8 ms·

Apple now has 9% US market share, volume growing at 6x the industry average

22 points by echair 18y ago

fallentimes 18y ago
And their stock is close to their 52 week low with a P/E under 20. Interesting.
- MikeCapone 18y ago
  1) The rest of the market is also at its 52 week low, no? 2) In a recession, upmarket stuff and luxury items tend to slow down more, so it could affect Apple more than some other PC makers.
  - mdakin 18y ago
    It's not quite that simple. Often the richest consumers are not hit as hard by recessions and keep spending. And even if they are hit with a glancing blow perhaps instead of buying another house, car, boat they might seek comfort in more modest luxury purchases. I saw this first-hand during the post-bubble recession when I was an engineer at a luxury consumer electronics company-- we made lots of money while much of the industry was hemorrhaging. Supposedly sales of Patek Philippe watches actually peak during recessions. [1] [1] http://www.brandchannel.com/features_effect.asp?pf_id=104 http://www.brandchannel.com/features_effect.asp?pf_id=104
- mishmax 18y ago
  And that's why I bought Apple today!
raganwald 18y ago
It’s almost as if Apple were in a different business than Dell (DELL), HP (HPQ), Acer and Toshiba. Helloooooo! DELL, HP, Acer and Toshiba are in the ruthless business of trying to cut their margins thinner and thinner with fewer and fewer opportunities to differentiate their products while they acts as collectors for the Windows Tax. Apple is indeed in a different business, a business based on differentiation and branding.
- anamax 18y ago
  > Helloooooo! DELL, HP, Acer and Toshiba are in the ruthless business of trying to cut their margins thinner and thinner with fewer and fewer opportunities to differentiate their products while they acts as collectors for the Windows Tax. Umm, no. They're in the biz of trying to increase their margins. Differentiation is one way that they try to do it. Customers are in the biz of trying to decrease said companies' prices. One way to cut prices is for said companies to cut their margins. Currently customers are winning. Never confuse the outcome of an interaction with the intent of one of the parties.
  - raganwald 18y ago
    Well, DELL has made much of using supply-chain optimization to make more money on lower net margins. If HP, Acer, and Toshiba are working to differentiate their products from each other, I think they need to work harder. And I speak as someone whose last PC was a Toshiba.
- netcan 18y ago
  That would be different companies. With different strategies.
- mynameishere 18y ago
  based on differentiation and branding Heh. You obviously don't go to the dell website very often. They spend an inordinate amount of time trying to brand and differentiate various product configurations. It can be literally 5, 6, 7 sets of pages before you get to the "buy now" button. Of course, it's all just CPU type + Memory Size + Hard Drive Size + Windows variant in the end, but they really, really try.
- cosmo7 18y ago
  HP is the odd one out. HP sees the future in services, just like IBM. They're fattening (ie: media-ing) up their consumer products to sell off their entire PC line in the next 3 or 4 years.
  - 18y ago
cabalamat 18y ago
I wonder how high this could go? I think Microsoft are vulnerable here, since they are widely disliked, even hated. Apple's market share in the US is higher than in the rest of the world, because the US market is less price sensitive. But what if Apple brought out a cheap version of the Mac Mini, to capture that sector of the market? It ought to cost no more than $200 and like the existing Mac Mini it would have BYODKM ("Bring your own Display Keyboard and Mouse") -- but it would also be able to use the old PS/2 keyboards and mice, which many people have in their attics or on an old PC. This would make it a very attractive low cost option. Apple could have as an option on all their computers dual-boot with Linux (maybe using a customised Ubuntu distro), and allow people to run Linux programs in a virtual machine under Mac OS. The number of extra customers this would bring directly is not large, maybe 1% of the total market for new PCs; however it's an influential market sector because most Linux users have less-technical friends who rely on them for advice. One of the drawbacks of running Linux is that it's less likely to be compatible with new hardware than a more mainstream OS. However if the Apple distro and campatibility layer was well-written it would allow and hardware that works with Mac OS to work with Apple's Linux. So many Linux users might go for this option. If Apple did this, I think they could get 20%+ market share in the US by 2009Q4. How could Microsoft respond? Reducing prices probably wouldn't help them much, and Microsoft are too bloated and slow moving to actually produce a good operating system.
- cabalamat 18y ago
  Of course, the problem with this strategy is that Apple may be cannabalising their existing market to some extent. I think they could minimise this effect, firstly because the cheaper computers would be a lower spec, and secondly (don't laugh) they could make the cheap ones look not as pretty -- a factor that's probably important for a significant proportion of Mac users. Maybe the ugly cheapo computers could be sold under a different name to preserve the quality of the Apple brand.
- gaius 18y ago
  Apple will NEVER ship a third-party Linux. If they do use the Linux kernel (and it's not clear to me what advantages that would have, esp. given the disaster that is Linux audio) the user experience will be indistinguishable from OSX.
vlad 18y ago
What may get lost is that Apple sold 33% the number of computers that Dell did in the same time frame. As Dell is a big corporate supplier, it is possible that Apple sold as many (or almost as many) personal machines as Dell, and more than any other manufacturer. Another interesting insight is that corporations install the same software they've already purchased and will continue to do so during a recession, while personal users are able to buy and install software as they see fit--especially those first-time users who are trying to find replacements for their favorite windows software. So, buyers choose Macs when they have a choice, but choose Dell and HP machines for their companies to run all of their existing software.
- echair 18y ago
  it is possible that Apple sold as many (or almost as many) personal machines as Dell, and more than any other manufacturer Indeed. This article http://money.cnn.com/2008/10/14/technology/moritz_apple_announcement.fortune/index.htm?postversion=2008101508 http://money.cnn.com/2008/10/14/technology/moritz_apple_anno... says they now have 17.6% retail market share.
alaskamiller 18y ago
Apple won't grow any bigger until Steve Jobs leave.
- pistoriusp 18y ago
  Interesting, why do you say that?
  - alaskamiller 18y ago
    I'm referring to the company size -- which has some direct influence in how big of a market share Apple can have. My pet theory is that Apple is only as big as Steve Jobs can handle from a management standpoint. The company is pretty constrained in terms of growth. Engineering team are making do with taking more projects while undermanned and understaffed. There's also a hiring freeze that's been thawing since last year. Also, half of the company size are retail workers. This doesn't mean that market growth isn't important to Apple/Jobs, but from what I gathered it's not his primary concern or motivation.
    - raganwald 18y ago
      Interesting take. I wonder if this is isomorphic to programming team size. If we get rebuild the management culture around spreadsheets and process so we are not dependent upon the key manager, we can scale revenue out. But do we end up with mediocre products and wind up with another me-too consumer electronics company? Very interesting conundrum if you're on the board...
      - alaskamiller 18y ago
        The dogma on campus was always to maximize what you have instead of adding more to the mix. Some teams are pretty resistant to hiring as it's a sense of pride to be working 80 hour weeks. So in that way, Apple runs very lean. In fact when Jobs came back one of the first decisions he made was to axe the research division in the company not because the company was weak (it had a good chunk of cash reserves) but because it was the easiest and fastest way -- from the management point of view -- for him to get products out. The mentality of the company switched completely and I believe it's partially from that early decision to act as a small company.
MaysonL 18y ago
I wonder what their US market share in computers priced over $1000?
reazalun 18y ago
9% market share in US only. The edited title here in HN can be misleading.
vermontdevil 18y ago
Let's see how long this will hold up since now we are in a recession and Apple's stubbornness in regards to high pricing of their laptops.

