A theory on Apple’s ‘Mactel’ business model
Posted by Dennis Sellers 
Aug 4, 2005 at 12:46am
As I noted in our Aug. 3 and July 25 musings, there’s a fairly common belief that Apple will eventually allow Mac OS X to run on all Intel-based hardware and evolve into a software company.
If Apple ever did actually allow other hardware manufacturers to offer Mac OS X on their systems, I still believe that the company would continue make stylish, cutting edge Macs. In fact, I believe the company has more, not less, hardware in mind for the months and years ahead—but that’s food for another column. However, Macsimum News reader Mark Hanley (a self-professed “Cocoa” fan and embedded software developer) offered some thoughts and a cool graphic I had to share with you:
Apple’s business model has always been “sell hardware.” They bundle software to make it more attractive, but sell hardware. iTunes is free—to sell iPods. When it comes to server apps, WebObjects and its ilk are free—to sell xServes. The Mac mini has more value in its bundled software than the hardware is worth. Hanley’s point: Apple’s business model gives it a unique advantage over its PC rivals: Microsoft doesn’t doesn’t sell PCs, and Dell and friends don’t write software.
“It costs Apple to write the software, but that’s all pre-tax expense, a decisive advantage,” Hanley says. “So what happens when Apple switches to Intel? Macs will still run Cocoa apps—that’s a no brainer, a simple recompile is all that takes. They will also run apps compiled for the PowerPC, thanks to Rosetta. Now here’s where the speculation starts, and the PC makers starts to squirm: just how hard will it be to make a Windows emulator that will allow .exe programs to run on Mac OS X on Intel?
“Consider this scenario: comparing apples to apples (please excuse the pun), Apple hardware today is a bit more expensive than Dell (feature to feature), but Apple doesn’t have to buy any software to include with the Mac (yeah, I know there are miscellaneous license fees for various IPs). So we have a picture that looks like this:”
“For about the same money, I can buy a Dell that runs Windows software, or a Mac that runs Cocoa apps and, if my hunch is correct, that same Windows software. Now the emulation might be a tad slow, although the Intel core will minimize that—no processor translation, but just how fast does the machine have to be to run Word and PowerPoint anyway? Not very. Audio/video editing you say? Apple software blows away Windows counterparts in that arena. Games? Maybe, although the speed in those apps comes from bypassing the Windows abstraction layers to get directly at the Intel core anyway, and you’ll always be able to dual boot the Mac, not so the Dell.
“I doubt Apple announced the processor switch without being certain they could protect their business model. The ability to run Windows apps on Mac hardware will make the iPod phenomenon seem tame.”
Thoughts? Write me at dsellers@macsimumnews.com
And don’t forget this week’s Macsimum poll. We’re asking, “Have you experienced iMac G5 problems?” With the first incarnation of the iMac G5, there were reports of problems with overheating, power supply bricks and logic board capacitor snafus. Now generation two of the iMac G5 is here. If you own or use an iMac G5, we’d appreciate it if you’d take a sec to participate in this week’s poll.
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Dennis Sellers
Dennis has been a newspaper editor/reporter (seven years) and teacher (seven years). He has over 4,000 magazine, newspaper and online articles to his credit. He has also covered the Mac and tech industries for over a decade for such online publications as MacCentral, MacMinute and now MacsimumNews.
