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"Growing disparity" in Mac vs PC pricing
Author: Gareth HalfacreePublished: 7th August 2008
Is the cachet of owning a nice, shiny Mac really worth a 62 percent jump in price over generic Wintel kit?
Joe Wilcox over at EWeek has posted an analysis of figures gathered by Stephen Baker of NPD Group during his investigation of the pricing disparity that exists between what I still mentally refer to as “IBM compatibles” (showing my age there) and Apple Macs. That a pricing disparity exists – and, furthermore, that it's definitely in favour or Apple's profit margins – won't come as any surprise, but the extent of the difference might.
According to NPD's research into the 'average' retail selling price of both Windows-based and Mac desktops, you'll pay around £500 more on average for a Mac compared to a Windows system. The difference in average price for laptops isn't quite so steep, but you're still looking at around a £400 premium for something from Cupertino.
Wilcox does make a good point in that the figures are somewhat skewed by the fact that Apple doesn't market any 'budget' systems – everything in the Apple Mac range excluding the Mac Mini, which sells poorly compared to its full-sized brethren, sells in the US for over $1,000 (around £500). By contrast, so-called Wintel desktops can practically be had by redeeming bottletops – so long as you're not fussy about performance.
However, it's not all about the figures – what matters is the bang you get for your buck, right? Well, according to Wilcox the news isn't so great there either – while the performance on both side of the coin used to be pretty much even, the scales have tipped dramatically in favour of Wintel. Wilcox says that while it used to be the case that “Macs and Windows PCs of similar price [had] hardware features [that] were about the same,” now “[the] situation has dramatically changed in the last six months, particularly the last three months.”
As an experiment, Wilcox priced up equivalent systems from Dell and Apple in order to see what the actual difference in price was, rather than a misleading difference in average selling price. Ending up with a mid-range iMac and an Inspiron 518 desktop system, the specs were as similar as possible – 2.4GHz processor, widescreen TFT, basic graphics, and so forth. While the iMac had the edge in extras with 802.11g WiFi and Bluetooth 2.1 included as standard alongside a larger 20” display to the Dell's 19”, the Dell certainly had the edge in specification: a Core 2 Quad compared to the weedier Core Duo in the iMac, 3GB of RAM compared to just 1GB, and a 500GB hard drive space compared to 250GB. Both systems came with the 'leading edge' OS from the respective companies – Windows Vista Home Premium in the case of the Dell and MacOS X 10.5 for the iMac.
The difference was plain to see - $1,199 for the iMac with its bells and whistles, but just $739 for the higher specification Dell. It's not the headline-grabbing $1,000 differential from the NPD data, but it's still a chunk of change – and all for wireless, Bluetooth, and an extra inch of screen.
As with anything, it's horses for courses – Mac fans will be quick to point out that the build quality is likely to be significantly higher for the iMac, and there's no denying that it's far more aesthetically pleasing. When you factor in that there are significantly more people singing Mac OS X's praises compared to Windows Vista, and perhaps the £230 difference doesn't seem so dramatic. It's still a big chunk of change, and with more people looking toward the grey-area solutions for running the real gem in the crown, MacOS X, on standard (and cheap) hardware it's a margin that Apple are going to be hard pushed to justify. Indeed, Wilcox concludes his article with the summation that “if Apple is going to continue its market share gains, or simply maintain that 8.5 percent U.S. share, prices must go down and configurations bulk up.”
Can anyone come up with a reasonable explanation for the Mac costing 62 percent more than its Dell equivalent – is the joy of MacOS X really worth so much, especially now the systems are based on the same off-the-shelf hardware as their Wintel competitors? Share your thoughts over in the forums.
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I got a OpenComputer, which is a third party mac from here: http://www.psystar.com/psystar_openmac_osx86_reinventing_the_wheel.html
the damn thing is cheater, faster and more flexible that apples kit and it works..... thank good for this as my system would of cost over £2000 in the shops, but only £750 from here.
remember, just because its a expensive and pretty doesn't make it better
Granted they are a stylish brand, but personally I'll go for function over corporate branding.
To each their own. It would be a boring world If we all bought the same things!
