October 30th, 2008
Mossberg laments lack of bargain Mac in his Fall Guide
Walt Mossberg just posted his fall guide called “Shopping for Basics and Saving Money on Your Next PC” with a focus on tight budgets in tough economic times. Although Mossberg consistently recommends Macs, he can’t sidestep the price gap between Macs and Windows boxes this go around:
I consider the Mac operating system, Leopard, to be faster, easier and more stable than Windows XP or Windows Vista. It isn’t susceptible to the vast majority of malicious software that circulates on the Internet. And Macs also include Apple’s superb built-in iLife multimedia suite. Macs can even run Windows, though that costs extra.
However, Apple (AAPL) has consciously chosen not to offer machines in the bargain category. The cheapest Mac desktop, the minimalist Mac Mini, which doesn’t even include a monitor, speakers, keyboard or mouse, costs $650 for a model with a hard disk I consider adequate. The cheapest Mac laptop, the base model of the prior-generation MacBook (which Apple has retained in its lineup) is $999.
Both are good values, mainly due to the software. And Macs can save you money over time. But if the lowest upfront cost is your objective, you can pay hundreds less for desktops and laptops from Windows PC makers.
Apple has always created premium priced machines, but this was usually offset and justified by a lower Total Cost of Ownership (TCO) over the life of the machine.
When Steve Jobs was asked if we’d “continue to see more affordable price points across the Mac product family and across iPhone going forward,” he replied (in part):
There are some customers which we choose not to serve. We don’t know how to make a $500 computer that’s not a piece of junk, and our DNA will not let us ship that.
The problem is that in tough economic times people are more concerned with the bottom line than anything else. Many won’t even consider buying a Mac because of its higher starting price. The funny thing is that this price sensitivity doesn’t seem to have the nearly the same impact on iPod or iPhone.
Could this be because the iPod doesn’t have the same kind of competition as the Mac and because the iPhone (at US$200) doesn’t have the same price premium that it once did?
Is it time for Apple to consider a sub-US$500 Mac, or is Jobs right that it would be “a piece of junk?”
Jason D. O'Grady is the editor of PowerPage.org, which has been publishing daily mobile technology news since December 1995. For disclosures on Jason's industry affiliations, click here or to view Jason's full profile click here.
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