Okay, Apple, so what about the sub-$1,000 desktop market?
Posted by Dennis Sellers 
May 22, 2008 at 7:06am
As was reported earlier, according to a study conducted by NPD, Apple’s share of the personal computer market for computers costing over US$1,000 grew to 66 percent in the first quarter of 2008. So what’s next—and does Apple have any plans to beef up its sub-$1,000 offerings?
It’s a pretty safe bet that the very popular iMac (see today’s review of the latest rev) is responsible for Apple’s staggering success in the more high-end market. But the Mac mini (which is constantly rumored to be on its deathbed) has “only” 14 percent of the sub-$1,000 category (which is actually more than I would have guessed).
If Apple is going to compete in the low (or at least lower) end market, it’s going to have to beef up its Mac mini offerings—and really promote them, something the company seems averse to doing. Price reductions are also needed—though how serious Apple is about this market, and what sort of slim profit margins it’s prepared to accept, remain to be seen.
Another option would be a mid-tower, expandable Mac, something I’ve covered before. Such a beast would be sort of a stripped-down Mac Pro that’s expandable—but not as expandable as the professional desktop. But again, this is an area that Apple doesn’t seem interested in.
Even if Apple doesn’t pursue the low end computer market, iMac sales and the strong sales of Apple laptops will keep the Mac’s profile high and rising. Also, Apple is competing in areas that it hasn’t before, such as the business portable niche (with the MacBook Air). And I expect we’ll see versions of the Mac creep into other niches as well.
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MarcosD Says:
Why would they want to enter that market? Eeeeww. TO make stuff at the volume those margins require, one has to turn out crap with outdated technology… basically everything Apple is not.
Posted on May 22, 2008
mjteix Says:
I kind of agree that in Apple’s perspective, the under $500-600 segment will be filled with iPhone/iPod touch kind of devices.
But that leaves the $599-999 segment that coud be used for lower-cost (that doesn’t mean lower-margins) computers. The Mac mini could be at least updated to newer technologies at the same current prices and Apple could had something at the $999 price point (that has not been filled since the Intel switch).
I think that sub-$1,000 computers are important for the emerging markets where the growth is and will be for many years, and also to attract new customers that don’t choose to buy Macs because of the (perceived) higher cost.
Posted on May 22, 2008
SpinPapi Says:
I have to agree with bobdmac. You’re right to WANT Apple to compete more agressively in the sub-$1000 space, Dennis. I’d like to see it too. But as long as they have a higher share of that market than their overall market share, I don’t think they’re going to worry about it.
Not until or unless the recession turns worse, with a greater impact on Apple’s revenues.
Incidentally I have a Mac Mini and love it! Dell monitor attached. ;)
Posted on May 22, 2008
Nazzdeq Says:
That is a race to the bottom. Apple will end up like Dell if they do that. Apple needs to stay high end and the low side of high end. Like BMW.
Posted on May 22, 2008
George Says:
I think this statistic is being reported in a very lazy, if not irresponsible, manner. The 66% figure only includes RETAIL sales. No enterprise. No direct sales.
I think it is really good news for Apple, but reporters are doing a disservice to their readership by not putting the numbers in the correct context.
Posted on May 22, 2008
tigre Says:
Apple will address this market when the timing is right.
iWork 09 - exceeding Office 2008 in everyway
Mac OS X server 10.6 - eclipsing Microsoft Exchange and SharePoints servers
Quickbooks version at full parity with its Windows version.
It will be a lot easier and less frustrating for business/enterprise customers to make the move with these in place. Apple is smart not to push too hard now.
Posted on May 22, 2008
Unclebugs Says:
This argument for a low-end Mac is stuck in an old paradigm. The low-end Mac is the iPod Touch/iPhone. It is less than a $1000 and does most of what you need to do:surf the web, watch/listen to media, text message, et cetera. With new applications coming via the SDK, and technology progressing at breakneck speed, soon you will be able to do almost everything a general purpose computer does in the palm of your hand.
Posted on May 22, 2008
way2trivial Says:
66% of Brick and Mortar (retail) store sales.
most wintel machines at retail stores are cheaper.
most >1,000$ wintel machines are not sold through B&M;stores- but online it’s a ‘damn’ statistic
Posted on May 22, 2008
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Contributor
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.
bobdmac Says:
It think Apple’s made it pretty clear that they aren’t interested in competing for the lower end (read: low margin) part of the desktop market. I expect that price range to be addressed by some form of mobile/sub-notebook, possibly augmented by a beefed-up Mac Mini as lower component prices permit. The iPhone has shown how a lot of functionality can be crammed into a compact size, and I think that’s the approach that Apple will focus on in the $600-$800 range.
Posted on May 22, 2008