could be in Apple’s mind but more than an hardware problem (which is definitively an hard problem since intel hw optimization is not at all easy to reach) it is a software problem.
      Mac started to grow when Apple switched to intel because they reached the capability of emulate windows and therefore allow the use of the niche programs that aren’t on Mac.
      Going without intel would mean to loose x86 compatibility, all existing software for mac should be emulated (like Rosetta did for powerpc software) and be slow or it should be rewritten for the new hardware, furthermore no windows emulation will be possible.
      iOS started anew so compatibility with legacy software was not a issue, but for mac it could be greater than the make your own processor as fast as intel’s ones hardware problem.
      A see more possible a new device, for instance a touch macbook with both iOS and OSx running together on an Apple processor, that device could in time disrupt Intel Macs, compatibility with iOS will take care of the lack of OS X software for the new cpu while mac software will be ported to the new device.
      The risk is that OSx software could be abandoned by developers in favor of the more lucrative and diffuse iOS platform.

      • Gene Grush

        I see two possibilities. The first is for Apple to use their experience on the ARM RISC chip to make an instruction set equivalent Intel Chip that is capable of running Windows. It won’t be as powerful as the Intel chip initially, but will have a better cost to performance ratio than Intel. The other possibility is the A8 chip and beyond, but this depends on Windows support of that chip which is still open to debate. I don’t see the switch for at least two years. In the mean time Apple will slowly drive the bottom end of their Mac prices lower as you have seen lately. They have 10% US market share and 5% international market share and has increased for 31 of 32 quarters. By lowering their price coupled with continuity and the ICloud storage available with the new software upgrades, there will be a compelling argument for current IPhone/IPad customers to replace their computers with an Apple computer in the future. Also, their added functionality for their computers to answer your cell phone at home will probably allow me to get rid of my land line.

      • Mixing Arm and x86 instruction sets on a single chip is not a possibility, it is nonsense.
        Apart from x86 copyright to be paid to intel, that will make the cost saving option insignificant, the two architecture are too different to be mixed and furthermore power will be higher than simpler cpu.
        The only option is A8 or A9 and a software emulation to allow developer to make a sweet transition to the new instruction set (from x86).

      • Duh

        WTF are you smoking? Just so you know, ever since Pentium Pros, the intel chips have been RISC at the hardware level, and have a layer of microcode on top that gives it that x86 flavoring (instruction set).

        ARM is another layer of flavoring (instruction set), on a different RISC chip.

        To get that x86 “flavoring” means licensing from Intel. Which won’t happen. Of course, there is a potential way out – AMD64 is owned by AMD… A 64 bit only AMD64 cpu, without any legacy 32 bit or earlier support. That would be interesting.

      • charly

        AFAIK The instruction set isn’t owned by Intel but the patents needed to implement the instruction set is owned by Intel. AMD already has a license for x86 so it wouldn’t surprise me if “pure” AMD64 uses Intel patents.

    • Tatil_S

      Designing a chip for devices that sell more than 100 million annually is quite a different proposal than one that sells only a few million. Further thinking that you can do so at a price cheaper than the one company who has been doing it for decades could be quite foolish.

      • Gene Grush

        So 16-20 million Mac Chips a year isn’t a good enough market. Also if they triple their market share they would be in the 48-60 million range.

      • Tatil_S

        No, it is not a large enough market, because requirements for the CPUs intended for MP, MBP with retina screen, for iMac and for 11” MBA are not the same. Each one will have far smaller volume than the total Mac volume.

        Yeah, if I triple my investment portfolio, I’d feel much better, but somehow I feel like it is just about as easy as Apple tripling its marketshare in the next few years.

    • charly

      Margin is not only important. It is also total profit. I think you can buy Android PC’s for $40. Even with 100% margin that only leaves you with $40 profit. I don’t think any mac leaves the factory with only $40 profit

      Next year is the transition year for PC in that storage will go from internal harddisk to SSD with usb harddisk. In the short term (next 2 years) this will lead to a slightly higher average price but after that prices will drop even lower. Add the fact that memory usage has been flat while Moore’s law makes it cheaper, No hard disk makes for smaller PC enclosures and the lose of the DVD drive because it is such a large part of it. This makes $200 PC’s an easy target price in 3 years time. But that is awfully close to the impulse buy price of $150 which is something that Microsoft and Intel executives should dread.

