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MacBook: A Piece Of Apple Now Costs Less

October 15, 2008

Apple Inc. slashed prices on its entry level notebook computer with a slight nod to the economic turmoil that might push consumers to spend less this holiday shopping season. But shares of Apple, which grew to 20 percent since the company revealed its new notebooks last week, fell 3 percent in heavy trade on the Nasdaq.

“Bad for the stock today, good for the stock over the next couple of months,” said Piper Jaffray analyst Gene Munster, who said that the new machines looked good even if the new entry-level price was not as low as Wall Street had hoped.

Many analysts had expected the entry-level notebook price to fall to $899. Instead, Apple cut it to $999 and introduced a line of aluminum-clad machines starting at $1,299.

The redesigned laptops are lighter than existing machines, and Apple touted a construction “breakthrough” in the way the casings are cut and tooled from aluminum, without a stronger skeleton fused to the insides.

Apple also gave the updated MacBook and MacBook Pro machines, high-end features that had been in the MacBook Air, including thinner laptop casings and a “multitouch” track pad, which, like the iPhone, understands gestures for spinning and zooming.

Apple founder and CEO Steve Jobs said the firm switched from Intel Corp. to Nvidia Corp. as the supplier of the laptops’ graphics chips. Jobs said the new chip speeds up processing-intensive activities.

Jobs put the focus on the new line of MacBooks, although he took a few moments at the end to joke about his health.

His blood pressure was 110 over 70, he said. “And that’s all we’re going to be talking about Steve’s health today,” he added lightly, referring to concerns earlier this year that the cancer survivor’s health was deteriorating.

At the lowest end of the redesigned laptops, a MacBook will cost $1,299, while the most expensive MacBook Pro, which comes with two graphics chips from Nvidia for extra fast graphics processing, costs $2,499. An updated MacBook Air, the ultra-thin portable notebook that does not have a CD or DVD drive on board, is $1,799.

Jobs would not take questions on the economy, telling reporters and analysts that “there are much smarter people than us that you can ask about the global financial meltdown.”

Tim Cook, Apple’s chief operating officer, said Apple’s Macintosh sales growth has far outpaced the broader PC market over the last several quarters.

Market tracker IDC said in its last quarterly report published in July, that Apple ranked third in the U.S. PC market, with 7.8 percent share.

Apple’s new machines can be ordered online Tuesday and are expected to reach Apple’s retail stores on Wednesday.

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