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    Home Apple
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    Apples Mac Halo: No Myth

    By
    David Morgenstern
    -
    February 20, 2007
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      With Windows Vista now in the channel, some analysts predict reversals for Apple. Others now question the so-called “halo effect” of the iPod, the notion that a positive experience with the Apple audio player will lead people to buy a Mac.

      I dont buy much of this talk. In fact, I see signs that the Mac will continue its comeback and may be on the threshold of making a greater mark in the business market.

      The hubbub was sparked by a Feb. 14 Piper Jaffray report by analyst Gene Munster, which was based on a recent survey of 50 Best Buy retail stores. It was more of a PC survey. The report said that 72 percent of stores found that Vista was driving an interest in new PCs and 29 percent said it wasnt.

      Munster warned that these Vista PC sales could result in a dip for Mac sales in the second quarter. But not by much.

      /zimages/4/28571.gifClick here to read more about the Piper Jaffray report on Vista and Apple sales.

      However, he was confident that over the long term Mac market share will rise. “As the PC market shifts toward portables, Apples market share will benefit from higher share in this category,” he told eWEEK.com.

      On the other hand, my former colleague Larry Dignan discounted the latest anti-Vista marketing effort from Apple in a Feb. 15 article on Seeking Alpha. In it he also dissed the whole idea of the halo effect.

      “If iPod purchases led to new Mac owners Apple would have more market share by now,” Dignan said.

      But is this survey at Best Buy really the place to measure of the halo effect? Should our expectation be that all Windows customers who own iPods will suddenly awake as if from a dream and run down to the Apple store for a brisk dose of Mac OS X running on a MacBook?

      Yet, on some days and in some places, it could appear that way. Apple said in its Jan. 17 quarterly analyst briefing that more than 50 percent of Mac customers in the companys stores were first-time “switchers” from PCs.

      /zimages/4/28571.gifRead more here about Apples recent quarterly earnings report.

      Certainly, this group of new users reported by Apple must have some iPod customers in the mix. Apple is a public company and must be mostly honest about reporting on its market and sales.

      However, this behavior is what I would call a “micro level” expression of the halo effect. I suggest that the iPod and the arrival of Intel-based Macs in the past year have had a more important “macro” influence on the market, with consumers and even with business customers.

      While, there were considerable technical and value hurdles that users needed to overcome on the road to switching, the biggest obstacle to Mac adoption was the perception of Apple as a failing company. Apple lived under a sentence of doom by analysts and pundits for many years. It was as if the company was one misstep, one failed product and one quarter away from ruin.

      Apples decline in the 1990s (and Microsofts rise) sent the brand into a great hole. And in the general publics eyes, Apple didnt really begin to climb out until the iPod came along.

      Of course, the company was sustained during its toughest years by its loyal user base. But Apples recent success with the iPod gave solid proof to the rest of the market (the other 96 percent or so) that the company would be sticking around for a while longer.

      The iPod became the engine of respectability that was able to pry the doom monkey off Apples back.

      Next Page: Whos switching now?

      Whos Switching Now


      ?”>

      Of course, the “macro halo” then leads PC users to wonder whether the Mac is a viable alternative to the Windows platform. This encompasses the Mac platform as a hardware technology and a software market; or in other words, users need to be confident that theres a value in the hardware and OS package, and that theres application software to get the work done, respectively.

      In the past, before the change to Intel processors, there was a technical hurdle with the Mac for Windows customers. The PowerPC platform didnt run Windows programs easily and quickly. And its performance and technology couldnt be compared easily with the PC. Now it can.

      At the Macworld Expo, I talked with a longtime Mac vendor, Rich Siegel, CEO and president of Bedford, Mass.-based Bare Bones Software. He agreed about the change thats come because of the switch to Intel.

      “Theres this funny connection with Windows and Intel. When the Mac was running on some oddball hardware, specifically the PowerPC, it wasnt in [Windows users] minds as a credible platform. All of a sudden, when the Mac is running the same [processor] as everyone else, its more of a viable deployment target,” Siegel said.

      (Side note: Readers on the Mac should check out the latest version of Bare Bones Yojimbo, the companys excellent organizational tool that can hold all the various scraps of text, passwords, bookmarks, images and even entire Web pages that we collect and usually lose track of. Its very easy and effortless. I use it all the time. Now at Version 1.4, it costs $39.)

      Now, as Ive said, given the length of time that the doom monkey was on Apples back, and the really short stretch that weve had since the rise of the iPod and the arrival of Intel machines, any growth in the Mac installed base must be evidence of a halo.

      From my own recent observations, this macro halo effect appears to be hitting across the board, including the top tier of customers—the very ones that common sense would tell us should be the most partisan of Windows supporters.

      Consider these few signs of the macro halo effect:

      • Who are the switchers really? They arent all college kids and consumers as many believe.

      I talk to a number of potential switchers each week and find that many are very technical people who use Windows at the office. Some used a Mac long ago in ancient times but gave it up to work in a Windows-centric enterprise.

      For example, one acquaintance pinged me the other day (and declined attribution). Hes a technical sales manager at an ERP (enterprise resource planning) company and spends his days working on a PC. He remembers owning a PowerBook 160 (purchased sometime in 1992 or early 1993). But he says hes sick of the PC. And yes, he knows all about Vista and its benefits.