Apart from that no real surprises in the difference in prices
Its also impossible to buy a mid range PC equivalent unless you opt for an imac with a built in screen that you may not want, nor is it upgradable (GPU/CPU etc). The MacPro's are now priced to outrageous levels and are only really suitable for Business or Science people to buy unless you have money to burn.
The only area they are doing well on is their laptop line. Their macpro is still the daddy of pro laptops in my opinion.
I think Apple has lost their way with the desktop computer options. Its like they have been too focussed on the Jesus phone, apple TV's and ipods.... whilst neglecting their core desktop line because their analysts told them that portable sales would rocket and desktop sales would plummet.
As for the price differences... I think in part it can be justified by the software (iLife) that you get with your mac. The imovie/idvd stuff really adds value to the mac line if thats your thing, and nothing that ships with vista compares to the ilife suite.
Someone like Alienware also charge a premium for their stuff too, and yet you don't see articles like this on them, and they ship the same Wintel config that Apple are being compared to here. I suppose the reason is that Apple still see themselves as something of a boutique company and price accordingly, whereas articles like this are assuming them to be fairly mainstream company, which is not too unfair either of course as they are fairly common these days...
What odd wording
Americans
The future money is going to be in digital distribution, content and services. With iTunes moving forward as it is and now the mobileme platform Apple are carving out a very lucrative Business.
Never owned a Mac but will purchase one and an iPhone after release of next MacOSX.
and you can't compare an imac with a normal case. it uses hardware specifically projected not bulk atx motherboard and standard components.
and OSX is great.
apple decided to go for a non-standard layout which costs them more but thats their problem not ours
anyway, i dunno if its changed but the price difference between apple/dell used to be a lot bigger in the UK than in the US too (apple markup over the dollar price way more than dell do)
Yep, that is what I think! I would never buy an iMac, but the small MacBook is a notebook, I would buy. But currently I'm waiting for the iPhone. The T-Mobile shop here in Germany where I booked one only got one (single, uno, 1) white iPhone! And on the 22nd August Apple wants to sell the iPhone in 70 Countries? I hope I get my iPhone this year....
Of course it's clear that nobody in this thread is a business person that knows how to do a proper cost-benefit analysis, either. I won't bother going into it, as it tends to be wasted on people (myself from three years ago included) that only look at performance per dollar.
But def. agree, Apple's prices are getting ridiculous, and the "build quality" isn't that great. I know quite a few Mac owning friends who have major problems with their Macbook Pros and my roommate even sent his in 7 times for major repairs within 9 months, he recently demanded a refund for it though.
Only thing I like from Apple is the iPhone, and that's it. But I'm sure a cheaper and better alternative will soon become available.
I run four macs in my office, which require about 3 hours (for all four of them) of preventive maintenance per month - that's less than 40 hours of maintenance per year!
Besides, OSX is much sturdier than windows (I just had to reinstall Vista on my PC after SP1 thrashed the OS, I had an HP laptop that had windows reinstalled some 10 times in less than nine months!), which is very important on mission critical machines. Even in the event of a catastrophic system or hardware failure (my powermac G4 went through 5 hard drives), it is very easy to reinstall the OS without losing any applications, data, preferences or user accounts.
It is not without its faults, however. My macbook has a hideous intel GMA 950, upgradability is quite limited (on the macbook / macmini / imac you're limited to memory and hard drive upgrades, the mac pro / powermacs are more flexible - you can swap video cards, add PCI cards and in some instances even change the processor(s)).
As I see it, macs are great for work - particularly in the fields of architecture, advertising, graphics and media design. PCs are far superior for gaming and entertainment, but I wouldnt trust them with any critical data.
But being a multi-platform user (OSX, linux, xp, vista) has made me less of a bigot, so I find these heated debates on the superiority of either PC or mac very tiring. We could also argue that any self-built PC is far superior to a Dell or HP or Acer or whatever.
Be sure to know your needs and desires, and do not expect a machine to do what it is not meant to.
I always like to point people to this picture when they compare a dell box to the iMac.
