Apple's Good Moves
Dan Knight - 4 February 1999
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Making iMacs
It feels good to be right.
Last August, I asked, "Is Apple too popular for its own good?" - and suggested Apple needed to outsource iMac production if it wanted to increase market share.
This week, Apple announced that it will no longer produce the iMac. Instead, Apple has contracted with Korea's LG Electronics Co. to manufacture the world's most popular computer at a plant in Wales.
Although this means some layoffs, mostly of temporary workers, in the short term, in the long run it provides Apple the additional manufacturing capabilities it needs to make enough PowerBooks and Power Macs, to say nothing of the forthcoming consumer portable.
Give it away
On an entirely different front, Apple quietly released System 7.5.3 for free download from their FTP site. Along with a freely available system updater, this will allow anyone with a Mac Plus or later, including the first generation Power Macs, to legally run what many consider to be a very capable, very stable operating system. (See Why System 7.5.5? on Online Tech Journal.)
So what?
These seem pretty disparate events, but they tell us a lot about the new Apple.
Granted, System 7.5.3 and 7.5.5 are yesterday's news, but they were only available to those who paid for an upgrade until now. By allowing free use of 7.5.3 and 7.5.5, anyone (read: especially schools) can upgrade to a more feature laden, more stable, more powerful OS than the System 7.0 or 7.1 they have often been stuck with.
Call it giving an old dog a bone, but for a lot of low end users (compact Macs, LCs, Mac IIs, older Performas, older PowerBooks), this means they can freely and legally run a more internet-friendly version of the Mac OS.
Best of all, it only costs Apple some bandwidth to earn the good will of millions of us who use older Macs.
Thank you, Apple!
At the same time, Apple production has been stretched to capacity by demand for the iMac. By moving that from Apple's factories, it creates room to build enough other Macs to keep the rest of the Mac market happy.
Considering the demand for and delay in obtaining the build-to-order Power Mac G3 Pro and the ongoing popularity of the PowerBook, along with rumors of both a new PowerBook and a consumer portable, Apple needs to dedicate more capacity to these lines.
Outsourcing iMac production makes that possible.
If the Welch plant (and maybe an Asian one, too?) can build 1.5-2.5 million iMacs per year, this leaves Apple free to build a couple million other Macs, whether desktops or portables.
And it's the only way Apple can increase market share, since they have limited production capacity.
Again, thank you, Apple.
Dan Knight has been using Macs since 1986, sold Macs for several years, supported them for many more years, and has been publishing Low End Mac since April 1997. If you find Dan's articles helpful, please consider making a donation to his tip jar.
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