Apple Seeks to Reclaim Lost PC Market Share With New Macs

EghtesadOnline: Apple Inc. unveiled new Mac computers as it seeks to revitalize a product line that co-founder Steve Jobs once said would be rendered redundant by the iPad.

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28 October 2016

Overhauled MacBook Pro laptops and a new computer monitor were presented in a press conference at Apple’s Cupertino, California, headquarters. While laptops are traditionally more profitable for Apple than the iPad, customers often spend more on films, music and apps with the iPad, making it a long-term moneymaker. The new MacBook Pro has a Touch ID fingerprint scanner which makes it easier to buy online using the Apple Pay payments system.

Jobs heralded tablets as laptop replacements by calling the iPad a “post-PC” device after it launched in 2010. But products like the MacBook Pro have shown surprising resilience. While Mac revenue has fallen from its 2015 peak, the decline in iPad sales has been more precipitous and the laptop now outsells the tablet. Chief Executive Officer Tim Cook has meanwhile sought to expand services revenue from the App Store, iTunes and iCloud to offset slowing hardware sales, reports Bloomberg.

The new version of the MacBook Pro comes with either a 13-inch or 15-inch display. The new laptops are lighter, thinner and narrower than their predecessors, and include larger trackpads and faster chips.

The highlight was a new digital function display at the top of the keyboard called the Touch Bar, replacing physical buttons. The thin organic light-emitting diode screen allows functions to change based on the application currently in use. Prices start at $1,499 for a 13-inch version without the new Touch Bar. The 15-inch one starts at $2,399, Apple said.

“While we don’t expect the updates to meaningfully move the needle, we believe this should return the Mac segment to growth in the near term,” Minneapolis-based Piper Jaffray analyst Gene Munster said in a note to clients, reiterating his overweight rating.

Apple also announced a 5K monitor developed with LG Electronics Inc. that connects to the new MacBook Pro, and a new TV app.

Apple last released new laptop computers in the middle of 2015, and has gradually lost customers in the intervening period. The iPhone maker’s personal computing market share fell to 7.4 percent in the three months through September, down from 8.1 percent a year earlier, researcher IDC said this month.

“Apple is going to be able to regain some of the market share that they’ve lost in the higher end notebook market because so many of their products have got so long in the tooth,” Shannon Cross, an analyst at Cross Research, said before the event.

Apple shares slipped about 1 percent to $114.48 at the close in New York. The stock had jumped about 20 percent in the past three months on hope for strong sales of the new iPhone 7. After a cautious holiday forecast earlier this week from the company, the shares have given up some of those gains.

If Apple is able to sell more services through Macs, they can become far more profitable than iPads, Needham & Co. analyst Laura Martin said before the product launch. “Then you really do want to sell more Macs, because it’s not only a higher upfront fee but then if you can get the same services revenue that’s a more powerful growth engine.”

The Mac’s average selling price is almost $800 more than the iPad, according to data compiled by Bloomberg, and Apple got 11 percent of its $216 billion annual revenue from the computer, with the iPhone accounting for most of the rest.

Siri, introduced to the Mac operating system in September, could also help guarantee a cut of revenue from taxis, meals and other services ordered with the virtual assistant via computers. Siri can be activated more easily using the new Touch Bar.