The Mac is doooomed (tell me I'm crazy)

Corporations, like most people, are pretty much all about self-interest. If you wouldn't do something that would hurt your income, why would you think Apple would?

Lets run the numbers here guys... which we will keep pretty simple for the sake of argument.

Lets set some easy boundaries... like
  1. The average cost of an Apple computer is $2000 (easy number to work with, and about the middle of the prices for all of Apple's computers).
  2. Apple's profit margin is 30% for it's computers (it averages about $600 for each computer sold).
  3. Mac OS X would cost $130 for PCs, and Apple makes $100 on each copy sold.
  4. Apple's market share is 6%.
Given these numbers, would Apple start selling Mac OS X for PCs?

Lets see... basically what we have here is that for every computer not sold because someone bought a PC and Mac OS X, Apple loses $500. The only way to make this up is to sell 5 more copies of Mac OS X for PCs for each Apple computer not bought because of a copy of Mac OS X.

What if half the people who would have bought Apple computers bought Mac OS X and another companies PC instead?

Market share is the amount of new systems sold within a quarter by a given company (and often times with a given OS). If half of Apple's market share stopped buying Apple computers to buy Mac OS X and another companies PC, Apple would see a drop in profits of about 42%.

But people have always said that Apple's market share would jump if you could put Mac OS X on any PC... right?

What if the market share of Mac OS X on computers jumped to 12% because of this? Apple would still be seeing a 25% drop in profits compared to when they were selling Mac OS X only on their own hardware. In fact, Apple would have to jump to 21% to brake even with the profits they had at 6% if half of those sales were lost to Mac OS X on PCs.

What would happen if everyone bought Mac OS X for PCs and no Apple computers? How much market share would Apple need to brake even?

Apple would need to hit 36% market share to be as profittable selling only Mac OS X for PCs as they are currently selling Mac OS X on only Apple hardware. And since almost 35% of Windows installations are pirated (and there is no reason to think that Apple would fare any better), Apple would have to hit 49% in order to make what they are making right now with their 6%. But if only the same people who were buying Apple computers before continued to buy Mac OS X for PCs (so that original 6%), Apple would see a drop in profits of 83%.

But here is an even bigger problem... Mac OS X for PCs wouldn't be counted in market share unless it is pre-installed on hardware. So even if 49% of PC hardware ended up running Mac OS X, only the systems sold with it already on them would be counted as Mac OS X market share and the rest would still be Windows market share numbers.



People who bring up NeXT
I'm not going to name names, but someone brought up the fact that NeXT went to PCs.

NeXT never (not once) had a profitable quarter making hardware. They were never able to sell enough systems to pay for the resources that they invested to make those systems. As most people should know, the more of an item you make (and sell), the less costly it becomes to produce and the more profitable that item becomes. NeXT hardware never even approached profitability. They only sold (in the full run of NeXT hardware) about 50,000 units (from 1989 to 1993).

Further, NeXT was about to drop OPENSTEP as a product when Apple acquired them. They had worked with Sun to port the NEXTSTEP look and feel to Solaris and were about to drop their OS line in favor of just selling Enterprise Objects and WebObjects. There was no profit in selling their OS.

Why... and how, can anyone compare that to Apple today?


Additionally, Apple has wanted to drop Computer from their name since the early 90s. It was the Beetles that had forced them to stay Apple Computer for this long (about 15 years longer than they wanted to).


There is no reason for Apple to stop making computers because it is a massively profitable business for them. There is no reason for Apple to release Mac OS X for PCs because it directly undercuts a massively profitable business for them.

