Path: utzoo!utgpu!news-server.csri.toronto.edu!clyde.concordia.ca!uunet!zaphod.mps.ohio-state.edu!usc!apple!agate!garnet.berkeley.edu!knrgroup From: knrgroup@garnet.berkeley.edu (Raymond group) Newsgroups: comp.sys.next Subject: Re: NeXT Positioning Problem Message-ID: <1990Nov11.230616.15911@agate.berkeley.edu> Date: 11 Nov 90 23:06:16 GMT References: <56039@brunix.UUCP> <1990Nov11.215148.8528@rice.edu> Sender: usenet@agate.berkeley.edu (USENET Administrator) Organization: University of California, Berkeley Lines: 49 jack@Taffy.rice.edu (Jack W. Howarth) writes: > When Apple released the new machines (Classic, LC and IIsi) they gave >some numbers for the amounts Apple would spend on advertising on TV for >those machines alone and the expected numbers Apple expected to sell. I think >the average cost of advertising was about $40 per CPU. Considering that >NeXT will sell a factor of ten less at best...that would be at least >$400 per NeXT box. All this means is that Apple is spending a lot of money on TV advertising. A NeXT TV campaign needs to be nowhere as extensive or expensive. The Mac target market consists of every middle to upper-income household in the Western world. The NeXT market is the higher educational and business communities. By the way, if NeXT sells an order of magnitude less than a $1000 Mac, NeXT will gain complete control of the workstation market. >...they are almost giving the 040's away... Another false assumption based on a comparison of apples and oranges (or Apples and NeXTs). Apple has HUGE profit margins. Can you say 66% or even higher? NeXT can still make a healthy profit while underselling higher cost Macs by a factor of two! You also must take NeXT's advanced manufacturing process into account: it greatly reduces cost, especially labor costs. Apple has a nice automated factory, but Steve Jobs was responsible for that and he has advanced the state of the art even further with the NeXT factory. >...NeXT could be mighty deep in the hole already and just keeping its mouth >shut... It may very well be. However, if recent sales (non-Businessland sales) are any indication, NeXT should dig itself out of the hole much sooner than you think. >As far as I have heard, the real rush on NeXT machines at Businessland was on >their firesale of cubes. NeXT has made some very large sales without the aid of Businessland. NeXT is now very actively in the direct marketing business. As for the Businessland fire sale, virtually every buyer of the old cubes plan to upgrade to the 040 for $1400-$1500. >it seems most people who are interested will probably be academic and will >go through educational sales anyway! That covers about half of the intended NeXT market. The other half is business, and NeXT is getting some large orders from large businesses. Apple never really cracked the Fortune 1000 market. It looks like NeXT is starting to.