A $99 PC, a $399 Hackintosh, and Growing the Mac Market

It's called the KPC. It sells for $99 bare bones (no CPU, RAM, or hard drive), and as low as $229 configured. And it makes me wonder, "Can it run OS X?"

The KPC isn't a powerhouse, but it could be. Its base CPU is a 1.8 GHz Intel Celeron, its base RAM is just 512 MB, its base hard drive is 80 GB, and its Intel GMA 950 graphic processor shares RAM with the CPU. In short, it sounds a lot like the Mac mini.

It's no Mac mini - it measures 7.5" wide, 6.7" high, and 11" deep. A stack of 5 Mac minis would occupy less volume.

On the plus side, it uses a 3.5" hard drive, which means lots of fast, affordable, and high capacity storage options. And it supports up to 2 GB of RAM, which is the bottom end for maximum RAM these days. Best of all, it has a socketed CPU, so you can plug in a Core 2 Duo if you want some real horsepower.

In addition to that, it has 5.1 channel audio, PS/2 mouse and keyboard ports, and 4 USB 2.0 ports. It just sips power - it has a 100W power supply but normally uses just 33W (55W peak in the standard configuration).

One more thing: It has a PCI slot. Just one, but that's one more than the Mac mini and iMac have.

There are some compromises made to reach the $229 price point, like a single-core CPU and absolutely no optical drive of any type - no SuperDrive, no Combo drive, not even a CD-ROM drive. The Celeron 430 has a 512 KB level 2 cache, which is small by today's standards (the low-end Mac mini has 2 MB). And you don't get a commercial operating system, just another version of "Linux for newbies" (a version of the KPC that comes with Vista and Microsoft Works sells for $449, so there's a reason Shuttle uses Linux).

A configurable model retails for $299 and includes a 1.8 GHz Pentium dual-core CPU, 1 GB of RAM, and a 160 GB 7200 rpm hard drive with an 8 MB buffer. You can upgrade to a 2.2 GHz Core 2 Duo for $100 and max out RAM to 2 GB for $15. A 250 GB hard drive is only $15 more - a very good value.

This being a Windows computer, speakers are considered an option, but you can buy Logitech's S-120 speakers for just $10.

And, shades of the Mac mini, the keyboard and mouse are extra. Shuttle offers a Logitech bundle for $35.

Add WiFi for $55 and an external USB 2.0 SuperDrive for $100, and you have a $594 computer (no mouse or keyboard) that will outperform the Mac mini - but without a commercial operating system, let alone all of the free iApps that come with Macs. (A similar configuration with Windows adds up to $719.)

It certainly shows how a $99 bare bones PC with Linux ends up costing nearly as much as Apple's Mac mini. On the other hand, if you already have some of the components, it could be a cheap way for a Windows or Linux user to move up to a more modern PC.

The Open Computer

It was called the OpenMac. It sells for $399.99 configured. It's designed to run Mac OS X. And it makes me wonder, "Could this be a good choice?"

The base configuration includes a 2.2 GHz Core 2 Duo CPU, a 250 GB 7200 rpm hard drive, Intel GMA 950 graphics, and 2 GB of RAM. The 20x SuperDrive is built in, and there are 4 USB 2.0 ports on the back.

It's now called the Open Computer (you can bet Apple Legal had something to do with that), supports up to 4 GB of RAM, and you can configure it with an Nvidia GeForce 8600 video card if you find the integrated graphics don't meet your needs (add $110 with 256 MB of video memory, $155 with 512 MB).

The Open Computer doesn't include FireWire, but if you need it, you can add 3 FireWire ports for $50.

Pystar, the company behind the Open Computer, doesn't publish a lot of details about the Open Computer. It can run Mac OS X 10.5, and you can buy it with Leopard installed ($155 extra). Based on photos on the company website, I'm guessing the Open Computer has one AGP slot and three PCI slots. Since it uses a PC motherboard, it probably has PS/2 mouse and keyboard ports as well. There appear to be three optical drive bays, and you can count on there being more than one hard drive bay inside the box.

Dimensions: not small. Weight: unknown. Colors: white or black.

This is pretty much the computer many of us have been clamoring for - an expandable Mac that costs a whole lot less than the Mac Pro. Configured with FireWire and Leopard, it costs $605. It could cut into the Mac mini and 20" iMac markets, although it's just as likely to build a new market among switchers and longtime Mac users upgrading from PowerPC hardware.

The Headless Mac

I'm convinced that Apple could sell a comparable computer for anywhere from $499 to $999, and the Open Computer follows one suggestion I've made numerous times (and which I hope Apple will follow if it ever enters this market): integrated graphics with an AGP or PCIe slot for those who want or need better video.

Apple could sell a similar Mac at $499 with a low-end Core 2 Duo CPU, 1 GB of RAM, and a Combo drive. Keyboard and mouse extra, as with the Mac mini. And it would have a genuine Apple logic board, so no worries that the next OS X update might be incompatible with the hardware (something the Open Computer can't promise).

More than that, it would look like a Mac - whatever that means. It might mimic the look of the Mac mini or the Mac Pro, but more likely it would have a whole new look. Maybe it would be a new 10" cube design, a shape Steve Jobs seems to love.

Whatever, the point is that Apple could build a low-end expandable Mac and could offer it at a very low price (say $499). And, being Apple, it could soup it up a bit (say a faster CPU, 2 GB of RAM, a bigger hard drive, a SuperDrive, and a low-end AGP or PCIe video card) and sell it at $999. Mac owners and potential switchers would line up in droves for a Mac with expansion slots, 3.5" hard drive bays, and a price tag south of $1,000.

Not that I'm holding my breath, but this would be the perfect time for Apple to release such a Mac. Windows XP is scheduled to come off the market in June, and Vista seems to have made more enemies than friends for Microsoft. Linux is not a suitably user-friendly solution, as Walmart discovered in trying to sell a low-end Linux computer.

While Apple has had phenomenal results in the notebook realm, the desktop computer is far from dead, and selling a Mac that both current PowerPC Mac and Windows users could plug in with their existing keyboard, mouse, and display seems like a no brainer, especially since modern Macs can either boot into Windows or run it virtualized alongside Mac OS X.

A History of Success

However, Apple may not be interested in regaining its former glory. Back in 1981, before the Macintosh and the same year that IBM decided to join the personal computer market, the Apple II accounted for 15% of units sold. The Macintosh peaked at 12% of the market in 1992, but the Windows market took off with Windows 95, and Apple fell from 9% market share in 1995 to 5.1% in 1996 - Apple had a 12% drop in unit sales while the PC market grew by two-thirds that year.

By 2004, despite the success of the iMac, the iBook, and other models, Macs accounted for less than 2% of the worldwide computer market. Four years later, Macs are selling in record numbers, and Apple's market share is growing while Dell, HP, and the rest are seeing their markets shrink.

Thanks to the iPod, the iPhone, and those wonderful "I'm a Mac" ads, Apple has become a leading brand worldwide. The time is right to grow the Mac market, and I believe an affordable headless Mac is the key to doing that.