22 points by echair 18y ago

fallentimes 18y ago

And their stock is close to their 52 week low with a P/E under 20. Interesting.

MikeCapone 18y ago
1) The rest of the market is also at its 52 week low, no? 2) In a recession, upmarket stuff and luxury items tend to slow down more, so it could affect Apple more than some other PC makers.
- mdakin 18y ago
  It's not quite that simple. Often the richest consumers are not hit as hard by recessions and keep spending. And even if they are hit with a glancing blow perhaps instead of buying another house, car, boat they might seek comfort in more modest luxury purchases. I saw this first-hand during the post-bubble recession when I was an engineer at a luxury consumer electronics company-- we made lots of money while much of the industry was hemorrhaging. Supposedly sales of Patek Philippe watches actually peak during recessions. [1] [1] http://www.brandchannel.com/features_effect.asp?pf_id=104 http://www.brandchannel.com/features_effect.asp?pf_id=104
mishmax 18y ago
And that's why I bought Apple today!

raganwald 18y ago

It’s almost as if Apple were in a different business than Dell (DELL), HP (HPQ), Acer and Toshiba. Helloooooo! DELL, HP, Acer and Toshiba are in the ruthless business of trying to cut their margins thinner and thinner with fewer and fewer opportunities to differentiate their products while they acts as collectors for the Windows Tax. Apple is indeed in a different business, a business based on differentiation and branding.

anamax 18y ago
> Helloooooo! DELL, HP, Acer and Toshiba are in the ruthless business of trying to cut their margins thinner and thinner with fewer and fewer opportunities to differentiate their products while they acts as collectors for the Windows Tax. Umm, no. They're in the biz of trying to increase their margins. Differentiation is one way that they try to do it. Customers are in the biz of trying to decrease said companies' prices. One way to cut prices is for said companies to cut their margins. Currently customers are winning. Never confuse the outcome of an interaction with the intent of one of the parties.
- raganwald 18y ago
  Well, DELL has made much of using supply-chain optimization to make more money on lower net margins. If HP, Acer, and Toshiba are working to differentiate their products from each other, I think they need to work harder. And I speak as someone whose last PC was a Toshiba.
netcan 18y ago
That would be different companies. With different strategies.
mynameishere 18y ago
based on differentiation and branding Heh. You obviously don't go to the dell website very often. They spend an inordinate amount of time trying to brand and differentiate various product configurations. It can be literally 5, 6, 7 sets of pages before you get to the "buy now" button. Of course, it's all just CPU type + Memory Size + Hard Drive Size + Windows variant in the end, but they really, really try.
cosmo7 18y ago
HP is the odd one out. HP sees the future in services, just like IBM. They're fattening (ie: media-ing) up their consumer products to sell off their entire PC line in the next 3 or 4 years.
- 18y ago

