toggle

AAPL Stock: 559.6 ( -5.72 )

MacNN News

'The iPod Perspective': where's Apple's Mac business?

updated 10:15 am EDT, Fri October 15, 2004

\'The iPod Perspective\'

says that Apple's business model may be too heavily dependent on the iPod: "Apple now makes more from its top line from iPod sales than from any single line of its computers. By revenue, the PowerBook notebook line is Apple's second most important product, accounting for $419 million, or just less than 18%, of sales for the quarter.... Take the iPod business away from Apple, and what's left? A company that sold 3.3 million computers in its fiscal 2004. That's less than 2% of the 176.5 million computers that market research firm IDC forecasts will be sold this calendar year. Apple's unit sales have improved a paltry 7% since 2002."

by MacNN Staff

(21)

TAGS :

Apple

Share the Article

Facebook Twitter Delious Slash Dot Digg

toggle

Comments

Horsepoo!!!
Banned

Joined: Jun 2003

0

10/15, 10:29am | report spam | close Reply |
Two Things Goind On

1. Apple's grand scheme might be using iPod to lure people to buy Mac. If this is the case, big changes don't happen over night, you gotta give it a few years for the effect to sink in. Once people realize just how good Apple products are, they will give Apple's computers a chance.

2. Apple doesn't just sell computers. As much as people would like to believe Apple is in the computer selling business, they're wrong. Apple sells a computer experience. The difference? Apple sells computers as well as software to go with the computers as well as digital hub devices such as iSights and iPods to name two. When Job came back and turned Apple around, there was a shift in the company's mission and vision. And it's certainly not 'selling computers to as many people as possible'.

hayesk
Professional Poster

Joined: Sep 1999

0

10/15, 10:35am | report spam | close Reply |
Why freakin' cares?

I don't buy a Mac because everybody and their dog has one too. I buy it because it's the best computing environment available. I couldn't care less if it has 2% of the market.

3.3 million computers per year is a lot. More than enough to sustain the Mac market.

Geez, think back 15 years ago (or whenever) when the entire PC market was about 3 million per year. It's not like analysts were saying "don't invest in computer companies, the market is too small to survive." So why is the Mac market not big enough?

As I said in a post yesterday, analysts will never understand the Mac market is not just a piece of the PC market.

pliny
Mac Elite

Joined: Apr 2001

0

10/15, 10:39am | report spam | close Reply |
"single line"

The article says that the iPod sells more than any single line of computers. And??? If you add up all the computers Apple sells, it makes more than twice as much from computers as iPods.

And anyway, what's the point of saying, "Take away the iPod and what do you have?"

Why would Apple suddenly "take away" the iPod? Why would an investor act as if Apple didn't have the iPod?

Let's take away, hmm, let's see, MS Office from MS. Let's act as if MS doesn't make it or sell it. Then what do you have?

Apple is one of those companies that just EVERYBODY loves to run!

eldarkus
Fresh-Faced Recruit

Joined: Feb 2004

0

10/15, 10:58am | report spam | close Reply |
no ipod to ruin Apple?

"Take away the iPod and what do you have?"

Did this guy miss somehing? Did he skip logic school? What do you have minus the iPod? The same thng you had before the iPod. A great company who puts out great products along with great software.

Between 1998 & 2000, Apple stock rose from 15 to well above 60, yet with no iPod.. how did they ever do it?

piracy
Mac Elite

Joined: Mar 2001

0

10/15, 11:06am | report spam | close Reply |
LOL!

Apple's successful, and it just completely blew away industry estimates, and its unit sales of computers have grown as well, but if you take all that away, really, what do you have?

A beleaguered company, that's what!

Folks, no matter how successful Apple is, no matter how many profitable quarters are posted, someone's always going to be woefully foretelling Apple's demise.

Deal
Mac Enthusiast

Joined: Apr 2001

0

10/15, 11:11am | report spam | close Reply |
Darn!

I was going to say that and you beat me to it!

koolkid1976
Fresh-Faced Recruit

Joined: May 2003

0

10/15, 11:15am | report spam | close Reply |
Question for you folks

Anyone know what Apple's profit margin is on it's iPod compared to the Mac?

