Will Apple Really Abandon the Low-End Desktop Computer Market?
Recent rumors suggest that Apple is to cut the 17-inch iMac from its range and drop the Mac mini, making the entry level desktop Mac a 20-inch iMac. But is it fanciful to think Apple would drop its low-end computers?
Long, long ago, in a cave without broadband, Steve Zog strode out, held up a burning twig, and proclaimed “I fire!” No need for reality distortion, the appreciative oohs and ahhs confirmed this capturing of fire to be a significant advancement—as well as beating Bill Zutz who was still chasing lightning around, trying to catch it in a bowl.
Some weeks later, Steve comes back with a burning stick and proclaims “No more twigs, I fire!” More appreciation.
A couple of months later, Steve starts waving a burning branch, shouting, “No more sticks, I fire!” However, this one isn’t as warmly received. “Come on, Steve,” says one of Steve’s usually faithful clan, “the twig was useful, the stick was great, but do we really need a whole branch? What next? The whole tree?” Steve’s eyes sparkled as his mind drifted off to its thinking place. Other members of the clan, however, liked the burning branch and begged Steve to go bigger and better. Fortunately Steve got a bit distracted by his work on the wheel, and the local forests were saved. “Just need to invent wheel so can make iPod,” Steve was heard muttering.
Fast forward a few thousand generations: Bill’s descendant is still trying to catch lightning and Steve’s is still replacing technology faster than we can get used to it, egged on by his mostly faithful clan.
Today it’s not burning sticks, it’s computer monitors. The first Macs Steve waved at us proudly sported a 9-inch screen. The latest rumors are saying that the next iMac will come with 20 inches as a minimum. Is that a burning branch?
The 20-inch iMac would likely drop in price significantly as LCD monitor prices are plummeting, and it could even come into line with the current pricing of the 17-inch iMacs.
However, retaining a 17-inch iMac would give Apple a very affordable iMac, let’s say US$699. At the same time, the cost of the Mac mini could be further cut to, say, US$499.
Without these two units, at best, the entry level Mac would be a US$999, 20-inch iMac. And that would put Macs back in the “Macs are expensive” basket.
Is this just consumerism? Or is there a real need for larger monitors? Do we really need a burning branch? How long before we demand a burning tree?
Sales are the indicator, so if Apple drops the 17” iMac, that would be some indication that consumerism is demanding larger monitors. And really, when you see a 20-inch or 24-inch iMac, it’s hard not to lust.
Whatever Apple decides on the iMac, dropping the Mac mini without replacing it would be bad for Apple’s image. Imagine if the entry level iPod was the 8GB nano at US$249. Sure they’d still sell, but Apple would be missing a massive part of the market.
Apple seems to have little interest in the corporate desktop market, and if these rumors are correct, then it’s also losing interest in the next biggest segment of the desktop computer market. And that can’t be a good thing.
Faithful aside, many consumers don’t want a burning branch that’s going to cost them their best rocks. They just need to light a fire.
If Apple is having challenges in the low-end market, is abandoning it really the best solution? What happened to innovation? Can’t we get an affordable, even if smaller, burning branch?
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I would love to have the Mini you describe—4 cores with a nice, honkin’ video card… but that will *never* happen.
Since Jobs came back (actually, even since Gil Amelio…), Apple has been *extraodinarily* careful to design their product lines such that one model does not cannibalize the sales of the next higher model. A Mini with those specs would crap all over iMac sales.
Most of us here on would jump at the chance to buy a machine like that. The only thing that keeps me from picking up a Mini is the lame on board video… and I don’t necessarily want a fill fledged 24” iMac, even though I want something with the power of the nVidea 7600 GT. I already have a decent LCD monitor, so an iMac is really more than I require.
What would make be buy today is the 20” screen iMac with the 7600 GT (can’t BTO it) or a MacMini with a nVidea 8600 (like the new MacBook Pros) or similar video specs to the 7600/8600 line (X1900 mobility, please?)
My prediction (and I think it’s a good one):
Apple still needs a low end, so they keep the MacMini, but maybe give it a slight redesign and minor spec upgrade. This box will run from $600 - $800 similar to the current mini line… Possibly even bumped to $900 on the high end, but still have slow on board video like the low end iMac.
Apple drops the 17” iMac, not because they’re abandoning the low end, but because the 17” iMac has too much overlap with the higher end Mac Mini. Separate 17” LCDs are so cheap, there’s no reason for the smaller iMac when the Mini already fills that niche.
Look at the current specs and you’ll see what I mean. There’s already a significant overlap between the low end iMac and the high end Mini.
That’s the real reason the low end iMac is going away—product line overlap.
