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Gartner: Apple should quit hardware business
ZDNet UK ^ | October 18, 2006, 16:55 BST | Andrew Donoghue

Posted on 10/18/2006 6:49:22 PM PDT by Swordmaker

The future success of Apple, Dell and Intel lies with a licensing deal between Steve Jobs' company and the PC maker according to analyst Gartner

Increasing component costs and pressure to cut its prices mean Apple's best bet for long-term success is to quit the hardware business and license the Mac to Dell, analyst firm Gartner claimed on Tuesday.

In a surprisingly ambitious report, called Apple Should License the Mac to Dell, Gartner says Apple should concentrate on what it does best — create software — and make use of Dell's production and distribution infrastructure.

"Apple should leverage its close relationship with Intel and team up with Intel's closest ally, Dell," the report states. "We recognise that this move would surprise and even shock many. We are aware that Steve Jobs cancelled previous Mac licences when he took over at Apple and that he guards the Apple brand zealously."

Up to around 1997, companies including Power Computing were given the rights to license Mac technology from Apple. However, when Jobs returned to the company, he attempted at first to renegotiate the licences but eventually opted to cancel them.

Apple increased its share of the PC market to around 4.6 percent in July this year, according to analyst figures.

Gartner claims that with the right partners, distribution channels and a more affordable price, computers running the Mac OS could eventually account for 20 percent of the total PC market.

According to IDC, Apple's sales, while still smaller than its major competitors, grew by double digits in the second quarter of this year. IDC attributed the growth to a successful transition to Intel chips.

According to Apple's third-quarter results — released in July this year — Mac sales were up 12 percent compared with last year, during what was considered a poor quarter for the PC market. Apple said that 75 percent of all Macs sold during the period used Intel's chips.

However, Apple will not be able to substantially increase this growth on its own because of increasing pricing pressure, Gartner warns.

Apple's margins for its Mac business, currently around 40 percent, are only sustainable because component makers such as Intel choose to prop up the business, Gartner claimed.

Given that HP has forced Intel to offer it comparable pricing to Dell, Intel is unlikely to continue to subsidise Apple, the analyst argues. "As a result of permanently changed market conditions, Intel has been forced to restructure and, in our opinion, cannot go on supporting Apple (or any other customer) indefinitely."

Whether Apple's Steve Jobs would sanction any of the suggestions made by Gartner is hard to gauge. However, comments made by the Apple chief executive in April this year suggest that he is not unduly worried by his company's limited share of the PC market.

"One of the nice things about having four or five percent market share is you don't really care if [the PC] market is down," said Jobs speaking at Apple's annual shareholder meeting in April.


TOPICS: Business/Economy; Computers/Internet
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To: ThinkDifferent; Swordmaker; antiRepublicrat
Larger picture, still WIP
41 posted on 10/20/2006 4:28:52 PM PDT by Echo Talon
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To: Echo Talon
have fun changing the processor in the Mac Pro. :)

Have fun changing the processor in the Dell, as neither are meant to be hobby machines.

BTW, I've had a lot of PCs, starting with a 486 OEM that through the years and several processors eventually became an Athlon frankenbox (the only thing original left was eventually the keyboard). I have never just switched a processor, as every upgrade came with a necessary mobo upgrade as well.

42 posted on 10/20/2006 5:03:39 PM PDT by antiRepublicrat
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To: antiRepublicrat
ave fun changing the processor in the Dell, as neither are meant to be hobby machines.

easy to do, its all open...

Im seriously thinking about upgrading this CPU(only) its a Athlon 3500+(single core) and I could put in a Athlon X2(Dual Core) for pretty cheep! wouldn't need anything else, the motherboard supports the dual core processor so... pop this one out and walla... dual core...

AMD Athlon 64 X2 4400+ Toledo 2.2GHz 2 x 1MB L2 Cache Socket 939 Dual Core Processor - OEM $198

I already have a nice aftermarket heatsink that wont be a problem.

43 posted on 10/20/2006 5:20:58 PM PDT by Echo Talon
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To: Anti-Bubba182
I do not know how many American workers would be involved

All of the design and engineering is done in the US, manufacturing in Asia. Jonathan Ives would be out of a job though, and it would be hard for him to find anywhere else interesting enough for him to work.

44 posted on 10/20/2006 6:18:35 PM PDT by antiRepublicrat
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To: Echo Talon
That it's a PC means nothing, but the guy has talent. Damn good, except I've never seen one with windows that clean and shiny -- and I've seen a lot of the 60 series.

Oh yes, I don't believe the Pave Hawk normally uses the minigun (although the Blackhawk does sometimes), and MEDEVAC helicopters (it's in the title) have big crosses on them and are not normally armed.

And in the end for a MEDEVAC, you'd think they'd use the UH-60Q MEDEVAC, and not an MH-60G or HH-60G Pave Hawk. But there are so many variations and off-type usage, you never know.

45 posted on 10/20/2006 6:37:50 PM PDT by antiRepublicrat
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To: Echo Talon
wouldn't need anything else, the motherboard supports the dual core processor so

Whenever I swapped it was generally in big leaps, which meant different sockets, including a switch from Intel to AMD. It also usually meant another video card since I went through VLB (remember that?), PCI, AGP and PCI-X. And memory, through FPM, EDO, SDRAM, DDR and DDR2.

46 posted on 10/20/2006 6:48:39 PM PDT by antiRepublicrat
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To: antiRepublicrat

yea, i got lucky... if i upgrade(just the cpu) i figure that i could stand this computer an extra year before a total upgrade. (doing that would be nice because by then i could possibly get the new robson tech with my next pc)[like end 2007 1st quarter 2008]


47 posted on 10/20/2006 6:53:37 PM PDT by Echo Talon
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To: antiRepublicrat
yea, I'm not sure about the model and what its supposed to be equipped with... but dang is that guy awesome... sheesh that thing had to take him a LONG time to make!
48 posted on 10/20/2006 6:56:17 PM PDT by Echo Talon
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To: Swordmaker

I'm not really an expert on computers, but I'm under the impression that Apple hardware is more reliable than Dell's. I'm planning to replace my old Dell with an Apple, but would certainly consider getting another Dell if I thought that the Apple was just a Dell anyway.

'Course there are other reasons than the hardware.


49 posted on 10/20/2006 7:12:29 PM PDT by Sam Cree (Don't mix alcopops and ufo's)
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To: Echo Talon
isn't Apple's motto "think different" thats seems to be lost in this crowd. :D you all have been brainwashed. :) iMac this iLife that iMovie the other thing... Jobs cares about ME, ME, ME... LOL

So your definition of "think different" is to join the crowd of lemmings running of the cliff in the Vista...

50 posted on 10/20/2006 10:49:10 PM PDT by Swordmaker (Remember, the proper pronunciation of IE is "AAAAIIIIIEEEEEEE!)
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To: Swordmaker
So your definition of "think different" is to join the crowd of lemmings running of the cliff in the Vista...

LOL! yea, like it doesn't get its share of bashing.

51 posted on 10/21/2006 11:16:59 AM PDT by Echo Talon
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