Apple market share, Paul Thurott, and Wall Street
March 19, 2007USAT heaps praise on Apple’s marketing, but with multiple mentions of the market share remaining at around 3%. Here’s the deal if Apple wanted market share increases, it can do go after it aggressively. Why wouldn’t want to do it? Because they’d have to do it at a loss. Imagine a world where Apple prices Macbooks and Mac-Minis at $499 and $299 – there is no doubt they would fly off the shelves like hotcakes (or iPods), but the margins would be miniscule and the support costs would balloon out of control.
Lumping Apple’s share against the global share is a complete waste. Apple simply does not compete with Lenovo in China or HCL in India. Secondly, comparing Apple’s share with all PCs shipped is another waste. It’s sorta like comparing Ford Focus’s share as a percentage of shipments that include Man trucks and Starcraft buses . Apple’s corporate share, despite banks and some retailers (JCPenneys) adopting Macs, is 1%. The only comparison that makes sense is Apple’s share of the consumer shipment market in the U.S., and that’s not 3% or 4%, it’s much higher, as RDM astutely observes.
One important thing to consider: Wall Street is more concerned with how much a company earns and not what a company grosses – and by that variable, Apple is killing them. Apple is more efficient in generating income from that small share than Dell or HP are with their “dominant” share of computers sold. I’ll take the free cash flow over marketshare any day.
In a recent article, Paul Thurott asks:
Why is the Mac community so fixated on Vista lately? Is it just because Vista is out now, or is there a feeling that Microsoft finally got it right this time?
The more interesting question is why Windows acolytes seem overly concerned with Mac OS X. Maybe it’s a lack of confidence with their product or maybe it’s linkbaiting. If it is true that Mac users are mentioning Vista more these days, it’s probably because Mac fans sense that Apple has a chance to take advantage of Microsoft’s monumental stumble. In any case, I can assure Mr. Thurott that it’s not because “Microsoft finally got it right this time“.
So, I’m not really a “Windows acolyte.” But I find it interesting that the quote you use is from my Apple blog, which has been around since I bought my first iBook in 2001, about five and a half years ago. The blog is dedicated to all things tech that aren’t Microsoft related.
As for Vista, sorry, but it’s really good. Hey, so is Mac OS X.
Paul,
Thank you for your comment. I am not aware of the different blogs that you update – I just wanted to answer your question.
Most reviews suggest that Vista is a mediocre improvement to XP at best. Stephen Wildstrom in this week’s edition of BW calls it “Slow and Dangerous“. I played around Vista a bit, and, yes, I agree it sure looks purty. Other than that – ehhh. So my question to you is – what else is so good about Vista?
Personally, I hope that Vista is good, and one would hope that after some really crappy Windows releases (ME?) and the hellishly long duration of Vista development, that Microsoft would finally produce something good! As long as Apple grows modestly (not wildly so as to attract the virus-writing crowd) and stresses profitability, then Apple fans will have the best of both worlds: a stable Apple with an innovative product line, without the hassles of dealing with a company that has to be number one, and all the problems that come along with that status.
Have you guys heard about any bugs on vista?
I’m a PC user, and so many stores I find are refusing to sell PCs with Windows XP, a few even to service them.
http://www.trinimobile.wordpress.com
As with most things Mac and PC/MS, it will always be a debate. I don’t want the world switching to the MAC. I love it as it is. I like to know that the Mac OS is coming along fine and that Apple is constantly trying to build best of breed products rather then defend a stolen empire(MS). We need GREAT products to wrap our lives around, our survival may just depend on it. It is just sad that Apple seems to be one of a few companies that strives for such product excelence. On what I think is going to be the next KILLER APP, it is an always ON, every where computer. Something that we don’t have to stop our day to use. I support a friend that claims to have ADD and he can’t remember to go to his computer to get his information. If his computer was always on “ala star trek” and he could just speak to it, then he and a lot of other “ludite/slow” adopters would not find the computer quite so difficult to use.
The computer keeps morphing into other use markets. Is it a Com device-iChat/email/second life? Is it a library/archive devise-terabyte hard drives/Spotlight/ search? Is it a work device-Text edtiting/Photoshop/webpage creation tool? Is it a business device-ebay/craigslist/paypal/accounting/spread sheet?
Is it an education devise-the web/and search engines?
Of course it is all of these and will be more. The question is at what point does it function better for the user to break a special use “catagory” out in to a separate device-ie. the iPhone and iTV?
New hardware-terabyte drives/WIMAX/cheaper flash ram/oled displays/lower power chips etc. are coming down the pike,it is only when a company (Apple), aims their products and developements to take advantage of new emerging sweet spots in Tech/prices and integrates that approaching target that we get great market leading “high tech toys” to use. I am not a power user, but just about. I would like to say that for me the desktop is just about dead. I am at that point that where I want to go on with my life and STILL keep contact with my connected information-iLife. How soon before I am liberated from my desk and can live in the sunshine and get my services from the clouds? Liberate me Apple! As for MicroSoft, life is too short to be satisfied with an also ran, mediocre, copy cat/stolen wannabe, unsafe and undependable computer system, even if runs on cheap hardware!
9,000 people a day switched in 2005 and 2006.
“As for Vista, sorry, but it’s really good.”
The BBC, CNET, Forbes, TIME, PC Magizine, Business Week and IT Enquirer don’t think so.
To read how Vista has driven one long-time rapid Windows apologist to OS X, see http://www.technologyreview.com/Infotech/17992/.
Thurrott is a Microsoft shill. The reasoning he shows in his articles has about as much logic in it as a Bush speech.
Just ignore him and he’ll go away.
Yours sincerely,
John Davis
[...] Apple market share, Paul Thurott, and Wall Street USAT heaps praise on Apple’s marketing, but with multiple mentions of the market share remaining at around 3%. […] [...]
“So my question to you is – what else is so good about Vista?”
Wow. You don’t actually read anything Paul Thurrott writes, do you? Why the heck should he repost his entire Vista review here? Why don’t you just go read it?
And you didn’t know that Thurrott posts a bunch of pro-Mac stuff, too?
I almost never agree with Paul Thurrott, I am much more pro-Mac and I often hate what he likes and like what he hates. Sometimes he pisses me right off.
But he is no acolyte.
You, however, clearly are an acolyte, since you don’t seem to know anything beyond the trash they spew on rag sites like MacDailyNews.
DBL,
Thank you for your comments. I am aware that Thurott posts pro-Mac articles. However, I think RDM has it right about Thurott: “What Thurrott writes depends a lot on what he thinks his readers want to hear.”
I am an Apple acolyte – no argument there. I do take exception to you claiming that I don’t know anything beyond MacDailyNews. I also read MacNewsDaily.
Anyway, I don’t think I still have an answer to my question. As Michael Linehan points out [in comments above], no one is really impressed with Vista. So what gives?