I certainly do not claim to be an expert on today's Apple. However, I have lots of history with the company and I have written the only book which describes what it was like to work at Apple in sales.
With that background I can look into the Cupertino tea cup and swirl the tea leaves as well as anyone.
Recent numbers on CNNMoney based on Gartner and IDC suggest that Apple might have had a period of "negative growth" in Mac sales during the critical back to school season. Both Mark Rogowsky, a contributor at Forbes, and John Gruber of Daring Fireball have recently chimed in with perspectives on Apple.
Others have chosen to spin this drop in sales as dramatic. I doubt Apple is any danger. They could keep Tim Cook in sushi almost indefinitely with their offshore billions.
The one take away that I have from Gruber's article is that today people who have the money are willing to pay for Macs.
The Mac today has roughly 10 percent of the PC market, but it’s not just any randomly distributed 10 percent of the market. Quite the opposite — Apple’s 10 percent of the market is entirely comprised of the high end of the market. Mac users are discriminating, willing to pay more for a product they deem superior.
I am not sure many price conscious buyers like me would be surprised that Mac buyers seem to have more money.
Long ago I hinted that Macs would have a hard time getting above 10 percent of the market, and price was a limiting factor then. I think things are perhaps even more challenging today.
My experience which is perhaps different than yours is that Macs have not delivered the value that I want in a computing platform. My computing closet still contains a very expensive 26" i5 iMac that died well before it was two years old. Hopefully it will be this year's holiday project for my son and I to install a new SSD in it.
With Apple's continued focus on thin and light, I have not seen the type of changes that once defined Apple's computer products and kept users on their seats and might have brought me back to its laptop platform. My Windows 8 laptop has a touch screen and it is almost a year old. Apple still does not have touch screens in their laptops and you cannot get an Apple laptop with a SD card reader for under $1,000.
Rogowsky's article, In A Declining PC Market, Opportunities For An Indifferent Apple is out of left field and must have been suggested by an old Apple enterprise sales person because he seems to think the real opportunity is for Apple to go after the enterprise market.
"What it hasn’t done so far is seized on the weaknesses of HP, Dell and others, though, to build a world-class corporate sales organization to push its tablets and PCs aggressively into thousands of organizations worldwide."
As much as I have a problem with Gruber's "discriminating" buyer argument, I came close to choking upon reading the suggestion that Apple build "a world class sales organization."
Actually I think Apple had close to a world class sales organization in the early nineties. It was perhaps one of the things that kept Apple in business long enough for Steve to rescue the company from itself.
Certainly Steve did not love the sales organization and that is one of things that the field sales force clearly understood. Apple's sales leaders after Steve came back were undistinguished and often off base unless you somehow believe that going after the enterprise with iMac based kiosks was a good idea.
As for thoughts that should temper any suggestions that Apple go after the world's corporations with an enterprise sales force, this post, Lingering Regrets From Days At Apple, that I wrote seven years ago is still pertinent.
Apple will never be a successful enterprise sales company, it is not in the company's genes.The company had plenty of opportunities that Microsoft threw in their laps but they punted on them all.
Certainly after Apple's last flirtation with the enterprise which included the Xserve, I would think most large customers would have a hard time seriously considering Apple on the desktop.
If I were an enterprise CIO who had tried Xserves only to see Apple abandon them, I might be worried that Apple would completely give up desktops and laptops for iPhones, iPads, and iPods. The CIO of the federal government was worried about that when I took Avie Tevanian in to meet her back in 2004.
The only real opportunity for Apple in the enterprise is to keep doing what they are doing and penetrate the enterprise with iPads and iPhones which users will demand be supported.
More important in reading Apple's tea leaves than either Gruber's or Rogowsky's article is the hint that the back to school season was not good for Apple. I do not have any inside verification that back to school was not great for Apple. However, it would not surprise me.