I'm thinking of the margin on the iPod is less, then maybe Apple should shave it's profit margin on the Macs, lower the prices, and hope to make money on quantity sold as opposed to relying on high margings, low quantity.

Heck, I think they should shave their margin on the iMac and focus on quantity. Keep the high margins for the dual processor desktop systems.

telem
Fresh-Faced Recruit

Joined: Dec 1999

0

10/15, 11:32am | report spam | close Reply |
G5 Problems

Wasn't iPod Perspective awake when Apple explained that the problems procuring G5 chips had hurt deliveries of iMacs and PowerMacs for the quarter?

Signed, a happy iMac G5 owner

Bookie
Fresh-Faced Recruit

Joined: Oct 2004

0

10/15, 11:35am | report spam | close Reply |
Market share

Their market share won't grow significantly until they release the cheapo headless Mac. Imagine you are a PC user; you have a nice monitor, and are thinking of getting a Mac. You don't want an all-in-one solution like the iMac. What is your entry level price? $2000. Apple should have a $600-$800 tower, which can take a decent graphics card, extra hard drive, etc. I believe there is a pent up demand for such a computer, in business, in education, for switchers, even a loyal Mac user like myself. I can't afford a G5 Poer Mac, and I wouldn't buy the iMac because of the crud graphics card. I'd buy the computer I described in a second, even if it were just a 1.5 gHz G4.

HeatherEcsedi
Fresh-Faced Recruit

Joined: Oct 2001

0

10/15, 11:43am | report spam | close Reply |
Smear like campaign ?

I'm just wondering how many companies out there are jalous of Apple's success with the iPod and how they can to some point try to have as many journalists give Apple some bad press... As if Apple was to remain a low profile company (in terms of sales) and any successful product was to be considered abnormal ?

testudo
Fresh-Faced Recruit

Joined: Aug 2001

0

10/15, 12:23pm | report spam | close Reply |
Re: Two things

2. Apple doesn't just sell computers. As much as people would like to believe Apple is in the computer selling business, they're wrong. Apple sells a computer experience. The difference? Apple sells computers as well as software to go with the computers as well as digital hub devices such as iSights and iPods to name two.

That's a boatload of c***. "Computer experience"? Sounds all great and all, except Apple makes the software to sell the hardware. They've started selling some stuff to fill holes in areas they want to move their user base to (A/V creation). But if they wanted to improve the 'experience' for most users, why don't they make a cheaper computer? Why did it take them so long to put ports in easily accessible places? Why don't they give the user what they want, rather than what apple wants?

The new iMac is a joke. Oh, it looks good and its got a G5, but let's talk usability from a user perspective. Want to turn it on, reach around back and find the switch (allright, we're back to 1984 again!). Need to plug in your digital camera, again, reach around back, plug and try to find the correct socket. Or rotate the screen, plug it in, rotate it back. Where's the 'great experience' so far? Now, what's that? You already own a great flat-screen monitor, you just need a new computer. Get an iMac for $1500! No, at that price its not expandable. What do you mean you want to keep your monitor? Oh, no problem, Apple has you covered. Spend $2400+ on a new tower (that includes all the money you'll need to raise the RAM to a decent level, and put in a decent video card). Oh, and don't forget to buy that ADC->DVI connector for your monitor, because Apple changed the specs on you, again.

My point is, maybe if Apple actually stopped worrying so much about looks and 'experience', and actually provided their customers with what they ask for (you know, some PC users actually think that if you buy a huge tower, you'll have lots of room for expansion, as opposed to Apple's 3 PCI slots and two drive bays - sure you can add firewire, but then that adds to your desk clutter, ruining the 'experience'), maybe they'd actually, I don't know, increase sales or something. Oh, right, they can't even supply people with the computers they have now, they wouldn't be able to handle actually trying to sell over a million a quarter.

When Job came back and turned Apple around, there was a shift in the company's mission and vision. And it's certainly not 'selling computers to as many people as possible'.

Yeah, god forbid Apple actually tried to sell computers to more than the Lexus 'I can afford a $2000 desktop' crowd. Then where'd the company be? Oh, with more sales and higher marketshare. Nevermind, no one would want that.

Eriamjh
Addicted to MacNN

Joined: Oct 2001

0

10/15, 12:30pm | report spam | close Reply |
Death Knell

#346?

