iPhone Profits
Robert Boylin writes in response to The iPhone: Apple's $3 Billion Cash
Cow:
Dan,
I agree that Apple is making more profit from the AT&T
rebates over time, and it makes sense for Apple to amortize the
sale with the ongoing contract income. As to cost and profit, a
gross profit of 28% would give a cost of $360 on the $500 model. As
to AT&T making $100 on the retail end, I expect they are paying
Apple more than that for the new customers. Retail margins
contribute to reduction of the 28% gross to a much lower net. I've
never seen the gross margin lessened by the retail discount in such
calculations. It's normally part of the calculation of "net"
profit. A Mac, regardless of who sells them, contributes the same
gross profit margin in Apple's calculations.
With the substantial sales numbers of this and future models of
iPhones I can see it contributing a significantly higher percentage
of Apple's profits than the iPods. Next year we'll have to see
where the Apple TV business matures.
Robert
Robert,
Some items have a lower markup; some are much
higher. In general, more expensive models (such as the Mac Pro)
have a higher profit margin than less costly ones (such as the Mac
mini). I don't know where the iPhone falls in this spectrum, but I
suspect it has a higher margin than a Mac mini.
I can't imagine Apple selling the iPhone to
AT&T below cost, nor can I imagine AT&T retailing it with
no markup. I'd guess Apple's net cost at between $250 and $300 per
iPhone, but that's just a good guess. Even at $360 cost, Apple is
making money hand over fist with the sign-up bounty and monthly
contract fees.
Dan
Working Around a Dead Ethernet Port
I'm not sure if you can help me, but I'm going to give it a try.
I have a 700 MHz eMac purchased
about 6 years ago. I live in Tampa FL, the lightning capital of the
world. The other day, I left my router on, but the eMac was off.
The router (from Verizon, I have FIOS)
apparently got zapped and since has been replaced. When I hook the
eMac to the router, the port on the router doesn't light up, and I
can't connect to the Internet. I also have a PC laptop on the same
router, and that port lights up just fine and can connect.
Do you sell just the ethernet cards for the eMac? I have tried
my Apple Store here in Tampa, and they said it would have to be
ordered, but they didn't know if they can get it in. I wasn't too
impressed with the rep I spoke, with as he stated he wasn't very
knowledgeable with the eMacs. By your ad, sounds like you know more
about them.
Any information you can supply me will be greatly
appreciated.
Thanks,
Sandy Hayes
Sandy,
Sorry for your loss. If your eMac's ethernet port
is shot, it may be cheaper to go another route than to fix the
motherboard. The cheapest solution might be a wireless router and
an AirPort card. 802.11g WiFi routers are really cheap compared to
the g-plus and 802.11n hardware that's supplanted it. And you
should be able to score an AirPort card for under $100.
Dan
Hi Dan,
Thanks so much for responding to my dilemma of to fix or junk
this eMac!! So, I can get an AirPort card, along with the wireless
router, and that should solve the problem? Is it very hard to put
it all together? I don't know very much about the hardware, but I
think I get it though, the wireless router will find the FIOS
connection, and the AirPort card will help make that
connection?
Do you sell the parts to the public or are you strictly
wholesale? Would you recommend a reputable place to purchase these
items? I would be very grateful if you could either way. Just let
me know when you can.
Thanks for your response. I look forward to hearing from you
again.
Sandy
Sandy,
I've never put an AirPort card in a 700 MHz eMac.
A little research tells me that it's easy. Remove the black bezel
surrounding the optical drive (CD, Combo, whatever), and behind it
you'll find a slot for the card.
Both it and the WiFi router should be
plug-and-play.
Low End Mac is more or less an online
magazine/encyclopedia of things Macintosh. We don't sell anything.
Any office supply store, CompUSA, or Best Buy should have a cheap
WiFi router, and the LEM Swap list
is your best bet for a used AirPort card.
Dan
Software for a PowerBook 1400
Richard Marks writes:
Hi Dan
Sorry if this is a stupid question; I keep getting my head
chewed off on various forums for nothing more than being a newbie
asking for help. I am a computer novice, outside of downloading
shareware to my Pocket PC and installing stuff on our desktop
iMac.
I have just inherited a free PowerBook
1400cs/133 OS 7.6.1 with 16 MB RAM and 1.3 GB hard drive and a
CD drive fitted. I've also got a couple of Zip drives with it, one
USB, one pin so I can save stuff to my iMac and swap it to my
PowerBook.
It runs but has nothing on it. I am a school governor and am
intending to use it as a document registry for all of the papers I
have to have and meeting minutes, etc. mainly MS Word and Adobe PDF
files, along with the odd Excel spreadsheet.
I am having all sorts of problems tracking down a copy of MS
Office 98 for Mac, which I suspect is what I need, via
Google/eBay/Apple/Microsoft sites etc. I've got a copy of Adobe 4.0
from System 7 site and have spotted a copy of Photoshop 5.5 for
when I get a RAM upgrade.
