Category: Apple commentary
Macs, iPads and Margins…
So as you’re aware Apple talked about Macs recently.
Seeing as this blog is mostly dedicated to talking about Macs, this piqued my interest.
The M3 chip was introduced, and squeezed into the laptops and iMac.
Highlights for me were few and far between, the main positive being that the ‘touch bar’ no longer exists – yay – and the 24” iMac has missed out the M2 and jumped straight to the M3, albeit just the base M3, not the M3 Pro or Max.
The 27” iMac replacement is already here by all accounts.
A very unsubtle hint was dropped – the 24”, 4.5k screen replaces the 21.5” and 27”.
So it’s official- the true replacement for the 27” iMac, is the Mac Mini with Studio Display.
But it was an odd presentation.
At only half an hour or so, it seemed more suited to just a press release, and a lot of pundits have observed this also.
Until the other shoe dropped.
Apple’s earnings report noted a 34% drop in Mac sales and a 10% drop in iPad sales.
Ouch.
So I think this presentation was rushed into place, with a hastily ‘Halloween’ gimmick applied, to goose Mac sales.
But why are sales falling?
Apple has been more active than ever in the Mac market (the iPad not so much), you’d think that all this effort would bear fruit. But it hasn’t.
For me, the blame cannot be applied to a single person, it’s more the way in which Apple seems to currently operate, now that someone with Steve Jobs’ vision and priorities has long gone.
But having said that, I’m not a big fan of Tim.
He’s a numbers guy.
He’s a share holder value guy.
He’s a channel logistics guy.
He’s a spreadsheet guy.
He’s a margins guy.
And although all these things are important, the most important thing that Apple has, is its brand and how that brand is perceived by its customers, its critics and its staff.
While everyone is looking at the details, no one seems to be looking at the bigger picture – what does Apple mean to people.
As my header states, I love the Mac, but Apple as a company? Not so much.
When Jobs first returned to Apple, he launched the Think Different campaign.
A campaign with one purpose, to make people (including those working at Apple) start thinking and caring about Apple again.
To make Apple more than just the products, the numbers, the bottom line and the margin.
To stop the staff worrying about (and leaving) Apple so that they could get on with making great products.
What Apple has become today, is a company that values and cares more about the details than they care about what Apple means in the abstract.
This is solely Tim’s fault – he should be setting the agenda to move forward, instead he’s letting Apple get bogged down in the details with different departments at odds with each other.
This is clearly illustrated by Apple, for all intents and purposes, operating a siloed business model.
I remember working for a company that operated like this.
The idea is that you task each department in your company with a set of goals, and the theory goes, if properly set and managed then each department doesn’t have to worry about the company as a whole, they just need to worry about their little bit of it.
So one department (or silo) is charged with keeping margins at a set rate, another department is set keeping quality control to the agreed level etc.
What this ends up with though is a spreadsheet.
These departments end up obsessing over a single number in their spreadsheet.
In the company I worked for, these departments had this percentage on a white board and OMG were people in trouble if it went above 5%, or below 2% or some other meaningless operator.
Staff only vaguely knew why that was important – even the manager it seemed. All that mattered was the percentage.
This is where Apple is currently.
The decision to keep old hardware around, even if it confuses the marketing message and makes the product line impossible for a customer to understand does not matter.
All that matters is that they keep this old, outdated hardware around so as to maintain the margin.
Look at the iPad, keyboard and pencils – the sole reason it’s such a mess, is because of Apple’s obsession with margin.
The decision to release your entry level Mac’s with 8gb RAM and a 256GB SSD, which will seriously affect negatively your computing experience, is a margin decision.
The reason why Mac’s are stubbornly high in price is because of Apple’s obsession with margin.
The reason why Mac’s upgrade prices are so high (hundreds of pounds for 8gb memory upgrade) is because of margin.
The reason why Apple struggles so hard with getting into gaming, is because they don’t sell enough Macs for game developers to get interested, and this is because of Mac prices being so high and that’s because of margin.
If Apple was serious about gaming then the entire company would be behind it – individuals clearly are, but as a company they’re demonstrably not.
If you’re serious about gaming, you wouldn’t be releasing your base level hardware with 8gb RAM and a 256gb SSD with upgrades being borderline exploitative.
