TMO Reports - Piper Jaffray Calls Rumors of Sub-$500 Mac "Not Out of the Question" [UPDATED]
by , 6:30 PM EST, December 30th, 2004
Piper Jaffray analyst Gene Munster commented on rumors of a new, inexpensive iMac Thursday saying it is "not out of the question" for Apple to release such a product.
Various Mac rumor Web sites began to report on Wednesday news of a sub-$500 iMac Apple is expected to announce at Mac Expo in San Francisco. Reports said the new iMac will use a G4 processor at around 1.33Ghz in speed and come with a Combo drive, 256MB of memory, and a suite of software including iLife '05.
Mr. Munster commented he would view the introduction of a US$500 iMac "positively" and wrote that an inexpensive Mac "would appeal to many potential 'switchers' that would likely not make the move at a $1,299 price point, but would consider a $500 product."
His opinion is based on Piper Jaffray's belief that "Windows iPod owners and PC users irritated by security concerns," and "are more apt to buy a Mac now than in the recent past." According to Mr. Munster, Apple could capitalize on that with a low-end entry Mac.
If the rumors end up not being true, Piper Jaffray is keeping to its estimates that Windows-using iPod owners will Switch at a rate of 13%.
While several Wall Street analysts have made note of the iPod Halo Effect, Mr. Munster has been the most bullish on the note. His prognostications are based, in part, on a survey conducted by Piper Jaffray that found a high percentage of iPod users thinking positive thoughts about other Apple products, including the Mac.
Mr. Munster also went on record to say he expects Apple to sell 68.5 million songs through the iTunes Music Store during the December quarter, and that Apple will release a flash-based iPod, perhaps as early as January's Macworld San Francisco. He did not offer any opinion on when the company might release this supposed inexpensive Mac, but noted again in Thursday's client advisory that he expects Apple to make some new announcements at the show, and that the company has done so in the past.
Piper Jaffray has not changed its 12-month target for Apple, which is currently at $100, the highest of all Wall Street brokerages. Mr. Munster wrote simply that if the rumors are true, then it would accelerate the potential iPod Halo Effect, the school of thought that some Windows-using iPod owners will Switch to the Mac.
Apple's stock closed Thursday at $64.80, up 0.36, or 0.56%, on moderate volume.
If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.
A bargin PC is no bargin when it come with Windows and all of its Malware.
What good is cheap hardware when you have to buy a boat load of anti-ware and ongoing subscriptions to keep Windows from tanking? $
What good is a fast processor when your processor is bogged down run a load of anti-ware in the back ground, sucking the speed out of your cheap hardware. $
What good is cheap hardware when you get sub-par Windows multimedia software that makes you wish you had an iLife. $
You get what you pay for. The value of a cheap Mac box is in the software. Software that allows you to enjoy your digital life.
Apple should do it - if they can come up with something that looks good, offers reasonable performance, and costs <$500, not only would switchers snap them up, but corporations might take notice as well.
RE: Bookman's comments about corporations also possibly taking notice.
Unfortuntately, I don't think so. The corporate environment has too much investested in a vertically-integrated Windows environment, and you have big applications such as SAP that are web-based, but IIRC are not Platform-Agnostic: its got to be a Windows PC running IE becaue of Active X and similar nonsense.
Apple would need a major shift somewhere for Corporate to open their eyes.
And it probably has to be done on the software-supply side, such as by big iron type applications truely embracing platform-independent web interfaces.
Until then, they'll patch their security holes with more windows stuff.
Think Secret which first published the rumor says $500. AppleInsider claims it will be $600. The latter sound more reasonable to me. I suspect there will be alot of disappointed Apple fans in any event. They always are after a product introduction, expecting too much for too little.
