Re: [NTLK] Why Apple Killed The Newton

From: Vaguely Radio (vradio_at_maine.rr.com)
Date: Thu Aug 12 2004 - 15:45:59 PDT


On Thursday, August 12, 2004, at 04:46 PM, John Ruschmeyer wrote:

> On Thu, 12 Aug 2004 15:24:06 -0500, David M. Ensteness
> <denstene_at_mac.com> wrote:
>> Actually considering that the latest iBook school deal was at a cost
>> of
>> $300/iBook that sorta erodes your argument ...
>
> How do you figure?
>
> According to AppleHistory.com, the eMate listed for $799; by
> comparison, the PowerBook 3400 (a PowerBook of similar vintage)
> started at $4500.
>
> Even allowing for steep discounts and older technology (5300cs or
> 1400cs), a school probably could not have touched a PowerBook for less
> than $1500 per unit.

Probably not, but at the time would schools have even considered
multi-thousand-dollar PowerBooks for students? I think the possible
fallacy of this argument is the idea that an eMate sale = a
cannibalized PowerBook sale. More likely, schools would purchase
desktops (as was the case historically at that point) or else see that
the eMate filled a niche that was otherwise too expensive to even
consider.

David then wrote:

"The statement I was referring to was that all Jobs cared about was
protecting high profits and making cool looking stuff. My point was
that in today's market Apple selling iBooks to a school in an exclusive
deal as was reported last week for as low as $300/iBook contradicts the
idea that all Apple cares about is profit. Selling a $1000 iBook for
$300 does not leave much of any profit."

---
Not directly, but of course the purpose of seeding cheap Apple 
computers into the school system isn't as altruistic as some would 
think.  I'm not saying Apple doesn't care about education, but consider 
that education is a market where a loss leader such as a break-even 
sale of 1000s of iBooks can later convert into diehard Mac fans when 
they grow up and get jobs and begin to be capable of spending real 
money.  Unfortunately the best analogy I can think of for this is the 
one I used when I recently heard of Microsoft's cheap "Windows XP 
Starter Edition" about to be offered in countries such as Taiwan where 
Windows has not yet gained a foothold:  it's similar to drug dealers 
giving kids their first hit of crack for free.  The idea being you take 
an initial loss to build customer loyalty down the road.  This sounds 
bad because I made a "drugs to schoolchildren" analogy (or maybe even 
worse, a Microsoft one!), but really it is just business.
-Dan
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