You guys may throw away money for no reason, but don't expect Apple to do the same. Until there is a plus for Apple's bottom line to any of these scenarios, it just isn't going to happen.
 
the whole theory behind the mac commercials is that the mac os is better than windows. what those adverts are actually saying is "hi, I'm the Mac OS", "and i'm Windows"

plug that new digital camera in; "oh it just works". "I have no virus's". "My upgrade cycle is problem free", "i can make a studio quality home movie really easily", "i don't crash".

these are all attributes of the Mac OS working with the closed environment Macintosh, not independently of each other.

the Intel Switch, this aggressive ad campaign, even the iPod are all designed to help Apple ship more macs. iPod started out at $499. now the full fat iPod is less than $250, with better parts. apple are selling these with a very small profit margin - they make far more profit off a full mac - and they are selling more than ever. the apple stores, they way they are laid out even, use the iPod to entice people in, the iPods always being on the front tables, with macs further back.


i think the name name change is a way of saying to people "look you can trust our products. we aren't a computer company that doesn't know anything aobut phones - we are a diverse electronics company"
 
Whoah whoah whoah, RacerX, you have it all backwards. I'm not saying Apple should or will sell OS X for regular PCs. That would be crazy for even more reasons than you described. I'm saying the exact opposite: that Apple could (and I fear will) focus solely on their hardware (and a few apps like iLife).

However, if they get to the point where they can sell their hardware without OS X, as I outlined, then perhaps it would make sense. It would certainly be preferable (from my perspective if not Apple's) to killing OS X entirely.

Well, unlike Windows, the Mac and the operating system are one in the same. iLife doesn't run on anything but OS X. The ease of use they promote, isn't just the applications, it is the operating system.
...
To me, they are the same thing. You can't have one without the other. Also remember, while the OS is great, it's not the OS people are concerned with.
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I agree, you can't have the Mac OS without a Mac. That much is obvious. But the reverse is not true (or at least, it doesn't need to be). You can use a Mac without the Mac OS. There are a lot of Windows users who would love to do just that. At some point, I think Apple will sell to them. That's one step in the process.

iLife could easily run on Windows, and would be another necessary step in the transition.

The whole point I'm trying to make is that Apple is moving (whether deliberately or not) to the point where their hardware can stand without the Mac OS. Once that happens, OS X can easily disappear. That won't happen tomorrow. No way. It won't happen in a year, either. But in 2-5 years, Apple could easily complete the necessary steps, as I outlined.

Someone mentioned the advantages to the Mac OS. Many of these advantages could disappear in that timeframe. I doubt Vista will be so virus-prone, for example. (And the whole virus issue has only been relevant for a short time, anyway. It's certainly not a reason why I'm a Mac user.) But ultimately, it doesn't matter; profit matters. If they can make a bigger profit selling Windows machines, they will. Again, business-wise, the Mac OS exists to sell hardware. If it's not needed for that, it's just not needed.



Actually, I should probably revise my original outline a bit. I forgot to mention Boot Camp 1.0 (i.e., the one that will ship with Leopard). I expect this to allow for Classic-like compatibility with Windows apps, just like the new version of Parallels does. With that in place, Apple can justify shipping Macs with Windows in addition to OS X much more easily (not immediately, but at some point).
 
Mikuro said:
Whoah whoah whoah, RacerX, you have it all backwards. I'm not saying Apple should or will sell OS X for regular PCs. That would be crazy for even more reasons than you described. I'm saying the exact opposite: that Apple could (and I fear will) focus solely on their hardware (and a few apps like iLife).

However, if they get to the point where they can sell their hardware without OS X, as I outlined, then perhaps it would make sense. It would certainly be preferable (from my perspective if not Apple's) to killing OS X entirely.
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And Apple could fold the iTunes Music store and start installing Zune's software on all new iPods.

:rolleyes:

But not in Jobs' life time.

Actually, Apple would not only lose the advantages their hardware currently has by dropping Mac OS X... they would lose the profit margins as well.

Apple sells closed systems so that they can't have their advantages used against them.

It should be noted that had people not found a way to install Windows on Intel Macs, Apple would not have released Boot Camp. Boot Camp was strictly in response to the successful hacking of the hardware. Boot Camp was released within days of a successful solution to installing Windows on Macs.

As it stands, Windows on Macs is the worse thing that we (the Mac community) currently face... and the same is true for Apple. Apple used to be able to count on Mac users to be return customers for years to come (because Apple is the only maker of Macs). What has currently happened is that people are buying Macs for the first time and then using Windows on them. Windows on a Mac is no better than Windows on a PC... hence, there is no reason for those people to buy a Mac the next time they need a new computer.

