* Jdr:
Apple is booming, and even though I haven't really used an Apple computer
since high school and college, I have thought about buying one.
It is now the third largest computer seller in the US. They've broken
the 5% barrier, and more importantly, IMO, they have over 15% of
retail and online sales. Microsoft still dominates the corporate world,
but Apple is making huge strides with regular consumers- especially,
younger folks and students.... future leaders and decision makers.
Apple's percentages are *growing*.
I really believe Apple could shake Microsoft's foundation if they
ever release OS X for the PC. I'd buy it.
http://money.cnn.com/2007/08/21/technology/apple_computers.fortune/index.htm
Apple's surprise weapon: Computers
The iPod and iPhone are hits, but they're not the company's hottest line,
says Fortune's Brent
Schlender.
By Brent Schlender, Fortune editor-at-large
(Fortune Magazine) -- Last January, when Steve Jobs rechristened his
company by ostentatiously
excising the word "Computer" and leaving it as simply "Apple Inc.," he did
so during the very
same public event when he first showed off the iPhone.
It also came right about the time that combined sales of iPod music
players and iTunes music
downloads eclipsed revenues from Apple's mainstay Macintosh personal
computers.
The new name seemed to concede the obvious: The company's PC business,
which for well over a
decade couldn't garner even 5 percent of the U.S. market (nor more than 3
percent worldwide),
would no longer be front and center. After all, the stripling iPod and
iTunes Music Store were
holding almost Microsoftian sway in their realms, and the iPhone already
was the most
ballyhooed new gadget since the transistor radio.
But a funny thing has happened over the past couple of quarters. While
Apple has been firing on
all cylinders, and the iPhone is selling hundreds of thousands of units a
month, its Macintosh
business is the hottest line of all. It roared back in the quarter that
ended in June to
reclaim its status as the company's largest revenue source and, at long
last, break that 5
percent share barrier, according to IDC.
Indeed, Apple's U.S. Mac sales have grown at triple the rate of the rest
of the PC industry
since last fall, propelling it into third place in the U.S., behind Dell
(Charts, Fortune 500)
and Hewlett-Packard (Charts, Fortune 500).
"Whoop-de-doo," you might say. "A market share in the mid single digits
isn't even table scraps
compared to the combined force of all those Windows PC makers." But if you
parse the market,
you realize that Apple's seemingly min-uscule share is much, much greater
in the slices it has
targeted.
For one thing, Apple's PCs are truly personal. Apple (Charts, Fortune 500)
has always pitched
them primarily as consumer products, and they're designed with the
creative individual - not
the corporate IT department - in mind.
Apple doesn't even pretend to compete for the corporate servers that are
technically considered
PCs because of their internal design; those account for about a fifth of
the market. Nor has it
ever targeted big business, other than publishers and creative
departments.
The bulk of Macs are purchased by consumers and students who make their
own buying decisions
rather than take what an employer issues. Apple has a 15 percent market
share of PCs sold at
retail and online, according to NPD. Having its own flashy stores helps,
of course, as does its
clever advertising.
But more important, you also can see why even modest gains translate into
outsized growth in
Cupertino. The overall U.S. PC market is so large - 65.5 million were sold
in 2006 - that
picking up a percentage point of share for Apple, which last year sold
about 3.1 million Macs,
means its unit sales would jump 20 to 25 percent.
And the Mac business is already quite profitable, so the incremental sales
yield even better
margins. A tiny nick to Dell and HP is gravy for Jobs. In other words,
there's a lot of room
for Apple to expand without gouging Microsoft and Windows PC makers, which
will also probably
keep growing, albeit at a slower pace from a larger base.
Finally, Apple's software could turn the Mac into a phenomenon again,
perhaps even in
corporations. Apple is arguably the best software company on the planet,
regularly releasing
basic operating system software and application programs that reveal the
greater potential of
computers as devices for communication, creativity and entertainment. Most
of Apple's software
gets an overhaul every few years and is constantly freshened with free,
easy, online upgrades
that improve performance.
Also, now that Macs sport Intel processors, the machines are just as
powerful as their rivals
and, with a little tweaking, can run standard Windows software, including
custom applications
that many people have to use to do their jobs. Macs could make inroads
into more businesses as
employees who use them at home begin to demand them of their IT
departments.
So what's the lesson? Apple is growing faster than its competitors because
it improves its
hardware and software more often than anyone else. It is broadening what
we think of as a
consumer-oriented PC and thus helping its market grow. That's a good
long-term investment
story. And, oh, by the way, Apple also makes some pretty slick music
players and cell phones.
