Are Microsoft's Delays a Boon For Apple?
Page 1 of 1
A recent contentious commercial for the first Intel-powered Macintosh begins with a narrator saying: "The Intel chip. For years it's been trapped inside PCs, inside dull little boxes, dutifully performing dull little tasks ..."
Maybe if the wise guys at Apple knew of Microsoft's looming troubles they would have added "... dull little boxes waiting for Vista software that once again has been delayed."
It's not clear what effect the delay will have on PC sales during the usually big-selling holiday season, but it's not a welcome development.
"There's no question this could hurt hardware sales in the fourth quarter," Tim Bajarin, analyst with Creative Strategies, told internetnews.com. "But I'm sure the hardware vendors are beating up on [Microsoft] to try and salvage this.
"Microsoft is going to have to provide $10 to $20 coupons, or something similar, in new PCs this fall for an upgrade to Vista."
But might some of those would-be holiday PC buyers consider an alternative, like a new Intel-based Macintosh? Analysts don't expect the Vista delay to have a huge effect on Mac sales unless Apple brings out a hot new system with extra-compelling features and/or especially aggressive price points.
But even then, most retail stores don't carry Macintosh, so for shoppers at major chains like BestBuy, Circuit City and office supply chains, the PC is it.
Apple sells Macs online, at its own chain of Apple stores, CompUSA, and MicroCenters among other locations. Apple had no comment for this story.
"There's a potential upside for Apple from the Vista delay," said Matt Sargent, analyst with Current Analysis. "If they came through with a Mac Mini with a TV tuner and TiVo-like functionality, that would be very interesting and you could see Apple have a big holiday season.
"I think Apple has a better fix on what a media center or digital living-type computer should be, which is almost more like an assistant to what you already have. Microsoft and Intel see it more as the ultimate center of the household, and I think people struggle with that concept. The Mac Mini is more like a separate device that doesn't take over; it's more like Microsoft's XBox 360."
Apple currently has between a 6 percent and 7 percent share of the retail PC market in the U.S., according to Stephen Baker, analyst with NPD Techworld.
Baker thinks Apple is on track to have a good holiday season but thinks the impact of Vista's delay will be negligible.
"People will buy Macs for lots of different reasons, but it's a tough proof point to say they're going to gain five points of market share because Vista is two months late."
Baker says Apple's bigger challenge is how to replicate the wild success it had last fall when it sold 14 million iPods, more than a 200 percent jump over the same quarter in 2004.
"You think of Apple as a computer company, but iPod is driving the train right now," said Baker. "There's no way they'll have as big a jump in iPod sales this fall, but how well they do with iPod is, I think, more important to them than picking up a few hundred thousand extra PC sales."
Analyst Bajarin said Vista wouldn't have hit its stride this fall even if it did ship as scheduled.
Years ago Microsoft spent millions promoting the launch of Windows 95, and there were numerous news stories about people camped out at computer stores till midnight to buy the first copies. But Bajarin notes those were mostly the geeks and core enthusiasts, not mainstream buyers.
"The early adopters jump in, but consumers don't buy in a big way for the first six months after release, and I think that's when you'll see Vista having its biggest impact."
For Apple, it's biggest focus this year is to get all its computers and notebooks switched to Intel processors.
So far it's ahead of schedule and showing a steely determination and marketing muscle far removed from its humble beginnings in a Silicon Valley garage.
CEO Steve Jobs noted earlier this year that Apple's 30th anniversary is fast approaching.
"You know," said Jobs. "Apple was founded on April Fools day in 1976. We thought that was funny at the time."