A perspective Mac users don't want to hear

I am writing this post on a Mac, I hope and believe Macs will be around for a long time.  Yet I don't think that unrealistic expectations for the Mac platform do the platform any good.

Once you get outside the Mac ecosystem, the Mac is nearly non-existent.  No matter how good the Mac is, and there is no doubt in my mind that it is still the best system, people are not flocking to the Mac.  I could say that I don't know a single switcher and that would be true, but the real proof is in the small market share numbers for the Mac. Last week Red Herring posted the article, "Apple’s Halo in Doubt."  The article asserts that the increase in Apple's market share looks better than it really is because of how far Apple has fallen.

“No Sherman’s march to the sea here,” said Roger Kay, president of Endpoint. “The argument against the halo effect says that while Apple’s shipments have been up for the past four quarters, it is because they are coming off historic lows. And we are now in an upgrade cycle in which the Apple faithful buy new systems.”

The article points out an even more serious problem for Apple.

That lack of openness caused MIT Media Lab to reject Apple’s offer to donate OS X to the consortium developing a $100 PC for buyers in developing countries (see TechSpin: Laptops for the Poor).

Members of the consortium rejected Apple’s offer because MIT Media Lab was committed to open-source software so the operating system can be tweaked. Being rejected by an organization developing PCs for the poor had to take a toll on Apple’s cachet.

Steve Jobs isn't dumb and knows that the rejection by the MIT Media Lab is a huge deal.  Jobs has always treated his education sales force as the most strategic part of Apple.  The idea is that if you get in front of the kids early, they're more likely to be friendly to Apple.  Unfortunately that was a strategy that was born of Apple's success in education in the eighties.  It no longer works.  Among the computer literate youth of the world, there are very few who haven't had some experience on Windows.  If the MIT project is successful, it will have a huge impact on educational software development in spite of the laptop being a product that is never sold to consumers.

As it becomes clear that Apple is very serious about locking its OS X Intel software to its hardware, the public's perception of Apple will change.  No matter what people say about it being okay for Apple to lock their software to their hardware, it's not right for consumers.  It's fine to make an OS that will only work on a processor that you deliver to consumers.  However making an OS that actually works, except for a vendor lock, on other processors of which there are hundreds of millions delivered by dozens of manufacturers is a different story.

I don't buy the idea that Apple releasing OS X Intel for systems manufactured outside of Apple would swamp Apple with support calls.  Apple could release OS X Intel with full support only on hardware manufactured by Apple. In fact OS X Intel support could be a huge revenue opportunity if Apple chose to view it that way.  Unfortunately what Apple really wants is an ecosystem that they completely control.  If you don't think Apple is about control, you haven't been watching Apple with anything but rosy colored glasses.

There are good aspects to Apple controlling everything. Obviously the hardware and software working together seamlessly because Apple designed both is a major plus, but there are down sides such as lack of choice in hardware, and having to do everything on Apple's schedule.

Ultimately Apple closing OS X Intel to other manufacturers might be one of the great mistakes Apple has made.  I don't think there is much doubt that Apple hardware users will continue buying Apple products as long as the products continue to deliver great value.  Yet I see no stampede to Apple products from Windows users.  Many may be buying iPods, but as Apple rapidly becomes more and more dependent on the iPod, the risk is that Apple will miss it's last chance to really change the desktop that most people see every day.  If that doesn't happen Apple may just become an iPod company.

The Red Herring article closes with this comment.

“From the overall market’s point of view, [the halo argument is] a tempest in a teapot,” said Mr. Kay. “I believe the company continues to make suboptimal strategic decisions, even as its marketing and short-term tactical execution are astounding. What will trip it up again are the standards and pricing issues.”

I have to agree with Mr. Kay about Apple's "suboptimal strategic decisions."  From my point of view Apple's lack of attention to the business and enterprise markets, and unwillingness to share critical details of the Intel transition are not smart decisions.  The success of the iPod will continue to prod up Apple's stock price, but any blip in iPod sales will cause a huge correction.

The Apple faithful clinging to the idea that Apple can make a serious dent in Windows market share without opening OS X Intel to other manufacturers only reinforces the idea that Mac users are in a world of their own which has little relation to reality.

