Rumors of a $499 Apple
Today's San Jose Mercury News has an interesting article on a rumored $499 computer from Apple. However, the quote at the end by NPD analyst Rich Baker sounds a bit off-key here.
"I'm not convinced that they could do an entry-level product, at that kind of entry-level price, very well,'' said Stephen Baker, director of industry analysis for the researcher NPD Group. ``They'd have to take too much out of it, and make it not very worthwhile. I'm not sure how they'd market it. It's not the kind of thing this company does. Does anyone tell BMW they need to have a $14,000 car?''
So lets see. There are currently Windows computers selling for $399 which incur costs like Microsoft Windows licenses and Intel processor costs which Apple doesn't bear. Further, Apple has the luxury of adjusting the OS to accommodate new low-cost parts, something a manufacturer like Dell or HP can't do nearly as easily. Finally, the analyst's analogy really breaks down when he starts talking about BMW; in fact, BMW has been most successful with its lowest cost 3 series cars, which, while not $14,000 are certainly competitive with more mainstream vehicles like Honda Accords and Toyota Camrys.
The bottom line: Apple certainly has the ability to introduce a low cost computer. However, Apple under Jobs only does things when they make sense for the brand and for the overall image that Apple stands for. But while the rumor may or may not be true, the one thing Blackfriars is sure of that doesn't stand in their way is economics.
"I'm not convinced that they could do an entry-level product, at that kind of entry-level price, very well,'' said Stephen Baker, director of industry analysis for the researcher NPD Group. ``They'd have to take too much out of it, and make it not very worthwhile. I'm not sure how they'd market it. It's not the kind of thing this company does. Does anyone tell BMW they need to have a $14,000 car?''
So lets see. There are currently Windows computers selling for $399 which incur costs like Microsoft Windows licenses and Intel processor costs which Apple doesn't bear. Further, Apple has the luxury of adjusting the OS to accommodate new low-cost parts, something a manufacturer like Dell or HP can't do nearly as easily. Finally, the analyst's analogy really breaks down when he starts talking about BMW; in fact, BMW has been most successful with its lowest cost 3 series cars, which, while not $14,000 are certainly competitive with more mainstream vehicles like Honda Accords and Toyota Camrys.
The bottom line: Apple certainly has the ability to introduce a low cost computer. However, Apple under Jobs only does things when they make sense for the brand and for the overall image that Apple stands for. But while the rumor may or may not be true, the one thing Blackfriars is sure of that doesn't stand in their way is economics.
posted by Carl Howe at
11:56 AM
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