New MacBooks: the smart move

updated 10/14/2008, 11:58PM EDT.  Fixed typographical errors.

You already know that Apple is set to announce something notebook-related later today.  After all the leaked pictures and spy shots, it’s easy to say that this is a very anticipated event (and one that must be Apple’s worst-kept secret to date).  Personally, I have been waiting for this day for over a year.  Besides waiting to purchase a replacement for my late motherboard-gone-bad iBook G4, I think that new MacBooks will directly affect Apple’s success in the computer market.  Hit the “read more” link for… more.

As it stands today, Apple has a very simple notebook MacBook line-up.

MacBook 13″

MacBook Pro 15″

MacBook Pro 17″, as well as

the not-very-competitive MacBook Air (13″)

The Air doesn’t fit into any specific category because its purpose and form-factor have been overshadowed by the netbook/mini-notebook market in the PC segment: why spend $1800 on the Air when you can get something smaller, lighter, and more expandable for $450?  It’s not like you’re really buying the Air to edit video anyway.  Whatever the case may be, the simplicity of Apple’s notebook lineup is a benefit but also a curse.  Being overly simple, the current line-up limits its market appeal and potential.  How so?

As I’ve ranted about for years on in, the MacBook 13″ is not powerful enough and the 15″ Pro model is too powerful… for certain markets, that is.  There exists a substantial market for powerful 13″ notebooks (just look at Dell XPS 1330).  Unfortunately, the current MacBook 13″ does not fall into that category: lacking a dedicated GPU makes it simply that: lackluster (performance-wise).  As we (as a society) make the move to portable work solutions, the requirement to own a powerful and portable notebook becomes ever-important.  The 13″ form-factor is the perfect size for such powerful portability, as opposed to the slightly-too-big 15″.

On the opposite end of the spectrum, the 15″ MacBook Pro is too powerful.  Currently, it can only be purchased with a dedicated GPU.  Are there consumers who don’t need all that power but want the 15″ screen?  Plenty!  Just take a look at how many 15″ Inspirons Dell sells that don’t have a GPU!  And it’s easy to see why: the price of such a Dell machine in a 15″ form factor is about $1299.  Contrast that with the price of the base MacBook Pro 15″ – $1999.  Yes, you can argue that comparing Apple and Dell is like comparing Apples to oranges.  And it’s true: they go after different markets.  Apple has made the choice to compete in the high-margin, high-performance, low(er) volume segment.  Dell is a market-share whore, trying to attain the highest market share possible at the expense of sacrificing prices and turning itself and its products into commodities (boxes that run Windows).  But that’s not the point.  The point is that Apple can do better by changing its marketing strategy.  The solution is very simple: give people choices, and they will buy from you.

1) Apple already owns the far-superior OS X – and that’s what switchers are looking at the most when going to the Mac.  It’s a competitive advantage that other PC makers simply can’t achieve, making it a flat-out barrier to entry.

2) Apple knows its buyers: the video/audio/photo/web-design professionals buy the highest-end Apple gear and will continue to do so.

3) New users are turned away by the huge price tags.  As I explained above, the only way a potential buyer can enter the 15″ Mac market is to spend $2000 on the MacBook Pro for power he doesn’t even need.

4) By selling on education rather than ignorance, Apple will provide greater satisfaction.  This is Apple’s strong point, as they’ve been trying to make the consumer more educated in the choosing the Mac.

5) Greater market share is always good.  The key is to keep with the greater value-adding Apple is known to do: great design, great usability, all tightly integrated into one package.  Don’t become Dell, but strive to gain a bigger piece of the notebook computer pie.  More Macs being used in public (they are portable, after all), builds more confidence for those who have not yet made the switch.

Keeping these key guidelines in mind, I think that the key differentiator in the new notebook range will be the GPU (along with the obvious releases like the amount of RAM, hard drive size, and processor speed/cache/FSB speed).  Here’s what I think Apple’s new notebook offerings will consist of: every notebook, regardless of screen size, will have a “regular” and a “Pro” version.  This means that the lineup will be called “MacBook,” will untie screen size from performance, and will consist of:

• 13″ MacBook
• 13″ MacBook Pro
• 15″ MacBook
• 15″ MacBook Pro
• 17″ MacBook Pro (the demand for 17″ notebooks is dwindling).

• The “regular” (non-Pro) models will run on lower-end (slower) hardware, not have dedicated graphics cards, and will have less ports than their Pro brethren.  Perhaps they can be a little thinner because of the lack of a GPU and certain ports.  Obviously, they will cost less than the Pro versions – starting at about $1000.
• The “Pro” models will include the highest-end hardware inside with super-duper powerful GPUs, a plethora of ports, and the latest gadgetry.  ExpressCard, FireWire, eSATA, and wireless USB are standard.  Prices are higher on these models, being around the $2000 range.
• The 17″ MacBook should stay as a Pro model only, as I don’t believe there is a high-enough demand for these gargantuan notebooks when not configured to great extremes.
• Obviously, the MacBook Air does not fit into any of these categories: it’s the slowest, thinnest, lightest Mac.  The geniuses at Apple need to run the numbers to see if it’s worth keeping around or scrapping the entire project and introducing a lower-cost netbook (ala Dell mini studio 9- just a bit more usable and expensive).  They can even forgo the netbook as we know it and build a larger version iPod touch for this market segment.  But this is an entirely different bowl of soup.

By segmenting the notebook line-up in this way, Apple will undoubtedly achieve the five goals I set out above.  In fact, the company can achieve them with flying colors.  Apple retains the simple line-up and pricing structures along with the higher margins they’re known for, and consumers purchase only what they need.  I’ve seen so many people purchase the current 15″ MacBook Pro just because they wanted the screen real estate the 15″ offered (the 13″ was too small) but didn’t need (in their life!) all the power the notebook comes with (if you like it or not!).  It’s funny seeing Apple lock people into an up-sell based on lack of education, since that’s what sells the 15″ Pro to soccer moms.  At the risk of offering a car analogy on a tech site, it’s like shopping for a Honda Civic, finding out it’s a little too small for your taste, and the only bigger vehicle in the line-up is the Hummer H1.

As for the rumor-mill: as we get closer to the scheduled event (12 minutes as of this writing), more and more pictures and details surface.  I believe that this picture is in fact of the lower-end “regular” MacBook 15″: fewer ports is all we can see right now, but it’s a start.  Moreover, the statement by Peter Oppenheimer (during a financial results call) regarding a major product transition can be simply what I have just described: they will split the line-up into Pro and “regular” models and see more customers going for the regular models, thus seeing a dip in revenue – something they plan on making up in the long run with increased volume.

Posted in Apple, Business, Decisions, Mac, Marketing