Analysts: doubtful Power Mac G5 will help Apple increase ‘its miniscule market share’

“In launching its next-generation G5 processor, Apple has made some innovative and market-savvy moves, say industry watchers. The company has formed an alliance with tech powerhouse IBM, it has moved into the new world of 64-bit computing, and it can now claim its computers are as fast as — possibly faster than — the fastest Windows PCs. Yet doubt remains about the company’s prospects for increasing its miniscule market share, which now hovers around 3.5 percent,” reports James Maguire for NewsFactor.com.

MacDailyNews Note: The Apple-IBM-Motorola (AIM) PowerPC alliance was established in 1991.

“‘There is a tendency toward monopoly in the industry, because customers want seamless compatibility,’ IDC analyst Roger Kay told NewsFactor. ‘There’s a tendency among business customers to coalesce around a single standard.’ That single standard ‘could have been Apple, if Apple years ago had lowered its prices and liberalized its licensing policies. But it didn’t do that, and as a result, it got marginalized, and the other platform became mainstream,’ he said. ‘I don’t think anything changes that, so now Apple is down to a few specialty applications that really use the differentiated Apple platform, like superior ease of use and very powerful graphics calculations,’ he said,” reports Maguire.

Maguire reports, “Apple ‘has a solid brand,’ Gartner analyst Martin Reynolds told NewsFactor, ‘They’ve got solid products, they’re good at moving into other areas, and they’ve got attributes that other companies can’t match.’ Successful areas of expansion for Apple include iTunes, which Jobs claimed has sold more than 5 million songs, and the iPod music player, of which Apple has sold more than 1 million. Yet, as Forrester analyst Rob Enderle told NewsFactor, Apple ‘isn’t just a niche player — it’s a small niche player.’ So, for all of the innovation the company is introducing with its next-generation G5 processor, its market battle remains decidedly uphill. The new release ‘will help them maintain market share — I don’t think it will help them gain,’ Kay said.” Full article here.

MacDailyNews Take: Market share, schmarket share. All Apple needs is enough market share to remain profitable, continue its excellent R&D and insure top-flight applications for the Mac platform. Anything else is gravy and an increases the liklyhood of the virus and worm plagues enjoyed by the Windows crowd. These analysts are obsessed with “market share” and cannot see the forest for the trees.

12 Comments

  1. quote- It seems like everyone is failing to realize one critical point. Profitability is everything. Porche continues to exist, not because they have small market share, but because the cars they produce and sell offset their costs. So much so that they can continue R&D for future models. The instant Porche or any company goes into the RED and cannot recover, its only a matter of time before they fold. MAC has a dedicated user base but this alone was not enough to sustain the company (i.e iPod, iTunes, Steve Jobs). Under sound leadership hopefully they can continue to remain profitable but remember, those with the money have the power, and they determine what exists or does not. Just a thought from someone who enjoys the right mouse button.
    ———————————
    The fact of the matter is, Apple is profitable. Apple has 4 billion dollars in the bank, roughly the same as Dell, which is a lot larger company, and which has remained profitable by laying off over 10,000 employees. Apple in turn has had some layoffs, but continues to innovate and develop new products with new features. As has been stated before in this thread, just because it is not a good investment, doesn’t indicate the company is going out as you seem to suggest, stating that these things are not enough to sustain apple. Apple is facing the same economic difficulties as any company in the current economy, but is continuing to innovate, rather than just copy what somebody else does. Even in the instance that they have copied ideas, they have implemented them in vastly superior manners. Apple will go on.

  2. And that tiny little three percent of us purchased 5 million tracks from the Apple Music Store in almost no time.
    We’ll see how much “market share” matters in another year when Apple users rule the world!!
    Okay, that was over the top. Point is, market share is just another number used to confuse people who need to follow the masses.

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