Mac OS X still trails Vista by a long way

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Angus Kidman27 April 200819 days ago.

The Apple fanboy community is rejoicing at news that sales for Macs have grown 51% in the last quarter, but still nowhere near catching up to Microsoft's dismal failure, Vista.

According to Apple's just-out financial results, a total of 2,289,000 Macs were shipped in the first three months of the year. (Though 'shipped' doesn't necessarily mean 'sold', we'll leave that argument for another time.)

"With over $17 billion in revenue for the first half of our fiscal year, we have strong momentum to launch some terrific new products in the coming quarters," CEO Steve Jobs remarked, a comment that will further fuel new iPhone rumours. But lets's stick with the Mac for a minute.

By Apple's reckoning, those sales represent a 51% increase in units on the same quarter a year ago. Apple also calculates that this represents a 54% increase in revenue, a figure it's obviously pleased with, since it normally only includes Mac unit growth in its earnings announcement and doesn't gloat about the dollars.

It's sensible and accepted practice to do year-on-year comparisons, since retail sales vary markedly at different times of year. But for a fuller picture, here's the numbers over the past three years (which predates when Apple switched to Intel processors for Macs):

 
QuarterMac sales% growth YOY

Q2 (Jan-Mar 2008)2,289,00051
Q1 (Oct-Dec 2007)2,319,00044
Q4 (Jul-Sep 2007)2,164,00034
Q3 (Apr-Jun 2007)1,764,00033
Q2 (Jan-Mar 2007)1,517,00036
Q1 (Oct-Dec 2006)1,606,00028
Q4 (Jul-Sep 2006)1,610,00030
Q3 (Apr-Jun 2006)1,327,00012
Q2 (Jan-Mar 2006)1,112,0004
Q1 (Oct-Dec 2005)1,254,00020
Q4 (Jul-Sep 2005)1,236,00048
Q3 (Apr-Jun 2005)1,182,00035
Macs sold in 3 years19,380,000

Source: Apple

Now, there's lots to be impressed by here. Apple has broken its own quarterly sales records for Macs three times in the past eighteen months. While there was clearly some initial resistance to Intel-based Macs, resulting in a nasty growth drop in late 2005 and early 2006, the company has seen year-on-year growth for each quarter since then.

Sales for the last three months are lower than the quarter before, but the Q2 figures are also always lower than those of the preceding period (which includes Christmas), so that's no source of concern. And in the past three years, Apple has sold just shy of 20 million Macs, with roughly 80% of those being Intel models.

While 20 million sounds impressive, it's still a drop in the PC ocean. Consider Vista, hardly anyone's definition of a successful product launch. Microsoft's latest results aren't out until later today, and it doesn't consistently break out sales figures for its different product families, but it has stated that Vista sold 100 million licences in its first 12 months. In that period, Apple sold around 7.8 million Macs. For every Mac sold, that's around 12 copies of Vista.

Keep at it, Steve; there's a long way to go.

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Damon (New user):

Your analysis is pretty spot on until you compare the sales figures for Vista with those of Macs. Here you lose the plot completely. For one, Vista is an operating system whereas Macs (inferring a strict definition of the term based on the context you set) are hardware. Where is the comparison there? Sure, compare Leopard sales versus Vista sales. You could even compare Mac sales to PC sales. But don't compare Mac sales versus Vista sales, for you are really comparing Apples and oranges (or lemons as the case may actually be).

SLi (New user):

This analysis is great. It would be too mean for those brain-damaged mac users out there to show them how much vista owns leopard or OSX because the comparison would prove extremely disappointing to the mac based OS's.

Damon (New user):

In your oh-so-humble opinion, of course.

Kidman wasn't comparing the virtues of each system - he was comparing the sales figures. However, comparing the sales figures of Vista (software) to the sales figures of Macs (hardware) as he does is just wrong. Why don't we compare the sales figures of Vista to those of the VE Commodore? We wouldn't for the same reason - they're too different to make an intelligent comparison from which usable conclusions could be drawn. But then, I wouldn't expect brain-damaged Windows users to understand the logic at play behind this argument. To them, Apple and Mac are synonymous. Anything carrying the Apple brand must be a Mac. Well, it 'aint necessarily so!

Me In Oz (New user):

Apple and Mac are synonymous !
Who would buy and Apple to run Windows or Linux ?

Tin (Regular contributor):

I know of at least one school that bought heaps of Macs and run Windows only on them. And a lot of Macs back in the PowerPC days had Linux put on them after they were unpacked.
It's a lot less strange than you think.

Me In Oz (New user):

I'll never understand the way a nerd thinks !
Why would you pay for an overpriced piece of hardware to run Windows and Linux when a machine half the price of an Apple will do ?????

Tin (Regular contributor):

Apple will pull prices pretty low to compete when it comes to bulk buys in schools (and similar). In some cases as low as any other vendor.

Dave Kay (New user):

The thing is, if you are buying a Mac, you are generally not buying it to run XP or Vista primarily, but that is a nice bonus to have. If you are, then you must really love the design of the Mac Books or iMacs :-)

You generally buy a Mac for a number of reasons. Personally, I find it much easier to use, has applications I need (I write Cocoa code, love iLife and Final Cut to name a few) It's hard to explain the way OS X's applications work so well together (but not always). Seems to have a lesser chance of getting infected (though that might have changed with Vista). I just find them a nice machine to use everyday, and yes, I do run 2k3, XP and just added Vista and Ubuntu, but only because I need them for work (well, OK, not Ubuntu, just curious about the latest release)...

