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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 th

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.
- cabalamat 18y ago
  > Apple will NEVER ship a third-party Linux. I agree. I don't think that they will either. My argument was not that they will, but that it would be in their interests if they did. Apple often behaves like this, e.g. the original Mac didn't have an expansion slot, even though it would've been in Apple's interests to include one.
  - gaius 18y ago
    Apple's strategy from day 1 can be summarized in two words: just works. Given the choice between something that just works but doesn't suit the needs of all users, and something that only a minority will use that opens the risk of something not working, they will always choose the safe option. Which is fine, everyone knows upfront what they're getting. Apple won't stop you running Linux in VirtualBox say, but they won't take responsibility for it at al.
jimbokun 18y ago
So...you are suggesting Apple sell a computer for less than the average profit margin on their current line of computers (or about there, I'm guessing). And this will help them how, exactly? What's the break even point for them to get to their current level of profit? Do you even know if it is possible to make a profit at all selling a $200 computer capable of running OS X? What kind of hardware are we talking about here? A just as likely scenario from selling $200 computers is Apple going out of business, I would think. Apple's strategy is basically to skim off all of the best customers from their competitors and make lots of profits by doing so. Meanwhile, the rest of the industry need to walk a tight rope between small enough margins to sell a larger volume than their competitors, but not so small as to be negative. Judging by the profit growth Apple has seen in recent years compared to their competitors, I think it's working pretty well for them.
- cabalamat 18y ago
  There's certainly an element of truth in what you say. I think most of the customers for the $200 computer would be new customers, not existing Apple customers. And over time, after having used a Mac they might buy another more expensive one later on. (Particularly if their experiences with Mac OS were better than witrh Windows).
MaysonL 18y ago
They already sell a small, just a bit over $200, portable, small display OS X computer: it's called an iPod Touch.
- nailer 18y ago
  You can't edit a modern document on an iPod touch. Nor can you use it for long periods.

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.

cabalamat 18y ago
> Apple will NEVER ship a third-party Linux. I agree. I don't think that they will either. My argument was not that they will, but that it would be in their interests if they did. Apple often behaves like this, e.g. the original Mac didn't have an expansion slot, even though it would've been in Apple's interests to include one.
- gaius 18y ago
  Apple's strategy from day 1 can be summarized in two words: just works. Given the choice between something that just works but doesn't suit the needs of all users, and something that only a minority will use that opens the risk of something not working, they will always choose the safe option. Which is fine, everyone knows upfront what they're getting. Apple won't stop you running Linux in VirtualBox say, but they won't take responsibility for it at al.

jimbokun 18y ago

So...you are suggesting Apple sell a computer for less than the average profit margin on their current line of computers (or about there, I'm guessing). And this will help them how, exactly? What's the break even point for them to get to their current level of profit? Do you even know if it is possible to make a profit at all selling a $200 computer capable of running OS X? What kind of hardware are we talking about here? A just as likely scenario from selling $200 computers is Apple going out of business, I would think. Apple's strategy is basically to skim off all of the best customers from their competitors and make lots of profits by doing so. Meanwhile, the rest of the industry need to walk a tight rope between small enough margins to sell a larger volume than their competitors, but not so small as to be negative. Judging by the profit growth Apple has seen in recent years compared to their competitors, I think it's working pretty well for them.

cabalamat 18y ago
There's certainly an element of truth in what you say. I think most of the customers for the $200 computer would be new customers, not existing Apple customers. And over time, after having used a Mac they might buy another more expensive one later on. (Particularly if their experiences with Mac OS were better than witrh Windows).

MaysonL 18y ago

They already sell a small, just a bit over $200, portable, small display OS X computer: it's called an iPod Touch.

nailer 18y ago
You can't edit a modern document on an iPod touch. Nor can you use it for long periods.