The Register: Apple faces a sales chill that could cost billions

“Letters Did Apple make an expensive mistake by announcing a switch to Intel, and a year-long wait for the first hardware? According to a survey of Register readers, Apple faces a sales chill that could cost it billions of dollars. Hundreds of emails have poured in – one every minute over the past thirty hours – representing an impressive cross section of our more than 3 million monthly readers across the globe,” Andrew Orlowski reports for The Register.

“More than half of you said the Intel announcement will have a negative impact on your private or corporate purchasing decisions with the lack of Intel hardware being particularly harshly felt amongst current and potential PowerBook users. Many users who had been holding off for a G5 will wait for the juicy Pentium-M roadmap that Jon Stokes outlines at Ars Technica today, here,” Orlowski reports. “It’s hardly a scientific sample, we stress, but it may be even worse than it looks on the surface.”

Full article here.

MacDailyNews Take: Orlowski’s right, it’s hardly a scientific sample. Apple will probably have to weather some sales drop off due to the transition from PowerPC to Intel. How severe or mild it will be, nobody knows. We’re sure Apple, resellers, and Mac users would like to see Universal Binaries stream out of developers and Intel-based Macs sooner rather than later. Steve Jobs isn’t stupid. In fact, he’s a genius. And he’s surrounded by some very smart people. It would make sense that Jobs and Apple have a plan.

Related MacDailyNews articles:
Cringley: Apple and Intel to merge; Steve Jobs finally beats Bill Gates – June 09, 2005
Fortune: Apple’s switch to Intel processors to accelerate Windows users switching to Mac OS X – June 09, 2005
Is it sensible or folly to wait for an Intel-powered Mac? – June 09, 2005
Mossberg: Switch to Intel will strengthen Apple and the Mac – June 08, 2005
Apple’s Intel shift could result in market share gain – June 08, 2005
Why buy a Dell when Apple ‘Macintel’ computers will run both Mac OS X and Windows? – June 08, 2005
Apple+Intel news is no reason not to buy a new PowerPC-based Mac today – June 07, 2005
Apple to unleash Leopard on Microsoft’s Windows Longhorn; Mac OS X 10.5 due late 2006 – early 2007 – June 07, 2005
Apple to use Intel microprocessors beginning in 2006, all Macs to be Intel-based by end of 2007 – June 06, 2005

77 Comments

  1. Like a universal architecture type Apple machine that may have PPC now, but that you can also pop an Intel into in the future so you don’t have a perceived or real legacy machine?

  2. When did Jon Stokes start working for Apple? His “roadmap” is nothing but a speculative guess. Face it people, we have no clue what Jobs and Co. really have in store for us. The possibilities for what could be in store are endless, and I’m sure we haven’t a clue as to the real plans behind all this. Everyone in journalism needs to chill and take a few minutes to unwind their panties.

  3. This was my main worry about the processor switch. It’s going to kill off the stream of people coming over to the Mac just as it was gaining momentum. By the time the Intel Macs start coming in bulk, Longhorn will only be a few months away, rather than at least a year and a half.

    I think Apple will be really lucky to sell 700k+ machines a quarter for the next year. I just hope that once the new machines arrive, those users who were holding out haven’t given up hope already and bought a Wintel.

  4. In the computer world (at least from an admin POV) it *IS* a swear word.

    Given:

    a) nothing ever works how you want it to right out of the box
    b) with enough money, you can make a thing work the way you want
    c) no matter how much money you’ve got, you won’t make the legacy thing any better than it is right now.

    That’s a swear word.

  5. The Bandit has got a point – people have been holding off buying PB because they thought a G5 was around the corner.

    Now that they know that an Intel PB Mac won’t be for at least another year – why wait.

    Hopefully that scenario will be significant, versus the wait until Intel Macs arrive before buying.

    If I were in the market for a new mac, I probably wouldn’t wait.

  6. Steve Jobs isn’t stupid. In fact, he’s a genius. And he’s surrounded by some very smart people. It would make sense that Jobs and Apple have a plan.

