Apple iPad unveiled

[s7eve]

No doubt it will have some effect on iPod touch sales and Macbook sales, not everyone can buy every product they want and people will look at which one is best for them. I want an iPod Nano, an iPod Touch and an iPad, the reason for wanting all three is none is exactly what I want, out of those I will most likely settle for a Nano and iPad, I'd like to be able to still borrow the kids Ipod Touch but they want to replace theirs with a iPad so most likely I will keep an iPod touch and not get an iPad myself. Before the iPad I needed a Macbook for my mobile needs, I no longer do. What I really want is a iPad a little bigger than a iPod touch but much smaller than the iPad. Lots of people like me have limited recources and will be forced to settle for one or two and as a result sales of the Touch/iPhone and Macbooks will go down a little when people decide the iPad is more suitable for them. All this may have already been offset by the increased sales Apple will most likely benefit from as a result of all the hype around the iPad good and bad.

I read the other day that Apple now account for 90% of +$1000 PC sales from brick and mortar establishments, this is a pretty impressive stat and incredible considering where Apple was just a few years ago. Apple are definitely doing some things right.

[Drew]

Originally Posted by s7eve

I read the other day that Apple now account for 90% of +$1000 PC sales from brick and mortar establishments, this is a pretty impressive stat and incredible considering where Apple was just a few years ago. Apple are definitely doing some things right.

I suspect, and am surfing over to the Best Buy Website to try to get a sense of this, that this has less to do with Apple cornering the market on expensive PCs and more with PC prices just plummeting over the past five years.

Doing some spreadsheet work, more in a moment.

[Elysian]

Originally Posted by Drew

I suspect, and am surfing over to the Best Buy Website to try to get a sense of this, that this has less to do with Apple cornering the market on expensive PCs and more with PC prices just plummeting over the past five years.

Doing some spreadsheet work, more in a moment.

Yeah, otherwise Apple's marketshare would be skyrocketing, and Windows would be plummeting. I guarantee more people are spending less than 1000 on PC's/Laptops than are buying Mac's of any kind combined.

[Drew]

Ok, first, a disclaimer - I'm bored at work and I've been reading up on this shit for the CFA exam anyway, so it seemed a good time to get some practical experience under my belt.

So, Best Buy lists 89 computers on their website for sale. Of them, 7 are Apple. The mean price of all computers (using the midpoint of each price range, weighted by number of computers) is $894. The mean price of an Apple computer at Best Buy is $1,696. The mean price of all computers, excluding Apple, is $826. Really, I should include some sort of standard deviation statistic with this (and I calculated one, for kicks) but the strong negative skewness of the All and All ex Apple populations makes it a pretty misleading statistic - suffuce to say, Apple is much more closely clustered around the mean than All or All ex Apple.

The raw data looks like this:



If you take those numbers and calculate frequency statistics from it, and chart them out, you'll see the following visual depiction of how the data is clustered:



The All Computers and All ex Apple are clustered on the lower end of the spectrum - the mean may be in the mid-$800s, but the mode (most common observation) falls between $250 and $750. Apple, meanwhile, has a modal point of $1500-$1999, significantly higher, and not surprisingly has a strong positive skew, almost exactly the opposite of the two "All" populations.

If you look at the cumulative frequency statistics, it's even more telling:



A normal distribution would form an S curve thaty would stay pretty close to 0 until the middle of the curve, then ramp up sharply pretty close to 100%, with the steepness of that climb dependent on the kurtosis of the distribution. The All populations form a convex curve, with a large number of observations happening early on, while the Apple is slightly concave.

Most telling, if you go back to that data chart and look at the observation point of $1k, the number you cited, you'll see that an All ex Apple population shows a 73% chance of any computer in the population selling for less than $1k, meaning about 26% of all possible non-Apple computers cost more than a grand. while Apple has a cumulative frequency at the $1k cutoff of 14% - about 85% of their models sell for more than a grand.

So, obviously this next standpoint depends somewhat on the assumption that any potential customer will randomly select a computer from the population with no regard to pricepoint, which is a stretch, but just based on the population dispersion the fact that Apple sells more computers at $1k or above than anyone else doesn't surprise me in the least - most non-apples cost less than $1k, and very fell non-apples cost more than $1k.

If you want to buy an Apple, 85% of your potential options cost more than a grand, while if you have no brand preference 69% of computers can be purchased for less than a grand, of which only about 8% (1 of 13) of which are Apples. I think that right there goes a long way to explaining why the bulk of people spending more than $1k on a computer buy an Apple - the bulk of their options at that price range ARE apples.

EDIT - also, I'm SURE you Apple nuts are going to take this as evidence that I REALLY hate Apples, if I'm willing to do this kind of analysis - no, actually, I'm contemplating a Mac or Mac Mini as my next computer, it's just I'm bored and also studying this shit, so I wanted to play a bit.

[Max]

hey drew shut the fuck, were trying to argue in here

[Drew]

Originally Posted by Max

hey drew shut the fuck, were trying to argue in here

Hey Max, I just pwned you so bad, you didn't even know you were pwned.

[Jeff]

All I care about is that Apple continues to make computers I like. I couldn't care less what their market share is. No wait; I do. I hope it DOESN'T increase. Because if it does, it's attractiveness to hackers will grow.

I'm perfectly content with our tiny slice, thank you very much.

[Drew]

Originally Posted by Jeff

All I care about is that Apple continues to make computers I like. I couldn't care less what their market share is. No wait; I do. I hope it DOESN'T increase. Because if it does, it's attractiveness to hackers will grow.

I'm perfectly content with our tiny slice, thank you very much.

Also, as production increases, maintaining quality control would likely get harder. Apple has a pretty good rep in that respect, as I understand, and if suddenly they produced a low-cost computer and started outselling Dell, I'd be surprised if that didn't change.

I was just pointing out that the fact that most computers sold over $1k in and of itself doesn't mean Apple's "doing something right." The fact is the vast majority of computers available in that price range ARE Apples, so it stands to reason that Apple has the lead in that demographic.

[Jeff]

Originally Posted by Drew

Also, as production increases, maintaining quality control would likely get harder. Apple has a pretty good rep in that respect, as I understand, and if suddenly they produced a low-cost computer and started outselling Dell, I'd be surprised if that didn't change.

I was just pointing out that the fact that most computers sold over $1k in and of itself doesn't mean Apple's "doing something right." The fact is the vast majority of computers available in that price range ARE Apples, so it stands to reason that Apple has the lead in that demographic.

yeah, all it means is that their computers are expensive. Which is true. They are.

[Max]

Originally Posted by Drew

Hey Max, I just pwned you so bad, you didn't even know you were pwned.

what?