That loss of dedicated users is very troubling for Apple. Mac OS X adoption has slowed while hardware sales have increased. Once the fad factor of hardware is gone (usually within a few days of purchase from what I've seen), these Windows users using Mac hardware start asking why they paid so much for the hardware (and a separate installation of Windows).

Apple has never tried to make money on software. It is a hardware company. It sells hardware with the best software on the planet to differentiate itself, but that is it. This holds true for Apple Computers as much as for iPods.

The day Apple starts selling iPods using WinCE or Zune's software, then you can start the sky is falling dance about Apple dropping Mac OS X. Odds are this would happen only after Jobs is dead (and even then I'll put money on the ghost of Jobs terrorizing any Apple Executive that tries to do this).

Seeing as Mac OS X is the foundations of the iPhone, you couldn't be further from reality of what is happening at Apple right now if you tried.
 
It's OK, RacerX. You could say it was me....I don't have a problem with it. :)

I did say that my theory was a crazy one and obviously you do know more about NeXT history than I do (from what I've seen anyways). I did mention, however, that it was too late for NeXT when they went that route. From what I've found out (before your information was given), they tried to do OPENSTEP but because they were in such trouble financially already, it was too-little, too-late. I only suspected that since Apple has more name recognition now (or in the near future) that might contemplate a move like that in the near future. Again, I'm most probably wrong an many counts, but it was just a suspicion...nothing more.
 
Heads up - I read the first page and then decided I had to post :)

At MacWorld - on of the first things Steve said is that 2007 is going to bring a lot of great things to the Mac .. but they weren't talking about them today.

Apple's stock is falling. My guess is it will continue to fall until April, in which I think Steve will announce some good news for us. Why is it falling?

1) I noticed the push away from 'Mac' and more to their iTunes franchise. Incase anyone didn't 'clue in', Steve reiterated it with the company name change.

2) The lawsuit that was filed the moment Steve said, "... and we're calling it iPhone"

3) The fact that shortly after all this Apple partnership details came to light, Cingular started changing their name... Cingular reps answer "Welcome to Cingular, the new At&t" .. and word is - they'll be saying "Welcome to the new AT&T" shortly, followed by "Thanks for calling AT&T". Cingular is phasing out - going away. Buh-Bye. Customers don't like this one bit.

Take a look at my city here. A lot of graphic design departments .. this time last year, were running Macs exclusively. Today, they can't get the software they want on the Macs anymore, and are moving over to Windows - where they can. I'm assuming this has a lot to do with Adobe.

Yeah - so in short ... I think Apple has really dropped the ball in the last year, focusing on their iPod franchise instead of their computer franchise. I agree with the SGI comment .. never forget your primary line of business.

As for predictions - I can't say. History is plagued with great ideas and great products that were destroyed by a few bad decisions. In my mind however - this would be the mostly successful scenario:

1) New iPods only work with new versions of iTunes.. and Mac OS X gets the new version of iTunes a month ahead of Windows.

2) Leopard has full Virtualization of Windows, allowing you to run Windows Apps within Mac OS X at near-native speeds.

3) Apple does a lot of horizontal expansion as a company - gets more involved in the production of their own products - quality control - etc etc. We already see this happening in some degree with the Apple stores .. it needs to happen on the manufacturing side as well.

4) Apple broadens their hardware line considerably. Product families: Mac Mini, Mac Home, Mac Office, and Mac Pro. Each family will focus on different areas, but essentially you have 3 models in each family. Model 1 will be low-price centric, Model 2 will be mid-range, and Model 3 will be quite capable systems. Mac Home will essentially have features that are people want at home, where Mac Office will cut back on the Home features, and focus more on Office functionality. Mac Pros will be available in desktop or rackmount and will be the high end machines / servers.