Higher education has been a strategic but sometimes under appreciated market for Apple since I joined the company in 1984. One of the things that higher education has always done for Apple is put a device in the hands of the one person most likely to understand leading edge technology in a family, the college student. College students often go home and sell their families on Apple technology. When they graduate from college, they take their Apple devices to work and lobby for corporate support for Apple. It was a well appreciated sales cycle at Apple during my time as a higher education manager. Apple lost a lot of its higher education focus when it rolled the higher education division in with the K-12 folks back in the nineties.
The only time in my memory that we had a bad back to school at Apple during my career there was during Gil Amelio's brief tenure as Apple CEO. He decided that Apple was giving higher education students too good a deal on computers so he raised prices for students. Higher education sales tanked.
Now Apple's prices have not gone up, but their laptop prices have not gone down either. As I suggested in the article that I wrote over four years ago, all you have to do is walk the aisles of either a Best Buy or Staples to get a feeling for just how far PC laptop prices have gone down.
In spite of what Apple folks think, there are some very nice PC laptops out there. I use a first generation Lenovo Yoga which cost me under $1,000. It is my second Lenovo laptop and will not be my last. When I decide to pass this one on to someone else in the family, I will be buying the next generation Yoga. My Yoga has been one of the finest laptops that I have ever used.
Beyond the product, I also happen to like the philosophy of Lenovo. Back in January I wrote an article for RWW, Apple and Lenovo: The Tale of Two Companies. I had this to say.
Apple has come to believe it cannot make anything worthy of the Apple brand at a low price point. Lenovo believes it can deliver quality and still serve customers looking for a good deal.
If they are both right, that's a big win for Lenovo.
If you look at the CNNMoney charts, Lenovo has grown the most of any vendor. While one quarter is too early to make much more than an educated guess, it is possible that the Apple price differential on laptops has finally gotten too much for even college bound parents to bear. Tuition keeps going up and family incomes have not gone up.
We are in a tough economy and the reality is that Apple is a luxury brand. There is protection in being a luxury brand as Gruber hints, but there are limits to your growth if some of your strategic customers have decided your products are too expensive.
Perhaps Apple's actual numbers will spin all of this a little differently. Certainly there is no cause for doom and gloom in the Apple world. After all, someday they might actually ship that new Mac Pro that they announced in June and of course we are due for an iPad refresh. Let me guess, they will be thinner and lighter but will still be lots more expensive than a Nexus or Kindle. Did I tell you I suspected the "new" iPhone might sport some color?
That is it from the Southern Outer Banks where we might get summer in October but the hope of actually seeing a Mac in one of our electronics stores is as elusive as ever. I will just keep living my dream to ease the pain.
Update- Mark Rogowsky posted some interesting charts on Apple after my article was published yesterday.
Just to make my point on price, I checked the flyer in the Sunday newspaper and compared the computer prices I found to Apple Store prices. You can argue all you want about Windows 8 and it certainly is not perfect, but it is very usable and in fact I use Windows 8 every day along with Mac OS X Mt. Lion and Xubuntu Linux.
As of October 13, 2013, the least expensive Apple laptop with an I7 processor is $1499. The MacBook does have a slot loading optical drive, a thunderbolt port, and Firewire 800 port, but I live quite well without any of those on my current laptop.
Best Buy's Sunday, October 13, 2013, flyer lists a Lenovo laptop with an I7 processor, a 15" touch screen which is bigger than the 13" MacBook Pro for $829.99. The hard drive is smaller on the Lenovo but the bigger screen would make that a wash for me. As someone told me when I bought my MacMini, you can find USB optical drives for under $70 if you really need one.
I have used a lot of Mac laptops and I judge the quality to be similar to Lenovo. You can make your own judgment, but as of October 13, 2013, you pay a 81% premium for buying a MacBook over a Lenovo. Unless you put a lot of value on Thunderbolt, aluminum, and Firewire 800 as opposed to USB 3.0, I think the Lenovo is a better buy especially for college students.
Laptops are almost a necessity for college students and those of us who travel for work. The word that comes to mind for someone willing to pay 81% more for a product that will likely need to be updated in three or four years no matter which one you buy certainly is not "discriminating."