Editorials @ Applelust

Apple's Post-Macworld Product Matrix: We're Cubed, and loving it!

Ten months ago, I penned a speculative article about the impact of the Cube fiasco on the Mac product matrix. It was titled "Why Lovers of New iMacs and iBooks Owe Thanks to the Cube's Failure". The title says it all: I reckoned that if the Cube had been a success, and had its portable counterpart appeared, today we wouldn't have a sunflower-like flat-panel iMac, or a beautiful, white iBook that looks less like a toilet seat and more like an awesome laptop.

Think about it, I argued: the Cube couldn't compete against the iMac today; and if there were an ultra-compact, exclusive notebook computer from Apple, where would today's ultra-compact iBook fit? As if I knew.

Incidentally, I also mentioned in that article that "Many people would like a sub-$2,000 notebook with uncrippled video output." Yet I was quite pessimistic, fearing that Apple would, after the failure of the Cube, revert to a two-by-two product matrix, and stay there. Well, I'm happy to report that the 2x2 matrix is a thing of the past; and the notebook that I dreamed of has appeared: it's the 12" PowerBook, which looks eerily similar to the iBook. Now, perhaps Apple wanted to release this laptop in the middle of the portable matrix, and the iBook was just a downgraded, plastic version? We won't know until Steve Jobs retires and publishes his account of the time spent at Apple. But it's interesting to note how Apple's product matrix has developed from a two-by-two square of 1999 to today's chaotic, yet much more pleasing shape.

Matrix History

Remember all the praise that some journalists heaped upon Steve Jobs in 1999 or so, for coming up with his simplified Mac product matrix? No more obscure, non-intuitive numbering schemes. No more overabundance of competing models. Actually, choosing your Mac boiled down to two questions: "consumer or pro," and "laptop or desktop." The naming scheme was there to help you, too: all you needed to do was to couple two prefixes ("i" or "Power") with the words "Book" or "Mac" to arrive at the actual product name itself. Okay, so there were two or three models belonging to each name, and colors too, but the pundits didn't seem to mind those minor annoyances. (However, I do remember some whining voices when the iMac started to ship with optical drive options. The horror! Consumers were now stricken with the stress and frustration that accompany the state of "Having A Choice.")

And when one fateful day Mr. Jobs attempted to expand the two-by-two product matrix to—three by two, all hell broke loose. Apple was doomed all over again, it started losing money, began to have inventory difficulties, and it was this close to reverting, in people's minds, to its good old beleaguered status, had the company not shifted gears and muscled itself back into profitability.

Yes, I'm talking about the Cube; the time Steve Jobs decreed that there shall be a category between "i" and "Power": a classy, hedonistic, decadent one, which isn't as powerful as the Power Mac or -Book, but its sacrifices in power and expandability are rewarded by gorgeous looks and stunning displays of gratuitous engineering brilliance. Here's a category for the rebels, for those who think different (remember that ancient Apple slogan?), for the cubic pegs in beige holes.

The Cube was still called a Power Mac. As it was weaker than the Power Mac Proper, it might have been marketed as a way to —save money, save power, save the environment. However, Jobs was so enamored of his cubic child —and his faith in consumer zeal was so corroborated by the unlikely success of an expensive yet useless chew toy called iMac from back in 1998 —that he would have had difficulties looking in the mirror had he tried to sell the Cube for cheap. Or for as much as it was worth. Or only 50% more. No; the Cube had to be ridiculously expensive, and that sole thing caused its demise.

"Cube owners love their Cubes, but most customers decided to buy our powerful Power Mac G4 minitowers instead," said Philip Schiller in the press release announcing the discontinuation of the Cube. In other words: professionals wouldn't switch to a new tool that did less for more. Puzzling, isn't it?

Or wait, maybe you are someone who thinks that there was something inherently wrong with the Cube? That it was a mistake to try selling to the middle ground? That Apple was right to abandon the Mysterious Sixth Mac (the Cube-Book), and revert back to a two-by-two matrix?

Then I challenge you to look at the product matrix today. On the desktop side, we have the G3 iMac, the G4 eMac, the G4 iMac (with two screen sizes, even), and the Power Mac. In laptops, there are two iBooks (a 12" and a 14" one), a 15.2" titanium PowerBook, and two new aluminum PowerBooks, with 12" and 17" screens. Oh, and there's the XServe, which is neither a desktop or a laptop, but a new category altogether.

Looking at prefixes, now we not only see "i" and "Power," but also "e" and "X." And as for the main words themselves, "Mac" and "Book" are accompanied by "serve." What will come of this? Will Apple release an eBook? Will it also weigh 50 pounds? How about an XBook, a rack-mounted, non-portable laptop that outshouts an airplane engine? Or the XMac? What if I want to buy an eserve, an iserve and a Powerserve? Where can I get them? Questions, questions.