5) Apple cracks down on Darwin - puts more money into their Unix team to do massive re-writes, code audits and changes to ensure that Darwin is fully-functional as a Unix, and is maintained very well for security patches. (I'm thinking the OpenBSD team's track record)

6) Apple gets REAL serious about Mac OS X Server. Does massive deployments in K-12 school environments and ensures that it does everything businesses, schools, etc needs it to do. Why K-12?? School uses Apple - kids want apple - parents get apple - parents advocate at work for apple. Not to mention that when those kids grow up - it'll only help Apple.

7) Apple releases Mac OS X to the world. For the best experience - run it on Apple hardware. Apple continues to innovate their hardware, and program the OS to use those innovations. Other PC manufacturers will always be a step behind Apple's brand of machines. More motivation to buy a Mac.

8) Lastly - STOP COMPETING WITH WINDOWS. Apple doesn't need to compete - just release their own products and people will move over on their own - quickly. Apple has a very loyal userbase - if they turn it into a Good vs Evil type scenario - they are alienating those group of people that want or need to run Windows. Stop doing it!

That's it. Steve referenced a quote at the last MacWorld - if you are really passionate about making software, then you have to make your own hardware too (or maybe it was other way around)... but the message is still there. Innovate and lead ... don't follow.

EDIT: Something to add in response to RacerX's comments. Your numbers are flawed. Apple would never just up and release Mac OS X to the world just so it could compete on the market without having some way to make themselves money. Windows sells for $300 per copy - you'd bet your butt that Mac OS X would sell for the same amount if not more. Lastly, Apple is at 6% market share - selling Macs. Mac OS X gets released to the world .. do you really thing people would buy PCs to run Mac OS X on it, if they've already owned a Mac? I don't think so. I'd say they'd keep the 6% market share of Mac users, and then gain additional Market share. They would essentially be penetrating the market faster, with a lower profit margin. Now - think also of the effects. Mac OS X on more machines = larger market share = more attention = larger developer audience specific to Mac OS X. That improves the entire Mac experience on a whole - and adds value to the entire franchise. That 6% they have now in Mac Hardware sales would only go up. You are also forgetting that Apple could require a DRM system in the computers OS X runs on - and the licensing costs could yield quite a bit of money as well.
 
The Mac OS is more likely to die if Apple doesn’t branch out.

A much wider range of Apple products provide a buffer for limited market take-up of Mac OS.

Furthermore, healthy product sales of iTunes and iPhone (for example) bring in more cash for R & D.

P.S. I predict the next Windows incarnation will be unix-based.
 
rhisiart said:
P.S. I predict the next Windows incarnation will be unix-based.
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....And for hilarity's sake, I predict that UNIX will be more Windows-based....

...Hell, I could be right on this one, considering the state of desktop environments on UNIX/Linux nowadays. Mac OS X is in fact one of them (Unix being "windows" based...as in the WIMP term....just in case it went over someone's head....:confused:).

:p
 
but in all seriousness, MS will never base anything for the mass market on UNIX. microsoft licences, not the other way around.
 
Lt Major Burns said:
but in all seriousness, MS will never base anything for the mass market on UNIX. microsoft licences, not the other way around.
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I'm just thinking outside the box... blue sky thinking... looking for the Goldilocks effect (not too hot, not cold etc...).

I think you guys are trying to boil the ocean.....
 
Actually IMO the Windows support isn't necessary a bad thing.

Look at it from a customer's perspective:

What do you do, if you get a new computer which comes with preinstalled software/OS? Of course you turn it on and boot it up, just to see if it works. Its most unlikley that you plunge the install CDs in and reinstall away.

Secondly what do you have to do in order to install Windows on a Mac?
Usually you have to boot up OSX and select the bootcamp app and run it. So the customer gets at least a glimpse of OSX, because he has to interact with the interface just to reach said application.
Windows installs and the configuration afterwards are long, ugly and usually not something you would do instandly. Humans are curious. I expect that most people play at least a few minutes til they make changes to the system.

My last point is that people usually like backup or fallback plans. Having the option to install Windows will usually lessen the fear of the new machine. "If everything fails or if there is no substitute for application YX I could still install Windows". This will give people confidence in the new purchase.

