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Seeds of Apple’s growth

Wednesday, 9 July 2008 — by

Apple logoApple’s market share is on the rise and they’re growing. Question is, which direction?

It’s not often I pick up where someone else leaves off (I have an aversion to blog burp), but Matt Asay of CNET raises some interesting questions as Apple approach 8% of global PC market share:

“Mac sales are outpacing PC sales at 3.5 times faster rate. Two big questions are looming: 1. At what point will the momentum accelerate even faster? In other words, what’s the tipping point for Mac adoption? 2. Is Apple set up to handle this success? Does it want it?”

Apple take 8% slice of global PC market share pie

In terms of a tipping point for Apple’s growth, they’re particularly lucky in that there could be many such inflection points. Apple aren’t just about computers anymore, which is reflected in Apple’s recent change of name.

Gone are the days of Apple making their big bucks from desktops and laptops. Now, they have clean lines of products, spanning Sony-challenging consumer electronics, such as that reasonably popular portable music player you might have read about. They call it the iPod.

Looks good, too!

That said, businesses aren’t going to plunk down huge wads of cash on thousands, or even tens of thousands of iPods. Although there’s an outside chance a sizable corporate might do so with the now corporate friendly iPhone.

But a large German publisher might just buy 12,000 Macs:

“In a major overhaul of its IT system, German publisher Axel Springer AG said it has struck a deal with Apple to replace every one of its 12,000 active computers with Macs.”

However, the deal is more nuanced than that; Axel Springer are buying into the Apple range wholesale — quite literally, I should imagine — with a choice selection across almost their entire range:

“The company will use all of Apple’s desktop line, including the Mac mini, iMac, and Mac Pro, and should also use MacBooks and MacBook Airs for its mobile workers; depending on the context, users will either run Mac OS X, Windows XP, or Windows Vista. The iPhone will also be on hand, Apple notes.”

Does that sound like an inflection point? Truth is, no one jumps into a massive purchase in the tens of thousands without being totally sure they’re doing the right thing, especially when received wisdom says you’re swimming against the tide.

My guess is, these guys have been keeping an eye on the succession of sizable Xserve deals, which will have certainly served as a whetter of many appetites and an strong indicator that Apple gear is up to scratch.

If you’re looking for a launch date for new MacBook Pro and / or MacBook Air, keep an eye on the go date for the Axel Springer deal. I’m sure Apple would prefer them to be walking away with all the newest gear they have to offer.

Apple’s dilemma — quality versus quantity?

Many has been the comparison between Apple and the venerable Bavarian automobile manufacturer. Should we really be casting Apple as the tech’ worlds equivalent of BMW? I suspect not, mostly because of that popular little music player, the iPod and it’s smaller siblings, as well as the iPhone.

Apple occupy several different markets with several distinctly different products. Arguably, you could say the same about BMW and their range of motor cars. But fundamentally, BMW are about selling cars, while Apple are selling several different devices, spanning computing, communication, software and entertainment.

With that small comparative aside out of the way, Apple and BMW do compare nicely with regards to their qualitative approach to their respective products.

Both have a global presence. Both have experience with selling direct to customers. Both enjoy handsome rewards from loyal customers, as well as commanding a great deal of respect from their competitors.

Think right back to when Apple ventured out into retail with their physical, bricks & mortar Apple Stores. Think of all the negative press they attracted, with everyone writing them off before they’d even started.

At the time, several high street PC retailers were having a rough time, with some getting out of the business all together, most notably Gateway, who all but vanished.

So lazy / obvious comparisons were made, and yet again we get a nasty dose of received wisdom. Thing is, Apple had Mickey Drexler from GAP on their board of directors. Combine that with Apple not having to chew through the rope every time they wanted to make a profit from selling their gear (PC manufacturers have to pay the Microsoft tax, remember), and you have the makings of a successful, yet highly ambitious venture.

Fast forward several years and the critics are all but silent. Gone are the “Is it the end for Apple?” headlines, replaced by “Mac sales are outpacing PC sales at 3.5 times faster rate.” and “Apple approach 8% market share”.

They say change is as good as a rest!

A worm in the core of Apple’s security?

Apple now have the products and the infrastructure to do pretty damned amazing things on a global scale. But what about security?

“Also, what happens to Apple’s much-vaunted security superiority? I happen to believe that architecture matters and that Apple’s Unix-based OS will fare better than Windows had when targeted by malicious hackers,…”

It would appear Matt & I are cut from the same cloth. More lazy / obvious comparisons get made when it comes to the question of Mac security should they become more popular.

Those that use Microsoft Windows like to think Apple’s OS X won’t fair much better. They’re wrong.

Architecturally, OS X is light years ahead of Windows. As one long-time Windows developer colleague once commented, it’s scary how bad the code is for Windows. A foul wind or a wet fart is often enough to induce the blue screen of death.

As an example, take a look at the number of intrusions that the number one web server software Apache experiences. Then compare that to the distant second Microsoft IIS. Like night & day.

Incidentally, as part of the standard installation, OS X comes with Apache.

Simply because something is more popular doesn’t mean it’s going to fail. Yes, stuff that’s bigger is an easier target, but it’s not inherently easier to get into and fool around with.

Ever since Steve Jobs returned to Apple, he keeps on pulling the proverbial white rabbits out of tall black hats. Despite the odd wrinkles in the fine fabric of success, Apple continue to surprise, amaze and induce gadget fever the world over.

To answer my own question, as to to the direction Apple are likely to grown in, any direction they choose, because that’s what Apple seem to do best these days.

Apple’s approach with the iPhone was as if the mobile phone had never even existed. On the strength of the iPhone, Apple are muscling Windows CE out of the mobile device space and giving the hierarchy at Blackberry sleepless nights.

My personal feeling is, should Apple grown substantially, they’ll resolve what dichotomy exists between quantity and quality, leaving just quality Apple products for the rest of us…

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Jillian Sands → Thursday, 10 July 2008 @ 1:18 BDT

Should be interesting to see what technologies Apple comes out with. I hope one day to see holographic pictures emitted from the iPhone like on this clip.

Wayne Smallman → Saturday, 19 July 2008 @ 20:17 BDT

Hi Jillian and thanks for the comment!

Despite being a revolutionary product in so many ways, the iPhone lags significantly behind in many ways; poor quality camera, no video function and no MMS…

Sorry Comments are close. Quite possibly for a good reason. Share your thoughts on some of my other posts or contact me directly.

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