There is nothing wrong with being a minority platform as long as there is plenty of software for the platform which there is on the Mac, the hardware continues to be manufactured which Apple will do as long as they are making money, and people are happy using the platform which I believe to be the case.  I think the Mac world already is a pretty happy place without the distraction of fantasies of how the "halo effect" is going to change the desktop equation.  I would like to see the Mac with ten to fifteen percent market share, but I don't realistically think it's going to happen.  Other than the iPod, Apple has shown an amazing inability to market to users than other current Mac users.  I think the analysis by Roger Kay is on target.

The article, "Sony, HP, Apple, Google: Who is on Your Side?," has a couple of other points, one on the locking of OS X Intel to Apple hardware.

This is generally considered anti-consumer behavior, and once again, this points to the fact that choosing companies that don't have conflicts like this is the best way to ensure they keep your best interests at heart. With music, Apple is clearly on your side...

The other which basically says if you feel a company is doing things in your best interest continue buying its products, also applies to Apple.  None of us are going to change Apple.  Apple is going to be whatever Steve Jobs wants it to be.  If you're happy with the products, buy the products.  If you're not happy with the products don't buy the products.  Apple may surprise us and release OS X Intel into the wild or something might force their hand, but I'm not going to hold my breath.   Without Apple life would be a lot less interesting and there would be much less to write about in the technology world so I'm thankful to have been part of the Apple world.

The article, "Sony, HP, Apple, Google: Who is on Your Side?," has some good advice.

As Sony is undoubtedly learning this month, preventing a mistake generally is vastly less expensive, for everyone involved, than correcting it. Every holiday season your personal dollars have power. This year, use that power to reward the firms that stand up for your rights and avoid rewarding those that trample them.

When Apple releases OS X for Intel and prevents me from running it on other similar Intel products, I think they will have stepped over the line.  Somehow the arguments that a company with billions and billions of dollars in the bank will go broke doing this, just don't carry a lot of weight.

Perhaps that's because I once had an Apple Vice President a few years ago tell me that Apple was thinking about giving away OS X for Intel.  Now that would have changed the desktop landscape.

Comments

[Leonardo]

Too much doom and gloom ApplePeels. One thing that I agree with you on is this, that Apple would be really responsible for its OS on hardware that it makes, or approves of.

I reckon that another thing that I could agree to is that this may be one of those times in which a shift can begin to take place, and so if OS X on Intel were released in to the wild, so to speak, a lot of people would like to have it. I am one of those who signed on to the petition years ago for OS X on Intel.

Remarkably, there are linux geeks who have called on Apple to make its OS open source, or at least to open it to hardware to license it.

Yes, Steve Jobs is one who is for control. He felt like he let things get away from him one time, and now he is running it strongly. But he has helped to see that the world would receive a computer that is pleasant and simple to use.

I have wondered why Apple is not pushing the Mac platform much more than they are. It is like Apple is content to be where it is, but who knows what all is going on.

Do you think that Steve Jobs will want always to run Apple?

Does he have perspective? We will yet see what comes about. I would not be too surprised to see Apple's OS X be widely available, but after they have a run to see what they can do this way.

[ocracokewaves]

So I don't agree with a minority platform being a world of doom and gloom.

The Mac community is a very vital and enjoyable community most of the time. It's a pretty nice place to be right now. There are no viruses, things are running great on my systems. I have all the software that I want.

I think Apple can survive almost indefinitely as a minority platform. That is unless Steve decides he is tired of running Apple. Perhaps I didn't get it across in my post, but I think being a successful minority platform is fine, but I don't think we should delude ourselves that Apple is ever going to be anything other than a rounding error in the PC desktop OS world unless OS X for Intel gets released for other manufacturers.

As to Steve, I think he is already tired of computers and more interested in devices like the iPod.

I also agree that Steve may change his mind and release OS X.

You also have hit one other thing on the head. Steve is "content" and maybe even happy to keep OS X locked to Apple's hardware products. After all he has the coolest products, the most buzz, and Hollywood is at his feet. With all of that, winning the desktop OS battle almost seems like too much work.

[Damian]

"Steve may change his mind and release OS X."

I hope he does. I would still probably buy Apple hardware myself, but not everyone would, and if Apple wants to put OS X on everyone's desktop ... well, they can't sell hardware to the world.

I think, as you say, it would also be the *right* thing to do. Adding a vendor lock comes pretty close to "pulling a Sony". It's very different in one way: it's not risky like a 3rd-party patching the kernel. But it is adding something that's not necessary to do something that really ought not to be done.