      He told me that he was sick of “device driver hell” and “thanks to Boot Camp, Parallels and VMware, I can still keep a copy of Windows for basic tasks that cannot be done via the Mac.”

      Now, those “basic tasks” include running his companys software.

      What I hear is that this guy is more confident that the Mac platform can run his real “basic tasks” than Windows can. At the same time, he has confidence that a virtualized Windows environment will handle his necessary work needs when something else is called for. And if absolutely necessary, he can run Windows natively on the Mac Intel-based hardware.

      Meanwhile, other market segments such as the Web 2.0 crowd appear to have no trouble choosing the Mac over the PC. When you see photos from conferences or from people hanging in the office, they appear to be using Macs. The Apple logo is plain for all to see, row after row of Macs. This acceptance cant be for the style of the Mac. After all, these people are savvy, technical users.

      • Discussions with business software vendors at the Macworld Expo in January also gave me the increasing scope of continued acceptance of the Mac.

      Several vendors, including the San Francisco-based Mindjet, showed “mind mapping” software, or project visualization and brainstorming software. Mindjets MindManager now comes in a Mac OS X-native version.

      Who uses this kind of software? Top-level executives, directors and project managers in the enterprise, thats who.

      According to Brook Stein, senior product manager, some of the demand for Mac compatibility came from the need of executives to more easily pass files with ad agencies and other outside consultants that used Macs. The creative and design market has always been a Mac stronghold.

      However, the demand also came from the increasing number of switchers on the client side. “The biggest market were seeing growth in are people who use Windows at work [because they have to], but who buy Macs for home,” he said.

      /zimages/4/28571.gifDo you dare to take eWEEK.coms Apple trivia challenge in honor of the companys 30th anniversary? Click here to read more.

      • Most content providers dont detail whos reading their product. Or more accurately, they dont provide figures of which platform is reading the content.

      So, a chart near the top of the Feb. 16 posting at Dave Winers Scripting News blog caught my attention.

      In the story, Winer told of how Michael Gartenberg, formerly consumer market research director at JupiterResearch, was now a Microsoft evangelist.

      The chart breaks out the Scripting News readers by browser. Firefox is the largest (49.76 percent), and Internet Explorer is second (23.43 percent). However, Mac-only browsers Safari and Camino are next in line (21.31 and a guesstimate of 2 percent, respectively). And Id guess that some part of the Firefox figures are really Mac users as well.

      Ignoring that inflation, almost a quarter of the readers are Mac users. Winer tells us who they are:

      “The people who read this site are all enthusiasts, thats virtually what defines this site. When I ask a question about technology here, no matter how obscure, we get to the answer in an instant, often with lots of interesting sidebars along the way. And were the people who Microsoft lost in the last few years.”

      Winer said that a few years ago, IE had an 80 percent share in that same chart. However, what I see are all the Mac readers. Pardon—all the “enthusiast” readers who are on Macs.

      /zimages/4/28571.gifIs a “perfect storm” of Mac upgrade sales on the horizon? Find out here.

      Apple keeps fooling our common sense. Many industry watchers keep waiting for some big splash from Apple toward the business market. A top-down marketing effort. Thats how its supposed to arrive.

      However, vendors at the Macworld Expo sounded pleased with the technology coming in Mac OS X Leopard and, especially, Leopard Server.

      Perhaps the resuscitation of the Mac in business will be aided by the new and enthusiastic switchers, well-placed in the executive ranks. It will be seen in steady growth of competitive midmarket products, some of which were already seen at the Expo.

      /zimages/4/28571.gifStorage Elements unveiled a new NAS/SAN storage management suite for Mac OS X Server. Click here to read more.

      Heres a bit of historical context: Ten years ago this very week, Apple rolled out a major new “comeback” marketing campaign.

      Asked by MacWEEK about the new, stronger, bolder approach (as pitched by an Apple marketing VP), Jeffrey OBrien, then a senior editor at Marketing Computers, an advertising trade journal, gave a tentative thumbs up to the new campaign. He said recent Apple efforts had been “weak, ethereal and airy.”

      “Apple is in serious danger of becoming irrelevant,” OBrien said at the time to reporter Leander Kahney. “Marketing at this point is the only thing thats going to save them.”

      However, it wasnt marketing that saved Apple. Or certainly not that “stronger, bolder approach to communications” in that 1997 comeback ad campaign. Maybe it was Steve Jobs. Or maybe Mac OS X. Or maybe great new hardware. Or all of the above.

      Certainly, the halo of the iPod and Intel can be added to that list.

      What do you think? Are you seeing switchers in your enterprise? And will you support them? Let us know here.

      /zimages/4/28571.gifCheck out eWEEK.coms for the latest news in desktop and notebook computing.

      David Morgenstern
      David Morgenstern is Executive Editor/Special Projects of eWEEK. Previously, he served as the news editor of Ziff Davis Internet and editor for Ziff Davis' Storage Supersite.In 'the days,' he was an award-winning editor with the heralded MacWEEK newsweekly as well as eMediaweekly, a trade publication for managers of professional digital content creation.David has also worked on the vendor side of the industry, including companies offering professional displays and color-calibration technology, and Internet video.He can be reached here.
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