PC vendors kill Macs on volume, but their margins are a fraction of Apple’s. Those margins mean Apple can offer excellent Mac support while spending spending billions developing game-changing features.
Now that Apple is migrating to Apple Silicon Macs (ASMacs), those advantages grow. Apple’s been selling as many CPUs as Intel – once the pacesetter for semiconductors – for the last several years, and now their foundry, TSMC, is two generations ahead.
Apple’s ASMac strategy
More transistors are nice, but matters is what those extra transistors do. Essentially, Apple embeds application specific co-processors to accelerate common workloads.
Apple embeds high-performance video, audio, camera, and machine learning co-processors. They also throw transistors at system level features that benefit all users, such as power management, high-performance storage, secure enclave, high-performance and high-efficiency CPU cores, crypto acceleration, GPUs, and security.
These co-processors give Apple hero numbers that Wintel vendors will find hard to match, as current iPad Pros show. Given Intel’s broad market focus, the chances are slim that x86 CPUs will come to the rescue.
Marketing against a superior product
Now, the PCs strength in core markets means PC vendors don’t need to panic. Yet. It will take a good two years before the shape of the ASMac transition, and Apple’s backing strategy, becomes clear.
When facing a superior product, the classic response is to redefine the product, as Intel did against Motorola’s superior 6800/68000 processors back in the 1980s. Intel saw CPU architecture didn’t matter to end-users and focused on offering pre-sales and technical support to OEMs and developers. Motorola skimped on those niceties and got crushed.
PC marketing strategy
PC vendors will be playing defense. Here are their key plays.
Segmentation: Apple’s limited product line has gaps, so fill them. Offer specials such as gaming notebooks and desktops, Chromebooks, ruggedized notebooks, and modular systems, like HP’s Z series. Consider extreme configs like 11- or 19-inch displays, new colors, and specialty branding — like adding the corporate logo for large buys.
Exploit every gap. Stay close to government and education since they like cheap products, and their IT is trailing edge.
Support: The horizontal play is foremost. PC vendors can’t replicate Apple’s Genius Bars where even mighty Microsoft failed to make a dent. Applications drive PC demand, so ensure Wintel has the best development tools and support for software vendors. Consumers may like the App Store, but some developers don’t.
Then go vertical. Where the business can justify additional investment, such as video production, AEC, CAD/CAM, and biotech, invest more to support keep the PC’s lead. Apple’s dithering on Pro customers has cost it with creatives who love Apple but need to get work done.
FUD: PCs are fighting a rearguard action, like IBM with mainframes. You can’t afford Apple’s R&D. Intel can’t help. So Fear, Uncertainty, and Doubt are your friends.
Don’t let the Apple brand halo win the fight. Apple does make serious mistakes. The trashcan Mac Pro. The butterfly keyboard. Pro app delivery and feature deficits. “Do you want to be locked in when they screw up?”
Use Apple’s secrecy against them. For example, “Sure, ASMacs offer great numbers on H.265 encoding, but what about when a better codec arrives? Will they support that? With Apple you never know.”
A little uncertainty dampens a lot of enthusiasm.
The take
Wintel has inertia and their installed base on their side. But Apple is leveraging their iPhone and iPad base, which is a new kind of threat for Wintel.
There is a deep-pocketed PC vendor who could take on Apple, and even they may abandon the Wintel platform. More on that in my next column.
The good news? We, the consumers, are the real beneficiaries of a competitive market. The next decade will be the PC’s most exciting yet!
Comments welcome.