I've had a quick scout on your site and links from it for Office
98 but without success.
I'm completely new to Macs and really haven't got a clue where
to go looking outside of these obvious places. Do you know of any
sites that deal in long obsolete stuff like this that may have a
copy, or if it is very well hidden away on Microsoft or Apple main
sites somewhere?
The other thing I would consider is teaching myself how to put a
Linux system onto the PowerBook if that would be an easier option
for Word and PDF access. Again I have no idea if this is viable or
not.
I would be grateful for any advice or suggestions that you feel
you are able to give as to where to go for stuff or if I'm flogging
a dead horse and should give up on it now.
Thanks in advance,
Richard
Richard,
Unless you can find more memory, you're going to
find the 1400 very limiting. Mac OS 7.6.1 is a good operating
system, but things like Word, Excel, and Photoshop like lots of
RAM. Probably the best place to find it is the Low End Mac Swap List, which may also be a
good source for an old copy of Word and Excel or MS Office 98.
Another option you might want to consider is
ClarisWorks, Apple's integrated office suite that may meet all of
your word processing and spreadsheet needs. I've been using it
since version 1.0 shipped, and I have had no reason to use Word or
Excel since.
Dan
Apple's Inadequate Lineup
Mike Perry follows up on Mac mini
and the Workplace:
Dan,
Apple's inadequate line up is particularly vivid this morning.
The little laptop drive in my PPC Mac
mini has been dying for several weeks. Yesterday it became
noisy, and late yesterday seemed to be the cause of a major
slowdown. Today it seems to have died completely. I booted off my
external FireWire drive, and I'm getting this oft-repeated
message:
IOATAController device blocking bus.
Fortunately, everything was backed up to the FireWire drive, and
yesterday I burned all my books (I'm a publisher) to CDs. Nothing
is lost. Just the hassle.
Why did Apple put laptop drives in Mac minis? They cost more,
they're slower, and (as this shows) they're more prone to fail.
They're also more hassle to replace. All so the cute little case
could be an inch less wide. That makes no sense.
Hopefully I can keep this beast going a few more months in the
hope that Apple brings along something - a mini tower or a revised
MacBook, that's worth buying. Like a long-distance runner, I have
my eyes on October. On my budget, even the cost of OS X 10.5
matters.
I agree that Bluetooth might make sense in a Mac Biz. I hope
Apple is also quick to support wireless USB.
I keep repeating the argument that the Mac's market share is
increasingly being limited by "at work" decision making. At home,
people decide to stick with the OS they use at work. Every Mac sold
to businesses is a potential sale to home users. Every Mac not sold
due to this limited lineup is a Mac not sold at home. Maybe someone
at Apple will listen.
- Mike
Mike,
Apple had three reasons to choose laptop drives
for the Mac mini: size, reduced power consumption and heat, and
noise. Steve Jobs loves quiet, and a notebook drive is typically
quieter than a desktop one.
Of course, there are three reasons for choosing
desktop drives: higher capacity, lower price, generally better
performance. You can see by Apple's choice what they believe is
most important.
Apple has scheduled a "Macintosh event" for August
7. Maybe they'll unveil a new iMac, an updated Mac Pro (now one year old), and a revised
Mac mini or a replacement for it. I wouldn't be at all surprised to
see Apple embrace wireless USB with the next generation
hardware.
Dan
Taller Mac mini = Cube?
Paul Allen asks:
Wouldn't a taller Mac mini with more expansion essentially be a
Cube?
Paul,
Pretty much. The Cube was a good machine, just
overpriced in comparison to the Power Mac G4, which was vastly more
expandable. The only expansion slot was for an AGP video card,
making it slightly more expandable than the Mac mini.
You'd think Apple would have learned from the Cube
vs. Power Mac that expandability trumps stunning good looks without
expandability.
Dan
The Mac mini Is Just Right
John Muir writes:
Hi Dan,
As an interested party in the Mac mini debate, I'll weigh in as
something of a "low end power user" if you'll let me.
I picked up my mini on the refurb store in December; a fairly
tricked out original 1.66 GHz model with a 1 GB memory upgrade
and 100 GB hard drive. I had been tempted by the mini before, but I
was always put off by the limited RAM, especially back in the
single slot G4 days. This machine came along at the right spec and
right price to finally make me ditch my decrepit desktop PC and go
all Mac, joining my 2003 12" PowerBook
G4.
As others have noted, the mini is very well suited to certain
tasks, since it is such a unique computer. Its power consumption is
ultra low - as is its noise level - which spells nicely for being
used as a home server. In the Intel era, its Core Duo processor is
up there with the G5 for pure brunt, and it handles the processor
heavy tasks I often give it very nicely. My mini is also connected
to a 21" Belinea CRT, which has been my screen of choice since
2000, with its powerful daytime-visible brightness when I use the
machine face to face; along with all my other peripherals. Other
times I control the mini with VNC and find it to be the best
behaved little box I've ever had.