      An awful lot of niche software is in legacy mode as in would not be profitable to rewrite it. It will never come to the mac or if it did as a browser app. CAD software is unix/opengl based. Bringing it to mac is easy. Most niche software does not have it roots in Unix.

      ps. Statcounter may be used to look at change in the market but they are completely useless for absolute usage

    • obarthelemy

      Designing an x86 chip is a lot harder than designing an ARM one:

      1- unlike ARM, x86 is not a licensed design with clear specs, a base design you can tweak, and plug-in IP (graphics…). You’ve got to clone it blind while not infringing IP
      2- I’m fairly sure VIA and AMD can’t be bought without Intel’s agreement
      3- x86 is a lot more complicated the ARM

      And finally, a big part of what make x86 interesting is Intel’s lead in chipmaking processes.

  • Hi Guys – good discussion as always. I’m a digital grandfather – an Apple evangelist since opening one of the first Apple Reseller stores in 86 Melbourne Australia. But here’s the thing – the next device I buy will be the next gen ChromeBook. Work and most stuff businesses need will be delivered through the browser. Steve was right – it’s the end of the PC era indeed!
    So @Horace – what category does a ChromeBook come under?

    • IDC and Gartner disagree on this so it’s not a simple decision. The correct categorization is on jobs-to-be-done not on device attributes. However jobs-to-be-done segments cannot be easily measured and hence the data is unavailable. For instance a subset of phones are used for jobs that used to be done by traditional computers and a subset of computers are used only for phone calls. Separating purchase decisions into those attached to jobs is the only way to plan, so the analyst needs to take both what is measured and what is not measured into consideration.
      Chromebooks are evolutions of network computers which were initially put forward during the early 90s as alternatives to the PC (I used one called an X terminal around then: It’s taken a few decades for them to reach million units/quarter sales rates. In a few more years they might grow to be significant. However they will also compete with touch-based alternatives which have shown to grow far more quickly so I don’t know if they will ever become a default choice for computing.

      • Thanks Horace and thanks for your digital insight and the difference you are making. I am one of your biggest fans ‘down under’

      • twilightmoon

        I would caution you to sink money and time investment into something that may not be around in a few years. Assuming the security issue isn’t an issue (I am not sure that they are secure enough for Business use?), Google has a long track record of abandoning hardware and software projects that they start that are not based on Search.

        A Chrome Book may be cheaper up front but based on time and other investments you sink into it, make sure that you can still benefit from it if Google decides to abandon the project as they have with so many other projects in the past.

      • kk

        Most hardware is good for 3 years or so. Even if google stops supporting chromebooks you could still use it until it dies. Considering that most people use web based apps and social media, it’s fine for that and basic productivity.

        If google made it self-destruct you could still install linux and continue without missing a beat assuming the hardware continues to work. After a couple years, technology lovers will replace it anyway, working or not.

        As far as buying hardware for a specific purpose… If you are planning a specific use for a computer, get what you need to do the job, whether that is a Mac, Windows PC, tablet, netbook, laptop, etc. or a specific operating system depends on primary use of the device. If you just use it for email and facebook, just about anything will do the job, If you create documents, presentations, artwork, music, videos, etc. Get the best tool that runs the software you need.

        I get a kick out of people deciding how apple should run their company and make the software available on all available hardware. They started with the proprietary model early on, had issues for years like IBM, Compaq and others that tried to stay proprietary and lost market share as a result. They came back with a vengeance with OSX and ipod, iphone, ipad, etc. Considering their position in the marketplace, it would appear that they have perfected their business model.

        If you can get away with limiting the support to a tightly controlled hardware platform it’s much easier to manage and far more profitable and in the end will lead to more customer satisfaction since everything will work as advertised. The same people that want to be able to put OSX on their crappy hardware platform will be the first to complain when something doesn’t work and then write negative reviews because they can’t run something that everyone else runs just fine on their supported hardware.

        I wasn’t a fan of the Mac until OSX and still don’t own one yet due to heavy investment in the old Windows platform and it’s applications but the cloud has leveled the playing field and now you can pretty much do what you need to on any platform if you are willing to make small changes like using cloud based apps. Once you’ve done that, the platform matters less and now you can be free from the Microsoft monopoly that it finally starting to crumble. If you want to use cheaper hardware, go with Linux. You can get a similar level of usability and stability, use the cloud and save money by avoiding the vendor lock-in.