Compared to me and other people on this board buying a new computer is a huge thing for certain persons. (I could easily spend my money on the latest imac and live the next 2 months from ramen without a problem, but not everybody has this freedom of choise ;) ) They invest in a computer just like someone would invest into a some house or whatever and will use it beyond the products life-cycle.
 
Phew. Don't have the time to read it all. Just here to say: Apple is a _guest_ at the MacWorld show(s). It's MacWorld magazine's gig AFAIK.
 
Can't wait to you see what's coming out this year in regards to hardware. OSX will be zipping along on new desktops and laptops running the latest and greatest OS.

Apple employees do not get secret information about new products, but we did get very big nod from the big guy on how wonderful this year will be! Even after the iPhone, there will continue to be some very impressive new equipment coming from Infinite Loop**.

OSX is not going anywhere. Innovation will continue. Mac hardware is definitely not going anywhere. There just was not enough room to in the keynote for both new hardware AND the iPhone. When you want one start to shine more than the other, you don't put them both out at the same time. That's marketing suicide. New hardware will come and it will knock your socks off.

** Yes I work at Apple. No I have no secret information to give out.
 
It should be noted that had people not found a way to install Windows on Intel Macs, Apple would not have released Boot Camp. Boot Camp was strictly in response to the successful hacking of the hardware. Boot Camp was released within days of a successful solution to installing Windows on Macs.
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Why do you say that? Apple certainly did not whip up Boot Camp in a few days. More likely, they'd been working on it from the start. If third-party hacks influenced them at all (which is just speculation), it was probably only in the timing of their beta release.

Actually, Apple would not only lose the advantages their hardware currently has by dropping Mac OS X... they would lose the profit margins as well.
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How? (Keep in mind that I keep saying Apple could NOT pull this off in their current state, but rather in the future. So any reasons much take into account the possible future changes I proposed, or else debunk those changes convincingly.)

I think you underestimate the appeal of Apple hardware. Apple does differentiate themselves, even when you just consider hardware. Even now, when Apple can pretty much dictate their own market (since only they make Macs), they limit themselves to fancy/luxury machines. That's what they'd do if they sold Windows machines, and I think they'd sell well. Apple makes good, appealing hardware, and better yet, Apple has a great brand image. They have cachet. Half the reason so many people buy Macs now is just because Apple is sexy and cool. That would not change.

And that appeal has increased steadily over the past few years.

Apple's image as a company that makes "solutions" would not die, either, as they would still be selling iLife. As has been said many times by all sides of this discussion, the general public doesn't care so much about the OS as the specific apps. iLife would still be Apple's thing. In a sense, they would still be using their software to sell their hardware — just not OS X. They'd be more "tying things together" the instead "making the whole widget".

I don't think iPhone is relevant, since it is closed and pretty much separate from the desktop Mac OS. It's not like the future of the iPhone is tied to the Mac OS. It's just a phone.

I like your comments about Steve Jobs, and part of me agrees, but that's really just faith. I had that faith for a while, but...not anymore.



Ifrit said:
Actually IMO the Windows support isn't necessary a bad thing.
<snip>
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I agree. In fact, I mentioned that briefly in my first post, in the mantras the Mac faithful have been using. I do think that's a valid way to look at it, but it's not the only way. Certainly, the current situation is not PROOF that my predictions are right. What I'm looking for is proof that they're wrong...


There just was not enough room to in the keynote for both new hardware AND the iPhone. When you want one start to shine more than the other, you don't put them both out at the same time. That's marketing suicide. New hardware will come and it will knock your socks off.
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I never expected new hardware at Macworld. I did expect at least some mention of Leopard. If not an extended preview (might steal iPhone's thunder, as you said), at least some word on the progress and expected release date. But that's not really the point. If Leopard had actually been released at Macworld, the theory would still stand. It would just be a lot easier for me to tell myself it's ridiculous.
 
I just dont understand your reasoning. Yeah, sure, if apple do get a huge percentage of the market which may or may not happen but why would they want to change their OS?

If you answer that then you have taken the first step to convincing me...

