Apple computer PCs have always been at the high end of the market when it comes to price. Years ago, being 20% more expensive meant that a Mac cost $400 more than your standard $2,000 PC. $400 is A LOT of money to your average American.
Computer prices drop FAST... and today you can get a low-end desktop PC from Dell for less than $300! And prices are going to keep dropping over time... no doubt about it. So what does that 20% Apple premium cost now if the standard desktop is $400... well that is $80 bucks. Hence you see the Mac Mini at only $499.
So what is the point you may ask.... my point is that as PC prices drop the option to get a Mac is increasingly becoming a real possiblity for the average consumer. Sooner or later the price of a PC simply won't be the issue, it will come down to how easy the PC is to use, how well it performs the mundane tasks of email & web surfing, managing photos & short digital videos, while also interacting with CE devices around the home. Clearly Apple has an advantage in usability over Microsoft... it also has consumers snapping up iPods and getting exposed to their CE products and broader product line.
Dell, Intel, Microsoft.... 3 companies that have benefited from PC adoption driven by price declines. That dynamic is about to end, and each company needs to determine how they will survive in a fundamentally different world. I think Intel provided a partial answer last week... now it is time for MSFT & Dell to answer.