Mr. Munster has been spot on with his "predictions" for the past few months. It should be noted that in October or thereabouts, he did go to Cupertino to meet with Apple execs..... so, he knows more then he's willing to say I'd bet. As far as the eMac being "the worst computer", that was the opinion of a writer at PC Magazine. One person, for crying out loud! The fact is that the eMac has always sold well, and I believe, was selling as good as the previous iMac (Sunflower). Anyway, the eMac has the same specs as an entry level Dell (actually it has a better video card). You don't hear PC writers complaining about the Dell. Neither is Dell, as those cheap boxes keep them in the high market share plateau. Dell has the lowest margins in the business.... and they only survive by selling a lot of systems. Any loss of market share can hurt them. HP has not been able to dent the Dell monopoly and Gateway is still struggling to get back to where they were 4 or 5 years ago. It's a tough business.
One last thing. Remember when Apple received a patent for a color morphing case? Perhaps this would be the product to incorporate it. 10 days and we'll know.
Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I agree 100%. I hope Apple is reading these comments. This would be a great move on their part and they would sell millions of these.
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I agree but I think it should also include built-in Airport and Bluetooth, as well as a wireless keyboard and mouse and an Airport base station. Do this and it's a guaranteed winner.
CloseViewName:Guest Fri Dec 31, 2004 11:36 amSubject:
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Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I think you probably meant a 200 GB (not MB) hard drive. I don't think MacOS X would even fit in 200 MB.
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I agree but I think it should also include built-in Airport and Bluetooth, as well as a wireless keyboard and mouse and an Airport base station. Do this and it's a guaranteed winner.
Wouldn't it be cool if they also included SCSI and serial ports!!! That would give people with older Macs incentive to upgrade to a newer system. My Quadra 800 is starting to show it's age!!
CloseViewName:Guest Fri Dec 31, 2004 11:45 amSubject:
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Guest wrote:
Quote
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I agree but I think it should also include built-in Airport and Bluetooth, as well as a wireless keyboard and mouse and an Airport base station. Do this and it's a guaranteed winner.
With the high cost of software, it would help out a lot of people if Apple bundled popular applications with the system such as MS Office, Illustrator, Photoshop, and Final Cut Pro. That would make a killer system.
RE: Apple needs a sub $500 Mac, but with more power
What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor. Better yet, just put a video port on an iPod and make it run OS X. Wow, I'm on a roll here! I can guarantee Apple's market share will surpass Microsoft in less than a year. I will personally buy five, just so I can have one in every room. Maybe I will buy another 10 just to give away to friends.
Unfortunately, it will be their last product before going out of business.
Get real! You can't wrap a $500 bill around every product you sell and expect to stay in business.
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
I agree but I think it should also include built-in Airport and Bluetooth, as well as a wireless keyboard and mouse and an Airport base station. Do this and it's a guaranteed winner.
With the high cost of software, it would help out a lot of people if Apple bundled popular applications with the system such as MS Office, Illustrator, Photoshop, and Final Cut Pro. That would make a killer system.
If Apple made buyers sign a contract for internet service from MSN or AOL, the ISP would kick in $300 - $400, and make these computers around $99. A system with all the specs listed above for $99 would be awesome. PCs couldn't compete. Apple's market share would skyrocket.
CloseViewName:Guest Fri Dec 31, 2004 11:57 amSubject:
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see3d wrote: What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor.
This is not really realistic since the G5 hasn't reached 3 GHZ yet and will likely be expensive when it is first launched. To make your idea realisitic, you would need a lower end G5, like 1.6 or 1.8 GHZ. Also, I think your size requirements are unrealistic. It would need to be at least the size of a hardback book to work.
see3d wrote: What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor.
This is not really realistic since the G5 hasn't reached 3 GHZ yet and will likely be expensive when it is first launched. To make your idea realisitic, you would need a lower end G5, like 1.6 or 1.8 GHZ. Also, I think your size requirements are unrealistic. It would need to be at least the size of a hardback book to work.
I think people here are starting to lose touch with reality. Based on this logic, Apple could start selling computers from vending machines (between the Snickers bars and the Skittles). Not likely.