Nice ideas for the Mini *g* Let’s just hope they keep the thing quiet. I am seriously considering a Mini as my next stationary Mac due to the low noise level. I do not need oodles of power, I need silence.
I agree that apple is far more likely to drop the 17-inch Mac then the Mini, if only for the mini’s better performance as a 2nd PC.
It’s easy to have a mini in addition to another PC, just switching the monitor plug as necessary, once you need a 2nd screen that becomes too impracticle.
That’s the real reason the low end iMac is going away—product line overlap.
Well said, vb.
Purely from a personal point of view - and despite not yet owning one - I’d be devastated if Apple dropped the mini entirely.
It’s interesting too, that I was reading Island in the Net’s blog, and he and a mate - who are both ubergeeks, like seriously clever - both bought Mac mini’s as their first Mac.
I think that’s a whole market we forget about for the mini. We sometimes think of the mini being for the same folks who buy low end PCs. And to be honest, I was thinking that when I wrote this piece.
But in fact - as all the mini mods and server stacks also testify - the mini has sold to a lot of geeks and nerds.
But as xwiredata said, it does need to be a tad bigger.
Why do people think a souped up Mac mini would cannibalize sales of the iMac? If so, wouldn’t that be a good thing for Apple? After all, the difference in cost to produce each is negligible. If they could sell more Mac mini’s don’t you think Apple would do this?
I have a Mac mini and a Power Mac Dual G5. I need to replace the G5 but I can’t really afford a new Mac Pro. And I’d rather not get an iMac because I’ve got dual 20” widescreens now. Apple needs another standalone machine with good graphics.
The thing is, Apple has never really tried to profit on volume. They’d much rather make a bigger profit on a higher priced machine even if sales are less than try to compete on volume. If the mini cannibalizes the iMac, they make less profit and they don’t like that—even if it gains them marketshare, or they still make a healhy profit.
That frustrates me because while they’re killing in the upper ends of the PC market, that is a market that actually does only serve 10-15% of the computer buying public. The biggest part of the market is around the $500-800 section. People mock the budget PCs, but they do what most people want them to—email, web, word processing and spreadsheets, and even video watching… rarely do you need dual cores or 64 bits for things like that.
The Mac Mini is a ‘Low End’ PC but it’s not a ‘Budget PC’ - that’s the problem and Apple really need to get their act together on this section of the market.
The Mac Mini represents very poor value for the buyer who does not already have a monitor, keyboard etc.
In the UK buying the higher end Mac Mini (with only 512mb RAM) and a 20” Apple TFT costs £929 (about 1800 US$) and then you have to buy the Apple keyboard and a mouse. Even with a cheaper Monitor, the Mac Mini will cost a hell of a lot of money compared to similar rivals from HP and Dell that will out-perform the Mini (the Mini has a 4200 rpm hard drive!!!). The iMac represents much better value for the first time buyer but they will have to suffer the disadvantages of having an all-in-one (i.e. they can’t just replace their PC or their Monitor).
Basically, the Mini is a cheaper-than-an-iMac option for switchers and that’s all. To call it a budget desktop is absurd.
Apple will tell you that the Mac Mini comes with iLife; but so what?? You can download argueably better sofware for free, and how many people really use iMovie or Garage Band??
Apple need to produce a truly budget low-form-factor-headless PC without the needless software and without the under performing components. This will be an education and low-end market winner.
All Intel mini’s have 5400rpm drives…
Apple is making 50% profit on the current Mini lineup.
If I were Apple and wanted to spice up the Mini line, while keeping the profits in line:
Core2Duo Santa Rosa’s: There less expensive than Meroms even today.
X300 Intel Graphics with USER SELECTABLE ram size (64-256): The X300 series is OpenGL 2.0 compatible as well as Core Animation.
5400.3 Seagate drives: These have shown over and over again to be FASTER than 7200 drives in the 2.5” form factor. Uses Perpindicular recording.
Base Ram 1gb 800mhz. Up to 4gb. SR 2.0 chips only. Superdrive only. Mini 2 comes with 160gb HD and 2gb of ram W/Kyb+Mouse and is targeted to switchers who already have LCD’s($100 more in cost but exactly $300 cheaper than the Base iMac with similar specs).
Santa rosa’s run TDP of 32* compared to the meroms 36* so no extra excessive fan operation-in fact it’s COOLER and requires less power.
That’s how I’d do it. You’ll still see profit margins in the 40%. It will still make money. And you don’t have to retool the case, just the MB which is shared with the MacBook for components anyway. It’s still bleading edge tech and with the specs I posted would actually outperform the current MacBooks (simply on CPU and HD alone) NOT MBP’s.
But that would keep the Mini alive, viable, profitable, and still fit in Apple’s High Tech only thinking.
Nice work, XW.
You might be quite close to the mark too if the mini survives.