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Microsoft Plans to Raise Price of Netbooks
Posted on July 31st, 2009 2 comments
Why oh why would I write an article about the monolithic beast that is Microsoft? Well, that is quite simple. Apple controls a little under 10% of the global consumer market share, and desires to have a bigger piece of that pie. Microsoft owns 80+% and would like to get to 100%. Over the past 2 years Microsoft has played a dangerous game with regard to pricing. They figured they would drop the bottom out of the PC market and sell tons and tons of units at a lower margin. However this strategy has failed them. Peter Burrows of BusinessWeek wrote, “the company’s goal is to raise PC prices in the next year. That’s due both to expected popularity of a new class of higher-end and higher-priced netbooks, a new pricing strategy around Windows 7 that the company hopes will result in far more upgrades to premium SKUs, and a reversal of a strategy in the last year to cut prices to spur demand in emerging countries.”
You may be asking yourself what this has to do with Apple. A LOT. You see friends, one of the single largest roadblocks to owning an Apple product for most consumers is price. We know, looking historically, that Apple is not one to fluctuate pricing very much if at all. Therefor When Microsoft uses their power over the PC manufacturers to force prices to increase, you now have an even more competitive product coming from Apple, with no work on their part. Apple has always believes in the value of their products and the price “premium” in the minds of the Cupertino elite is justified. (i put that in quotes because similarly spec’d pc’s and macs will cost the same price)
Apple has yet to jump into the netbook market and has publicly stated that they will not move into this market. Regardless, rumors are flying regarding the potential Apple netbook arriving this fall. Whether or not these rumors materialize is irrelevant because of the implications that Microsoft’s sudden shift in tactics brings. Apple is gaining ground and in a fair fight 9/10 people will choose quality over quantity, which means Apple. Just to keep those rumors flying, here are a couple of mock ups people have done for Apple’s rumored Netbook.
2 responses to “Microsoft Plans to Raise Price of Netbooks”
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As an Apple fan and investor, I REALLY hope Apple is entering this market with some kind of killer feature that is NOT interactive album artwork. Those mockups look horrible, and I can’t imagine someone wanting to type on a keyboard that you can’t do with just your thumbs because the screen is too broad. These are obviously just artists’ renditions, but wow – with all the rumors flying around, I really hope it isn’t true.
Then again, I have FULL faith that they won’t enter the market unless they are SURE they can add something unique to it to justify the premium price I’m sure they’ll be asking us to pay. But what could you possibly add to this tablet-esque device? I wouldn’t even buy it if it had a projector built in – and that is asking a LOT. Maybe I’m just not creative enough to imagine it…hm…[Reply]
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I think you are right to say that Apple will not enter the market unless they are sure it will succeed. While this hasn’t always been the case lately Apple has had a string of releases of new devices that critics have raved about.
At BestMacs we tend to chat a lot behind the scenes about new products and how they fit into the broad range of Apple’s offerings. To be frank, we didn’t like to MacBook Air when it first arrived on the scene, citing that it was “not powerful enough” and cost to much to not have an optical drive or ethernet port.
Sometimes I feel Apple knows where the trends go before we go and I think i have a fairly simple explanation for this: Apple is setting the market trends, period. An article i was reading recently wrote that all major netbook manufacturers are holding off on any new releases to see what comes from the Cupertino camp so that they wont be left in the dust again like with the iPhone. Though, if i had to venture a guess, i would say whatever Apple does release, will knock our socks off.
My only fear is the price of this device, though if the MacBook Air is any indicator of how Apple will price this, we can expect it to fall in between the iPhone and lower-end Macbook. Only time will tell, but as the line between cellphone and laptop are blurred more each day I cant wait to see how Apple will change the game for the better.[Reply]
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Jordan August 7th, 2009 at 01:36