Apples and Advice

Friday evening, Britt and I were in Tulsa celebrating her birthday when we stumbled onto a rare occurrence. As we walked on the lower level of Woodland Hills Mall (the monstrosity that started the mess that has become 71st & Memorial in Tulsa) I saw a store with a crowd outside. I could see on the wall inside a picture (or maybe it was a huge video screen) of an iPhone. I immediately thought, "Oh, AT&T has a store in here and people are buying iPhones." Wrong.

It turns out that Tulsa now has its own Apple Store. I really figured that only North Dakota and Montana would come after Oklahoma in getting one (or more) of these stores (and maybe they did, I haven't checked to see where they are and are not located at this point). We figured out that they were handing out free t-shirts at the door, so we wandered through the rope & stanchion and into the store. It was almost like I would imagine the experience of being a tiny person walking into the guts of a MacBook or something. The store itself was very cool, I will admit I was impressed.

We looked around for a while, took our shirts and went on our way. I did stop to ask one of the guys in black shirts (not a genius mind you, or at least his shirt didn't say he was a genius, if only everyones shirt identified their IQ) how long the store had been there. He said, "Well, since 6 this evening." The grand opening of the store had been set to coincide with the launch of the iPhone. Not a bad move. The crowd was large enough they needed police (yes, actual TPD) outside to hold people out until some of the ones inside left.

This experience, coupled with a few conversations with my wife, left me with a couple of thoughts. Two things first. My wife is already posturing to make our next home computer purchase a Mac. And I am a PC guy, matter of fact, I'm a Dell guy (I have a lot of respect for the way Dell redefined the computer buying process in the 90's and I've had good experiences with their products and service).

1. Anyone in the PC world that doesn't think Apple means business is smoking crack.

2. Apple's stuff is cooler than PC's stuff. (Yeah, I know, this one's a no brainer)

3. Apple machines now run Office (and have for a few years now). This change in the super-structure of the computer world (or computer-land as my friend Robin would say) was less publicized than when Mac's started running Windows. To me Office is way more important than Windows in this equation, read on. This matters because at one time the inability of Apple machines to run Office applications was a big barrier for businesses (and I mean those not in niche industries like design, audio, and film) to switch over. The whole world (like it or not) operates on MS Office, so to convert a corporation (take GE or GM or any other mega-corp you like or hate) to a platform that can't talk to the rest of the world would have been crazy. Those days are gone. The only drawback I see today with using Office on a Mac is the lack of a right mouse button (which is a big part of how I operate Excel, yes I know they have shortcuts, I don't care, I want a freaking right mouse button).

4. Price is the only thing that stands in the way of even corporate America heading down the Mac road (in my opinion). I do think Mac pricing has become more reasonable and competitive with PC pricing. But here's the deal. For the most part, when corporations need to buy 1000 laptops for their sales people or whatever, they are not concerned with whether they have 15 cool applications that will do everything from video or audio editing (I'm told Leopard will have iDVD standard) to I don't know, whatever other cool things Macs can do. They care about a functional machine that will run the software their people need to do their job and they care about price. That is why I think most companies who have no need for the specialized characteristics of a Mac machine are still choosing PC's.

5. Mac may not be taking over the world just yet, but they are going to take a bite out of the consumer computer market (they already have). With the usability of OSX and the affluence of the U.S. economy more and more people are opting for Mac products for their home. And for many of them this makes sense. Home users do want to be able to do things with photos they take, video they shoot, etc. and the Mac gives them this ability right out of the box.

So, as a devoted PC guy, here is my advice for PC makers.

Reinvent yourselves. You're going to have to do something to change the paradigm. The monopoly you built has been breached and if you choose to do nothing Mac will just continue to eat away at your market share until you're where they were 10 years ago.

Quit thinking that you can offer people sub par crap and they'll keep coming back for more. Yes, I know that margins are tight. But you need to catch on to the value proposition. Mac maintains its margins much better than most PC makers because they provide perceived value to the customer (by packaging applications the customer wants with the machine, no extra purchase or installation required and the applications run very efficiently on the machine). You may have to invest in some programmers and developers to come up with applications that are as user-friendly and beneficial as those Mac offers in order to keep your machines from being such commodities that you eventually have no margin on them at all.

Pray that Steve Jobs really is the creative genius behind all of this. Follow me here. If it's really all about Steve (and I've posted about this before) then when Steve is gone (and I'm sorry Apple fans, he's not going to live forever) Apple will struggle to maintain focus and direction. I see this as a key weakness for this company - it's too dependent on a single leadership figure for all ideas to continue its rise when he steps away. Apple is not the only maker to have this problem - don't forget Michael Dell had to step back in to lead his company because it began to flounder when he stepped away.

That's my take.