Upgrade to Apple Silicon could usher in lower-cost Macs

JP Morgan expects the first Apple Silicon Macs to significantly drive innovation, cut material costs, and possibly lead to a lower-priced lineup of Mac devices.

Apple on Monday, June 22, 2020 announced it will transition the Mac to its world-class custom silicon to deliver industry-leading performance and powerful technologies.
Apple on Monday, June 22, 2020 announced it will transition the Mac to its world-class custom silicon to deliver industry-leading performance and powerful technologies.

This transition will also establish a common architecture across all Apple products, making it far easier for developers to write and optimize their apps for the entire ecosystem. Apple plans to ship the first Mac with Apple silicon by the end of the year and complete the transition in about two years. Apple will continue to support and release new versions of macOS for Intel-based Macs for years to come, and has exciting new Intel-based Macs in development. The transition to Apple silicon represents the biggest leap ever for the Mac.

Mike Peterson for AppleInsider:

Analyst Samik Chatterjee believes that the most important announcement at Apple’s November 10 event will be at least one new Mac model equipped with the proprietary Apple Silicon chip.

For consumers, Chatterjee believes that a lower bill of materials cost with a new Apple Silicon chip could lead to Mac devices with a lower price point targeting a wider market. More specifically, the analyst contends that Apple could release an SKU with a price point between that of the MacBook Pro and the MacBook Air.

The analyst estimates a standalone market opportunity of 10 to 15 million unit volume for the new Mac device, with a starting average selling price (ASP) of $1,000. That implies about a $15 billion opportunity for Apple, “which will assure multi-year growth in a lackluster PC market.”

MacDailyNews Take: The upgrade to Apple Silicon could usher in lower-cost Macs – or even greater margins for Apple (which would be good for Apple investors).

26 Comments

    1. I wouldn’t suggest either of those junk devices but you are right about the pricing. Apple’s shtick for years is “…and we’re offering it at the same great price”. None of the model lines will change just the chips, expect the Air and/or a 12” Macbook with the new Silicon at the same prices, maybe even more if they re-introduce the 12” as a “new” device.

  1. I hope that Apple chooses the interests of the users over the shareholders, for once. A little break in prices would be welcome to many of us. It would have a greater impact on more lives. The move to Apple silicon, overall, is very encouraging.

    1. Apple isn’t going to give you something for nothing, Apple will sell the new hardware at the same price with more features built in and it will be best in class by a mile.

      1. I think that will be the big question what will the advantage/disadvantage initial offerings be. If there is good all round compatibility and better performance then prices may remain similar. However if the compatibility issues are more substantial with non Arm devices in the early days than any speed and Apple compatibility advantages will be more questionable especially amongst the more conservative minded users and thus a price advantage will help to kick start the new platform. It will be a difficult judgement to make but Apple does tend to get such matters correct more often than not at least in terms of its own profits. If they have the capacity to produce them I reckon an initial price advantage would be the likely decision to make sure they can ensure good sales figures. After all within two years or so there will be no ability to compare anyway so they can return to whatever profit margin they prefer.

          1. There are two possible solutions to that problem:

            The free market solution—if enough people refuse to pay high prices, demand will drop and so will prices. If, on the other hand, the product is really popular, the price will rise until demand matches supply.

            The other solution—appoint a Commissar with authority to set prices wherever the Government wants, irrespective of market forces. If the price is set low enough, it will stifle R&D, but who cares?

  2. With this transition, the only real hardware difference between a Mac and an iPad will be memory and the number of ports. Apple could release an update that would erase any user difference between them. Surprise, you are a mac user.

    1. Switch to A-series SoCs will not fully eliminate the hard Macs and iOS devices identical. For instance, Macs have physical keyboards and touch pads, but not touchscreens. I know that because whenever I switch from my iPad to a MacBook Pro, I almost always end up poking futilely at the MacBook Pro screen. 😉

      But I agree that the resulting OS will more cleanly support multiple Apple platforms, just as iOS currently supports the Apple Watch, iPhone, and iPad. And this move to A-series on the Mac will also facilitate OS convergence over time. Eventually, we may see hardware convergence, as well.