        If you want state of the art, go with a Mac and enjoy a superior integration between the OS and the hardware and the ecosystem that was designed around it. If not, buy cheap hardware that will get the job done and stop expecting Mac OSX to support your cheap computer.

        I doubt that you will ever see the day where businesses rip and replace their Windows systems with a Mac platform due to cost and familiarity among the workforce. The cost of hardware and training would be too much and the return on investment just wouldn’t support it. Also, while losing market share, the Win-Tel platform still makes up the bulk of computers in use in homes and businesses across the world. It will take a huge shift to change that and the tablet platform seems to be the most likely replacement for low-end pc’s in the personal market where apple and google reign. It’s hard to say what the future holds but PC’s for regular folks may not be where the growth is these days and apple appears to be focused more on satisfying it’s loyal base where it’s margins are than trying to appeal to the masses and compete directly for the low end.

      • Hi Horace – it’s now 2 years on – just wondering what’s your view on the growth category of Chromebooks now?

        From what I see – we are now almost through the early adoption phase lead by schools and education – now business also seems to be embracing the change.

      • Chromebook is doing well indeed. The tasks it’s assigned to do are the “low end” of the market and it does qualify as such a disruption. The problem is that there is an even lower-end alternative in tablets and phones. The computing category is being subsumed by devices and therefore “winning” against the PC is not particularly exciting when PCs are contracting.

    • JohnDoey

      That is the myth. The reality is the trend over the past 7 years has been away from the browser, not towards it. People use more native apps than ever. Even business people.

      The browser is slower, less reliable, and less capable than native apps. If you are working 40–60 hours per week, that adds up considerably, to where a user who only has a browser can’t compete with a user who has both native apps and the browser.

  • plcm123

    Companies used to have to buy PC’s for every different environment and need that they have. Nowadays, all of those environments are replaced by virtual machines. The hardware on the desk now can be anything, so of course people would choose Macs. It’s the signs of the times.

    • charly

      Spending $500 for a mac instead of $100 for a thin client makes sense. Especially if the desktop machine only displays the thin client software.

      • plcm123

        You pay what you get, and people are smarter now, they don’t want to buy craps. If it is the only hardware they’ll be using everyday from work or home, they might as well enjoy it.

      • charly

        Tool is wrong so the $100 thin client is better than the $500 mac. Same as a Ford transit is better than a Ferrari to transport packages

        ps. I wont enjoy the whirl of the mac fan compared to the silent thin client

      • plcm123

        To you a Ford is good enough, but to others a Ferrari is better overall. To each his own, I can’t say more, the statistics speak itself.

      • charly

        Overall when transporting packages?

      • plcm123

        What packages?? just because you use your device for a specific purpose, doesn’t mean others want to do the same.

      • charly

        But the computer would be used as a thin client, not something else?

      • plcm123

        Who said anything about using it just as a thin client?

      • charly

        You in the first post

      • Duh

        Something is clearly wrong if your Mac’s fan is whirling, if all you are doing is using it as a thin client

  • plcm123

    To those who keep insisting that Apple give out OS X to OEM’s, they still don’t get it.
    Apple is not about quantity, it’s about quality, craftmanship, refined user experiences from inside and out, top down. They built their reputation based on that, something that will last much longer in people mind and heart and lifestyle.

    • Will

      True, OSX cannot handle the vast hardware options out there. It’s simply wasn’t designed for that.

      • charly

        What vast hardware options? I would be surprised if Hackintosh doesn’t work on 99% of the PC sold last year

      • Will

        I mean there’s no support for any hardware other than Macs. Once Apple releases OSX for any hardware, the effort for supporting said hardware would skyrocket.
        Compatibility is not something to brush off.
        To be clear, I’m not saying it’s impossible, I’m saying the risk is not be worth it.

      • charly

        If you exclude prosumer stuff than consumers only use stuff integrated on the motherboard chipset except for video card. There are three video card makers, two chipset makers and two cpu makers. As Apple doesn’t use all of Intel so my estimate is that they would need at max 3x as much drivers. That is not something hard to do. What is true is that Apple can’t compete with white boxes

      • Will

        You have drastically oversimplified the situation.

        But whatever, it’s not like it’s going to happen anytime soon.