If you’re serious about gaming then your Mac App store wouldn’t be selling Tomb Raider 2013 for £29.99, whilst it’s less than £5 on Steam.
If you’re serious about the education market, then you’d release a comprehensive ecosystem, backed up by rock solid iPads that were competitively priced with Chromebook’s. Apple isn’t and actually can’t do this because of margins.
This obsession with margins is damaging to the company’s growth.
And that is because the siloes in the department don’t care about education, gaming, or selling more Macs, or creating great products – all they care about is their silo and their little spreadsheet.
Tim and the board? Well they don’t care, all they care about is all their little siloes making sure that their spreadsheets are all hitting their targets.
Tim’s job is to steer the ship into uncharted waters, but he’s down in his bolthole, looking at the numbers, because if the numbers add up – he must be doing a good job – right?.
Now, I’m not saying that margin isn’t important, it clearly is, but if your myopic obsession with margin is damaging the brand (and now sales it seems), then Tim needs to seriously stop looking at his spreadsheets, take a long walk and have a good think about what Apple is trying to do.
He’s made Apple employees lose sight of what it all means and what they go to work for.
To create insanely great products that people want to buy.
The real world, Apple…
I’m currently in a long term contract as a graphic design freelancer for a solidly PC-based company.
As I’ve said before, the means me having to use Windows exclusively.
This isn’t a problem as I’ve used Windows on and off throughout my career.
Through my career I’ve usually had to manage a suite of Macs that sit within larger PC-based businesses.
I’ve only really seen fully Mac-based businesses in design agencies and even then, there’s always a smattering of PCs around.
For the most part, I’ve managed this by keeping Macs and PCs separate.
Separate servers, separate workflows and the 2 worlds only cross when they have to, email, internet, networking etc.
I’ve done it this way because despite Apple advertising, connecting Macs to PC environments is frustrating at best and impossible at worst.
Yes – everybody tries to get along, but Apple’s SMB implementation is lacklustre and its Active Directory support is laughable.
Even though SMB is the officially supported file sharing protocol at Apple, and it’s ok Mac-to-Mac, it doesn’t use the latest version and is comically slow when connecting to PC shares, to the point where you have to disable features via the Terminal to get it to work.
I’ve always avoided connecting via Active Directory simply because it can’t be relied upon. It just doesn’t really work and from what I can glean online Apple are dropping support for it.
Apple are just not interested in playing nicely, or just don’t see the point of it.
This is why the Mac share of the wider PC market and its share of their internal revenue at Apple is stubborn in its growth.
Their advertising waxes lyrically about how fast, intuitive and productive their Macs are, but they say nothing about actually how you can incorporate Macs into your business.
They just don’t want to put the effort into this.
This was brought into sharp relief recently when out of the blue I was asked about the issues my workplace are having in the design department where I’m contracted, what could be done about it and whether moving to the Mac would help?
Now a bit of background on where I’m working currently.
There’s 5 graphic designers here and 2 marketing assistants. All using Windows.
We use an outside design agency for video work (which is Mac based) and this agency is part owned by the owner of the company
You can see where this is going.
We have lots of issues here and they all centre around the fact that their IT team, just don’t understand the size and complexity of the files and workflows the we use daily.
Storage is the main issue.
We create about 5 gigabytes of content a week and we store all that on an old networked PC in a locked room somewhere.
We connect to it using 10-baseT Ethernet.
Yes you read that right.
Their IT department are full of clever, qualified people, but in terms of large scale deployment of professional design workstations they are dangerously arrogant.
They are used to a world of ignorant users who use Microsoft Outlook, Microsoft Teams and push tiny Microsoft Office documents around, all on the back of a Microsoft cloud based storage system.
The storage for the studio is a spinning HD of about 1TB and it fills up fast, so we have to constantly move this somewhere else so we can keep working.
IT flatly refused to invest in more robust local storage – their solution to all this is to use Microsoft SharePoint.
This of course isn’t a solution.
It’s cloud based and syncs back and forth as needed.
Fine if you’re using Office documents, small JPEG’s etc.
Not fine when you’re using InDesign with large placed files, Character Animator files which number in the 100s per project or huge Adobe Dimension, After Effects or Dimension files for instance.