> What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor.
>>This is not really realistic since the G5 hasn't reached 3 GHZ yet and will likely be expensive when it is first launched. To make your idea realisitic, you would need a lower end G5, like 1.6 or 1.8 GHZ. Also, I think your size requirements are unrealistic. It would need to be at least the size of a hardback book to work.
Does no one get that the first poster was being sarcastic/joking?
Guest wrote: > What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor.
>>This is not really realistic since the G5 hasn't reached 3 GHZ yet and will likely be expensive when it is first launched. To make your idea realisitic, you would need a lower end G5, like 1.6 or 1.8 GHZ. Also, I think your size requirements are unrealistic. It would need to be at least the size of a hardback book to work.
Does no one get that the first poster was being sarcastic/joking?
I think we in the Mac community have wanted this for so long that we will grasp at anything. A sub $500 Mac is long overdue, and exactly what Apple needs. Bleieve me, I have a college business degree and I know these things.
With Apple making in-roads in the server market with the XServe and with a new foot in the door in the consumer market with the iPod, the $500 iMac makes more sense now than ever before in Apple's history. Even with a ho-hum G4 under the hood the miniMac would drive sales of XServes as a client/server solution much like what Sun's entire business model is based on (only much more friendly). Remember that Oracle just certified 10g on Mac OS X. Plus, even if Apple is selling miniMacs at zero profit or even a loss, it will drive sales of the iPod in the consumer space. The limit of the G4 processor will prevent cannibalization of iMac sales in their traditional markets, and finally Apple is in a place (with iPod and Xserve profits) where it isn't totally relying on desktop and laptop profits. Looks to me like the planets are aligning for something BIG at Apple. Let's hope Steve doesn't disappoint.
CloseViewName:Guest Fri Dec 31, 2004 2:54 pmSubject:
Quote
Guest wrote: > What Apple really needs is a sub $100 3GHz G5 system with 2G ram and 200G hard drive --the size of a deck of cards with an optional $50 20" LCD monitor.
>>This is not really realistic since the G5 hasn't reached 3 GHZ yet and will likely be expensive when it is first launched. To make your idea realisitic, you would need a lower end G5, like 1.6 or 1.8 GHZ. Also, I think your size requirements are unrealistic. It would need to be at least the size of a hardback book to work.
Does no one get that the first poster was being sarcastic/joking?
I think maybe the second poster did. Maybe.
I'm hoping.
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough.
I think you guys are missing the point here ... If Apple introduces this $500 headless iMac, it will be to entice new users as an ENTRY LEVEL computer ... basically serving the same market as the $299 Dell specials. No, this won't be a machine for hard-core gamers, or high-end graphics renderers, or any sort of hard-core business users, any more than those folk would get by with a Dell equivalent.
However, a fast G4 will be more than enough for people who want to check e-mail and browse the web. It will run the whole iLife suite -- iTunes, iPhoto, iMovie, Garageband -- passably well enough for any home users who want to manage their music and photo collections and use the Music Store and try their hand at some quick movie and music creation. It will run AppleWorks or MS Office for folks with a business need. Home users and families and grandparents around the world will rejoice.
What's more, this is a manageable pricepoint -- think of it, cheaper than the most expensive iPod -- for current Windows PC users who want to 'test the waters' and see what these Macs are all about. For $500 they can hook up an old monitor and get a pretty good demonstration of what OS X and iLife apps are all about. I've seen PC users spend more than that on a video card. And then, when some of them realize how much they like the platform after all, their next computer may just be a G5 iMac or a G5 tower.
Quote
Guest wrote: It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
Sure, it would be nice to get all that for $300 as you say ... So would getting an 80GB iPod for $25 or a new BMW for $79.95. But Apple's in the business of making money, not offering charity to tech geeks. I think the system being suggested here is well worth their time, even at $500.
