Apple’s demise is imminent. Say that every day of every year and there is a chance– just a chance– that you’ll be right one day. Pretty much like a broken clock displays the correct time twice a day. The reasons for Apple’s success should be obvious to all but the nattering nabobs of negativity which make up the Apple Critics League. The company’s successes are simply defined. In nearly every product category Apple has staked out a presence in the premium end of the spectrum. Mac, iPhone, iPad, and now Watch.
Apple chooses not to engage in the low end of the product spectrum where products are not easily differentiated and gross margins are grossly low. It’s like the admonition of wrestling with a pig. As George Bernard Shaw put it:
I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.
Here’s a good example of why Apple avoids visiting the bottom of the product barrel. Cheap Chromebooks are all the rage these days. A Chromebook is little more than an Android-like OS on a tablet that comes with a keyboard. CPU, RAM, storage, quality are all anemic at best, but there are buyers at $199 (sometimes less).
Microsoft has been forced to respond to the threat from the low end of the product spectrum with a free version of Windows for PCs priced below a certain threshold. Thanks to that strategy– which does not make much sense because nobody makes any real money– PC makers like Acer can build a Chromebook-killer notebook called the Cloudbook; a full version of Windows in a notebook for $170.
Cool, right? Except that Acer’s Chromebook killer notebook is the same hardware as Acer’s own entry-level Chromebook, but with Windows inside instead of Chrome OS.
The problem here is an age old issue I’ve discussed many times. Product differentiation. Apple differentiates the Mac from PC riffraff (and iPhone and iPad from plastic smartphone and tablet knockoffs) a number of ways; higher quality materials, faster, more powerful CPUs, more RAM and storage, and, of course, OS X.
By being different in all the right places, Apple’s product line is associated with quality and durability and security while anything with a Windows or Android logo on it is associated with cheap and throwaway.
Chromebooks are not Cloudbooks just as the Mac is not a Windows PC. Different strokes for different folks, but Chromebooks do what Windows notebooks regardless of price tag, do not. They provide ease of use, easier updates, fast startup times, and better security. That’s what Apple does at the premium end of the product spectrum, so Microsoft’s Windows is caught in the middle.
The company’s product territory is easily defended, which is why you won’t find Apple wrestling with the pig of cheap notebooks, cheap smartphones, or cheap tablets.