Wednesday, October 18, 2006

Apple out of Hardware Business?

An article by Gartner said that Apple should stop making hardware and license it's Mac OSX to Dell, letting Dell manufacture Macs in the future. I try not to laugh because I want to maintain an open mind until I see what you guys think. Here is an excerpt:

"The future success of Apple, Dell and Intel lies with a licensing deal between Steve Jobs' company and the PC maker according to analyst Gartner," Andrew Donoghue reports for ZDNet UK.

"Increasing component costs and pressure to cut its prices mean Apple's best bet for long-term success is to quit the hardware business and license the Mac to Dell, analyst firm Gartner claimed on Tuesday," Donoghue reports.

Donoghue reports, "In a surprisingly ambitious report, called Apple Should License the Mac to Dell, Gartner says Apple should concentrate on what it does best — create software — and make use of Dell's production and distribution infrastructure. 'Apple should leverage its close relationship with Intel and team up with Intel's closest ally, Dell,' the report states. 'We recognise that this move would surprise and even shock many. We are aware that Steve Jobs cancelled previous Mac licences when he took over at Apple and that he guards the Apple brand zealously.'"

"Apple increased its share of the PC market to around 4.6 percent in July this year, according to analyst figures," Donoghue reports. "Gartner claims that with the right partners, distribution channels and a more affordable price, computers running the Mac OS could eventually account for 20 percent of the total PC market."

"Apple will not be able to substantially increase this growth on its own because of increasing pricing pressure, Gartner warns," Donoghue reports. "Apple's margins for its Mac business, currently around 40 percent, are only sustainable because component makers such as Intel choose to prop up the business, Gartner claimed."

3 comments:

Le said...

To me, it's better for Apple to license the software to PC based machines, like they did with iTunes, as opposed to giving up its PC manufacturing. I think that having the Macs under Apple's domain is important for the innovation. Apple could effectively do the same thing for its software distribution by simply licensing the software itself, and not the machines. PC's are certainly capable of running on Unix.

-Le

Macintosha Fanatica said...

True, and the way I see it, Apple contributes so much to the design of the computer, including human interface qualities, and that would disappear in machines manufactured by Dell. On the other hand, iTunes has been hugely successful on PC's, showing that Apple can write successful conversions of its software to PC's.

Stitch said...

I don't believe that iTunes is the same. Apple does not make money off of iTunes the software like it would with the operating system. If it was left to Dell to design all new computers, heaven help us. Apple could stay in the design of the computer system and then have Dell manufacture and market the machine to their specifications.

By the way, I think the reason Intel is so called proping up Apple. Which I don't know is the case. Is that they are tired of the heavy hand of Microsoft. MS has threatened Intel in the past when they teamed up with OS2.