Of course, this is all nonsense. Rather than arbitrary symmetries, it's real needs that shape the selection of models Apple offers today. Forget about understanding the Mac product matrix in three seconds. Apple is diversifying, and nothing should stop that trend—not even analysts' desperate need to count and categorize all Mac models on one hand.

Sure, a company with a market share as small as Apple's can't afford to fragment its own market with competing products. Apple always needs to be very careful when introducing new products, watching out that they don't cannibalize sales of existing ones. It always has to be subjected to careful analysis whether the release of a new product will attract new buyers, or it will simply affect people who were planning to buy something from Apple anyway. In the latter case, though, convincing a buyer to pick a pricier item (usually one with a higher profit margin) may also be beneficial for Apple, while the reverse may hurt the company badly. It isn't easy, for sure, to get it right.

The New Batch

The current diversification started when Apple released the new iMac, while also keeping its old, CRT-based predecessor. This was very likely due to the high price of the LCD models: they didn't make a good entry-level Mac at their initial price point. The flat-panel iMac started at $1,299, and even now, the cheapest model sells for $1,199—hardly comparable to the $799 G3 iMac that served as Apple's cheapest new model at one point.

Then came the eMac. Apple needed a machine for education in an attempt to match Dell's low-priced offerings, and a yesterday's model like the iMac wasn't good enough—thence its bulky mutation that was first offered for educational institutions only. Possibly, Apple later realized that price of the flat-panel iMac wasn't dropping as fast as planned, so releasing the eMac to the wide public would actually create new sales. Did it work? Well, according to Apple's Q1 figures, the company shipped 298,000 iMacs in that period—58,000 CRT, 106,000 eMacs, and 134,000 flat-panel G4s. Clearly, Apple is lumping eMac sales together with iMacs; and the flat-panel model accounts for less than 45% of all "iMac" sales.

Looks like there is a demand for the eMac, and also for the G3 iMac. Actually, in my view, the flat-panel iMac doesn't even belong to the low end of the late 2x2 product matrix—I think it's right in the middle. Yep, it's today's Cube. If you disagree, just think about it: Isn't this beautiful, stylish, and ultra-compact Mac, with pro-level features except for expandability, with its small footprint and symmetrical, non-computer-like shape and size—nothing but a rounded, re-thought, somewhat economized version of the Cube? The concept lives on. This time, however, Apple realized that price actually matters, and that people aren't going to choose style over substance. It's hard to imagine how Apple was able to architect the iMac into a $1,299 machine, including the flat panel, when the Cube was a $1,799 computer, without a display. Still, iMac sales apparently didn't live up to Apple's expectations, and thus the eMac was needed. Let's all be thankful for that heavyweight competitor: perhaps Apple would have pulled another Cube without it.

What About the Laptops?

Some people apparently don't get it. When rumors first appeared about a 14" iBook, many speculated about the discontinuation of the 12" model. Yeah, right: bigger is better—but laptops are one notable exception. No, when the 14" iBook was eventually released, Apple merely diversified its product line. The iBook has been a hit, perhaps even a too big one. Yes, cannibalism reared its ugly head: however much Apple tried to cripple the iBook with outrageous decisions (like shipping it with a 66 MHz system bus, or a ridiculous video card with even monitor spanning ripped out of it), as the product developed, it became more and more attractive for professionals like software developers. Many chose the iBook over a PowerBook because of the former's size, so the solution was straightforward: why not make an iBook-sized PowerBook? Finally, Apple seems to be doing the right thing: offering choices to customers. And while they're at it, how about a 17" PowerBook too? Apple just realized that size is just one factor of a laptop, and the need for a small one isn't the same as the need for a stupid one. I certainly hope that Apple didn't fumble its market research, and the five different laptop sizes will coexist very nicely.

One disturbing thing is the way the 15" PowerBook sticks out from the lineup like a sore thumb. It doesn't have Bluetooth, its AirPort is one generation behind, its antennas are admittedly worse than the iBook's and aren't where they are "meant to be" (Steve Jobs himself said so). All in all, the titanium-clad star of MWSF 2001 looks really long in the tooth these days. But don't worry: the only reason imaginable for such a discrepancy is that Apple wants to get rid of all the TiBooks already built before killing the model, and replacing it with a new member of the aluminum family. After all, Apple can't get away with selling 12" and 17" PowerBooks and nothing in between.

Will There Be an Xclient?

Product matrix simplicity freaks must have had nightmares when Xserve was announced. No "i"? No "Power"? Not even a "Mac"? Nevertheless, the Xserve was a must. When Apple has, through much pain and suffering, arrived at a point when it finally boasts a server-quality operating system, and is ready to take on the enterprise market (okay, "ready" and "take on" should not be taken literally), why should its efforts be quenched by the lack of server-quality hardware? The Xserve was part of a natural progression of events. While the few thousands of it sold may not help Apple's bottom line too much, the machine demonstrates, even today, that the company can provide a complete solution: an entire organization can run on Apple hardware, including the servers.

