Sunday, October 5, 2008

Rebirth of the Apple from 1984

Amids the sighns of a troubled economy comes the promise of a great
shift in market power between the different computer companies.
Whithin a year or two, the marketing strategy of the vast magority of
PC makers will be chalenged by one company that is continuing on it's
quest to reclaim the dominant position it held in the 80s. That is

While the Mac product line does show a steady increase twice that of
the overal industry, a new but rapidly expanding foundation of the
company is poised to greatly accelerate that increase.

The iPhone has been a technological and a cultural revolution. It has
brought Apple to the front page of technology for almost 2 years now.
It's initial effect on the Mac product line was that of a hallo:
easing awarreness and increasing sales without significant efforts on
the part of Apple to offer something new in it's computers.

With the notable exeption of the Macbook Air the whole Apple product
line is due for a Major overhaul, having ratained it's basic design
for many years now. Least of those is the iMac, however that is the
area where competitors have caught most in recent years.

The second effect of the iPhone is that on Apple itself. The Macbook
Air is a sign of things to come with it's multy touch trackpad. But
it's not the feature list that will be the biggest change in the new
Macs due out on October 14th. It's the production value, the design
and cost of distribution.

Apple originally tried to cell the iPhone along it's traditional
philosophy. Bacauses it was so far ahead of the competition, it had
time to try different marketing models way before the competition had
a chance to respond. Initially Apple tried to cell the iPhone as a
premium product but quickly realized that containing the device was a
result of their own conservative projection of it's appeal. While
Apple may get a bit less profit by dramatically lowering the price,
the effects of mass production and wide availability were even more
beneficial. The more people have iPhobes the more will eventually buy
Macs as well.

Neverthess even at the midrange price of $400 the quick drawn up of
the first generation iPhone months in advance of the second model put
a lot of cash in Apple's hands.

Recent study of Mac sales has indicated that for every 3 dolars
consumers spend on laptops in the US, 1 goes to Apple despite the fact
that is hold only 10% of that market.

The flow of cash will soon enable Apple to get another edge over it's

Apple has learned from the iPhone that it can both prosper and cell a
lot by having products that do not offer the latest in technology but
the best integration and user experience even if it comes at the
expence of not offering a product with the top specs.

The iPhone has neither the highest res screen, nor the best camera or
the widest range of conectivity options. What it has is an industrial
design centered around the best user experience while using yesterdays
components. Very few of the iPhone technologies are cutting edge. The
cutting edge is their integration, the software behind. And software
does not have a hardware cost only a labour one. So, the iPhone is
maybe the first mass hardware product where due to the software a
copany is so Able to cell a hardware with significant sales margin.

It is very likely that Apple will apply the same to the new Macs. The
Macbook Air is a product that can greatly benefit from that. There
isn't anything extraordinary about it's performance. It's all about
the functionality of the thin form factor coupled with high end
wireless capability. It may be possible for Apple to greatly enhance
it's capabilities trough software while at the same time dramaticaly
lowering the price of the hardware.

This is the crown jewell of the Apple strategy. Being able to produce
state of the art designs at low cost and high production rates. It is
very likely this is what Apple has been investing in for the past 2
years and the Macbook Air was just a test example of the kind of
production precision and design Apple will be able to offer in the
near future for the rest of it's product lineup.

This new hypptetical high tech production facility in the US is
nothing new for Apple. In fact Steve Jobs has seen two of those
The first one was in 1984 with the Macintosh. It was eabling Able to
produce if I can recall directly up to 6 million Macs a year. Back
then Jobs lost to CEO John Skully and Apple missed the oportonity to
cell a lot of units due to the high pricetag.

In the early 90s Jobs had managed to create a high tech facility for
producing it's Next computers but just lacked the Marketing power to
fight with Apple and Microsoft.

Now, however Apple guided by Jobs has played all it's cards perfectly.
Not only can it use it music and portable bussiness as a hallo for
it's Mac line up and vice versa but it may be able to benefit from the
likely next president's policy.
If Barack Obama is elected president, which I pray he is, corporations
now benefiting from exporting Jobs oversees will see significant tax
increases. At the same time companies having production facilities
here will have less of a tax burden and I believe no other than Apple
is better position to take advance of this .

The other concept Apple can borrow from the iPhone is the Apple way of
doing things that no one else has. Instead of offering pure
performance stats, Apple can inovate by creating a custom product that
delivers a specific experience based entirely on human needs rather
than the needs of corporations.

As said the iPhone did not become the leader of the Market by juping
in front of everyone. Rather, After years of research Apple was
convinsed that the success lies by making a sharp turn and following
another road.
It took over an year for the compatitors to aknoledge that Apple was
right and try to follow but now theyare traling behind.

If Apple finds a simillar way to sharply distinguish it's product it
can be not only the leader of inovation but in computer market share
as is ever more the case with the iPhone.

I believe Apple has found the recipy. It will be a combination of
several factors.
Among the are:
- New production techniques offering seamless Aluminium cases for
stunning design
- Custom made chipsets by NVidia, Intel and Apple themselves offering
dramatically increased performance trough integration and software.
- Expansion of the Multi Touch Technologies in Macs
- Mac OS 10.6 Show Leopard with Multi Processing core support.
- Low production costs and decreased sales Margins
- Very fast increasing chain of resellers worldwide.

All those things will Atribute to ever greater record sales of Macs
among consumers and businesses alike and Apple capturing the N1 spot
in revenue from hardware sales within a year or two.

Sent from my iPhone

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