Analysts: Will $999 MacBook have an impact?

Apple today finally broke the $1,000 barrier on MacBooks, yet it didn't break out a sub-$800 notebook or netbook. Will people forced into penny-pinching still be willing to pay what some call the "Apple tax?"

At a hyped-up Cupertino launch event today, Apple dashed the hopes of a lot of users, introducing the expected new models of its existing MacBooks, but not rolling out a rumored sub-$800 notebook or netbook.

With consumers starting to scrutinize their bank accounts and stock portfolios as holiday shopping looms, Apple took a small but positive step today in cutting the price on its lowest-end MacBook to $999, industry analysts told BetaNews. But with an Apple netbook no longer an immediate prospect, according to its own CEO today, analysts were somewhat divided over the competitive impact of Apple's generally higher-than-average price tags.


"Just getting below $1,000 should help Apple a bit," noted Rob Enderle, principal analyst at the Enderle Group, in an interview with BetaNews. "But Apple is still going to have the problem that their [notebooks] are more expensive than Windows laptops."

"Apple has traditionally held very high margins on its notebooks, especially on its [high-end MacBook] Airs," concurred Michael Cherry, lead analyst at Directions on Microsoft.

"This represents another stay-the-course, evolutionary announcement from Apple. Even at $999, the lowest priced MacBook still commands a visible premium over the middle of the Wintel notebook market," said Carmi Levy, senior vice president at AR Communications.

As might be anticipated -- especially in light of its anti-Vista ad campaign -- Apple leveraged its notebook launch as an opportunity to take sharp aim at Microsoft. Steve Jobs said that the thought of someone running Windows on a Mac literally sends shivers up his spine.

One out of every three dollars is spent on the Mac, because Apple offers "fuller featured systems," event attendees were told.

But with many people's retirement funds cut in half by the financial crisis in just a few weeks' time, and real estate values slashed 20 percent or more, are fuller features on MacBooks at the top of everyone's Christmas list?

Seemingly, new features such as Nvidia graphics and larger multi-touch trackpads with glass fronts might not be enough to act as deal makers for everyone, especially those who aren't already Mac users.

Cherry told BetaNews that, even before the economic disaster of the past few weeks, he noticed trends among consumers toward cutting their expenditures on portable devices.

"There's been more of a tendency to think in terms of 'what's good enough.' And in looking at that, a lot of people are concluding that 'what's good enough' for them is something that will let their do their e-mail, browse the Web, and perform some light processing work," the analyst said.

On the Wintel side, gobs of vendors sell PCs with list prices -- or at least street prices -- below $600. At the same time, manufacturers such as Asus, Dell, Acer and others are producing Windows and Linux netbooks in the $300 to $400 bracket; and today, Samsung announced one at the $500 price point but with full features such as a high-capacity hard drive.

Meanwhile, many folks no longer feel a compunction to buy a new machine every year or two, according to Cherry. "People are extending the life of how long they keep a computer," he elaborated.

Cherry, however, pointed out that the Wintel crowd is feeling its own set of pressures during the current deep economic crunch.

Although Vista is Microsoft's "preferred operating system," Vista does best on high-end systems, and it's entirely absent from Windows netbooks, which run Windows XP instead, according to the lead analyst.

"You can find a machine where you will like the performance of Vista. But it will cost you a significant amount -- probably on the order of what a MacBook costs," he contended.

In a Q&A session at the end of today's Apple notebook launch, somebody popped the Mac netbook question. Netbooks are a "nascent market," reporters at the Mac event were told.

Some analysts, however, weren't all that surprised by the content of today's announcements. "Average transaction prices for typical [Mac] machines will always be higher than industry averages, which is precisely how Apple has always liked it," according to Levy.

"While the current market turmoil may drive small numbers of potential Mac buyers into the Wintel camp, Apple has never played to the price sensitive anyway. Its core market, which has always been willing to pay a bit more to be part of the Apple family, won't fundamentally change its behavior as a result of the economic turbulence we're seeing now," he predicted. "Apple may see flattened growth as a result of delayed purchasing decisions, but its long term strategy to maintain a consistently visible price premium for its Mac-branded offerings remains in place."

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