For once I think Rob Enderle is right: "[choose] companies that don't have conflicts like this". I agree that he's written some very pertinent commentary on the Sony debacle. He was one of the first to point out that the XCP scandal shows that Sony didn't learn its lesson: it lost its Walkman market by bringing out a digital player that had what he described as DRM "so nasty" you'd have to have been "insane" to buy one. That's why the iPod rules the roost now.

Vendor lock-in can certainly be counter-productive.

[notabeliever]

This article would make a lot more sense if you discussed the business side of his whole issue. Do you really think that enough people would buy OS X for Intel that it would make up for the loss in hardware revenues. I'm sorry, but that is suicide. And just because OS X could run on a plain Intel box, doesn't mean it will run well. Apple as a company is succesful because of it's control, and as long as that control is providing the customer with the best experience, I fail to see any reason to change. You did not give one good reason as to why it should be any other way. Apple is selling to the home market, the average computer user, not the gear heads. Most people don't ever want to open their computer. And you shouldn't have to. I've been reading this blog for quite some time, but I have to say, these last few articles have made me wonder if you understand Apple's business at all. Time will tell I guess, and unless one of them goes out of business, the competition between MS and Apple will continue. I for one think a lot more people will be buying macs in the future, even if we haven't really seen the uptick yet. These long term strategies take time (and generally are misunderstood by most armchair business people).

[Doug Petrosky]

I have to say I disagree with almost everything you wrote but for the sake of time I will just ask you to clarify your core statement, which I believe can be summed up with this:

"When Apple releases OS X for Intel and prevents me from running it on other similar Intel products, I think they will have stepped over the line"

Why? How is this any different than Apple making an OS that runs on PowerPC hardware only (they have always had the ability to support Intel) so why is this so unforgivable?

Arguments Against:
1) I'm not sure how long you have been in the industry but I watched as OS 2 got roasted in the press because it didn't support a wide enough cross section of hardware. I contend that if you support third party you need to do it almost as well as Windows, but without manufactures motivated to make drivers this is nearly impossible.

2) The more time you spend with compatibility the less time you have to spend on everything else. (features, security etc.)

3) Apple subsidizes it's hardware sales with software. iLife and iWork are priced where they are because that level of quality software are necessary to promote hardware sales. If Apple does not get the benefit of hardware sales because of that software, it will have to reduce development or increase prices.

4) It is simply not necessary from a good business perspective. Sure, you can say that Apple can't be all things to all people but Apple makes some of the best and most innovative hardware in the world. So I'd argue that they make the exact correct system for many people. The exact percentage could be debated for decades but suffice it to say that the percentage of people who match very well with Apple designs is far greater than it's current 5% market, maybe as much as 30%.

5. Allowing OS X to officially run on x86 hardware would be a quagmire of compatibility disappointment and reduced revenue.

To all of the nay sayers. I point to the iPod as a closed system that just works better and is dominating the market.

To gain market share, Apple simply needs to deliver solid systems at reasonable prices.

[swissfondue]

I think Apple does not want to become a Dell. I doubt Apple would want to become a Microsoft.

My view is that Steve wants to give people an Apple experience. Defined as elegant, simple, beautifully designed and innovative symbiosis of hardware and software.

iTunes for Windows and Quicktime for Windows are not as good as the Mac versions. They are buggier and more exploit/malware/virus prone. This shows Apple where the dangers and costs lie in opening up Mac OS to non-Apple hardware.

Steve has a master plan and selling Mac OS X to run on non-Apple HW would tie resources and restrict his pace. Therefore I do not forsee any change in his position in the near or mid-term.

Apple remains a relatively small company and relies mainly on innovation and "the Apple experience" to survive. Whenever the company has faltered in the past, it was because they could not keep up the pace and allowed other companies to pass them.

When Apple feels it can no longer compete in HW, it will allow Mac OS to run on non-Apple HW.

[Tonio Loewald]

Apple has certainly made suboptimal business decisions in the past (not licensing MacOS before Windows gained marketshare being the main one) but whether it's current strategy is suboptimal is harder to assert.

1) You don't know what it is.

2) It seems to be working.

This post seems to basically constitute whining about not being able to install OS X on a box of your choice. Ordinary people don't care. Ordinary people don't buy a PC and then install an OS on it -- they buy a PC with the OS on it and leave it there.

As for Apple not sharing its strategy and hence your not knowing what it is, it follows that criticising it is basically pointless. But here are some points:

1) If Apple plans to, say, in 2007, support third-party hardware, it would be stupid to say so now. Remember, they need to stay in business until 2007.