Buran
Fresh-Faced Recruit

Joined: May 2000

0

10/15, 12:32pm | report spam | close Reply |
What's wrong here?

Why does this guy complain because a company makes a fair bit of its sales from one product? If a company can do that and stay alive, well, then, they're apparently doing the right thing when it comes to finding new stuff to sell.

I think he just wants to complain.

testudo
Fresh-Faced Recruit

Joined: Aug 2001

0

10/15, 12:43pm | report spam | close Reply |
Re: who freakin' cares

Geez, think back 15 years ago (or whenever) when the entire PC market was about 3 million per year. It's not like analysts were saying "don't invest in computer companies, the market is too small to survive." So why is the Mac market not big enough?

Because at such a small market, the whims of developers severly affect the mac user base. If Intuit decided to drop Quciken for mac, where would its users be? Off buying PCs or VPC to run the Windows version (which, by the way, a lot of people do, because the Windows version is SO MUCH BETTER than the mac version!), because there's no real alternatives, because the market is too small to warrant competition. And because of the small market, there's no financial reason to make specialty apps for the mac. My sister would get a mac (after years of battling windows), but the software she needs for her real-estate job only runs on Windows. Oh well.

h***, why do you think Apple came out with the likes of FCP? It was to make sure they had some offering for that market, because the existing developers were starting to dwindle down their offerings. And how many Adobe products seem to either not be available for the Mac, or have been EOL'd for the Mac.

And once the whole iPod fad wears off (and it will, as all fads do), Apple will need to make up for those dwindling revenues. And where's it going to get them? If they're really lucky, they'll have some new fad device out there (but keep in mind how long it took for the iPod to take off from when it was released as an over-priced player in a crowded field), they'll again just be left with their computer revenues. And without any increase in marketshare or sales (which apple seems h***-bent on making sure that happens), Apple's profits go in the toilet, followed immediately by its stock. So they'll have to either boost sales (which, again, they seem completely unable to do, and I don't know why - who wouldn't want to spend $2000 for a Mac rather than $1000 for a Dell or Gateway or HP?) they'll have to boost margins, which means higher prices for all you mac-lovers who'll buy anything apple makes regardless of price (because, its the 'experience', and how can you put a price on that).

BTW, the argument about Macs being usable longer than PCs, so its OK that they cost more is flawed logic. I'm still using a 6 year-old mac, not so much that its still so usable, but because it cost so damn much I have to get all I can out of it, and you have to save up $$$ a lot longer to get you're next mac.

Gee, if only some computer company could come up with a way to make a computer with the insides of, oh, I don't know, say the new G5 iMac, but take the screen off. You know, those $600-1000 LCDs, that make up for over half the price of these iMacs. So, you could take this screenless mac, stick it in a box, and sell it for $700-800. Too bad such technology to sell a sub-$1000

koolkid1976
Fresh-Faced Recruit

Joined: May 2003

0

10/15, 12:51pm | report spam | close Reply |
Re: Re: Two things

Testudo, I thought you were a Mac guy who always post sarcastic comments, but there is nothing sarcastic about your post.

Like the other guy said, Apple does sell an experience. It's why iLife was created in the first place. To improve out of box and user experience.
"Apple makes the software to sell the hardware"
Ofcourse. How else can they sell the experience without the hardware? Or the software? Both make the experience.

A cheaper Mac enhances the BUYING experience. Not the out of box and user experience like I mentioned above. So you are off track.

"Need to plug in your digital camera, again, reach around back, plug and try to find the correct socket."

I know, it's not as elegant as the PC where you have to pull out your tower and crawl underneat the desk and fumble in the dark to find the USB ports.

mfeldman
Fresh-Faced Recruit

Joined: Oct 2004

0

10/15, 01:04pm | report spam | close Reply |
STock will fall... why?

I'm concerned about a number of things from Apple's recent financial results. My thoughts echo Jack Miller's fears--

http://www.mac360.com/index.php/mac360/more/apples_stock_price_are_you_worried_about_a_fall/

Apple's riding an iPod wave, not stellar Mac sales. Mac sales are just so-so, not great. But that's bread and butter. Chances are good that there's not much profit anywhere at Apple right now. Even with about $2.5-billion in sales, all they could scrape together is $100-million in profits. What's that? A couple percent?

