Apple As An Appliance Vendor

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Today marked another departure from the ranks of 3rd party software developed for the Macintosh OS: Adobe Premiere. With the bow of Internet Explorer for Mac last month, the move of independent software developers continues to be away from the Mac OS. And why shouldn't they? Forgetting about the Mac's paltry market share, Apple has itself launched products which directly compete with Adobe's Premiere and Microsoft's IE. Apple hasn't built its own Microsoft Office yet, but does appear to be working on it.

I've mused about Apple's strategy before and I'm starting to wonder if it's not very simple: Apple is trying to become an appliance company. Apple has always had the advantage of developing both the OS and the hardware and as a result could build more tightly coupled hardware support into the OS. By developing the bulk of the software (and Internet services) for its platform, Apple can focus on end-to-end user experience like no one else in the personal computer food chain and build the all purpose computing appliance.

Apple will never have a lower cost model than Dell or the installed base of Microsoft and seems to have finally realized that trying to compete on those terms is a losing battle. Apple needs to continue to push its strength -- a more integrated, easy-to-use product -- and squeezing out 3rd party software development seems to be the current tactic. The appliance model has worked well for Apple in more focused categories, it will be interesting to see if the company can succeed with it on the general purpose computer front.

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Listed below are links to blogs that reference this entry: Apple As An Appliance Vendor.

TrackBack URL for this entry: http://ventureblog.com/cgi-bin/mt/mt-tb.cgi/104

» I said that, too! from dwlt.thinksOutLoud

From VentureBlog: Apple As An Appliance Vendor: I'm starting to wonder if it's not very simple: Apple is trying to become an appliance company Yep, that's what I said on March 31...... Read More

So Adobe will no longer be producing the Mac version of it popular Video Editing software Premiere according to this news article... So is Apple going to become an appliance company? Asks Andrew Anker on VentureBlog Read More

So Adobe will no longer be producing the Mac version of it popular Video Editing software Premiere according to this news article... So is Apple going to become an appliance company? Asks Andrew Anker on VentureBlog Read More

» Apple's Strategy As Appliance Maker from BusinessPundit

VentureBlog has a good post about Apple. The technology coming out of this company never ceases to amaze me, but their business ideas have kept... Read More

» Tuesday, July 08, 2003 11:14 PM from Critical Section

Andrew Anker things this is further evidence that Apple is an Appliance Vendor. Their control over both hardware and software enables tighter integration and hence a better user experience.... Read More

» Steve Jobs: Icon or "I con"? from Ian Murdock's Weblog

Two memorable quotes from yesterday's New York Times article about the iCon flap: Jeffrey S. Young: "I think [Steve Jobs has] lost it. He faced mortality, and he knows without some massive change Bill Gates will be remembered as... Read More

6 Comments

Al said:

I'm on the virge of making the switch from PC to Mac actually, and one major consideration is the software availability and its cost.

Unfortunately, since the corporate world still emails Word and Excel documents around, I need MS Office. The cost of MS Office for mac has actually stalled my migration. I would have bought the terrific PowerMac on the spot if it were not for this. I'd rather blow the few hundred on an iPod than on the MS Office suite.

This type of thing adds to the actual cost of "making the switch".. a PC emulator seems to be around $200..

It's too bad really, as I rarely use Office products any longer. Just give me an html editor, yahoo messenger, telnet or ssh, ftp, and a web connection, and I can help manage and build a company. Html from an intranet page loads way faster than a Word document and it's easier to maintain, and helps you spend less precious time on fancy, non-value add format features, etc.

As I researched the Mac OS X software availability and development platforms, I don't see any barrier at all to creating 3rd party software. There's all sorts of 3rd party Mac software out there. And Java and Perl are even included in the default system, unlike in MS XP, so developers have even more choices than on PC, right out of the box.

OS X is really a wonderful leap ahead. It feels like something refreshing and new. I hope to have such a machine soon. Maybe my company can pay for the Office suite :)

Al,

I haven't tried it myself yet but friends and colleagues using an OpenOffice.org build have raved about it. And it's free...

Pedraum

This is along the lines of my thinking that Apple should buy Tivo. They are going to build in the functionality anyway, why not get the market position, subscribers and just come out with Tivo3 which is OSX based and integrates IMovie, ITunes, Airport, etc.? Apple has always wanted to be a home media portal, why not just buy the guys who have the head start?

munich said:

My wife got a Mac only because she was able to get MS Office (thrown in for $100 on a special sale) for work related matters. Without having MS functionality, it would have been a deal killer.

While I have stayed on a PC in the other room, I have been impressed with the Mac's ability for pics, video, etc. However, I wouldn't recommend it to anyone who is moving from a PC, but someone who is building up from scratch, or is keeping their PC separate. Mac advertised heavily in 4Q02-1Q03 on the "easy" move from PC to Mac, but it ISN'T easy, and they charge you for any questions you have. It took about 6 weeks to get everything from my wife's PC to the Mac working comfortably.

Con Tendem said:

Frankly, I do think getting into a primarily "appliance" mode would be a huge mistake for Apple. Getting rid of supporting high-end Video/Graphics software, like Premier is also a mistake, IMO. Appliances just do not carry the price tags like $3,000 or more. They also do not have the profit margins for software. Coupling OS X with appliances is also a waste since a regular, free, Linux is as good of a driver, and one did not have to spend years and billions of Apple dollars developing it.
What I do see Apple doing is realizing that what is going to drive home computer purchases in the next few years are Digital Video editing and access to Music/Entertainment from everywhere in the house. If they manage to sell nice powerful G5's as the house's mainstay processing machine, and seemless integration with appliances for music play and video and photo storage, connected to less-powerful iMac-type consoles around the house that can tap into the powerful's machines processor power, then they might stay alive. I am still not sure how they are going to fend off Dell/Microsoft/Linux-based appliance vendors, but I just do not see how replacing 3rd party software with their own will help to keep the interest in the platform alive.
Obviously, all sort of dumb-terminal/rich interface stuff is even more native to regular Unix/Linux (X-Windows) than to OS X, so it is not clear where Apple's advantage might be. They could manage on sheer aethtetic design prowess, I guess.
Admission: I am also one of the people who never liked iPhoto. Did not find it innovative or useful to really catalogue a large number of images in various stages of editing. And for Windows there are excellent ACDCee and Picasa that do the same and more as iPhoto.

Ken Keller said:

If throwing around Word/Excel documents is all you need, then get your hands on Appleworks which can read and write such documents out of the box.

Push comes to shove, I'd rather use Word and Excel. Excel is a superb programme and Word has its own strengths. That being said, I haven't seen any problems while editing, viewing, printing or creating Word/Excel files.

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This page contains a single entry by Andrew Anker published on July 7, 2003 2:50 PM.

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