[rackforms]

My brother, a comparatively well paid teacher in the Midwest desperately wants but cannot afford a new MacBook Pro. At the same time his school and many others are awash in perfectly functional Chromebooks.

In my own experience then we've got Apple purposely cutting off vast swaths of potential buyers due to lackluster/irregular updates and high prices on one end, and seemingly unaware of a vast market for education and lower price users on the other.

A declining market is one thing but this, so far as it looks to me, is Apple simply throwing potential customers away. That's not riding a wave, it's just plain bad business. What am I missing here?

[mattnewton]

I think two things are happening. The first is, Apple does not pay attention to it's marketshare, instead thinking of itself as a mercedes with 10% market share on the high end. Apple wants to avoid commoditization at all costs. Two, I think that Apple believes strongly in protecting it's margins. Despite the current cash piles, Apple execs still vividly remember a time when Steve jobs resurrected the company from near death[0], and religiously follows what worked for them before. One lesson was to always prefer to pouring money into R&D over decreasing pricing.

[0] I mean, this wired cover was cited often during my time there as a perfect illustration of the mood then https://cdn2.macworld.co.uk/cmsdata/features/3520866/Wired-p...

[IBM]

Apple was pretty clearly shaped by their near death experience and it showed on the balance sheet. It took them a very long time for them to start returning cash to shareholders, but Tim Cook finally did it and that was the right capital allocation decision. They've returned $186 billion via buybacks and dividends since then and cash (and equivalents) has grown in spite of it.

They would rather stay relatively small (115k employees but over half of that is probably retail) and operate like a start-up than grow headcount to support more products. Frankly that's the right decision. There's been a lot of whining from Mac fans about being neglected and today people have been sharing this Vox piece [1] saying they should change to support more products, which would be fine if it wasn't the fact that being resource constrained is part of Apple's organizational culture and if it wouldn't kill the magic that led to their position in the first place.

[1] http://www.vox.com/new-money/2016/11/27/13706776/apple-funct...

[yuhong]

I was wondering for a while what if Intel bought say Compaq back in 1991 instead of Rod Canion and Jim Harris leaving.

[orionblastar]

Chromebooks and notebooks with Linux on them do tend to be cheaper than Macbooks.

When Apple first started the Apple 1, was $666.66, it was a breakthrough in using cheaper parts to make a cheaper microcomputer for a market that was just growing and didn't discover what these microcomputers could do.

Over time the Apple /// and Apple Lisa flopped. Steve Jobs knew he had to innovate to make something to give Apple and advantage over other microcomputer makers. Taking the GUI designed for the Apple Lisa Jobs took over the Macintosh project to make it into a GUI based desktop computer using a mouse. The problem is it cost a few thousand dollars and did not run Apple II software. There were not many apps available for it, so Apple let Jobs go and replaced him with John Sculley.

Apple in this post-Jobs era had sold expensive Macintoshes and had a hard time earning money for profits. They brought Steve Jobs back from Next to fix the problem. His solution was a cheaper Mac named the iMac, then later the Mac Mini as an ever cheaper Mac.

The Macbooks have always been targeted at developers, web designers, and programmers. People who had a high paying job and could afford a few thousand dollars on a Macbook Pro. Teachers are not paid enough to afford Macbook Pros and have to settle for cheaper things like the Chromebook for like $300 or $200 instead of $2000 for the Macbook Pro and the educational discount.

Apple has sort of stopped innovating after the Jobs 2.0 era is over and Tim Cook runs Apple now. Just look at the Mac Pro, it used to be ATX based which means gamers would buy it to upgrade the video card to play more games. Tim Cook changed the Mac Pro to a trashcan tower that can't upgrade the video card, forcing Mac gamers into making Hackintosh systems and eating into Apple's sales.

The Amazon Echo and Google Chromecast have sort of beat the AI at Apple. Apple is getting out of Wifi routers and Google now has Google Wifi and taking over Apple's sales.

In the Post-Jobs 2.0 era at Apple, it is still profitable via iPhone and iPad sales, but has no endgame for the Macintosh, and left a void that Google, Amazon, and Microsoft are looking to fill.

[ovao]

Just look at the Mac Pro, it used to be ATX based which means gamers would buy it to upgrade the video card to play more games.

Did any significant number of users actually do that though? I do remember in the Power Mac G5 era that NVIDIA would, occasionally, vaguely support Mac gaming by releasing high-end consumer-level graphics cards for the Mac, but I truthfully don't remember ever hearing a single user account of a user riding the expandable Mac Pro wave for high-end gaming.

[orionblastar]

Some of the video games need a better GPU than the stock that comes with Macs. The Mac Pro since it was based on ATX standards would take a PCIe NVidia/AMD/ATI video card that could be replaced.

Tell me about a modern Mac made today that can exchange the GPU for a faster one.

If the Macs can't exchange the video card for a better one, they are losing the gaming market. More Windows than Mac games, and Bootcamp can install Windows on an Intel Mac to run Windows games but if the GPU is too slow for the top of the line games, might as well buy a cheaper PC with expandable video cards instead.

I've found Linux Mint or Debian on a PC ATX gaming system runs faster than on an Intel Mac with OSX and video games.

Apple is losing their customer base by doing a classic blunder that Atari, Commodore, etc tried, they don't know the target market of users. Apple is losing the Mac gaming market, due to price losing the Educational market, due to not having a pressure sensitive pen the Artist and creative market, and while Apple has the developer, web designer, and programmer market with Macbook Pros for Startups as the Macbook can book OSX, Windows, and Linux with Bootcamp, they've forgotten of their other markets that left a void that others like Google, Amazon, Microsoft are filling.

