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Time ripe for $700 MacBook, says analyst

Cheaper 13-in. white MacBook would 'close the gap' with netbooks

September 8, 2009 01:34 PM ET

Computerworld - Amid talk that Apple will kill the iPod Classic and add a camera to other models of its music player tomorrow, one analyst has a different prediction: Apple will roll out a retooled MacBook for $700.

"The rumors of a less expensive MacBook have real potential," said Ezra Gottheil, an analyst with Technology Business Research. "It could drive up Apple's share further and quite possibly increase the margins on Macs, even at the very attractive price of $700."

Gottheil's rumor reference was to stories two weeks ago, particularly by AppleInsider, that said sources had reported Apple would soon revamp the design of its 13-in. white, plastic-enclosed MacBook.

The white MacBook, which currently sells for $999, is the only model remaining in the line. In early June, Apple shifted its two "unibody" MacBook configurations into the MacBook Pro lineup, swapping out the user-replaceable battery for an integrated battery and adding a backlit keyboard to both models. The 13-in. MacBook Pro starts at $1,199.

Gottheil has pushed the idea of a less-expensive MacBook before as an easy way for Apple to dip a toe in the netbook waters.

"This would close the gap between the entry-level prices of PCs and Macs," he said today, speaking of the current difference between Windows-based netbooks, some of which sell for under $300, and the $1,000 price point of today's MacBook.

From his spot in the peanut gallery, Gottheil thinks that Apple could lower the price of the MacBook and retain its traditional high profit margin, by backpedaling the laptop's technology to circa-2006 components, which are considerably cheaper than when the notebook debuted that year.

"Apple could position the MacBook as just as good [in performance] as two years ago, or even better, since it would drop in Snow Leopard," Gottheil said.

The original MacBook -- the first of that line to sport an Intel processor -- debuted at $1,049, and included a 1.83GHz Core Duo CPU, 512MB of RAM and a 60GB drive.

Unlike AppleInsider, however, Gottheil said it made more sense to stick with the existing enclosure mold, another way Apple could cut costs to drop the price by $300. He also said he would expect Apple to offer the cheaper MacBook in several configurations, probably three -- the company's sweet spot, it seems.

"It's the right time to do this, assuming, of course, that a tablet won't be released this year," Gottheil said. "The lack of a netbook entry can't go on forever. And earlier, when sales were soft, Apple wouldn't have wanted to appear weak," he added, talking about the first calendar quarter of this year, when Apple said Mac sales had fallen 3%, year-to-year, the first such decline since 2003.

"Now they can do [a reduced-price MacBook] from a position of strength," said Gottheil. "And it would give them some additional [sales] volume."

In the quarter that ended June 30, Apple sold 4% more Macs than in the same period the year before, reversing its one-quarter sales downturn.

Apple's San Francisco event, which will kick off at 1 p.m. ET tomorrow, is expected to focus on its iPod business, but the company has a history of tossing in unexpected announcements at virtually any opportunity. For example, Apple revised the MacBook Pro line, adding the 13-in, aluminum-cased notebooks formerly part of the MacBook family, during its annual developers conference in early June.

Read more about Macintosh in Computerworld's Macintosh Topic Center.



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