“As a capacity crowd waited in San Francisco’s sprawling Moscone Convention Center for Jobs’s keynote speech on Jan. 11, those who knew the truth could hardly curb their enthusiasm. ‘This is going to go down as an important event in Apple history,’ enthused Mike Gartnenberg, an analyst with JupiterResearch who had been briefed the night before on what Jobs was going to announce. While Gartenberg wouldn’t give up any details because he was sworn to secrecy, he hinted, ‘It’ll be interesting to see how he articulates this,'” Peter Burrows reports for BusinessWeek.
“Indeed, while the Apple acolyte sites captured many of the features of the new products, they couldn’t capture how it all adds up to Apple’s most aggressive play for market share in years,” Burrows reports. “Jobs took the covers off the ‘Mac mini,’ a full-functioning Macintosh computer that’s about the size of two paperback books and sells for as little as $499. That doesn’t include a monitor, mouse, or keyboard. Discount prices like that may seem terribly un-Apple-like. But analysts say it points to a bigger, long-term strategy: Build from the iPod’s success and win a whole new generation of converts to Apple technology. Many faithful may also give the offerings a try. But these products are aimed squarely at people who shy away from Apple price tags.”
Burrows reports, “No doubt, Jobs is taking a risk — and some investors may have preferred he left well enough alone. iPod-mania has lifted Apple’s shares more than 200% in the past year, to $64.56 at the end of trading on Jan. 11. Even with no new products, most analysts figured Apple will be able to hold share in digital music and gain share, for the first time in years, in the PC market. The big concern will be over cannibalization. How many customers will opt for a $99 Shuffle, rather than a $249-plus iPod, or a $500 Mac mini rather than a $1,300 iMac? Investors were clearly spooked, driving Apple shares down 6.38% on the day of Jobs’s speech… [But] analysts at the keynote say it amounts to Apple’s best chance at achieving Jobs’s original goal for the Macintosh when it was introduced in 1984 — a computer for ‘the rest of us.’ As Apple watchers know, that didn’t quite happen. Apple ended up in the high end of the PC business. Even now, the cheapest iMac costs $1,300, roughly double the price of an average PC. The Mac mini fulfills that original promise.”
Full article here.
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