Apple Intel and Increased Market Share

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Jan
11

By: switchtoamac at: 5:52 PM on January 11, 2006 | Comments (0)

Why did Apple move to Intel processors?  We've all heard the "Performance per Watt" argument presented by Steve Jobs and other Apple executives.  Although true, the reason to go with Intel reaches far beyond performance metrics.
 
Apple's decision to use Intel microprocessors was a strategic decision to expand it's user base, to capitalize on notebook sales, and most importantly, to increase it's market share.  Over the past few years, Intel has focused on developing chips designed for notebook computers. Notebook sales have been outpacing desktop sales over the past few years and IBM's inability to deliver faster energy efficient G5 microprocessors drove Apple to Intel.

Apple will leverage the strong marketing power that Intel brings to the market.  The relationship between the two companies is off to a strong start as evidenced by the appearance of Intel CEO Paul Otellini at Macworld 2006.  Otellini joined Jobs to unveil the new Intel based Macs.  Previously, Otellini joined Jobs at Apple's World Wide Developers Conference in 2005 where the transition to Intel microprocessors was announced.  Furthermore, the latest Apple television advertisement contains a the following phrase:
"The Intel chip: for years, its been trapped inside PCs, inside dull little boxes, dutifully performing dull little tasks, when it could have been doing so much more. Starting today, the Intel chip wlll be set free and get to live life inside a Mac. Imagine the possibilities."
The release of this advertisement without objection from Intel demonstrates the strength of the Apple-Intel alliance.  The Intel homepage has a link to an area of their site titled, "New Generation of Intel-based Macs"core_duo

The new Macs, the iMac and MacBook Pro contain Intel's Core Duo microprocessors.  Apple maintained their stance that they would not prevent owners of the new systems from running Microsoft's Windows operating system.

Phil Schiller, Apple’s senior vice president of worldwide product marketing, stated that Apple will not sell or support Windows on Macs but the company would not prevent users from installing it.

The choice is now compelling for consumers, they can own a Mac capable of running both OS X and/or Windows.It's only a matter of time before owners develop a method to dual boot both operating systems on the new Macs.

Microsoft is at risk of loosing market share even though it plans to release Windows Vista by the end of this year.  Early builds of Vista demonstrate that Microsoft is copying features already available in OS X 10.4 Tiger.  Apple's next operating system, OS X 10.5 Leopard will likely be released by the end of the year giving Apple an even larger lead in features that today's consumers demand.

The new Macs will usher in a new wave of Switchers.  I predict that Apple will gain significant market share on a percentage basis in 2006 whereas Microsoft will see a slight decline.

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