The Dubious Economics of Processor Upgrades

Last week Newer Technology announced its new iMAXpowr G3 466 processor upgrade for Revision A through D iMac computers. Reportedly, a similar upgrade product is on the way for PowerBook G3 Series computers as well.

The operative question: Do processor upgrades make good economic sense, or are they a false economy?

The iMac upgrades and anticipated PowerBook G3 Series upgrades have caused considerable excitement in the Mac community, because it had been assumed previously that upgrades for these machines would never be offered, because Apple had deliberately chosen to thwart third-party (effectively any) processor upgrades by mounting the boot ROMs on the processor daughtercards.

Apple has consistently refused to license Mac ROMs to third parties - and without a supply of ROMs, upgrades were impossible. Or were they? The workaround Newer came up with is to use trade-in or otherwise obtained used daughtercards and recycle the ROMs from them. This means that the ROMs on your iMac (and later PowerBook) upgrade card will have been used before, but Newer assures us that the used ROMs will be thoroughly tested before they are resold.

The iMAXpowr G3 466 uses a 466 MHz G3 microprocessor with 1 MB of backside cache running on a 155 MHz bus. iMAXpowr is designed for the first four versions of the iMac (Revs A, B, C and D), but not the current 350 MHz and 400 MHz slot loading machines, and is compatible with all OS versions that originally shipped with these iMacs, including OS 8.1 through OS 9. Since the supported iMacs were originally equipped with 233 MHz to 333 MHz G3 processors and only 512 KB backside cache, iMAXpowr G3 offers not only up to twice as high a processor clock speed, but also doubles the backside cache to a full 1 MB, which significantly improves the performance of many applications, including VirtualPC.

iMAXpowr G3 466 will begin shipping this month at $499 after trade-in rebate (full purchase price is $699). Does this represent a good value? Ironically, it may represent a better value for iMac owners who don't buy it than those who do.

How so? Well, historically, upgradable Macs have held their value a lot better than non-upgradable machines, whether the owner chose to upgrade or not. Consider the case of the PowerBook 1400 (upgradable) against that the PowerBook 3400 (non-upgradable). The 3400 sold new for roughly twice as much as the 1400, and it is a more advanced PCI design with a much faster processor and internal bus. However, on the used market the 1400 is now selling for about the same price (or even more than) the used price of a low-end 3400.

This dynamic definitely benefits all PowerBook 1400 owners when they sell their computers, and it is why I am a strong advocate of Mac upgradability even though I think that in most (although not all) cases, upgrades don't make much sense.

For example, I have heard from at least two readers who removed the G3 upgrade cards from their PowerBook 1400s, replaced them with the original poky 603e processors, and sold the computer and upgrade card separately - realizing cumulative proceeds just a couple of hundred dollars or so short of the price of a new iBook. In the end, both of these people ended up buying leftover WallStreet 233s instead of iBooks, but that's another movie.

The point is that if you have a first generation iMac in good condition, you can probably get at least $500 to $600 for it (all prices in US dollars). Now, take that money plus the $499 you might have spent on the Newer processor upgrade, and you can buy a brand new 350 MHz iMac - or add $200 extra and get an 400 MHz iMac DV with DVD, FireWire, a 10 GB hard drive, iMovie, better video, the Harman Kardon sound system, AirPort support, and a full year's warranty.

Of course the Newer upgrade is substantially faster than any of the new iMacs. After the iMAXpowr G3 466 upgrade is installed, a processor benchmark score of 1360 using MacBench 5.0 is achieved. A stock 233 MHz iMac scores 719 using the same processor testing, so users can expect to see up to a near-doubling of system performance, depending upon the original processor speed. (The 400 MHz iMac DV scores 1139.) So if you're a speed freak, enjoy, but most of us won't tax the processor power of the 350 and 400 MHz machines.

For PowerBooks, the upgrade would make more sense, since you are souping up a higher-value machine, but a used WallStreet should be worth a minimum of $1,400 to $1,500. If we assume that Newer's PowerBook upgrade will likely cost more than the iMac unit and require factory installation (let's say $650 to $700 after the rebate), you're not all that far short of the price of a new Lombard (or soon Pismo) at the end of the day. With Lombard you get lighter weight, bigger hard drive, better video, longer battery life, and USB. With Pismo, add FireWire, still lighter weight, a faster internal bus, even longer battery life and better video, all of which adds up to better value for your money along with a new machine warranty.

However, the Newer PowerBook G3 Series upgrade, when and if it appears (the 466 MHz MAXpowr PowerBook G3 shipped in August 2000), will enhance the used value of my G3 233 'Book, and I thank Newer kindly for that (and a raspberry to Apple for otherwise blocking the upgrade road).

For more information visit the Newer Technology site