Analyzing the MacBook's Importance to Apple

by , 2:55 PM EDT, October 13th, 2008

Macintosh sales have become a much larger share of Apple's revenues since 2006 when the iPod dominated. Moreover, the notebook sales have surged from just above half to almost two-thirds of all Mac sales. That's making the MacBook Apple's most important product, according to Philip Elmer-DeWitt in at Fortune on Monday.

As late as 2006, Apple earned more revenue from its iPods than the entire Mac line, but that's changed in 2008, the author noted. Telling and informative pie charts were included to emphasize the point. "Apple's notebook computers have been its main source of revenue for some time now, and if Apple plays its cards right, they are likely to remain so for the foreseeable future," Mr. Elmer-DeWitt noted.

Even more notable is a recent analysis by Sanford Bernstein's Toni Sacconaghi that while Apple only has 8.4 percent of the U.S. market, it commands about a third of the high end notebook market.

Possible price cuts on Tuesday to the MacBook line could further enhance that number, and, according to Mr. Sacconaghi, the $799 price for a MacBook would do a much better job than $899 in expanding the Addressable market.

The notebook market, TMO notes, is a long war and is based on warfare principles. Looking at the overall growth of Apple's U.S. and worldwide market share may lull some into complacence, but if Apple were to, for example, seize and control dominant market share in one piece of the notebook market, other pieces could start to crumble in a domino effect. The result would be a non-linear growth in Apple market share that could take the competition by surprise.