Apple’s iPhone ‘Halo Effect’ Boosts Mac Sales 16.4 Percent
11:41 am, December 1st, 2009, Ed Sutherland
The iPhone is helping all Apple sales. (Credit: Zushi323/Flickr)
The iPhone has joined the iPod in their ‘halo effect’ promoting Apple’s Mac. Mac global sales in September rose 16.4 percent, far ahead of a 2.3 percent year-over-year sales increase for PCs, one analyst told investors Tuesday.
“We believe that the halo effect emanating from the iPhone should be even stronger than that surrounding the iPod,” wrote Needham and Co. analyst Charlie Wolf.
The gains came in spite of Apple’s refusal to join the rush to inexpensive netbooks. Although many PC makers introduced the low-cost laptops, Apple continued to increase its sales while overall PC sales slumped by 6.7 percent. The drive toward netbooks marked “the implosion of PC prices,” Wolf told investors. Even during the back-to-school period which benefitted both PCs and Macs, Apple’s computers have a 14.1 percent sales lead over PCs, according to the analyst.
Apple was wise to avoid the common belief that lower prices would equal higher sales.
“Such cuts would not have stimulated much demand because the price elasticity of demand for the Mac — the one differentiated product in a sea of commodities — was simply too low. They would end up decimating Apple’s gross margin with little to show for it,” argued Wolf.
That resistant to follow pricing pressures allowed Apple’s worldwide revenue share to hover around 10 percent while maintaining around four percent of the market share. In the U.S., Apple has 20 percent of the revenue with 10 percent of the sales, according to the analyst.
Although Apple has long thought to be largely dependent on U.S. Mac sales, much of the Cupertino, Calif. company’s sales gains in September were overseas. While Apple saw 9.8 percent growth of U.S. Mac sales, the firm had 38.7 percent growth in Europe and 27.1 percent in Asia.
It makes sense the iPhone becomes the latest Apple gadget to provide a ‘halo effect’ for Mac sales. “After all, the iPod is a relatively simple device while the iPhone is arguably a mini computer wrapped in a phone’s form factor,” Wolf wrote in his “Wolf Bytes” investor note. Wolf expects the iPhone will eventually take the iPod’s place as Apple’s iconic lead product.
In the previous quarter, Apple sold 7.4 million iPhones and 3 million Macs, causing the company’s revenue to rocket 46 percent to $1.67 billion.
[Via AppleInsider]
Posted by Ed Sutherland in News | Comment on this article
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Why does it have to be an iPhone halo effect? Perhaps it is just more people accepting the Mac as the premium computer and they have a different cell phone and carrier. Remember that AT&T has made its presence in major metropolitan areas and ignored the more rural parts of the USA. There are many Blackberry users on Verizon that are happy th get a new Mac.
Panolo, on December 1st, 2009 at 12:35 pm
You are right, Panolo, the halo effect is not just because of the iPhone. Actually, it’s more of a Steve Jobs halo effect.
Everything that SJ did right in the past decade has generally given a boost to the growing popularity of the Mac platform. That includes: OSX, migrating to Intel CPUs, iPod, iTunes, iMac (remember that the original Bondi Blue iMac was revolutionary back in 1998), and many other things, plus the iPhone.
bjorntech@squee.org, on December 2nd, 2009 at 12:02 am