It wasn't the mini's closed case and iMac-style philosophy for
external upgrades instead of internal ones which attracted me to
the machine. Indeed, I've a long history as a tinkerer. It was the
fact it just fits my desktop needs like a glove. As such, I've I
found the Mac mini to be spectacular value for money.
Then 2007 rolls around, and I hear my mini is to go the way of
my discontinued 12" laptop! Are Apple shooting at my second Mac
now?
Hopefully they won't drop it. The mini as it is, is already a
brilliant little machine for particular uses. Contrary to some
statements, it is neither just a glorified Apple TV nor a low-end
headless iMac. It certainly isn't a domesticated Mac Pro either!
It's a wholly different machine, and Steve Jobs introduced it as
such back when it first appeared. I'd like to see Apple keep it in
production, and if they are minded to maintaining the gap in
processors between it and its Core 2 counterparts, it wouldn't do
any harm to knock a little off its price to set it back to G4
money. We know that Apple's margin on the mini is surely higher now
than when it was last speed bumped back in 2006. They certainly
made it worth my while with the price cut and feature upgrade I
found on the refurb store.
As for the Mac midi dream machine of the screwdriver faithful
. . . I fully support the idea. Just one proviso however:
Add it to the lineup and don't drop the mini! Shouldn't there be
ample room for both models?
John Muir
John,
Yeah, the Mac mini is a great little computer for
many applications. It's a very small, very quiet server. It's a
decent media PC for hookup to modern TVs. It's a competent Mac in
most respects, although it fails to meet the FPS demands of the
gaming crowd.
I'd love to see the Mac mini stick around, either
with a faster Core Duo or, more likely, Core 2 CPUs. And I'd love to
see a midrange Mac for those who like to tinker, need expansion
slots, etc. Something that sells for a lot less than $2,200!
We should know more on August 7.
Dan
How About a Mac mini Dock System?
Trevor Howard dreams:
Hello,
Firstly, I'm a new LEM reader, but I'm so thankful for your
resources and articles being on the Web. Despite having a Power Mac G5 Dual 2 GHz (Late 2005), I
bought a Pismo PowerBook just to toy
around with the idea of having a laptop as I save and wait for my
MacBook Pro. Granted, the poor little Pismo struggles on a lot of
tasks, but I still love the darned thing so much
Anyways, I converted to the Mac with the original 1.42 GHz G4 mini, and I loved
it. (In fact, I kicked myself after I sold it at the end of the
year for only a mere $350 thinking like a PC user that it was only
worth that much . . . and I discovered your site and saw
they still sell for more than that!) It was a bit slow, basic, but
it got me into the Mac way of thinking so much that I bought one of
the Late 2005 G5s, a computer that I've actually gotten so attached
to I don't want to replace it (a rare event for me, only one PC
ever got my attachment!)
Anyways, enough babbling - on to my idea.
Start with the basic mini, keep its form factor the same (maybe
upgrade the styling a tidge, add a way to easily pop the case off
to do a RAM upgrade, make it maybe a little larger to
facilitate the rest of my suggestion better), drop the price to
$500-600 base, offer a $700-900 model that has the 8600 GT graphics
chip from the MacBook Pro in it .
Also, on the bottom of the mini add an expansion connector or
two . . . these can be proprietary, obviously. For an
additional $100-200 you can purchase an "expansion" bay that maybe
makes the whole thing the size of a mini on its edge, adds an
additional pair of 3.5" Drive bays and 2 or 3 PCIe slots, including
one x16 slot for a graphics upgrade. It would also offer an extra
FireWire 400 port, a FireWire 800 port, and an extra pair of USB
2.0 ports. It can and should include some sort of small fan to cool
it from the graphics card (I'm guessing the primary reason people
would buy such an expansion device would be additional graphics
horsepower).
Bam, for maybe a little over a grand, you have an upgradeable,
small, inheritor to the Cube form while retaining the original Mac
mini's size (which is useful in so many ways).
Anyways, just thought I'd throw this out there,
Trevor H.
Trevor,
Great idea! Back in the day, someone made a family
of SCSI drives (hard and optical) that docked to a powered base and
could be stacked.
To go a step beyond your suggestion, what if you
simply popped the lid off the mini II and snapped on the expansion
bay there? Give the new motherboard a socket for a PCIe riser and
offer one module with two slots. Offer another module with room for
a single 3.5" hard drive, and another for use with any standard
5.25" drive. License the dock specs (as Apple does with the iPod
dock connector).
Hmm, maybe even a module with an iPod dock.
This would require a more robust power supply than
the current mini has, but I think it would fly.
Dan
Dan Knight has been publishing Low
End Mac since April 1997. Mailbag columns come from email responses to his Mac Musings, Mac Daniel, Online Tech Journal, and other columns on the site.
