When Apple first released the eMac on April 29, the company offered the new CRT all-in-one computer exclusively for the education market. The features of the old iMac style computer combined with a G4 processor and 17-inch screen left Apple’s retail customers clamoring for a way to purchase the machine themselves.
The eMac for consumers
Yesterday, Apple answered those calls and released the eMac to the consumer market. The release of the eMac puts another box in Apple’s growing product matrix that Apple CEO Steve Jobs shows off during his keynote addresses at Macworld Expos. Analysts don’t see the once streamlined, but expanding grid as a big problem for Apple.
“There will clearly be some confusion at first, but as I understand it the retailers were really hot on the eMac because of the bigger screens,” Tim Bajarin, an analyst and president of Creative Strategies, told MacCentral. “What it really does is give people the option to go from the 15-inch to the 17-inch. I think in the end, it’s a win/win for Apple and the consumers.”
Not only does it give Apple a 17-inch CRT model to sell to consumers, it solves another problem introduced with the flat panel iMac — price point. An entry level iMac sells for US$1399 from the Apple Store, while the eMac retails for $1099 — quite a difference for cost conscious consumers in this economy.
“I think Apple needed a lower entry point in retail and the eMac gives Apple that opportunity,” said Charles Smulders, an analyst with research firm Gartner Inc.
In addition, if the eMac turns into a high-volume seller it could have a more positive affect on Apple’s quarterly financial statement than the iMac because of the lower cost CRT display. “With CRTs being cheaper the eMac is a smart business opportunity,” said Smulders.
Cost is something that Apple has to be aware of with an entry-level computer targeted to the consumer. While consumers want all of the best technologies on their system, they also want the lowest cost possible — this is something Apple hopes to accomplish with the eMac.
“Some of the customers will be the first time buyers as well as students who are very sensitive to the price point, but still want all the power they can get with the G4,” Phil Schiller, Apple’s senior vice president of Worldwide Product Marketing told MacCentral.
One of the features not available on the consumer version of the eMac is Apple’s popular combo drive. For Apple it comes down to offering the best consumer level machine, but keeping the price at a level that people can afford for an entry-level system.
“There’s always a balance between offering lots of configurations and keeping the product line simple,” said Schiller. “I think many customers, if they were getting up to the price point the eMac would need to be at with a Combo drive, would rather have an iMac with its flat panel display.”
With the entry-level price point, analysts don’t see the eMac as taking sales from the flat panel iMac.
“I’ve heard of consumers trying to get the eMac by posing as education people because they really wanted the box, so it’s clear there is demand for it,” said Roger Kay, an analyst with IDC. “I’ve had some people question whether there would be cannibalization with the low-end iMac and my sense is that it [the eMac] is priced just right. This just allows Apple to cover another price point and reach a little further into the consumer segment.”
“e” for education or everyone?
When Apple first introduced the eMac they made it very clear that it was for the education market. “Our education customers asked us to design a desktop computer specifically for them,” said Apple CEO Steve Jobs, in announcing the product.
Now that the eMac is available for the consumer as well as the education customers, Apple no longer has a specific machine to market as an education-only system. But the company will continue to work with the various education segments to provide them with a computer that meets all of their needs.
“We are still focusing on education with the eMac,” said Schiller. “We are going to work really hard with our education customers to make sure they understand that first and foremost we make the eMac to meet the needs of education.”
CRT or LCD
When Steve Jobs introduced in the flat panel iMac at Macworld Expo in San Francisco, he proclaimed, “the new iMac ushers in the age of flat-screen computing for everyone. The CRT display is now officially dead.”
At the time Jobs couldn’t have foreseen the upward pressure that is now being placed on flat panel displays. In fact, on March 21, 2002, Apple announced a $100 price increase across the board for flat panel iMacs, which Apple attributed to significant increases in component costs, including a twenty-five percent increase in LCD costs.
Even with the increased cost of the LCD components and the forced iMac price increase, Apple’s commitment to the LCD product line is unwavering.
“We are still strong believers that the future of the desktop is flat panel and we’ll continue to drive in that direction,” said Schiller. “We think a lot of consumers understand the benefits of flat panels and want them. The only reason it’s not across the whole product line yet is the cost of the flat panel.”
Apple shows flexibility
The fact that Apple released a consumer CRT computer should not be taken as a sign that they are going back on their word of making the entire product line LCD-based.
Quite the contrary — Apple’s decision to release a consumer system with an attractive entry-level price point shows great flexibility on Apple’s part to move with the industry.
Apple’s quarterly results during the past few years have been almost unparalleled in the industry, and the public has clearly expressed interest in Apple’s new CRT-based all-in-one system. It only makes sense for Apple to give the public what they want, especially if the eMac helps the company continue to show strong financial numbers.