[toyg]

Your brother wants a Mac in no small part because he can't afford one. It's a status symbol. Ferrari make ridiculously unpractical cars that they refuse to sell for cheap; same thing with Apple, especially in the latest iterations. Advertising and society tell one that wealthy and hip people use Macs, and one "decides" he wants a Mac.

If your brother really needs OSX, he can go second-hand (I use a 2012 retina model, still works great); if he needs general computing, there are tons of equivalent alternatives at cheaper prices. Apple is never going to sell him anything for cheap because it would damage their brand.

[peng]

You're missing the fact that he doesn't need a new MacBook Pro. It's a luxury item. If Chromebooks are perfectly functional for school use cases, clearly a new MBP is entirely unnecessary. If he wants OS X and a retina screen, the baseline MB 12 is more suitable for his needs. Or he could get an older, used MBP.

[wink]

You might be missing the point here. I think what the parent was saying is that Apple are not making a sale because they're (needlessly?) keeping their margin at X% whereas someone who currently states they can't afford that would've bought a MBP for Y% less margin.

But then again, who needs an MBP? Maybe if you have a use case that is only covered by an Apple Laptop and not a similarly specced model with Windows and Linux - but most people who buy a MBP want one, not need one. (Which is perfectly fine, I'm not judging)

[smacktoward]

Apple has nearly always been happy to throw potential customers away, if those potential customers aren't potential high-margin customers. This preference goes all the way back to the original Macintosh. The Apple Way is to sell products that can command premium prices to whatever segment of the market is willing to pay those prices, and leave price-sensitive customers for their competitors to fight over.

[exhilaration]

What am I missing here?

Apple is confident that in an iPhone/iPad-centric ecosystem consumers will be strongly drawn to Apple computers. It's the same reason OSX is becoming more like iOS, they're not interested in catering to power users - average iPhone/iPad users are a much bigger market.

[cyberferret]

Does the Apple educational pricing discounts still not make it worthwhile? I have no idea what the discount percentage is now, but I remember years ago some teacher (and tertiary student) friends of mine being delighted in being able to afford and Apple Macbook due to this incentive.

[AlexeyBrin]

Last time I checked the educational discount was around $100 for a $2K+ laptop. Here is the relevant link http://www.apple.com/us-hed/shop/buy-mac/macbook-pro/13-inch if someone is interested.

[cyberferret]

Hmm, I thought I could remember my friends saying the educational discount was around 20%. Perhaps I am not remembering correctly, or the discount has changed a lot lately.

[grzm]

I remember larger discounts as well. That said, summer vacation seemed longer, too.

[AlexeyBrin]

You could check yourself http://www.apple.com/us-hed/shop/buy-mac/macbook-pro/13-inch there is indeed a $200 discount for the high end 15" version. The low end 13" has a $0 discount. Remaining 13"/15" models all have $100 discount.

[leonroy]

Looking at my old receipts the discount for college students in the UK at least was approx 14% on Macs.

[xapata]

It's hard to create a good menu. The lower priced options will often be good enough that folks who would have bought the higher priced item will buy the lower instead. This lost revenue will often be greater than the total new revenue for folks that would have otherwise bought nothing from you.

The free market finds an equilibrium price such that some demand is not met. To meet all demand, the price would need to be zero or even negative.

[mcphage]

> seemingly unaware of a vast market for education and lower price users on the other.

Does anybody make money off of Chromebooks?

[jbigelow76]

Google does if you're paying attention to the long game. Does anyone think that Chrome, and by extension ChromeOS, is pure altruism?

[snowwrestler]

It's probably more accurate to say that Google hopes to. I don't know that I've ever seen an analysis that directly connects the dots between Chromebooks and profit growth at Google.

[mcphage]

I meant more in terms of the hardware manufacturers; obviously Google does (or intends to).

[orionblastar]

Chromebooks are using a Linux type OS with the Chrome web browser as the GUI. They are sold at $300 or $200 because there is no $100 to $200 Windows Tax by Microsoft on them. Google makes money with Adsense and collecting user data like any other Dotcom might do. Google also has Chromebooks that can run Android apps from the Google Play store as well as ebooks, music, videos, etc from it.

Google has a different way to make money off Chromebooks that Apple does with Macbooks. Apple claims not to collect data and sell it to make money, which is why Apple products cost more than normal PC or Chromebook products.

[Oletros]

What data does Google sell and to whom?

[orionblastar]

Here this may explain it better, you have to read the TOS and EULA from each company: http://www.pcworld.com/article/2986988/privacy/the-price-of-...

[Oletros]

Please, I have read the TOS of the companies and the article you have linked and I can't find where is said that the data is sold.

Can you point a source to your claim? Thanks

[orionblastar]

I am copying this from someone else who replied to you, and you didn't say anything.

https://en.wikipedia.org/wiki/PRISM_(surveillance_program) And a giant backdoor with purposefully vague language in their privacy policy to let them sell data. https://www.google.com/policies/privacy/ "We provide personal information to our affiliates or other trusted businesses or persons to process it for us, based on our instructions and in compliance with our Privacy Policy and any other appropriate confidentiality and security measures."

I really wish you'd read articles and remember what others wrote to you in the comments. The only reason why I have trouble with that is I have a mental illness that put me on disability. I try to learn from my mistakes and the mistakes of others.

If you forgot because you have some sort of mental illness, I understand, if not and you have a perfect memory, you might just be trying to troll or put up a test for others like college professors do.

[orionblastar]

Here is another one: http://www.independent.co.uk/life-style/gadgets-and-tech/new...

[mcphage]

I meant the hardware manufacturers.