Blogs Intel's 'Ultrabook' Strategy is Outdated

Fair point, well made.

Super-thin laptops such as the Samsung Series 9 and the MacBook Air currently cost around £1,300 (or US$1,500) and rumours suggest the Asus UX21 will achieve a sub-$1,000 price (possibly £900?).

That's a fairly strong reason to favour the UX21 over the others, but is it compelling enough to make you opt for it over a £500 CULV or a mainstream laptop? That's where desirability needs to take over if Intel's project is to claim the 40 per cent market share that the company wants/predicts.

Desirability and only desirability doesn't lead to sales; there are practical considerations too. It's odd that it's these considerations that are Intel's primary focus though.

 

I also disagree, I think Intel's right.
For most buyers, the price is the price is the price.

Of course there's a top end market that caters for the must-have's at any price.
But in the end, it comes down to affordability.
According to your philosophy, a total of 0 netbooks should have been sold the last few years.
Iphones may be a tad more slick than androids, but they're triple the price, what's selling better?

I bet at least 99 of 100 people really liking a porsche at a car show end up buying a golf.

Look at it this way: Intel, other than Apple, thinks VOLUME.
Sales based on Style aren't for the volume market.

I couldn't find the unit sales (I'm not sure either intel nor apple publish them) but just to show you the size of chipzilla:

Apple made a revenue of 65.23 billion in 2010
That's a lot.
Intel made a revenue of 43.623 billion in 2010... ahyupp, that's a digit more in there

Mind you, the american system of billions and dots and so on doesn't really make sense to me in my european way, i'm however guessing it's not supposed to be a comma

 

@volund, as a Linux user you should know those reasons already

when i was younger i didn't mind tweaking my computers and spend time with building/upgrading and so on.

these days i want to get done what i need to do as quickly as possible without even thinking about hw/sw, that's why i switched

i'd be happy with ubuntu too but no photoshop for ubuntu and gimp doesn't support cmyk

the thing is that those components might seem underpowered on win but on mac os they are more than enough. i normally run about 15 apps on my macbook pro and no problem at all, couldn't do it on win

mac os x is built around their hw, they know what's inside therefore it's better optimised

 

Hmmm, from their respective 10K-forms, it seems that the dot I mentioned actually is a comma, and Apple is bigger than intel...

Oh well...shame I can't find the unit sales though

 

So if they're underpowered, why not by a PC which is more powerful for the same price?

Also computers have come a long way in the last few years, and CPU's are a lot more powerful than they used to be, and its nearly impossible for me to make my computer cry and i'm folding 24/7 on skype, got monitoring software going as well as the usual av+firewall.

I think optimisation is important, of which Macs probably are, but you pay for it. I found it amusing when Nvidia released a new quadro part that was £150 quid yet spanked a 580 in CAD design.

 

@ Xir Apple do have a lot higher profit due to them making the iPhone 4 for $180 and selling it for £700.

 

Very important detail. Thanks for reminding us.

Speaking of details...

The production price in components for a 16Gb model is $187.51. Add to that manufacture, software development, shipping, patent licensing, marketing/advertising, warranty cover, replacement of defective units and all the R&D that went into creating the thing in the first place, it all mounts up.

The sale price of a 16Gb model is $599,-- or £365,-- at current exchange rates.

Apple has an overall profit margin of 24.27%

 

If you go onto the Apple store its £510 for the 16gb version. Yea that don't take into account marketing and research, but that is still a heafty margin hence why they make such large profits.

A lot of people though buy stuff just because its Apple, almost like a fashion statement and ashumed quality.

 

apple nailed it with their stores, they didn't used to have them, i think it was after jobs returned to apple. makes sense, if you cut the middleman your margins are fatter.

 

This is the one case where apple is cheaper and it's only because of the screen. Try it with the smaller screen iMac and the PC wins.

Also, imagine two people bought both of the machines you priced up, then fast forward 3-4 years. Both users want to upgrade to a faster machine.

The PC user buys a new box for a few hundred quid, or if they know what they're about just upgrades the core components and spends even less.

The Mac user has to buy a whole new iMac. That's £1399 please! Ker-ching/Ouch (depending on your perspective).

EDIT: Also, premium product? Really? Last time I looked at a Mac it had a foxconn motherboard and low-end RAM, not to mention a glossy IPS screen that is completely trounced in terms of colour accuracy by any consumer level IPS screen you care to mention. They look shiny and have features that can be given names and numbers (usually embelished with words such as "magical"). The only thing positive I have to say about Apple is they have good customer support and they make a decent PC case/laptop shell.

 

Don't blame Apple for the hefty import mark-up that the UK tends to suffer on all imported goods.

Is that a sweeping generalisation or a statement based on sound analysis of the facts, just like your first one?

That was partly the reason. The main reason was that Jobs identified that Apple PCs were selling poorly because mainstream outlets did not market them very well. Apple PCs would be positioned next to cheaper IBM-type PCs but the salesmen would not be able to tell the customer how the Apple was different, and therefore justify the price difference.

Jobs decided that with the own Apple store he would have more control over how the product was presented and sold. Turns out he was right. Muggles are not like us geeks; we are happy to buy a list of complicated components on the web and put together our own machine. To a muggle that would be tantamount to building their own car from parts that they have to pick out themselves. It's their worst nightmare. They want to buy their PC, like their car, in a nice clean, brightly lit air-conditioned showroom, where they can test drive the thing, and get support, aftercare and servicing/repairs included. For that they will happily pay a premium.

