EclecticLip

This story stunned me.

I previously figured Macs would have the same market share across all price points. Of course, on further reflection Apple doesn’t make “budget” computers. (And that’s a good strategy for keeping margins healthy.) All of its market share is probably in the >$1000 category.

I think this is a turning point in the personal computer market. (And I’m probably one of the slower ones on the uptake here…) It suggests that prices and performance have reached the point where design is starting to matter.

To draw an automotive analogy: in the 1920’s, Ford kept making the Model T cheaper and cheaper. But GM started refreshing their models each year, and positioned their cars at all price points (hence Sloan’s expression “a car for every purse and purpose”.)

As a result, GM cars became the ones people wanted to buy; that’s probably one of the many reasons GM wound up replacing Ford as the world’s #1 automaker.

PC manufacturers have competed largely on price in the past couple decades — whether price for a basic model, or price for the premium model. Perhaps the product is mature enough now, that design becomes a big differentiator. To draw again from the automotive sector, design is probably the main reason that the Nissan of the 2000’s has been healthily profitable while the Nissan of the 1990’s tumbled towards bankruptcy.