cabalamat 18y ago

I wonder how high this could go? I think Microsoft are vulnerable here, since they are widely disliked, even hated. Apple's market share in the US is higher than in the rest of the world, because the US market is less price sensitive. But what if Apple brought out a cheap version of the Mac Mini, to capture that sector of the market? It ought to cost no more than $200 and like the existing Mac Mini it would have BYODKM ("Bring your own Display Keyboard and Mouse") -- but it would also be able to use the old PS/2 keyboards and mice, which many people have in their attics or on an old PC. This would make it a very attractive low cost option. Apple could have as an option on all their computers dual-boot with Linux (maybe using a customised Ubuntu distro), and allow people to run Linux programs in a virtual machine under Mac OS. The number of extra customers this would bring directly is not large, maybe 1% of the total market for new PCs; however it's an influential market sector because most Linux users have less-technical friends who rely on them for advice. One of the drawbacks of running Linux is that it's less likely to be compatible with new hardware than a more mainstream OS. However if the Apple distro and campatibility layer was well-written it would allow and hardware that works with Mac OS to work with Apple's Linux. So many Linux users might go for this option. If Apple did this, I think they could get 20%+ market share in the US by 2009Q4. How could Microsoft respond? Reducing prices probably wouldn't help them much, and Microsoft are too bloated and slow moving to actually produce a good operating system.

cabalamat 18y ago
Of course, the problem with this strategy is that Apple may be cannabalising their existing market to some extent. I think they could minimise this effect, firstly because the cheaper computers would be a lower spec, and secondly (don't laugh) they could make the cheap ones look not as pretty -- a factor that's probably important for a significant proportion of Mac users. Maybe the ugly cheapo computers could be sold under a different name to preserve the quality of the Apple brand.
gaius 18y ago
Apple will NEVER ship a third-party Linux. If they do use the Linux kernel (and it's not clear to me what advantages that would have, esp. given the disaster that is Linux audio) the user experience will be indistinguishable from OSX.

vlad 18y ago

What may get lost is that Apple sold 33% the number of computers that Dell did in the same time frame. As Dell is a big corporate supplier, it is possible that Apple sold as many (or almost as many) personal machines as Dell, and more than any other manufacturer. Another interesting insight is that corporations install the same software they've already purchased and will continue to do so during a recession, while personal users are able to buy and install software as they see fit--especially those first-time users who are trying to find replacements for their favorite windows software. So, buyers choose Macs when they have a choice, but choose Dell and HP machines for their companies to run all of their existing software.

echair 18y ago
it is possible that Apple sold as many (or almost as many) personal machines as Dell, and more than any other manufacturer Indeed. This article http://money.cnn.com/2008/10/14/technology/moritz_apple_announcement.fortune/index.htm?postversion=2008101508 http://money.cnn.com/2008/10/14/technology/moritz_apple_anno... says they now have 17.6% retail market share.

alaskamiller 18y ago

Apple won't grow any bigger until Steve Jobs leave.

pistoriusp 18y ago
Interesting, why do you say that?
- alaskamiller 18y ago
  I'm referring to the company size -- which has some direct influence in how big of a market share Apple can have. My pet theory is that Apple is only as big as Steve Jobs can handle from a management standpoint. The company is pretty constrained in terms of growth. Engineering team are making do with taking more projects while undermanned and understaffed. There's also a hiring freeze that's been thawing since last year. Also, half of the company size are retail workers. This doesn't mean that market growth isn't important to Apple/Jobs, but from what I gathered it's not his primary concern or motivation.
  - raganwald 18y ago
    Interesting take. I wonder if this is isomorphic to programming team size. If we get rebuild the management culture around spreadsheets and process so we are not dependent upon the key manager, we can scale revenue out. But do we end up with mediocre products and wind up with another me-too consumer electronics company? Very interesting conundrum if you're on the board...
    - alaskamiller 18y ago
      The dogma on campus was always to maximize what you have instead of adding more to the mix. Some teams are pretty resistant to hiring as it's a sense of pride to be working 80 hour weeks. So in that way, Apple runs very lean. In fact when Jobs came back one of the first decisions he made was to axe the research division in the company not because the company was weak (it had a good chunk of cash reserves) but because it was the easiest and fastest way -- from the management point of view -- for him to get products out. The mentality of the company switched completely and I believe it's partially from that early decision to act as a small company.

MaysonL 18y ago

I wonder what their US market share in computers priced over $1000?

reazalun 18y ago

9% market share in US only. The edited title here in HN can be misleading.

vermontdevil 18y ago

Let's see how long this will hold up since now we are in a recession and Apple's stubbornness in regards to high pricing of their laptops.