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Apple gets faster and cheaper, but will more consumers bite?

By Michael B. Farrell / June 8, 2009

Philip Schiller, Apple senior vice president for Worldwide Product Marketing, stands under a picture of the 13-inch MacBook at an Apple Worldwide Developers Conference in San Francisco, Monday.

Jeff Chiu/AP

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San FranciscoFast and cheap (well, cheaper) was the mantra on Monday at Apple’s Worldwide Developers Conference.

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While the company dropped the price of its existing iPhone model to $99, they also said they’d start selling a faster one on June 19. That phone will be pricier for new customers – $200 for a 16 gigabyte model and $300 for 32 gigabytes – with a two-year contract.

But while the phone snatched most of the headlines from the tech confab that attracted some 5,200 developers, the faster and cheaper mantra also extended to its line of laptops.

Analysts say the company is being pushed to drop prices by growing competition in the smart phone market and sluggish laptop sales. Apple's move to drop the price of its smart phone will probably nudge their competition to bring down the price of their smart phones, too.

Prices for Apple computers are also falling. After all, Microsoft has been going after Apple in a recent advertising campaign that claims Mac are just too expensive -- and tad elitist, to boot.

And AdAge recently reported that the campaign is having an impact. One consumer survey recently showed that the value perception was up for Microsoft and down for Apple.

Perhaps the price drop is an effort to counter that attack.

The company shaved $300 off a new MacBook Pro – and also packed the new version with upgrades in battery life, memory, and boosted the size of the hard drive.

It also dropped the price of a new 13-inch laptop by $100 and the pricey and thin MacBook Air became a bit less pricier with a $300 dent in the price of that computer.

There was little doubt the crowd here in San Francisco was impressed. The developers greeted the parade of new products and upgraded features with hoots and hollers. Someone actually cried out when it was announced the new phone would include a built-in compass.

But will consumers bite?

Sales of Apple computers certainly lags far behind the iPhone in terms of market share and the company has yet to introduce a netbook -- a small laptop mainly for writing email or surfing the Web.

Even though some anticipated a netbook might have been announce on Monday, Apple aficionados will have to wait a bit longer for the company to build one of those.

The audience in San Francisco was also kept in a bit of suspense over whether or not Steve Jobs, the Apple CEO who took a leave due of health issues, would also make an appearance.

He didn't. In fact, there was no mention of Mr. Jobs during the keynote address, leaving audience members wondering: "How's Steve?"

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