At this point, Mac's have the best operating system and the way things are going I cant see windows becomeing a greater OS, if anything it would have to be a next generation OS other than mac os or windows or linux that works in ways no one has thought of, and if someone was going to do that I would put my money on apple anyway.

Mac os works near perfect and I can only see the design team at apple improving on that, why would they throw it all away for something that isnt half decent?!?!

Another thing I dont understand is why you (and alot of Mac fans) have lost faith in jobs, if you lose faith in him you might aswell forget about apple 'cause hes the heart and soul...

A man make a great product and company... he gets kicked out of his job as CEO, the company goes down hill... he comes back, tries all the things apple had failed with in the 90's and pulls starts to pull them off... why would you lose faith in that? (apart from the fact that Jobs didnt give a release date for leopard, woop de do, i can tell you now, its in spring)
 
I think they need to allow leopard to work on pc's. This would give them a huge amount of exposure, and could easily double their software market share within a year. I would say a solid 90% of people would never even consider using macintosh software just because you have to buy a whole new, rather expensive computer and theres a chance you might not like it. But if you give them the option of trying it out for $200?,MANY MANY people will try it out. And then they'll tell two people how great it is, and they will tell two people, and they will tell two people, and so on and so on.

The majority of Apples marketing campaign for the past few months is "we are better than microsoft. Their product is boring and our product is fun and easy to use". While a great campaign, many people simply will not spend over a $1000 on a macintosh computer when they never had the chance to try it out, regardless of even the most influential marketing campaign. Yes you can run windows on it, but the masses of people won't take this into consideration.

It is a great product and it deserves much more of the market share than it holds. The intel switch gives them the prime opportunity to skyrocket their success. They have had a far superior product for ten years, but why do they still only hold 5-6% of the market share? (a seriously low number) It is because people aren't willing to shell out the money to buy a new computer and try it out, THEY WEREN'T THEN AND THEY STILL AREN'T GOING TO NOW. But trust me, with the success of the ipod, the stylish macbooks you see going around campus, and their fantastic marketing campaign, people are very intrigued by Apple. Intrigued enough to spend a $1000 on a product they have never used before (and has a bad game collection)? NO. Intrigued enough to spend $200 on a product they can try out on a computer they already own? Most definitely.

After their software catches on with the pc crowd, which it certainly will, people will begin to have brand loyalty towards apple. I think initially apples hardware sales may take a hit (which might not even happen), but after everyone tries out leopard they will want to buy a mac computer. They won't mind shelling out a little more money for a stylish and reliable machine. Even so, a $200 software sale is money in the bank with very little materials cost.

And this is how Apple will take down Rockefeller Microsoft.
 
Yesurbius said:
That's it. Steve referenced a quote at the last MacWorld - if you are really passionate about making software, then you have to make your own hardware too (or maybe it was other way around)... but the message is still there. Innovate and lead ... don't follow.
Click to expand...

I think was "people who are serious about software should make their own hardware".

I think it pretty much applies to everything Apple is making - the Mac, iPod, iPhone... they had great ideas on how to make useful softwafe, like OSX, and design their own hardware, the Mac to run them.

People can actually run OSX on any 386 capable system now... but the integration just isn't as good as a Mac running OSX. Apple could release OSX for the generic PC, it would give exposure to the market, but would it be the best exposure?

I think not. Installation an OS isn't always straight forward, on a generic PC. If you have been following 'desktop linux' like Ubuntu, you would hear a consistent cry on why installation is so difficult, sometimes doesn't not work at all without any reasonable Linux knowledge. In most cases Ubuntu does install with ease though. But if Apple does the same thing, it is going to give bad experience to some people, so staying on the Mac would guarantee the best Mac experience - after all, they design the Mac to run OSX!!!

So if Apple are really serious about software, then why would they sell Macs without OSX? I mean, if the above quote were true, then whole point of of making Macs is to run OSX... making computers to run Windows isn't making Macs... anyway, OSX is going pretty strong, Leopard being sent to Open Group for UNIX certification and... if they really want to ditch OSX, they could always release it to the open source, like netscape, java, right?
 
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