2) If an Intel Mac costs about the same as an ordinary PC + the cost of OS X, why will people care if they can't buy noname hardware? People do not perceive Windows XP Home edition as an added value component of a PC, or you'd see stuff like "including Windows XP home, a $79 value" on ads.

And finally, let's go back to your source of information: Red Herring. Their original piece about the Halo being in doubt was founded on the basic assumption that Apple is benefiting from an upgrade cycle right now. Come again? Since when is the leadup period to a pre-announced processor switch during which time your flagship CPU has "increased" in clock speed from 2.7GHz to 2.5GHz (and your laptops have hardly improved at all in 18 months) a natural upgrade cycle? Given the current situation, Apple should be happy to have stagnant sales. Most companies expect to see sales plummet after announcing a major new future product.

So, in summary, you may be right that Apple's strategy is "suboptimal", but (a) you don't know what it is, and (b) the evidence and analysis you provide are bunk.

[Damien Barrett]

You're referencing Rob Enderle for support for your opinion? Rob "Giga" Enderle?

I just can't take seriously any article that quotes a Rob Enderle article.

I agree with commenter Doug: "To gain market share, Apple simply needs to deliver solid systems at reasonable prices."

End of story.

[ocracokewaves]

To answer a few questions, I have written about the business case for Apple releasing OS X to potential partners like Dell

http://viewfromthemountain.typepad.com/applepeels/2005/06/apple_dell_the_.html

You might disagree with my numbers, but there is nothing that says Apple will go out of business by releasing OS X for Intel. Apple lost business the last time it licensed its OS X because it wasn't making products at competitive prices. Most people forget that Apple hasn't always produced stellar products. Just remember the PowerBook 5300 and some of the Performas which became customer satisfaction nightmares.

The reason that it is wrong for Apple to not release OS X for Intel is that it is anti-competitive.

No one is saying that Apple has to support OS X for Intel on other products, but why insert something that prevents other people on very similar hardware from using it.

If all the arguments are right that few people would want to do this, then this should be a non-issue for Apple. Those few Geeks who would go to the trouble to do it, could be allowed to buy and install OS X for Intel without destroying Apple.

There's only one reason Apple is preventing others from running OS X Intel and it is not Apple going out of business. The reason is that Steve believes living in a proprietary closed world will make them more money. He may be right and be may be wrong.

You can argue that there are other operating systems out there that I could use which I do, but I would rather run Apple's OS X on my Intel box than Windows. OS X is more secure. There are no good analogies because few things are like operating systems. It's sort of like being in car caught in a hail storm (think viruses and worms) and not being able to park in a garage because Apple who is running the garage is only taking Apple cars. I can get in the garage but I have to buy an Apple car.

I woulld argue that operating systems are things of great public importance, and preventing someone from running the safest available one will at a minimum harm Apple's shiny image and may be at odds to our national interest. We don't have laws that deal with this sort of thing so I'm sure Apple will be able to do whatever they want, just as MS has been able to.

Some will argue that it is Apple's right to force me into buying Apple hardware if I want Apple's OS X for Intel, but I don't think they are paying much attention to anti-competitive behavior this indicates. Behavior of this type is frowned on in our country though the laws are very complex.

As to the the main premise of the Red Herring being that this an upgrade cycle, I would say that you didn't read the Red Herring article.

The article's main premise is that Apple's computer numbers look good because Apple has been doing so bad. The bunk is thinking Apple is doing well in computers.

To quote the Red Herring article..

"According to the report, Apple’s personal computer market share has fallen steadily from a high of 16 percent in the U.S. market and 13 percent worldwide back in 1986. By the 1990s, Apple had lost some of its shine but it was still a contender as the second-largest player behind IBM with a 10 percent market share."

Apple doesn't have a computer strategy, they have the iPod. Their computer "strategy" has managed to take what is arguably the world's best OS and hardware to a mere 2 percent and change market share. Now that's a great strategy and a wonderful halo effect.

As to an upgrade cycle, there a pretty good argument that could be made that some folks have been waiting so long for the desktops to upgrade that they went and ahead and ordered so they could use their end of year money. There is a whole set of folks and I'm not one of them who would rather have the last of a line than the version 1.0 of the next line.

[Damian]

Well, you were right ocrawaves this was a "perspective Mac users don't want to hear".

Apple fans should realize Apple can be as anticompetitive as the next guy:

"The Court of Appeals affirmed the trial court's determination that Microsoft's exclusive dealing arrangement with Apple (pursuant to which Apple agreed to distribute and promote IE exclusively in return for Microsoft's continued development of the MS Office suite for Apple OS) was anticompetitive and unlawful."