My big worry is that the air will come out of the iPod balloon soon. Buy low, sell high. The iPod's market share can only go down, meanwhile, back on the farm, the Mac's market share is ONLY going down.

hayesk
Professional Poster

Joined: Sep 1999

0

10/15, 03:35pm | report spam | close Reply |
Re: testudo

Testudo, you have validated my point. Analysts go on and on about marketshare that it does affect the mindset of some developers. If marketshare wasn't an issue, more developers would develop for the Mac because they know there are 3.3 million Macs sold each year. I don't know about you, but if I had a business, I would love to have that many potential customers each, especially with less competition.

For FCP, it's not because Adobe was dwindling down anything. It's because Premiere was sucking on both platforms and Apple wanted to do better. Premiere is still crappy on Windows. Adobe discontinued apps after they realized they couldn't compete with Apple's - you make it seem like it was going to happen anyway.

As for plugging in your digital camera to your iMac, I plug mine into the keyboard port right in front of me. How is a PC experience better?

Macs are usable longer, not because of price, because they are usable. If it wasn't, it wouldn't matter how much a new one costs. My wife's clamshell iBook G3 with 320MB of RAM still runs MacOS X well. She has no need or urge to upgrade. A low end PC laptop from four years ago with 320MB of RAM would choke on WinXP.

testudo
Fresh-Faced Recruit

Joined: Aug 2001

0

10/15, 04:03pm | report spam | close Reply |
Re: two things

Testudo, I thought you were a Mac guy who always post sarcastic comments, but there is nothing sarcastic about your post.

No, I'm sarcastic when the mood strikes, I'm critical when the mood strikes. Today I'm critical of the previous post mainly because, to me at least, they missed the bigger picture, market share and price, for some small picture of 'user experience'. But I am a Mac guy.

A cheaper Mac enhances the BUYING experience. Not the out of box and user experience like I mentioned above. So you are off track.

Actually, a cheaper mac would give MORE people the ability to enjoy the user experience. Right now, its limited to the select few who (a) can afford the computers, and (b) can justify them. I like the iMac, but have a hard time to justify it, not only of its actual cost ($2500 easy, with applecare, ram, etc), but also the additional cost of what would be my now-useless monitor (and anything/everything else I'd have to toss from the old computer). Not everyone wants to be part of the 'disposable society' where you just throw out all your old stuff because something new has come along. There's a reason there's a large outcry for a headless iMac (or whatever). Its because there's a large group of people who find buying a computer with a built-in $1200 screen, that can't be used with any other device, kind of a waste of money.

"Need to plug in your digital camera, again, reach around back, plug and try to find the correct socket."

I know, it's not as elegant as the PC where you have to pull out your tower and crawl underneat the desk and fumble in the dark to find the USB ports.

I don't know. All the PCs I've worked with in the last several years have some ports on the front of the machine. You know, just like the G5 tower.

But if you think about the new iMac, the criticisms some posted do make sense. Apple touts simplicity and style with their products (it'll look great on your desk), but that takes precedence over ease of use (again, the USB cable in the back business). Then they throw in the "You don't need internal space for anything, use external peripherals for your extra hard drives and such", which again sounds good, but it blows up the whole first point, the 'user experience' and 'great looks'. Nothing like having a couple of firewire cases on your desk, plus the USB hub so you can easily plug in that camera, and a bunch of cables dangling down from your monitor to connect them all. Yeah, real neat and tidy.

just a poster
Fresh-Faced Recruit

Joined: Jun 2004

0

10/15, 04:05pm | report spam | close Reply |
Jealousy and cluelessness

There is nothing wrong with the iPod approaching 20% of Apple's total revenue stream. It is evidence of MacOS X's vertical scalability and Apple's newfound ability to leverage its existing marketshare to make compelling consumer products that supercede it.

The only question worth debating is whether Apple can continue to leverage its infrastructure and technology to make other iPod-like consumer products.

So I'll address that.

Microsoft has the same administrative and technical run-up towards creating a product that Apple does (example: a music store), but they are further burdened by having to build and develop features into Windows that would make it possible to do so as quickly as it is done on unix-based operating systems. It was a lot more difficult for Microsoft to integrate WMP and web-based stores than it was for Apple to port iTunes to Windows for seamless compatibility with the iPod.

