Path: utzoo!utgpu!news-server.csri.toronto.edu!rpi!think.com!zaphod.mps.ohio-state.edu!mips!apple!keith From: keith@Apple.COM (Keith Rollin) Newsgroups: comp.sys.mac.hardware Subject: Re: A Classic Dead End? Keywords: Classic,System 7.0 Message-ID: <53176@apple.Apple.COM> Date: 21 May 91 20:45:54 GMT References: <1991May20.154508.4325@midway.uchicago.edu> <1991May20.164257.1959@milton.u.washington.edu> <24576@oolong.la.locus.com> Distribution: usa Organization: Apple Computer Inc., Cupertino, CA Lines: 67 In article <24576@oolong.la.locus.com> jfr@locus.com (Jon Rosen) writes: >In article <1991May20.164257.1959@milton.u.washington.edu> gwangung@milton.u.washington.edu (Just another theatre geek.....) writes: >>In article <1991May20.154508.4325@midway.uchicago.edu> jcav@quads.uchicago.edu (john cavallino) writes: >>>I'm sorry, but I still think my arguments contain one or two shreds of >>>reasonability. :-) >> The market aint gonna move anywhere until it wants to. The reason >>why Apple is making the Classic is that the market wants that particular >>product. No amount of prodding by Apple is going to force the market >>where it doesn't want to go. Otherwise, the lowball winner would have >>been the LC and not the Classic. The market doesn't agree with you. > >Actually that statement is not entirely provable by the evidence. First >of all, the Classic is, at street prices, still about $1100 less than >an LC. That means the Classic is about half the price... What is not >available for comparison is if the LC, priced closer to its "real" >value compared to a Classic which, based on the IBM market cost for >color and a faster processor, would be about $1500 instead of $2100, >would still sell less than the Classic. I bet not. If the LC were >in the $1500 price range (which would still allow for reasonable margins >to Apple) LCs would sell better than Classics. You don't read the newspapers, do you? Haven't you seen all the news recently concerning Apple and its profit margins? How - because the Classic is so successful - that Apple is having to take extreme measures just to stay profitable? Unless Apple can radically restructure itself in the next 6 months, there is NO WAY you are going to see Apple have a Mac LC for the price you list. $1500 does NOT allow for reasonable margins. That claim of your is totally unsubstantiated. >However, for the average >person at home, the Classic makes economic sense. This does NOT mean >that the market doesn't agree with the original poster. Rather it means >that the market has, once again, been coerced by Apple into buying a >lesser product in order to protect Apple's margins. "Coerce"? Coerce? What...did Rocko come by your house and force you to by a Classic? This is a free country! People can buy what they want! If people feel that a Classics suits their purposes, then Apple will be more than happy to build the Classic and sell it to them. For the same reason, people go out and waste their money on PC's. Those computers get the job done, and people are happy with them. You don't see those people bitching that they can't run 7.0 (though they should :-) >What is amazsing >is that Apple, despite the hype, continues to ignore the obvious. They >could, on the basis of a superior product, OWN the personal computer >marketplace at a price that would probably improve their profits by >a factor of 2 or 3, if they were willing to sacrifice their margins >in order to gain marketshare. Apple's working on it. As you can see in the papers, Apple's margins have been sacrificed to every god this multi-theistic society of ours has been able to dream of. And it hasn't (and won't) increase Apple's profitability by a factor of 2 or 3. Since profitability is a function of profit margin, you won't raise that profitability by slashing margins. -- ------------------------------------------------------------------------------ Keith Rollin --- Apple Computer, Inc. INTERNET: keith@apple.com UUCP: {decwrl, hoptoad, nsc, sun, amdahl}!apple!keith "But where the senses fail us, reason must step in." - Galileo