So how can Apple expand from here on? Higher-end, workstation-class machines are definitely on the way, but they don't really represent a mass market. Personally, I'd rather like to see Apple going towards the low end—leveraging its server product and embracing network computers. I think one way for Apple to diversify further and address the very cost-conscious corporate and educational markets would be by releasing a setup consisting of Xserves and thin clients: cheap, possibly even HD-less Macs that can only boot from the server.

If engineered and marketed successfully, such clients could sell for the fraction of a full-fledged desktop Mac—yet they wouldn't cannibalize any iMac or Power Mac sales, as nobody would buy a $4,000 Xserve and one "Xclient" for $500 instead of two desktops (or if someone did, Apple wouldn't mind much). But imagine setting up a corporate intranet of a hundred high-quality thin clients, running a mostly virus-free operating system, managed centrally from a user-friendly, GUI-based yet powerful server built on open-source UNIX foundations, with legendary ease of installation and maintenance! This would sound too good to be true to quite a few weary corporate and educational IT managers, who would perhaps consider adopting a completely Apple-based solution for the first time in their careers.

The technology to enable all this can't be too far away. After all, NetBoot already does part of the job: even the first demo of the Mac OS X server back in 1999 featured iMacs without hard disks booting (though not into OS X) from a NetBoot server, and playing the same QuickTime movie from the same server.

To conclude: I certainly hope that Apple will continue to diversify its products. When Macs came in only four shapes and sizes, it was considered a good thing mostly because people still remembered the hideous mess that the Mac product line once was—as well as the uncontrollable, unmanageable playground of managers with costly and useless pet projects that Apple once was. But an Apple that doesn't treat the customers with choices is a lean, mean, penny-pinching, cost-saving Apple; not the flamboyant innovator and crowd pleaser that we like. Let's hope Apple finds a way to satisfy the needs of as many users as possible, in a way that actually helps its bottom line.

- András Puiz

What do you think? Hash it in our forums...

MacBook Pro (5-17-06) Dr. Neale Monks. A subjective review of the MacBook Pro
Freeway 4 Pro (2-28-06) Dr. Neale Monks. Freeway Pro, the Quark-like web design program from Softpress, has been substantially revised and sports a bright new look. But do the changes go more than skin deep? Neale Monks finds out.
Astrostack (1-18-06) Dr. Neale Monks. Long respected as one best astronomical image processing applications about, in its newest incarnation AstroStack now runs on the Macintosh. Has the wait been worthwhile?
Virtual PC 7 (11-23-05) Dr. Neale Monks. Virtual PC 7 is the update to the venerable Windows emulator to be entirely all Microsoft’s own work. Can Mac users expect to see any dramatic changes?
Eudora Pro 6.2 (8-5-05) Dr. Neale Monks. Eudora has been one of the most popular e-mail clients for the Macintosh for more than a decade. Neale Monks finds out how it compares with the Mail application that comes with OS X
MacAstronomica (4-22-05) Dr. Neale Monks. How does this amateur naked eye astronomy software stack up?
iKey 2.0 (3-11-05) Jeremy Young. How well does this automation utility work? How much time will you save?
Wolfram Research Publicon (3-11-05) Jeff Terry Does this new scientific word processor live up to the potential?
Microsoft Office 2004, Part 3, Word (1-28-05) Dr. Neale Monks. Are there enough new features to necessitate a jump from v.X?
REALbasic 5.5 (12-03-04) Dr. Neale Monks. Neale takes a look at the latest version of this programming package.
Office 2004, Part 2, Excel and Entourage (11-05-04) Dr. Neale Monks. In the second part of his review of Office 2004, Neale Monks looks at Excel and Entourage.
Phone Valet 2.0 (11-05-04) Pat St-Arnaud. The best question to ask might be "Is there anything that you can't do with this telephone/Mac integration tool?"
TiPaint Touch-up Kit and iKlear iPod Cleaning Kit (10-29-04) Dr. Neale Monks. Is it possible to restore the shiny good looks of iPods and PowerBooks even after years of use? Neale Monks looks at two cleaning products designed especially for Apple hardware.
Microsoft Office 2004, Part 1, PowerPoint (10-15-04) Dr. Neale Monks. In the first part of his review of Office 2004, Neale Monks looks at PowerPoint, for many people still the benchmark for presentation software.
ScrapX (9-17-04) Dr. Neale Monks. Aqueous Software's ScrapX brings the Scrapbook to OS X
CDFinder (8-20-04) Dr. Neale Monks. Finding what you want from among a stack of similar looking CDs can be a hassle, but help is at hand. Neale Monks looks at CDFinder, a budget-priced but powerful cataloguing tool.
Endnote 7 (8-13-04) Dr. Markus Geisen. EndNote 7 is a literature database that seamlessly interacts with your word processor. Is the latest version worth the upgrade?