This is only the beginning. Companies reliant on Microsoft technologies - particulary Windows - will continue to fall further and further behind as they struggle with commoditization; inability to leverage multiple technologies and partnerships of their own; and continued dependency on a monopolist product that at once threatens their business and relies on introducing incompatibilities in order to drive revenue.

Apple's music business will face challenging times ahead, but the nature of their offerings in this field mitigates their costs more efficiently than offerings from the Wintel world. Consequently, a worst-case scenario for Apple will still be far less damaging than a similar scenario for all other parties attempting the same thing.

mfeldman
Fresh-Faced Recruit

Joined: Oct 2004

0

10/15, 09:46pm | report spam | close Reply |
Touble on horizon...

These next two quarters are the "tell all" for Apple. I'd expect a profitable year end quarter, though. More G5 chips, iPods will be hot for the holidays. BUT, those G5 chips MUST sell and that hasn't been the case for a year.

First quarter of the new year usually sucks in comparison, so if Apple still does well-- iPods and G5s-- all is good. If not, watch out. Stock dive...

JEB
Junior Member

Joined: May 2001

0

10/18, 05:44am | report spam | close Reply |
well, just wait until

wait until they make a G5 iPod, that rolls sushi !!!!!

then this sucka will eat his words!!!!!

Show More Comments

Login Here

toggle

Network Headlines

05/25	Third-gen iPad coming to Philippines...
05/25	Apple to integrate Baidu search into...
05/24	Apple submits surprise optical stylus...
05/24	Yahoo releases Axis 'visual search'...
05/24	Apple airs two new Siri commercials...

Show All

05/25	Apple to integrate Baidu search into...
05/25	Google picks up webOS Enyo team, Open...
05/24	Apple submits surprise optical stylus...
05/24	Yahoo releases Axis 'visual search'...
05/24	Google�s 7-inch tablet ships next month...

Show All

05/23	Google launches redesigned Search app...
05/22	Leaked next-gen iPod touch part hints...
05/22	Hulu Plus updates with iPad Retina...
05/22	TiVo Stream to push TV to iPhones,...
05/22	Hands on: TouchType case for iPad,...

Show All

03/02	Save $330 on refurb. 15.4-inch, 2.4GHz...
03/01	Pre-owned 8GB iPod touch 2G, drops...
02/29	$150 off Nikon Coolpix S80 Compact...
02/28	Plantronics BackBeat 903 Bluetooth...
02/27	Refurb. Seagate 1.5TB GoFlex Portable...

Show All

toggle

'The iPod Perspective': where's Apple's Mac business?

updated 10:15 am EDT, Fri October 15, 2004

\'The iPod Perspective\'

Two Things Goind On

Why freakin' cares?

"single line"

no ipod to ruin Apple?

LOL!

Darn!

Question for you folks

G5 Problems

Market share

Smear like campaign ?

Re: Two things

Death Knell

What's wrong here?

Re: who freakin' cares

Re: Re: Two things

STock will fall... why?

Re: testudo

Re: two things

Jealousy and cluelessness

Touble on horizon...

well, just wait until

Login Here

Register for our weekly email newsletter:

Connect tools:

Subscribe

to our RSS

Follow us

on Twitter

10 Most Read

10 Most Discussed

MacNN Marketplace

'The iPod Perspective': where's Apple's Mac business?

updated 10:15 am EDT, Fri October 15, 2004

\'The iPod Perspective\'

Related Articles

Recent Articles

Two Things Goind On

Why freakin' cares?

"single line"

no ipod to ruin Apple?

LOL!

Darn!

Question for you folks

G5 Problems

Market share

Smear like campaign ?

Re: Two things

Death Knell

What's wrong here?

Re: who freakin' cares

Re: Re: Two things

STock will fall... why?

Re: testudo

Re: two things

Jealousy and cluelessness

Touble on horizon...

well, just wait until

Login Here

Register for our weekly email newsletter:

Connect tools:

Subscribe

to our RSS

Follow us

on Twitter

10 Most Read

10 Most Discussed

MacNN Marketplace