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Apple Rolls Out MacBook Laptop With Intel Chip

Posted on: Wednesday, 17 May 2006, 09:00 CDT

By John Boudreau

Apple Computer on Tuesday rolled out its latest Intel-based laptop makeover, the MacBook -- just in time for graduation and the important back-to-school summer sales.

The Cupertino company is hoping to dramatically boost sales of its computers, which make up less than 5 percent of the U.S. market. Last year, Apple announced that its Macs will use Intel chips, and last month the company began allowing its latest computers to run Microsoft's Windows operating system.

The MacBook, which starts at $1,099, replaces the iBook and the 12-inch PowerBook, and could lure consumers who were waiting for an Intel-based laptop. It also could catch the attention of school districts and universities, some of which have defected recently to Windows-based rivals.

With most of its computer line now running on Intel chips, Apple could make gains in the education market, an area where it has focused its laptop efforts. In the U.S. education market last year, Apple sold more than 900,000 computers to schools, second only to Dell, which shipped 2.7 million machines, according to research firm IDC.

Any benefits in sales to schools, though, will be long-term, observed IDC analyst Richard Shim.

"Apple does a good job of offering generous discounts," he said. "But it's a pretty price-constrained segment. It's hard to get a PC in there at all."

Paul Rische, director of technology for the San Jose Unified School District, which equips all its teachers with Mac laptops, said being able to run Windows on an Apple computer could eliminate the need for the district to buy many PCs. Right now, about 10 percent of its computers are Windows-based systems.

"I like the idea that we really only need one computer," Rische said.

Marie Scigliano, assistant superintendent in charge of technology at the Palo Alto Unified School District, doesn't expect Apple's move to the Intel chip to shift much of its computer procurement strategy, at least in the short term. About 60 percent of the computers used in her district are Macs. Computer-buying decisions are based on what applications will be run on the machine, she said.

"School districts aren't on the cutting edge," Scigliano said. "We stay behind the curve. It's not like our funding sources are there to make these quick turns. So we are more cautious."

Historically, Apple has done well this time of year as students think ahead and buy new laptops for school, said Philip Schiller, Apple's senior vice president of worldwide product marketing.

Schiller wouldn't say how many people are downloading Boot Camp, the free software Apple has offered that allows Mac users to run Windows on the newest Intel-based machines. The company, though, believes the ability to run Windows programs on a Mac is persuading some consumers to switch to a Macintosh computer from a Windows-based PC. "It's nice to know they can always run Windows if they have to," he said.

Analysts believe the overall market will reward Apple for its move to Intel.

Shaw Wu, an analyst with American Technology Research, noted that Apple's computer sales have been sluggish as consumers waited for the new models. He believes Apple should be able to outpace the computer market, reaching or exceeding 5 percent U.S. market share in the short-term.

Still, the new feature-packed laptops are not likely to attract budget shoppers, observed Jupiter Research analyst Michael Gartenberg.

"It doesn't carry the lowest sticker price on the market," he said. "But Apple isn't aiming to be the lowest-price player."

Unlike the iBook, which came with 12-inch and 14-inch screens, all three MacBook models are equipped with a 13-inch screen and are 20 percent thinner than the older version. The high-end version comes in an eye-catching black finish.

Schiller said customers told the company that looks really do matter.

"In addition to wanting the best performance, the other thing they wanted was something that looked exclusive -- less consumer-y," he said. "So we decided to create this new black MacBook."

Contact John Boudreau at jboudreau@mercurynews.com or (408) 278-3496.

Source: San Jose Mercury News

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