    Yes..Jobs isn’t stupid, but I have come to learn that in general, people can be very stupid. I am just hoping that Steve has such a brilliant plan, that it will keep Apple in the black for the Transition period. I’m more than sure that it will happen.

  7. For those that don’t know Steve (like 99% of “analysts) they will wait because they will apply the fear they have felt from other computer companies.

    For those of us that know Steve as the genius captain of Apple that he is, we all know that he has NEVER left ANY of his users in the cold… well, he did use the word “laggard” to describe those still using OS X 10.1, but he is STILL there for them!!!

    If I needed a new Mac, I wouldn’t hesitate a minute, and I’d run right down to my nearest Apple store.

  8. A sales drop-off is indeed the biggest threat Apple is facing. Indeed, it should be Apple’s biggest concern.

    However, consider that there is still a lot of uncertainty in the air. A lot of people are reacting emotionally. What Apple needs to do is get realistic and follow-up by turning lemons into lemonade. Let’s see some immediate price cuts. Let’s see new models that are pimped to the max in terms of available technology. More price cuts.

    I mean, let’s get realistic. Who wouldn’t want to pick up the current 15″ PowerBook G4 for $1499? Or the 12″ PowerBook for $999? Or a 12″ iBook for $799? How about a Mac Mini for $399 – $299 for Christmas? Apple’s gonna need to cut prices to these levels to tell users, “Hey, PowerPC is still great and the party is just beginning!”

    Sitting on its collective ass and hoping to squeak in to the finish when the first Intel Mac appears is the worst thing Apple can do. There are plenty of things Apple can do to make PowerBooks a great buy today. Who wouldn’t pick up a It just takes guts and the insight.

  9. Honestly I am completely lost. I just purchased my PPC G5 a year ago and I dont know what is going to happen as far as supporting my hardware configuration. All of this Intel stuff is puzzling, supporting two different chips is not something new (Intel and AMD). I just dont like being in the dark about all of this. I dont care who owns a Mac or who is going to by a Mac in the future I am worried about my Mac and now. So if you have any insight please let me know.

  10. Every computer becomes legacy the moment it rolls off the assembly line and into a box, because that computer will not receive the latest and greatest technologies being built on that assembly line from the following day forward.

  11. You might not wait – I will though. It just put a halt to a computer purchase for my family until more information became available.

    It will hurt – there are a lot of folks just like me that stopped in their tracks.

  12. I bought a Mac mini yesterday, and will probably buy another in a week or so. There’s no reason that they won’t server there purpose for a long while. Additionally, I have 800MHz PowerBook. There are better, faster, more tricked out PBs now, but it doesn’t stop my current PB from being just as fast, just as useful, and just as much a plain joy as the day I bought it. No matter what you buy today, there will ALWAYS be something different and faster around the corner. Just as I’ve used Classic mode to handle the (thankfully) dwindling of apps that weren’t OSX native, it looks like Apple has covered legacy software issues pretty nicely with Rosetta. If I had a need for another G5 PowerMac I wouldn’t hesitate to buy it now…IF I had a need. That’s the question. If you can put a new Mac to productive use now, you should buy it now, cause it’s going to be a couple of years before the really juicy stuff hits the streets.

  13. ” I mean, let’s get realistic. Who wouldn’t want to pick up the current 15″ PowerBook G4 for $1499? Or the 12″ PowerBook for $999? Or a 12″ iBook for $799? How about a Mac Mini for $399 – $299 for Christmas? Apple’s gonna need to cut prices to these levels to tell users, “Hey, PowerPC is still great and the party is just beginning!”

    Yes, let’s get realistic. As a stockholder, I would rather have Apple lose a few (or many) sales and get 0 profit from them than have them get sales at a negative profit.

    It’s like the old saying: “We lose a dollar on every one, but we make it up in volume”. Not a way to get ahead in any business.

  14. whatever, don’t worry about your G5 – it has plenty of legs left in it. You can do exactly the same thing you were able to do last week, right? Does the announcement prevent you from accomplishing any task on your Mac?
    Will it even stop you from getting your work done 6 months or a year from now? The answer will be no.