So I quickly managed to convince them not to go down that road.
A design studio needs fast, local, networked storage that’s backed up.
So I was asked about this problem, and because the owner owns an agency that use Macs, I’ve been asked to come up with a solution, potentially using Macs.
I’ve deliberated long and hard about this and I’ve come to a sad conclusion.
I can’t recommend the Mac.
Despite me banging on about how good Macs are for 3 decades, in the real world your computer isn’t an isolated asset.
It has to exist in an ecosystem.
It has to play nice.
That ‘it just works’ mentality that Apple has, must apply in all circumstances.
But it doesn’t.
Yes, if you’re buying a Mac for personal use or you’re a start-up or a (very) small business then a Mac is a good choice.
I don’t need to tell you that I consider Macs the best computers around, they’re fast, reliable and the OS is simply the pinnacle of excellence.
But in larger corporations, none of that matters.
Putting a Mac in place would mean a huge amount of training, infrastructure changes, strict workflows and staff on hand to handle issues.
There will be less issues for the user for sure, but it’s a huge change for the company’s IT team.
Unless you delegate an experienced Mac user to act as the IT go-between.
This is what I’ve done in the past, but it’s not something I want to do in the future.
So I’m recommending that the company stick to Windows, and just beef up their storage.
A NAS RAID is obvious here that’s connected locally on the network. It’s not that difficult to figure this out.
So what lessons can be learnt from this?
Well in some alternative timeline where Apple thought that this was important, it means working closely with Microsoft.
Much more closely.
Close, as in having Mac staff actually on site with Microsoft to make all this networking bulletproof and ‘just work’ out of the box.
I think Microsoft of today is ideally placed to help here – this isn’t Ballmer’s & Gates show anymore.
The new Microsoft wants their tech to work everywhere.
But we don’t exist in that timeline.
We exist in the timeline where Apple just aren’t seeing that the Mac is an area of growth.
We have the Apple that’s obsessed with service revenue and the entertainment arena and of course, the iPhone.
Not one that wants to grow the market share and mind share of the Mac.
As my bio states, I’ll defend the Mac until the end of my days because Apple certainly won’t.
If someone like me wants to recommend the Mac, but can’t due to Apple’s intransigence, what does the future hold for it?
Apple, take my (employers) money!
I’m currently the design studio manager of a small Mac-based in-house design studio, which is part of a much larger, PC-based company.
Every 3 years I refresh the Macs as the AppleCare run’s out.
Last refresh I moved all users to 27″ iMacs, leaving behind a collection of cheesgrater MacPros of various denominations.
Apart from the odd screen quality issue it was the right decision.
Speed, small footprint, a lot less cables to worry about, identical installs and less dust, all make managing those Macs a lot easier than it used to be.
I’m not sorry that the cheesgraters were discontinued, as the iMacs are perfect for what we need.
However there is one left, a venerable cheese grater MacPro RAID, that handles all the file serving, backup etc.
I can’t replace that, because, well, Apple hasn’t got anything to sell me that would replace it.
I’ve toyed with the idea of getting a big SSD with thunderbolt and hooking that to the network, but it’s a bit of a kludge.
So the money stays in my pocket.
And so the iMacs.
AppleCare runs out next year, so I’ve looked at what’s on offer.
And, well, there’s nothing to replace them with. Current iMacs are not that much different from what we’ve got.
So the money stays in my pocket.
Upwards of £20k, and Apple just doesn’t want it.
Next year, let’s see who does.
Chuq’s advice for Apple…
A long time Apple commentator and ex-Apple employee, gives his view.
I listened to Chuq on the Appletalk podcast and his point about Apple, “cutting the ends off the bell curve” is a really good point.
The marketing & finance people have taken over at Apple and they are drowning in data.
They’ve looked at the data and like all marketing people, want to be spending their money on things that are likely to return on the investment.
They’ve looked at the usual market sectors, and because nobody in marketing actually does any serious heavy lifting, they don’t understand those that do.
There’s a current illness in marketing where any market they can’t measure, they just don’t see, and marketing is full of people who can only truly understand people like them.
They look the all that data from sales, social, email, web and the only data that is shown by that are trendy millennials sat in coffee shops.