  3. If Apple reduced the prices of all their Macs to compete toe to toe with PCs that generally give you more bang for the same buck.

    Under beancounter Cook, no way Jose…

    1. I understand your desire for lower-priced Apple hardware. I wouldn’t mind a big price drop, myself. I need a new Mac.

      Your post implies that Apple is not currently competitive with PCs. On the contrary, Apple has generally performed quite well in the global computer market since the move to Intel processors circa-2007. But I agree that Apple would likely expand its market share if it chose to pass on at least a portion of the cost reduction achieved from using Apple-designed silicon. Even a $100 reduction would be welcomed on lower end Mac hardware. On the mid- to high-end Mac hardware, we might see more cores and higher performance at the same price points, as mentioned elsewhere. But that could be perceived as a price cut if the new mid-range MacBook Pro were to become more powerful than the previous high-end MBP.

      My biggest Apple Mac pricing gripe is the cost delta to go from a 13” to 15” MBP. I like the extra screen real estate, but I don’t necessarily need the higher performance and additional features that drive up the price of the current 15” MBP.

        1. I wouldn’t call it Apple tax, but GoeB is right. There is a premium today.

          In the early Intel years (maybe 5–10 ago) Mac HW was actually competitively priced spec-wise.

          Especially when the models were new (Apple never lowers prices mid cycle), you’d get same or better specs than in a PC with same or in many cases even lower price. Plus OSX, quality display, aluminium body and superior touchpad for free on top of it. Today? Not so much. You have to pay for those extras (worth it for me).

          But the fact that macs have been competitively priced means they can be in the future too. Today Apple is not competitive because they don’t compromise margins – pricing is more about margins than being expensive. Lower costs should lead to lower prices (and/or new lower tier models).

          1. The Apple Tax is a term for premium pricing of Apple products since the 1980s.

            You can agree or not with the terminology commonly used for decades is irrelevant.

            The bottom line for the
            most part is Apple premium build quality and better, not by much OS, but underperforming.

            Can you say Apple superior gaming?

            Nuff said…

          2. Bottom line, JV:

            You are paying a premium price and you are not getting a premium product that competes spec wise. Certainly, as you pointed out, some years were better than others.

            YES, the OS is easier to use, YES the free Apple programs are a huge bonus to compete with Microsoft Office Suite saving customers from the Microsoft tax additional fees. Excluding Numbers that without pivot tables cannot compete with Excel, and YES the quality of build and components is the best in the computer industry.

            But NO, the SSD prices and RAM are outrageous and do not compete with PCs and the most important aspect to my profession processor speeds are lagging behind PCs. You’re not getting the same bang for the buck!

            This is Apple’s achilles heel since the first Mac in 1984 and you would think Apple would get the message by now and COMPETE toe to toe, spec to spec. MDN repeatedly defends this business practice and supports the disparity simply by saying premium prices for premium products. Well, IMHO when you are paying more for less amounts to total baloney, sorry.

            Under Gil Amelio in 1995 the front page headlines and business section headlines were proclaiming Apple would go out of business because of the premium Apple tax and underpowered machines could not hold their own when Windows 1995 was released. As I have been long been advocating for decades, YES Apple makes a better product. That said — WITHOUT A PRICE AND SPEC MATCH they will NEVER compete for dominance in the personal computers.

            With all all the money they have from iPhone sales, obviously they don’t care…

  4. If they would simply usher in lower-cost SSD drives, it might be nice.

    Currently, if you want to upgrade a Mac mini from 256 GB to 1TB SSD, it is a mouth-dropping $400 surcharge. To get a 2TB SSD is a mind-blowing $800 surcharge. Given that 2TB SSDs can be found on Amazon for $200-$300 (yes, even M.2 NVMe SSDs), this is beyond ridiculous.

    While I can (perhaps) justify bleeding-edge SSDs on MacPros, it’s pretty hard justify an $800 SSD for a MacMini which has a starting price of $800. Apple should create a design which offers a user-serviceable SSD for such an entry-level machine, even if it forces them (God forbid) to make the machine a 1/4 inch taller. Besides there is no compelling reason for a desktop machine to not allow user accessibility—a desktop machine does not have the size, weight, and power constraints of a laptop.

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