iMac has PC world playing catch-up

Success: A year after its debut, the colorful desktop has restored Apple's reputation as an innovator.

August 16, 1999|By Dave Zeiler | Dave Zeiler,Sun Staff

A few weeks ago, Bill Gates made the following remark about Apple's top-selling iMac: "The one thing Apple's providing now is leadership in colors," the chairman of Microsoft said while pointing to a red-hued Windows PC. "It won't take long for us to catch up with that, I don't think."

Poor, misguided Bill. One year ago as of Aug. 15, Apple stunned the PC world with the iMac, an attractively styled machine designed for folks who want the benefits of a personal computer without the hassles. Contrary to Gates' assertion, it has taken PC makers a full year to even attempt to replicate the iMac.

The iMac is probably Apple's most significant hardware since the original Mac made its debut in 1984. Who could have imagined the impact this mighty little machine would have in just one year?

The iMac has contributed greatly to Apple's revived fortunes (seven straight profitable quarters and counting) and restoring its reputation as an innovator. Not since its glory years in the mid-1980s has Apple commanded such attention in the tumultuous domain of the PC industry.

Contrary to predictions that interest in the iMac would wane after an initial spurt, sales have remained steady over the past year even as some Windows PC makers have struggled.

Better still, consumer demand for the $1,200 iMac shows no sign of abating. At last month's MacWorld, Apple interim CEO Steve Jobs said that nearly 2 million iMacs have been sold so far, with Apple's inventory shrinking to 15 hours (not days or weeks, like other PC companies). And the iMac was the best-selling PC in June (according to PC Data).

Just as befuddling to the doomsayers, a third of those purchasing iMacs are first-time computer buyers, not longtime Mac users. As a result, Apple's once-shrinking market share has doubled over the past year to 11.2 percent.

For evidence of Apple's reclaimed role as an industry leader, look at how inclusion of USB ports in the iMac jump-started a market that had languished in the PC world for several years. (USB, short for Universal Serial Bus, is a new, more efficient standard for connecting peripherals such as scanners, removable disk drives and joysticks to both Windows PCs and Macs.) Tellingly, many of the USB peripherals introduced over the past year feature cases that match the translucent plastic first seen housing the original "bondi blue" iMac.

Only in the past few months, as the iMac's success became undeniable, did a few PC makers try to duplicate its groundbreaking concept. The first attempt, by a Santa Clara, Calif.-based company called Future Power, was such a brazen rip-off of the iMac's design that Apple filed a legal complaint within a week.

More recently, Mattel announced a more creative PC take on the iMac: a pair of decorative mini-towers aimed at children. For girls, Mattel offers a pink-and-purple Barbie-themed box; for boys, a blue-and-yellow Hot Wheels-themed box.

A stronger challenge might come from eMachines of Irvine, Calif., which stormed into the top ranks of PC manufacturers a year ago by selling solid, inexpensive Windows-based computers. On Aug. 6, the company unveiled a stylish, colorful one-piece computer called the eOne which closely matches the iMac in features but costs only $899 -- well below Apple's price point.

Still, the iMac seems to have solved a problem that has been puzzling PC manufacturers over the last few years -- how to get computers into moderate-income households that don't have one, the last big untapped market. Their answer was to build cheap, low-quality boxes and keep dropping prices to the point at which their profit margin nearly vanished. It never occurred to them to design a moderately priced machine customized for those target households.

The iMac was conceived as a schoolroom and family-room computer for people who want to read their e-mail, browse the Web, write a letter and play some games with a minimum of technological hassles. It's not as cheap as the bottom-of-the-barrel PCs out there, but then, it isn't obsolete a week after you buy it.

Certainly, the iMac was not designed for veteran power users who crave the fastest CPU, load up their machines with obscene amounts of RAM and insist on having the latest software the day it's available. There are already plenty of PCs out there for people like that.

Apple has sold 2 million iMacs in one year because it has crafted a PC that appeals to the average consumer. And there are a lot more average consumers buying computers today than there are veteran power users.

Bill Gates, you might have more catching up to do than you thought.

Send e-mail to david.zeiler @baltsun.com.

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