They respond to social, email, branding etc., so the data marketing collects is full of them.
The real pros who rely on Apple’s kit to make a living are too busy working to ‘respond to branding cues’, they just buy Apple every few years, because it works.
Problem is with all that data, it seems like servicing these pros is a waste of money.
The data doesn’t show the mindshare and influence that pros give Apple.
Marketing doesn’t care about that because you can’t measure it, and in their view, they don’t want pro’s evangelising and advertising Apple – that’s marketings’ job.
Problem is with all that data, it only tells what people have done, not what they will do.
Problem is relying on data, you lose your gut instinct – that ‘Steve Job’s’ effect where Apple entered markets because they wanted to create a great product, not simply did what the marketing’s data was telling them to do.
You make the odd insanely great mistake, but that’s what made Apple great.
I do sincerely believe that Apple is changing from a company that used to service professionals creatives, into a company that simply wants to be a dumbed down, lowest common denominator, lifestyle company.
We’ll see what this year brings, from what I can see it’s just minor updates to the iMac.
Next year we are promised more – new processors and a big jump ahead in terms of performance.
After that, 2019, we’ll all know what company Apple wants to become, because by then, they will certainly be there.
Whether the pro market is with them remains to be seen – I not that hopeful.
Apple Will Murder Microsoft and Bury It With BlackBerrys Corpse – Rocco Riffs – TheStreet
Apple Will Murder Microsoft and Bury It With BlackBerrys Corpse – Rocco Riffs – TheStreet.
This is a significant article.
I’ve written at length for my distrust of Microsoft, representing in my view, a road that personal and business computing should have never gone down.
Microsoft got lucky with DOS – everything else, Windows, Office, Sharepoint, .Net, Exchange – it’s all momentum from that huge mistake that IBM made all those years ago, letting Bill Gates provide a disk operating system he didn’t even own at that point.
It allowed ‘computing for the rest of us’ to be a ridiculed statement made by a company that didn’t understand what ‘business’ needed.
Over the years, Apple has struggled on, sometimes lacking any direction, sometimes having the odd big success, but even that was dismissed as transitory – the mantra being that Apple needs a hit every year or two, otherwise it would just fade away.
Meanwhile Microsoft soldiered on, knowing that their army of IT people whose jobs depended on Microsoft staying in pole position, would keep them healthy.
An almost parasitic dependancy on each other developed, Microsoft need those IT managers to keep fooling company’s into believing there is no alternative, and those IT managers need Microsoft to keep the technology just opaque enough so that their jobs are safe, the rest of us suffered, or worse, carried on, not even knowing there was an alternative.
One thing they didn’t bank on was BYOD – bring your own device. Even in my little corner of the world, away from the US and even London, I’ve seen the effect. More people are choosing ‘anything but Microsoft’ for their personal computer and phone needs.
It’s still early days, and I don’t see a Mac on every desk anytime soon, but the article puts it perfectly:
“These days consumer preference dictates enterprise decisions. If you’re not powerfully out in front with the consumer, you’re going to end up getting hurt in the enterprise. That’s why it was smart for IBM to partner with Apple. Led by Apple, they’ll bury Microsoft in the same grave BlackBerry cluelessly fell into.”
Apple’s joint enterprise with IBM is very significant, as is this article. I’ve never seen any commentator dare even mention this as an option. I’ve also never seen anything like this from Apple either.
The enterprise doesn’t mention Macs, but I can understand that. In the eyes of business, the Mac brand is tainted (even though it’s a world away from the Mac of 1984).
However it doesn’t matter – the juggernaut that is iOS is the Mac OS underneath. Everyone knows that, Microsoft knows that, IBM knows that. What they don’t know is what iOS devices Apple will release in the coming years, which will be automatically part of the agreement.
If you consider that iOS and Mac OS will merge at some point and what the device Apple will merge them on will look like, you can start to see a future where we will all be using devices that run iOS.
Any IT manager still clinging on to Windows will use it in the server room where it belongs – just don’t let any normal person near it.
And I haven’t even mentioned the software services that Apple offers as part of this agreement – why would you choose Office when (an admittedly enhanced) iWork is free?
The Mac at work . . . 