However, if XP or Vista fills your needs, the by all means stay with it. If you ever find that they don't, then it have a look at Linux or OS X (or Amiga OS 4)...




Tin (Regular contributor):

Of course sales volumes are nothing to go by when you add in free and open source operating systems that people are also moving to.
How many Ubuntu users are out there for example? There's no reliable way to find out.

jbelkin (New user):

Unlike MS, Apple counts shipped as "sold." The problem is MS is not selling very many full priced VISTA OSes - hence the price drop ... and it's not necessarily a real comparison because not only does MS count shipped as 'sold,' they also count batch purchases by an OEM PC seller even if they technically use up that licensing number ... and of course, MS makes about $50 per OEM license ... the bottom is this. Apple has become the ONLY full margin hardware & OS dealer for personal computers. Not only did they sell millions of copies of Leopard last Q at $129 - they also get revenue along with hardware so each sale of Leopard is really a $1,600 (about the average selling price of a Mac) versus MS getting $50 per sale of Vista. You can do the math of how many OEM copies MS needs to sell to match Apple' revenue. While MS' margins are higher on software, they are X% of $50 versus Apple's 28% of $1,600 ... Ms is the the OS of choice when you only have $50 to spend on an OS ... Apple, on the other hand gets full price buyers ... That's the difference.

jbelkin (New user):

Unlike MS, Apple counts shipped as "sold." The problem is MS is not selling very many full priced VISTA OSes - hence the price drop ... and it's not necessarily a real comparison because not only does MS count shipped as 'sold,' they also count batch purchases by an OEM PC seller even if they technically use up that licensing number ... and of course, MS makes about $50 per OEM license ... the bottom is this. Apple has become the ONLY full margin hardware & OS dealer for personal computers. Not only did they sell millions of copies of Leopard last Q at $129 - they also get revenue along with hardware so each sale of Leopard is really a $1,600 (about the average selling price of a Mac) versus MS getting $50 per sale of Vista. You can do the math of how many OEM copies MS needs to sell to match Apple' revenue. While MS' margins are higher on software, they are X% of $50 versus Apple's 28% of $1,600 ... Ms is the the OS of choice when you only have $50 to spend on an OS ... Apple, on the other hand gets full price buyers ... That's the difference.

jbelkin (New user):

Unlike MS, Apple counts shipped as "sold." The problem is MS is not selling very many full priced VISTA OSes - hence the price drop ... and it's not necessarily a real comparison because not only does MS count shipped as 'sold,' they also count batch purchases by an OEM PC seller even if they technically use up that licensing number ... and of course, MS makes about $50 per OEM license ... the bottom is this. Apple has become the ONLY full margin hardware & OS dealer for personal computers. Not only did they sell millions of copies of Leopard last Q at $129 - they also get revenue along with hardware so each sale of Leopard is really a $1,600 (about the average selling price of a Mac) versus MS getting $50 per sale of Vista. You can do the math of how many OEM copies MS needs to sell to match Apple' revenue. While MS' margins are higher on software, they are X% of $50 versus Apple's 28% of $1,600 ... Ms is the the OS of choice when you only have $50 to spend on an OS ... Apple, on the other hand gets full price buyers ... That's the difference.

stefcep (New user):

Not sure why the sales of a single vendor (Apple) are being compared to the total sales achieved by numerous vendors all selling the same product. What would be interesting to see is how Apples sales compare to the individual sales of Vista by Dell, or Sony or Toshiba, or Lenovo et al and what their profit margins are compared to Apples. I'd rather sell 10 items and make $10 each rather 100 and make a dollar each.

Infinitus (New user):

According the Gene Munster, a senior Wall Street analyst at Piper Jaffray, Apple now controls over 20% of the consumer market in the US. It doesn’t matter how many cheap enterprise boxes are sold because those boxes are sold at commodity prices, hence Dell’s struggle to provide a meaningful return to its shareholders despite exhausting over $20 billion buying back shares. The stock has flat lined for five years and the company is quickly imploding financially no matter how many cheap boxes it sells. As of this writing, Apple has more than 11 times the net asset value (balance sheet comparison) of Dell despite Dell being the #1 Vista PC seller in the US.

While Apple has less than 10% of the US PC market and less than 5% of the global market (for now), the company continues to have the highest gross margins of any major PC maker and the highest yield per customer. In short, it doesn’t matter how many boxes are sold, it’s a matter of how well the company’s owners are rewarded and how well shareholder assets are used. Even HP can only envy Apple’s success and the manner in which Apple’s management serves the people who own the company.

Apple is one of the world’s largest developers of Windows software. QuickTime and iTunes are installed on more XP and Vista boxes than just about any other 3rd party software products. Both Apple and Google have turned XP and Vista into little more than a roadbed for revenue traffic. In short, it doesn’t matter how many cheap Vista boxes are sold. Ask Dell. That company is a shell of its former self and shareholder assets are plundered by management to keep the share price at 2003 levels.

The question isn’t one of which operating system is being sold most frequently. It’s a matter of which company provides products and services desired by its users. Face it. Vista is a commercial failure. Otherwise Microsoft wouldn’t be talking up its replacement (Windows 7) so soon and wouldn’t be offering an astronomical price to buy Yahoo! in a desperate effort to compete with Google. Apple owns the digital distribution pipe. Vista is just another roadbed for Apple to drive revenue to its digital stores.

Compare active QuickTime/iTunes users on Windows to those who use Windows Media Player for a more accurate view of leadership in the digital distribution era. Vista will eventually replace XP as the most popular revenue carrier for both Apple and Google. It all comes down to how you wish to determine success.