    In fact, you should learn to enjoy your G5 and stop worrying about whether it will become obsolete. The fact is, all computers become “obsolete” after 3-5 years, depending on the user.

    Consider how comparatively little you can do with a gumdrop iMac G3 today compared to your G5. You wouldn’t be able to run Tiger. No iLife ’05. No GarageBand. No iSight video conferencing. No iTunes 4.8 or iTunes Music Store. With only USB 1.1 ports, your iPod experience would be positively awful and forget about editing movies in iMovie. And that iMac would be running on a PowerPC G3 chip, and it’d be FAR more obsolete today than your G5 will be in 2007.

    So don’t worry, accept the fact that you can get a very product 4 years out of your G5, 5 years if you stretch it. And don’t stress out thinking, “I have to buy an Intel Mac in 2006” because, really, you won’t need to. With today’s G5, you should be fantasizing about what kind of Mac you will be able to pick up in 2008.

    Enjoy your G5. It’s still a kick-ass, trouble-free, virus-free, adware-free computer that purrs like a Tiger.

  15. I was going to by a new Powermac G5 (was waiting for a dual core PPC) but not now. I’d rather wait for something that software vendors will be writing software for in the future.

    (About the only way I’d buy a new dual core G5 Powermac if is the price was slashed by at least 60%. I don’t want to throw away $3000.00 on a cool looking boat anchor).

    I don’t know why Apple doesn’t start selling these Intel boxes now…

    – Mark

  16. critic wrote: “Yes, let’s get realistic. As a stockholder, I would rather have Apple lose a few (or many) sales and get 0 profit from them than have them get sales at a negative profit.”

    I’m a stockholder too, but I’m not sure what you are saying here. Are you saying that Apple is somehow making zero profit from their Macs at the current prices? That’s pretty laughable.

    Apple has one of the highest margins in the industry. Their Macs have an average gross margin of nearly 30%. Apple has a LONG way to go before it begins selling any Mac for a loss.

    But if Apple cuts gross margins to, say, 20%, that could not only prevent a sales collapse, it may actually boost volume. Because people can never resist a deal. Staying with the current margins is a recipe for disaster.

    At this point in time, with Mac sales growing 40% on a year-on-year basis, it is more important for Apple to keep the momentum up and take a small hit on profits (which can be offset by profits on Tiger sales, iTMS, and iPods) while continuing to maintain 40% growth in Mac sales. Apple needs to create the impression that it is going into the Intel transition BIGGER AND BADDER THAN EVER instead of shrinking and retreating in the minds of consumers.

    That’s reality.

  17. Why buy a mac now for premium prices when an intel/imac will support both operating sytems? Sure it’s 2 years away but isn’t worth the wait. It has nothing to do with the longevity of a new mac more than the potential of an intel/mac.

    That being said I just shipped back my new iMac G5 for the second time due to dead pixels. I will now use my refund and buy a dell 24″ monitor right after I perform an operation on my aging powermac.

    This is from an Apple advocate. The one thing that this intel news has taught me is that brand loyalty should not compromise a pragmatic approach. i.e. Apple/Intel’s joint venture.

  18. how short the memory is, this transition is going to be far less painful then the move from the 68K processor the PowerPC processor, and look how well that went.

    Apple are strong for it, and now they make the next move.

    For those concerned over losing support for OS 9, well for those not making the move to OS X, the new machines will be a great incentive.

    As Steve pointed out, software will be sent out for both PowerPC and Intel, so as long as developers don’t hold back, most should not feel that much of a problem.

    As someone has already mentioned, no G5 Powerbook, so how much longer is the wait going to be for the Intel version when IBM where having so much problems getting the G5 to work in smaller units..?

    There are always going to be people writing the end of Apple, they do it with every change that occurs, but when a ‘what if’ plan has been in place at Apple for nearly 5 years, Steve and the rest of Apple are hardly just supply deciding to move to Intel, they did not decide and cross their fingers…now is a good time, Apple are riding high, onwards and upwards.

    :o)

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