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Posted Oct 20, 2006 09:55 by Chris L. Listed in: Opinion & Analysis Tags: Microsoft, Sony, Sega, Intel, Gartner
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10QJ

Hypocrisy!!!


This should spark some debates among the die-hard Apple-addicts reading this. Analyst house Gartner says that if Apple wants long-term success, it should do what game firm Sega did in response to the Sony PlayStation 2 and Microsoft Xbox. In case you're not a gamer, what Sega did was to retire from the game console manufacturing business and concentrate on software publishing and development.

Yep. In an ambitious analytical report, entitled "Apple Should License the Mac to Dell," Gartner is suggesting exactly that. Apple licenses Mac-making to Dell, and quit hardware manufacturing altogether, to concentrate on OS and software.

Why, oh why must Cupertino give up on those little bundles of computing joy to Dell? Same reason Sega bailed on their Dreamcast: competition. In Apple's case, Gartner believes that increasing market pressure will cut into Apple's profit margins with the Mac. This is because Apple is recently using Intel chips, which is also a big reason for a surge in Mac popularity, says Gartner. They also say that Intel, as a component maker, effectively "subsidizes" Apple production.

But with pricing pressure from other computer firms like HP, Gartner believes that Intel "cannot go on supporting Apple (or any other customer) indefinitely." Instead, Apple could license Mac production over to Dell - which also uses Intel chips, and is "Intel's closest ally" - which has a more robust production and marketing infrastructure in place. The firm even believes that by doing so, Mac OS could capture 20% of the market, and Macs themselves could become more affordable.

Will Steve Jobs take heed? Silicon.com's conclusion is that he's not worried much about Apple's position in the market - or about the competition either. Most likely not, in that case. Nothing in the report either about other Apple hardware, like the iPod and upcoming iTV. What do you guys think?

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   by Franken Stein (Unregistered) - 2006-10-20
 » Dum dum dum dum dum

Thats why hes a reporter / analyst and not a computer tycoon.

I hate analysts and this one needs to get a life.
   by Jonny (Unregistered) - 2006-10-21
 » Stupid

It would make absoulutely no sense for Apple to back out of the hardware market. They are doing very well at the moment. If anything, this guy seems afraid of Apple.
   by glen (Unregistered) - 2006-10-21
 » ha

that guy is a *****wrinkle...
   by iNF (Unregistered) - 2006-10-21
 » He has a point

He's points are certainly valid, Apple has increasing problems with their manufacturing cycle and they must improve their production logistics/lines to meet all this demand. Just look at the current situation with Macbooks and/or the manufacturing problems concerning Merom-based computers.

They certainly are going to wonder wether they just hire someone to do the hardware for them on their factories or if they should build more factories themselves. Expensive stuff.
   by ha_ok (Unregistered) - 2006-10-21
 » DELL SUCKS!

Apple prides itself in making a superior product across the board. Part of the reason you buy an apple is because you know they keep a higher standard.

The PC market is flooded with "lowest bidder" components that really hurt the performance and long term reliability of these machines. Not to mention the fact that all new PCs come with an assload of tray-resident resource choking trialware.

The reason Apple makes their own machines and doesn't use the cheepest parts in them is becuse they want you to feel you have made a sound investment and that you got your moneys worth. And because it costs them less to repair and support machines that outperform their rivals. They cost more because they are better machines. Especualy now that they are Intel machines that are running a Unix\Linux OS.

Now arguably, Apple may have a higher profit margin because of their higher prices. This may give them some room to play with. But it may also cost them more to make and support these machines, because they do it themselves. They have already made a play for the less expensive audience. And it's working. The Mac Mini and MacBook are outselling the iMac and MacBook Pro. If they pharm it out to anyone, it wouldn't be DELL.

Honestly, I've worked in the PC repair sector once in a while, and DELLs are right up there with eMachines in getting your moneys worth. Which is to say, inexpensive because its CRAP.

Now you say, "But Dell bought Alienware. See? They can handle high-end machines." Alienware were overpriced machines to begin with. You are paying for the case. And the wallpaper. You can get those benchmarks out of any well-equiped machine. I can put anything I want in their case. What makes it an Alienware is the case. You want Alienware, go build it yourself, get a sexy case and send me the extra $1000 you have left after not paying for the Alienware name.