If you want to compare a Dell to a iMac, pick the Dell XPS One, then you will see that the iMac isn't that expensive in comparison.
want me to pay £199 + contract for iPhone 3G? NEVER!
for Apple computers, as people said, it's because of the branding. the hardware is P.O.S. to be honest, but the software is pretty good, with full driver support all round.
i personally would prefer doing research on hardware, then buy Hackintosh compatible hardware to have an Hackintosh with Leo4All install on it. (was going to try to install Leo4All until i accedentally made by 500GB into Dynamic volume by Vista)
Same thing with iPods.
What's more interesting to me than the fact that they're overpriced (well, duh) is their greater popularity in the US. Certainly this is somewhat due to the greater disposable income there, and the fact that they're not quite so badly overpriced, but it's always surprising to my American friends that I don't own a mac nor do I know anyone who does. Any American will, if he doesn't have one himself, know someone who does. People in the US just don't seem to get how unpopular Apple are here because they're so painfully expensive.
P
Hardly a fair comparison in that pic - the XPS allows you to change everything, not everyone wants a one-size-fits-all enforced scheme. You won't see people whipping the Mac open and slotting a new graphics card in when it's outdated in 12 months, which you will with the XPS.
That, and that cable management is dogshit. I'm sure most of us can have a desk looking much neater than that pretty simply. Besides, what does it really matter? You set a PC/Mac up, set the cables how they should be and that's it, you don't need to touch them again for ages. If you're that anal about not seeing the cables then you've got problems.
Oh, and the whole point of the article is a spec-to-spec comparison between Macs and PC's. Comparing those two is ridiculous.
Macs have their place, as do PC's. Macs are (imho) still overpriced. When they have a hardware refresh with new tech they're pretty competitively priced, but then it doesn't change for a year, leaving you with a hefty bill. Dell are constantly updating their prices and refreshing lineups.
so there
If I had charged for my time, the PC would have cost much more than a comparable Mac. Of course, your mileage may vary, but that was my experience.
-monkey
apple is hardly the only company that makes something that looks better than the avg dell box. sony's lt for example linky. mac mini? nothing unique either, aopen minipc, linky.
Where the ripping off gets even worse is ram, seriously, apple charges 400$ for 4GB DDR2 6400 and what they sell you is what is referred to as stay away from value stuff. Kingston Value Ram 4GB DDR2 6400 costs 76.99$ at newegg. 76.99 ->400$, thats what I call markup and there is no fancy looking case involved.
indeed. i'm more than happy to pay the premium for what i perceive to be a better product for my needs. i don't really care if the cpu is 6 months old... in fact i'd have to check the spec of my macbook to tell you exactly what's in it
I call the comparison in the research flawed because they compare a regular Dell with aniMac which is an all-in-one and not both companies all-in-ones like the iMac and XPS One, if you do that comparison the iMac gives you more spec for your money than the XPS One, Dells matching computer.
The AOpen MiniPC isn't bad either but the Mac mini haven't been updated in over a year and as said before Macs are good value when they are updated but the further you go between updates the more they lose in value.
I'm aware that Apple rips of people in the case of ram and it's kinda sad but most big companies charge a lot for ram so its hardly surprising. Also, you are only two screws away from changing the ram in an iMac so it's not exactly hard to do yourself even if you don't know anything about computers.
what's the point of adding RAM yourself? why not just buy a cheap local shop built computer, and put Hackintosh on it?
I use my PC for gaming and Music organization. I have not ever, in all my computing experiences, had a windows based computer not give me some kind of burp or strange issue every once in a while.
Build quality is very inportant to Mac, and in my experiences it shows. They are still a little over priced though, I agree with you there.
How many non-Apple apps, drivers, add-ons, etc do you use on your Mac? How many non-Microsoft do you use on Windows?
Mac comic strip (NSFW language)
I'm sure that Apple is already starting to feel the squeeze... our economy is "entering" a recession (I think it already is in one). The housing market's bubble has burst, and people are getting less hours at work. Gas prices continue to rise, and many people are feeling the same squeeze that europe and other countries have felt for years and years. Folks that used to take their $50,000 dualie trucks out with their $50,000 toy haulers loaded with $20,000 of dirtbikes (all purchased on credit of course ) out for a 7 hour drive across state lines... now don't even have the money to drive to work.
