Why Apple disdains netbooks

Can't believe no one has figured this out

Tim Cook's comment reinforces what I've thought ever since Snow Leopard was announced. From the article above: 'Cook added that netbooks are "principally based on hardware," and throughout the call he repeatedly stressed that Apple believes "software is the key ingredient."'

Biggest complaints I've heard about Netbooks are (a) they're too slow (this is why none run Vista), and (b) keyboard is too small.

Too slow. Hmmm... Well, OS X runs surprisingly well even on 5 or 6-year-old hardware. But, wait a minute....isn't the whole focus of Apple's Snow Leopard (next version of OS X) PERFORMANCE and FOOTPRINT of the OS??

Apple is working hard to make OS X run faster on existing hardware, which will benefit Macs, the iPhone, the iPod Touch, and....make OS X absolutely run *circles* around Windows XP and Linux in terms of performance.

Gee, sounds like a great OS to put on one of these slower netbook thingies... Re-read Tim Cook's comment (above) and see if this doesn't make perfect sense.

Apple following a trend?

Apple doesn't follow a trend, it creates it. Don't you remember? First PC: Apple; first mouse, first graphic desktop, first, first... When it isn't the first, it is the best and starts a trend, like de iPod, and then the iPhone.
That is where the money is.
And, by the way, Apple doesn't rip off anybody. You pay for what you get. You don't complain about the price of a Volvo, BMW, Mercedes...

Wha?

"Every PC maker on the planet loves netbooks because they're the fastest-growing segment (and the only growing segment) of the PC market."

It's just not true to say that all of the growth in the laptop segment is attributable to netbooks. Only 10 million were shipped in 2008, less than 1 million in the US according to IDC (see 1st link). Besides, PC makers are wary of netbooks because of the thin margins.

«The dilemma: Big tech suppliers remain heavily reliant on sales of high-powered, high-priced laptops to drive profits. Profit margins are razor thin on netbooks. And shipping millions of cheap PCs could drive down consumers' expectations of what they should spend for a basic computer, Shim [an IDC analyst] says.»

www.usatoday.com/tech/products/2009-01-19-netbooks-future_N.htm

«The entire category of so-called netbooks – personal computers designed primarily for Internet use – may be headed over a price cliff, according to industry analysts. […] Heavy price competition is never a happy thing for manufacturers. More broadly, this netbook category has been a mixed blessing for the personal computer electronics industry.»

http://bits.blogs.nytimes.com/2008/08/22/netbook-prices-are-now-falling/

«In a tale of sales success breeding resentment, computer companies are wary of the new breed of computers because their low price could threaten PC makers’ already thin profit margins. […] “When I talk to PC vendors, the No. 1 question I get is, how do I compete with these netbooks when what we really want to do is sell PCs that cost a lot more money?” said J. P. Gownder, an analyst with Forrester Research."»

http://www.nytimes.com/2008/07/21/technology/21pc.html

"Some analysts believe that netbooks will outsell laptops at some point."

Which analyst firms? And what do you mean by 'at some point'?

«We expect the mini-note PC market to settle at approximately 16% share of the notebook PC market by 2011.»

www.displaysearch.com/cps/rde/xchg/displaysearch/hs.xsl/Strong_mini_note_shipments_buoy_notebook_PC_Market_Q3_08.asp

Apple is a bit player and always will be

The Apple lemonade stand is doing great, why should they offer other products? After all, not everyone is sophisticated and wealthy enough to buy a Cadillac, but GM is doing well. :)

Seriously, I think Apple clearly has a niche market strategy and absolutely no dream of a Mac on every desk.

And that's great, because Microsoft is on a long slide into oblivion. MOST netbooks run XP but that's bad because (1) Microsoft makes hardly any money on these licenses. And (2), it takes a lot of green to feed an 800-pound gorilla--look at the music player market. iPod's are a big hit for Apple, but even if the Zune were equally popular, that would be fairly small change for Microsoft. The commoditization of computing means that Microsoft's salad days are over. Apple products will compete nicely as high-end alternatives to cheap Linux devices.