You say "Apple was\is proprietary." Manufacturers like Dell are just as bad. There are loads of non-standard components in these things. Dell and Compaq and others. Slots that only take their components and form factors that couldn't take standard cards. I delt with pissed off customers all the time who felt ripped off because they found out that they couldn't add the simplest thing to their not-cheep machine. People who built their business on a network of them, only to discover that they'd painted themselves into a corner.

Apple has been proprietary so that they can control the presentaion and performance of their product. Better presentation means more appeal and less intrusive in the home. Better performance equals happier customers and lower costs after the sale. And for the record, custom designing proprietary parts so that they fit in an iMac is not the same as what I'll describe below. It is obvious when you buy a machine shaped llike a desk lamp, that replacing anything inside may be a bit more involved. It's not a big boxy looking thing that looks from the outside as though it will take just any old PCI card as long as I have the drivers, until you open it up and look inside. I'll explain...

Dell and Compaq and many others have simply made poor planning decisions in the interest of getting the cheepest parts into their machines for higher profit margins, and flattening those big desktop boxes. In the PC market, proprientary simply means, "Now when it breaks, they'll have to buy replacement parts from us. We're so brilliant!"

"But Dell is the cheepest PC out there. They have to be doing something right!" You get what you pay for.

And Dell is one of the brands with the highest repair rates. To which you'd say "That's because they sell more machines, duh!" Which means nothing. More crap out there in the market just adds up to more machines that die a premature death. Which is what took them from number one in customer satisfaction to like number, fell-straight-off-the-charts. Seriously. Apple is Number One right now. And that is no happy accident. It is the result of careful planning and the intentional confl

   Re: hai_ok_again (Unregistered) - 2006-10-21
 » continued

confluence of the right hardware, software and a first rate OS. All elements they control for this very reason.

The only thing attractive about this strategy is cheeper UP-FRONT hardware costs for Apple. And just look what it's done to Dell's cusstomer satisfaction ratings. They are paying for it now. This is a Top-Down strategy that only looks good on paper in the accounting boardroom, where people try to cut corners. Apple likes their corners right where they are. You want to cut corners, go have your mom cut the crusts off of your PB+J and put you down for a nap. This is a sheer-as-the-face-of-a-cliff bad idea all the way around.
   by Bob (Unregistered) - 2006-10-21
 » ..

If Mac came out as an OS for the PC I would buy Mac OS ahead of a possible Vista upgrade. I dont know why Apple sell Mac's but also licence the OS to PC manufactors and as a PC OS to buy.
   by PS3Rider (Unregistered) - 2006-10-21
 » good idea

I was talking about this ages ago. The only advantage that a pc has over a mac is price. Pc's are very cheap to build at near top spec, whereas because apple make macs directly they are more expensive. If dell was to take over mac manufacturing then prices would plumet. Take this example:

A mac mini with 1.6ghz and 80hdd costs (and the rest)£450
A pc with 3.2ghz 160gb HDD(and the rest) costs £350

See the difference? But if dell took over hardware would be cheap to get so a mac mini would porbabaly go down to £200. Personally I hope dell manufactures macs and keeps the sleak sexy look of a mac still.
   by New Mac User (Unregistered) - 2006-10-21
 » macs are better

Apple should stay with building their macs, it insures quality control. A mate of mine has a pentium D 3.2ghz 4gb of ram, 500gb HDD blah blah and i have an iMac dual core 2 2ghz, 2gb ram and 250gb HD. My Mac can beat his computer in everything except gaming. Pcs must be updated every what 3 months when a new processor or graphics card comes out. Not Macs there garunteed a decent life span. Why? because apples insures there of the highest quality. Except for the protection and Warranty, they suck there.
   by Dom (Unregistered) - 2006-10-21
 » LOL

If this were ever to happen, i would shoot myself in the head with a double barreled shotgun, and use my own dead body to massacre everyone at the Hell computer manufacturing comporation

   Re: MacUser (Unregistered) - 2006-10-21
 » agreed

think i'll join you in that
   by Snowspot.net (Unregistered) - 2006-10-21
 » lol

Who wrote this article? What were they thinking lol.... If anything apple is finally starting to get a lot of press about it's products. I would bet in 2-3 years time, after the next ipod even, mac computers will be selling VERY well.

Especially with the new version of OSX and the time machine feature....that thing is awesome. Consumers will gobble it up after seeing it in stores.




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