Then there's this:

http://varbusiness.com/article/showArticle.jhtml?articleId=22102756

And of course this ongoing controversy:

http://www.eff.org/deeplinks/archives/001557.php

As for Apple's tying OS X for x86 to specific hardware, of course that would be an anticompetitive practice, and of course Apple could well come to grief over that. I remember reading when this first came up that a very similar case did come to court and the company in Apple's position lost. So there's no argument: there is a good precedent. I can't remember which companies were involved, but a lawyer for any OEM that wanted to sell OS X pre-installed on Intel boxes would certainly know and would be able cite the case as precedent ...

John C. Dvorak suggested on the latest tWiT podcast that the future will be Linux on servers, Mac OS X on the desktop, and office software from Microsoft. I could live with that, and I hope that is the final outcome, but I'm not sure its what Steve Jobs wants.

There's nothing wrong with running a company that serves a niche market. But Jobs strikes me as more ambitious than that. However, he can't make hardware for the whole world. He's no longer a young man and he's already tasted his mortality. Why not be remembered as the man who was responsible for the desktop OS of the early 21st century? But, apparently, that's not what he wants. Either that, or he's playing his cards very close to his chest.

[Steve Covello]

On proprietary versus open: I am a video editing professional having worked on Apple hardware for 15 years using Avid, Apple and Adobe software products. The best analogy I can make to compare Jobs' strategy is when Sony came out with Betamax, while JVC came out with VHS for the consumer market.

Long story short, JVC licensed vhs to everyone and literally drove Betamax -- although a far superior product to vhs -- right out of the marketplace. The end result, once the two formats settled into their niches, was that vhs continued to suck and their uprade format of S-VHS never stuck in the professional market because it was composite video. And Betamax [a superior component video format] was improved upon in the form of Beta-SP [SP being Superior Product], then Beta-SX, then Digital Beta, a near ubiquitous broadcast quality format that has remained a gold brick in any post house's rack of equipment since 1997.

My point is that opening up OS X to non-Apple hardware risks the possibility of stagnating innovation for fear of making buyers of non-innovating hardware left in the dust of upgrade incompatibility. Apple's constant improvement would be burdened by the drag of bringing all its diverse HW users up to speed. I know that Apple has to think in terms of the consumer market for its greater share of profitability versus the professional market as I have described. But the premise remains the same: Innovation within a proscribed system, IMO, produces better overall products quickly.

Another case I can site is the long-standing argument video professionals have had in the last few years about whether Avid or Apple's Final Cut Pro editing system is the better system to commit to. The "proprietary" side of this argument, however, is Avid's closed system of both hardware and software where hardly any other manufacturer's products can be integrated into the system. Upgrades and improvements are very expensive, and support is narrowly available. FCP/G5 setups, however, can have a multitude of 3rd party capture/ouput cards, media storage systems, effects plugins, and FW/USB automation devices attached to it.

Because of this, Avid is losing marketshare and it is clear to many small business owners like myself that getting on the Avid boat means you could end up marooned with expensive, unsupported old equipment within a year or two. [for the record, see famous Avid screw-overs such as AudioVision, Media Spectrum, Meridien Film Composer, Media Illusion and Avid branded $4000 72gb media SCSI drives].

So how does this seemingly contradictory example relate to Apple's closed OS/HW model within this greater argument? Apple is not making the same mistakes as Avid: 1) Avid takes their market-leader position and proprietary systems and leverages it into forcing you into expensive, dramatically different HW/SW options, or be left unsupported, versus Apple whose product line is more of a continuum that takes into consideration its existing user base i.e. OS X with Classic support, 2) you are not restricted to Apple created software or denied the ability to add-on with 3rd party HW, 3) their trend towards UNIX and internet protocol standards is an indication that they are oriented towards joining a greater pool of existing users rather than Avid's trend towards building systems that only work in their world i.e. Unity media storage versus off the shelf SAN hardware.

I see the consumer-orientation of Apple's current product development as a strategic move to make Apple's total HW/SW product line more reachable to the PC customer. Many soccer-mom/black-sock-guy type PC users feel Macs are intimidating and overwhelming, and spoon-feeding them simple products like ipods and itunes are a great way to entice a crossover.

[littlemoney]

Ill just try it first.

[littlemoney]

ARE THEY DEAF!!!!!!!!!!!1