Combine that with a increasingly stupid and worthless youth- my county's high school dropout rate is 54%, the state (California) average is somewhere around 30%. High school isn't even that hard here... it's a joke compared to other countries (I've got relatives in Scotland and Germany; I've seen their classwork loads). It's recipie for national economic disaster... everyone is spending money, but nobody is making it.
I truly hate companies like Apple... they force this sense of "entitlement to be entertained" onto the American populus, and now the country is entertaining itself to death. In fact, that seems to be the only thing that anyone, especially youth, are good at here nowadays... being entertained.
/rant
Anyways, on topic, my coworker spent every penny of his savings to get an iPhone, and then ended up having to take out a loan from my boss to get dental work done when he got a bad cavity. That's how in touch people are in America with their spending, and that is why Apple continues to charge the prices that they charge. It's just plain sad. I'm ashamed.
(sorry for all of the rolleyes, I feel they are warranted)
Its just a case of if you want it you will pay for it, Jaguar X Type owners know that, the rest buy a Mondeo.
People need to stop pointing it out for the sake of a bit of website traffic, you dont get car magazines bitching about it afterall :p
At the net price it was worth it. If I hadn't had the free printer to sell to recoup some costs, then I probably would have bought a Dell laptop for about the same $1300 range instead.
I'll debate this one a bit. All the extra stuff on a Windows machine has to be stripped of (generally accepted attitude) however what about all the extra stuff from Apple? Do your parents need a video editor? chat software? etc. In theory you could also spend a lot of time stripping a Mac back down to just a core OS too if, like with Windows, you choose to not use or keep the "extra stuff" on there. I can't say why but for some reason most Mac users don't normally consider removing the fluff stuff like Windows users do.
All of that extra stuff in OS X does not run on start up or clog the system up if you don't use it. Plus, if you want to remove it, it takes about 5 seconds to drag a few files into the trash :)
...I kid I kid.
Apple has ventured in to the land of "trendy" and like all things trendy will eventually become "untrendy" and "embarassing". It's just a matter of time.
that being said you have to evaluate their individual uses, for example I would not reccommend a mac to my mother because besides her having to learn a new OS for her needs there's no low priced alternative for her.
obviously gaming is a big push over to PC.
Enterprise software is another issue when we start talking about proffessional content creation, video, sound, pictures etc.
I work in an engineering firm and we are all PC, I'm not sure if you can get all of the major cad programs and minor industry specific ones on mac's.
If I had enough money to build a digital audio workstation just for creating electronica (my hobby) then I would consider mac, but that would lock me into so many hardware and software choices. The other thing about pc is upgradability, I have parts in my pc I've been using for 3-5 years (sound card, hdd's) my next upgrade will be new mobo, new cpu and new ram, and it won't even cost me $500. I have a continual upgrade path and I've never had to buy a whole pc at once in 8 years.
but it's all personal, if I was doing graphic design for a living just using photoshop etc Mac all the way
Whilst it's very east to tot up some price comparisons, it's not really that relevant. It only serves as ammunition in the great forum war that is often fought between Mac and PC.
To me, if I need a new computer some time in the future, I'll most likely buy a mac, because I like them. Cost isn't a huge issue for something that you use every day, and I think the premium is worth paying for.
PC fanboys, feel free to read that as "I will just pay through the nose for inferior hardware cos uncle Steve says so", if that makes you feel good about yourself.
But hey sometimes 60%+ extra is worth it if you really never want to have a virus, play a game, or god forbid you try to use a file from a windows based system (luckily files from windows computers are rare it is not like most computers in the world use that system or anything)
Obviously I am not bringing vista into this but I will say that in the days of Windows ME it is not like that fail made macs better...
I would also like to point out that even though the hardware will always be different b/c of the mac os is not the point the same. All the os is supposed to be is more like a platform for the operation of the computer. What is it that I need a mac for that a pc just can never do. It is like getting a car, if I am just trying to drive somewhere then why not get the one that really is the fastest or the best buy, if I need it to tow something I can put my own hitch on I do not need one stock.
-monkey