Monday, May 10, 2004

Morons.

Apple's hardware business generates profit, but maybe they should give it up. Discuss.

In what other markets are companies able to generate a profit, but industry "analysts" (read: Rob Enderle or Michael Dell) still call for the company to disband, or get out of the business? If your company can consistantly sell billions of dollars worth of hardware, and generate millions in profit (and is able to do so through an industry downturn) is market share all that important? The market is still growing, and the user base is growing even though the market share may not be.

It is reasoning like this that made Wintel machines the monster it is today. Because everyone else has a PC, it makes sense for me to get one as well. Do people buy Sony receivers and Honda Accords because they have a bigger market share? I think not, there are many more reasons why people purchase the brands that they do (quality,cost, etc.) , but it doesn't stop analysts from using this one dimentional argument when calling for Apple to get out of the PC market.

A point that Steve Jobs regularly brings up is that BMW has even less market share (car market) than Apple does in the computer market. Does that make them a less viable company? On the contrary, because there aren't a hundred knock-offs up and down your block, many people desire the car even more. Nobody "settles" for a BMW, and the same goes for a Macintosh. These are consumer items that value form as well as function. It is these people who don't see any value in form who will go out an purchase a Saturn because it does the same job as a BMW Z3, and also don't take the time to understand WHY someone would purchase the Z3 when you can get 3 Saturns for the same price.

Aside from form, market share is also what is killing the Windows machine. Virus and worm writers looking for notoriety will continue attacking the platform with the largest market share. Just this past week, my parents had three different friends/family who owned a PC where they had to go out and either a)Purchase additional software costing $150-200 or b)Pay techies at Best Buy to purge their machines of the latest worm and/or spyware. Granted, Macs are no less vulnerable (Apple puts out a security update almost once a month), but the market share of PCs acts like one of those UV lamps in the backyard, attracting pests away from you. Let them keep their market share. It reduces the total cost of owning a Mac.

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