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I'm actually not so sure about this. Apple's gross margin target is in the ballpark of 38-40% and a savings of $200-800 per MBP would have a substantial upwards
by acrooks 6y ago
I'm actually not so sure about this. Apple's gross margin target is in the ballpark of 38-40% and a savings of $200-800 per MBP would have a substantial upwards impact on that gross margin number. Apple carefully sets pricing to achieve a target gross margin without impacting sales too much (higher price = higher gross margin but likely lower net revenue because they're priced out of the market).
One of the two scenarios (or perhaps a mixture of both) are more likely, and I lean towards #1:
1. Apple decreases the price of the Mac to stay aligned with gross margin targets. This likely has a significant upwards impact on revenue, because a drop in price like this opens new markets who can now afford a Mac, increasing market share, driving new customers to their services, and adding a layer of lock-in for iPhone-but-not-Mac customers.
2. Apple uses the additional budget per device for more expensive parts/technology. They are struggling to incorporate technologies like OLED/mini-LED because of the significant cost of these displays and this would help open up those opportunities.
- deleted 6y ago[deleted]
- mattigames 6y agoThe high price of MacBooks is treated as a status symbol and the marketing department clearly knows as much, so I don't think they will be willing to give that up, so I lean towards your second option.
- Twisell 6y agoHow do you explain the iPhone SE then? Why not got the same road with an MacBook SE? I even think this will be the first product out the pipeline. MacPro buyers usually don't want to be beta testers and will probably be the last to transition out once horsepower is clearly there with mesurable gains.
- onion2k 6y agoThe iPhone SE is less a "cheap iPhone" and more "an expensive basic smartphone". Far more people upgrade to it from a low cost Android device then downgrade from a different iPhone.
- Twisell 6y agoAnd that is exactly why they can expect marketshare growth. Who is gonna buy a 600$ range plastic laptop PC if Apple ship a 700$ range MacBook SE? Of course you'd still get 350$ range crappy product, Apple can't and don't want to compete a those levels.
- DrewRWx 6y agoThe iPhone SE also picks-up the market segment that prefers smaller phones.
- ehutch79 6y agothe SE is a parts bin phone, not an entirely new design.