Business in Vancouver: News that works for you

    Apple's remarkable Macintosh may just wind up a victim of its own success at innovation

    by Alan Zisman (c) 1996 First published in Business in Vancouver ,  Issue #328  February 6, 1996 High Tech Office  column

    The vast majority of personal computers are members of that broad, ill-defined species, the PC, which is somehow related to IBM's original 1981 PC. But what about the rest? In particular, what about the 10 per cent or so that are Macs--Apple Macintoshes?

    Macs exist in a funny sort of limbo: many years, Apple Corporation ships more Macs than any other computer manufacturer, yet is considered a fringe manufacturer. Despite a reputation (based on reality) of being easier to use, easier to network, and easier to add hardware to, it remains unacceptable to most of the business community. Despite being the computing platform of choice in most schools and among graphics professionals, and despite having a strong range of word-processing, database, and spreadsheet software, it isn't accepted in most offices. And despite continuing to post strong sales of both desktop and notebook models, Apple Corp. is considered to be in trouble, and a possible candidate for buyout.

    Ironically, Apple's current problems have arisen at a time when it has closed the gap on much of what the business world has considered its main liabilities: the price gap between Macs and comparable PCs has shrunk, and with Apple's switch to models built around the PowerPC chip, new Macs run standard office software just as quickly as do PCs.

    Add the ability of Mac users to share data with PCs and even to write to PC floppy disks and interact with PC-based Novell networks, and you'd think they'd be able to build a stronger following in the business world.

    In some instances, they have. Business in Vancouver remains predominantly Mac-based, from the page designers' to the reporters' desktops. That's equally true of many companies involved in publishing. But take a look at Calgary-based TransCanada PipeLines--certainly not your stereotypical Mac shop. Macs were well-established there by 1986, and today there are 2,300. TransCanada PipeLines likes the fact that there's typically less user support needed, saving a bundle over the life of the machine.

    Computer analysts The Gartner Group have estimated the cost of ownership of a typical business personal computer. They suggest that a networked Windows 3.1-based PC, running an average of four applications, will cost an average of $41,000 over five years--much of this in unrecognized support costs. By comparison, an average Windows 95 machine will cost $35,859. But a Mac, running the latest System 7.5, comes in lowest of all at $35,124, with end user operating costs of about $3,400 per year.

    As these figures indicate, however, Windows 95 systems are approaching Macs in overall cost of operation, and in usability as well. And that's part of the problem for Apple. Claims that "Windows 95 = Macintosh 1987" don't matter to most users. They're more interested in what can they accomplish today. With its newly added long file names and hardware Plug 'n' Play (yes, available on Macs for a decade or more), Windows 95 has narrowed the usability gap. And with pre-emptive multitasking, Windows 95 gets a productivity edge on Copland, Apple's System 8 operating system, which might have it for some time next year.

    Apple has had other problems as well--paradoxically, often as a result of increased sales. Last year, it began seeking other manufacturers which wanted to make Mac clones, hoping to expand the user base. But shortages in vital computer chips have caused it to limit the number of clones that it will license.

    Similarly, shortages of popular PowerMac notebooks have kept sales restricted, and when they were forced to recall their flagship PowerMac model (the batteries started catching fire--including several in Apple's own offices), shipments were suspended.

    Sales are up, but profits are down. Part of the problem is that Apple nets a lot less with each low-priced model sold than it does with the high-end machines. It wants to focus on increasing sales of the more profitable models, but unless it builds its customer base, primarily through selling more low-profit, entry-level machines, it will continue to be perceived as a fringe platform.

    Apple has a fanatically loyal customer base, whose stability has been one of the company's strengths. But to the extent that Mac users are seen as a sort of cult group, it again becomes difficult to break into wider business circles.

    Apple and its Macintosh line have played an important role in the evolution of computers for business use, if only by providing an example of features that the Windows-using majority has tried to emulate. But while pioneering features that are increasingly taken for granted by computer users, Apple has remained outside the business mainstream. Rumours abound of Sony, Oracle, even IBM as prospective purchasers. Let's see if 1996 is the year that Apple finally becomes a victim of its own success in changing the way we all work with our computers.

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Alan Zisman is a Vancouver educator, writer, and computer specialist. He can be reached at E-mail Alan