Researcher: Macs not as expensive as thought
Published: 17 May 2006 09:35 BST
Although Apple's PCs are more expensive than those running Windows, one Wall Street researcher says the price of a Mac isn't that much more than a comparable Windows-based computer.
Piper Jaffray analyst Gene Munster said that his research shows an average price difference of only 13 percent for desktops and 10 percent for laptops, once you narrow the comparison to Windows PCs that use the same components found in Macs.
"We believe both consumers and investors tend to believe that purchasing a Mac will cost 20 percent to 30 percent more than a PC," he said in a research note.
But IDC researcher Richard Shim noted that Apple competes only in part of the market.
"You can compare a Mercedes and a BMW and say that there isn't much price difference," Shim said. "But the point is you can't reach a mass audience with that kind of premium brand."
The Piper Jaffray report compares an $1,874 (£995) 20-inch iMac with two Dell models and two Hewlett-Packard models ranging from $1,440 to $1,970. On the laptop side, the $2,699 17-inch MacBook Pro is compared with a $1,899 HP laptop and two machines from Dell, a $3,445 XPS M1710 and a $1,922 E1705.
But while HP and Dell offer machines at those lofty prices, they also have machines that cost far less. It is now common to see ads touting $300 desktops or laptops for $500.
And, to use the car metaphor, most people are buying Hondas, not BMWs or Mercedes.
"If you look at sales by price band, very few desktops are sold in that $1,500-and-above category," said Samir Bhavnani, a researcher at Current Analysis. "The sweet spot for desktops tends to fall around $600."
For notebooks, he said the sweet spot is around $1,000.
Last year, the average desktop with a display sold for $744 in the US, according to IDC, while the average laptop sold for $1,070. Those prices are forecasted to drop further this year, with the typical notebook selling for $981 and the average desktop fetching $711.
Apple basically starts at those levels with its cheapest models. The least expensive laptop, the new MacBook, starts at $1,099, while the desktop Mac Mini sells for $599, but doesn't include a display.
Dell, meanwhile, recently had a sale that saw a Core Duo laptop with 1GB of memory, an 80GB drive, a 15.4-inch screen and a DVD burner selling for $699, down from a usual price of $1,234.
Shim said the fact that Apple caters to the high-end of the market "isn't a bad thing".
He pointed to the 13-inch widescreen display in the just-introduced MacBook as an example of where Apple chose the feature it wanted over price considerations. Shim said that 12-inch and 14-inch widescreen displays are relatively standard and tend to be comparably cheaper because there are already 12-inch and 14-inch traditional flat panels that are used in laptops. The 13-inch display is more unusual, he said.
"They often lead in innovation, and you often have to pay for that benefit," Shim said.
An Apple representative declined to comment.
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