What does this tell us? It tells us that ordinary people, i.e. the majority of PC users will pay a premium for something that is safe and easy to use. Not flexible, not versatile, not customisable, hackable or rootable; easy. Something that does the straightforward stuff muggles want to do transparently, not the esoteric stuff we want to do by applying our hardcore geek-voodoo.

Intel and Microsoft are catching on to that. The future isn't powerful; the future is safe and easy.

 

Yes, also keep in mind that that free or dirt cheap software is subsidized by charging a large permium on the components. I'll be the first to admit, other than the apple logo on them, Apple makes some sexy hardware. However, BOM wise, they are doing easily a double or more markup on a lot of their products (BOM for the Apple TV is supposedly around $30 and is sold at $99 as an example). Sure that is reduced on full fledged desktops and laptops, but there is still a significant markup for the permium product.

So of course the software can be cheap or free, you've already paid through the nose for the hardware. Most Apple products with the exception of the consumer electronics products where Apple shifts massive volumes (up to and including the iPad) they get such a low price on the components compared to their competitors that they can charge a larger premium and still not be much more expensive or cheaper.

Tablets and phones Apple is starting to be overtaken in price. Its hard for, say, Acer to get a low BOM on its components when it is only just sourcing maybe 500,000 screens, or 500,000 SOCs or whatnot when you are up against Apple who is already sourcing 25 million of each at the same time. The Transformer, Iconia and Galaxy tabs are also coming in at or below the price of the iPads now, its only a matter of time unless Apple drops its price that Apple is very much going to be the premium price dealer of tablets, just like they are with computers.

Apple developed a great product at the right time and has made money hand over fist...but just like the iPhone, who's market share is rapidly being overtaken by Android, Apple is failing in a lot of ways to innovate further and incorporate either hardware or software elements that a wide potential user base wants. Micro SD card slot of SD card slot? You're telling me they couldn't have fit one in to the iPad 2 and it almost no additional cost? But then it would "undercut" their higher capacity iPads and the massive premium charged on them (with current price of NAND flash, the 32GB iPad2 is likely only costing Apple around $20-30 extra to make, but they are charging a lot more than 3x the price premium). That is just one example of something that could be easily incorporated in, at little cost and little design compromise that probably 98% of users either want or would appreciate, but Apple says no.

The walled ecosystem is another issue. Speaking from someone who has an Ipad2, it annoys the hell out of me. I WANT access to my file system. I hate that files can't really be shared between applications. I'd love to wirelessly connect to a network share and transfer over some file and then interact with those files in whatever app I want. No chance in heck of that, at best I can wirelessly transfer in a file from a network share directly to the app copying it and then I can interact with it only in that app. Great usability there.

Oh, but it just works and I am protected. Forgot that selling point.

PS As a note, the iPad2 was a gift, and yes I am enjoying it, but there are parts of it that piss me off so much about Apple's walled ecosystem. Some perks, I'll grant that right off, but if it had been my money it would have been a Galaxy tab or an Iconia or a transformer that I would have spent my money on.

 

@Nexxo, yea some of the stuff is ramble like the fashion thing. But the fact they're safe is bs considering in every hackathon the Mac is the first to fall. The only reason why they've lasted so long is because they're based on Linux.

I think one of the big reason why apple has done well was the iPod, as that got the brand name around a bit, everyone has one. Similar to the halo effect of GPU's then people started to buy more of their products, think of the first iPhone which the best part of it was the touchscreen, connectivity wise it was shocking.

The stores might be good, but i reckon if you setup a computer shop and allowed people to test drive the stuff you could tell them anything. PC World doesn't do well as they try and sell you loads of bundle crap (i went for an interview there and if they don't sell you the extra stuff they don't make any money)

It would be interesting to see what happens to Apple in the future, as i feel that there could be a trend that they will re-invent something and then people will slowly catchup in sales (thinking of the iPhone losing market share) So what will happen when they run out of ideas?

 

Fixed

 

Surely the reason everybody has a PC now, is because they are cheap!

If the price of a laptop had stayed at £1500+, then only 'geeks' and businesses would buy them.

Apple might make nice consumer electronic devices, but they are outside the price range for the vast majority of people in the UK.

Most people just want a gateway to the web and a reasonable hard drive for their snaps/music/pr0n.

 

Intel IS out of touch with you and me, but not out of touch with Joe Schmo who thinks voting is important (primarily for X-Factor), has an addiction to football and beer will be buying his ultrabook on revolving credit.

The market determines what is developed, and the market is stupid. Like Nexxo is always saying (and I can't remember the exact percentage) but the vast majority of the population are incapable of critical thought of the level at which this debate exists.

Street price and lack of margin has been slowly killing retail in this country for at least a decade. I used to work in pro-audio and it's the same there. Some people will pay for top quality, but very few. So the only places in the market (and it's the same in tourism where I now work) are the best - or the cheapest. Anything else is death.

 

well said, fully agree

 

don't forget that apple re-sell value is much higher than of that of regular win based desktops. i paid for my mbp 999 and still can sell it for 800 after 2 years. try it with regular laptop or a win based desktop. you can't, i know for how much i sold my quad based gaming machine after 2 years with new gfx and new psu.

 

Definitely a good point! I've never sold a Windows PC, I either upgrade them in stages and sell off components (which can hold their value very well, depending on what they are) or keep them until they're so old that they're worthless.

 

Hmm, except Intel isn't talking about safe and easy, it's talking about cheap. Obviously it's a microprocessor company and doesn't make UIs, so 'safe and easy' is outside their remit, but the curious thing is they're not really talking about end-user benefits (thin, light, quiet, fast, long battery life etc.) they're just talking about lowering the price. Surely that's off the mark these days?