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Office runs on Macs too! Seriously, I predict we will see Apple successfully attack the sub $1000 laptop market within two years. They sell the iPhone SE with

Office runs on Macs too! Seriously, I predict we will see Apple successfully attack the sub $1000 laptop market within two years. They sell the iPhone SE with an A13 for $399 so they could easily do so now they no longer have the 'Intel tax'. And the products will be a lot better than the Windows equivalents. Most home users might use Office and that's about it. The allure of the Apple ecosystem will be strong especially for iPhone users.

perardi 6y ago
I’m skeptical. Apple’s bread and butter, as far as Macs go, is the MacBook Air. And by all accounts, they sell a lot of those, and will presumably sell even more, with better margins, now that they’ve gone ARM. Do they really want to undercut that with a cheaper laptop? I suppose it’s possible, if the volume/margins works out, but I’d bet they just keep plugging along with $999–$1500 13-inch laptops.
- klelatti 6y ago
  All fair points but I think that with higher margins it tips the balance towards market share growth. Key issues are 1) can they make an acceptable margin on a good $800 laptop and 2) can they genuinely significantly grow market share rather than lowering average selling price - i.e. can they maintain distinction between $800 and $1000 products. Given what we've seen them do on iPhone and iPad I bet then answer is yes to both of these. Bear in mind too that after a generation or two they can put the last gen M chips in cheaper products.
  - singhrac 6y ago
    I think there's an economic principle here (and I don't know the sign), but this is all assuming a frictionless vacuum - in practice, Apple cannot sell 25% more M1 Macs if they lower their price to $800, or whatever, since their marginal costs rise in that case (because TSMC is totally booked!).
    - klelatti 6y ago
      That's today but I'd expect next year's sub $1000 Macs will use previous year's M series chips in due course. (Exactly the iPhone and iPad playbook).

perardi 6y ago

I’m skeptical. Apple’s bread and butter, as far as Macs go, is the MacBook Air. And by all accounts, they sell a lot of those, and will presumably sell even more, with better margins, now that they’ve gone ARM. Do they really want to undercut that with a cheaper laptop? I suppose it’s possible, if the volume/margins works out, but I’d bet they just keep plugging along with $999–$1500 13-inch laptops.

klelatti 6y ago
All fair points but I think that with higher margins it tips the balance towards market share growth. Key issues are 1) can they make an acceptable margin on a good $800 laptop and 2) can they genuinely significantly grow market share rather than lowering average selling price - i.e. can they maintain distinction between $800 and $1000 products. Given what we've seen them do on iPhone and iPad I bet then answer is yes to both of these. Bear in mind too that after a generation or two they can put the last gen M chips in cheaper products.
- singhrac 6y ago
  I think there's an economic principle here (and I don't know the sign), but this is all assuming a frictionless vacuum - in practice, Apple cannot sell 25% more M1 Macs if they lower their price to $800, or whatever, since their marginal costs rise in that case (because TSMC is totally booked!).
  - klelatti 6y ago
    That's today but I'd expect next year's sub $1000 Macs will use previous year's M series chips in due course. (Exactly the iPhone and iPad playbook).