(Or look at it this way. Two years ago, a 1GHz G4 tower with 256M ram, Combo drive, 60GB drive, and USB/Firewire/Ethernet/Airport ready was introduced at a price of $1499. Now that's progress!)
Can Apple optimise the G4 system without resort to using a faster processor? For example, an increase in buss speeds on the logic board (notwithstanding Freescale's development of MP chips)?
$500 machine dual processor (X86 & G5) Tiger and Longhorn PCIX slots, FW1200, USB3, iLife05, bluetooth keyboard and mouse, but save on the RAM at 128 MB soldered and one slot for extra RAM
Is to not take care of your video hounds, your core gamers, or even your career freelancer. They would be meant to take of your grandma, who likes to email, surf, and scan an image every now and then.
MILLIONS of users spend hours doing the three activities listed above, and THAT'S IT... they don't program, they don't need Xpress or InDesign, they don't need all the stuff in photoshop, they don't need to stream music while rendering 3d images, they don't need any of that.
They want to get online, they want to email, and sometimes they want to share images. That's about it.
And for those of you who can't see the humor in the card deck sized 3Ghz mac, wow... take some drugs and remember how to laugh!
Guest wrote: Apple needs a sub $500 Mac (probably closer to $300) but in order to sell them in quantity, it needs to be powerful enough. It should come with a G5 processor at a minimum of 2.0 GHZ (even better - dual), at least 1 GB of RAM, a 200 MB hard drive, a Radeon 9600XT video card, and at least 3 PCI-X slots (or better - 5 of them). And if Apple throws in one of their low-end 20" LCD monitors, this would get PC switchers to come in by the droves. Anything less powerful or if Apple charges a higher price, and it's not worth their time.
Guys this is a joke. That should have been obvious right around the time you got to "even better - dual".
Any old quadra/ppc would be able to surf, email and scan...on that basis Apple could have flooded the market with cheap lo-tech, lo-spec boxes, years ago...
It doesnt answer the question as to why Apple would launch a new G4 product now if only to continue develop and refine the G4 lineage.
Anyhow, both Panther and Tiger need the power of G4 to support their GUI bells and whistles, as well as GarageBand and iTunes apps. Apple has always
been about creativity, ever since I can remember... so what's to stop all your grandmas and grandpas making heavy metal music and art movies? No more excuses now!
Anonymous wrote: ... Anyhow, both Panther and Tiger need the power of G4 to support their GUI bells and whistles, as well as GarageBand and iTunes apps. Apple has always been about creativity, ever since I can remember... so what's to stop all your grandmas and grandpas making heavy metal music and art movies? No more excuses now!
Agreed.
The primary target is the switchers who, after using iPod/iTunes, want to try out other applications in the iLife suite. Some of these switchers will end up buying iMacs and iBooks, a few will buy eMacs, PBs and PM. Some is hesitating because they already have a LCD monitor and very used to Windows keyboard and multi-buttons mouse. The headless Mac is targeted at this latter group.
The secondary target is those Windows users who are tired of the malwares situation and want to try out Mac but don't want to spend too much and just like above group has a LCD monitor/USB keyboard/USB multi-buttons mouse.
Though it is not targeted at current Mac and corporate users, it is an attractive buy as a second Mac or Windows box replacement.
It will not be marketed as a digital lifestyle/entertainment computer. iMac is already being marketed as such. It will be marketed as a switcher box sufficiently capable to run iLife, surf, email and perform occasional Office works via Apple Works. For this group, an utilitarian message is more appropriate than the cooler digital lifestyle/entertainment message.
Selling such a Mac stray from current Apple strategy but is a potentially rewarding move to exploit this window of opportunity created by the mega-hit iPod and malware-laden Windows platform. Take it now or regret later.
The eMac, which is a great machine at a great price, all they really need to do is improve the spec (better graphics card) and lower the price by $100 and thats your entry model. Listen if Apple are chasing the sub $500 dollars (tire kicking)pc crowd, then we should all be very worried as we may not have a company in a few years from now.
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