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Mac Musings

No $500 PC This Year

Dan Knight - 1998.04.27 - Tip Jar

Homer Brickley on Nando.net thinks we'll see $500 computers by Christmas ( The Computer Model T Is Not That Far Away).

I beg to differ.

I'm an old timer in this industry. I used my first PC (back when that meant "personal computer") in 1979. Back then, we had some truly inexpensive computers.

Remember the Commodore VIC-20, "The Wonder Computer For the 80s?" William Shatner pushed it and dealers moved a lot at $299 or less. Color, sound, and a reasonable 5KB of memory made it a winner. You could hook it to your TV and use a $100 tape drive for storing programs.

It was an incredible breakthrough.

In the States, Timex sold the Sinclair computer for as little as $99. This one didn't have color, but it didn't require a special tape recorder, either. It sold fairly well.

Then Commodore blew our minds: the C-64 sold for $595 with an incredible 64KB RAM, 40-column text, and compatibility with all our old VIC-20 accessories. You could buy a real computer with a 170KB floppy drive for under $900 - and the price dropped constantly.

About 4 years ago, just before CD-ROM became essential, Compaq was selling $999 computers. Apple sold the Mac Classic (floppy only) for that price. We've had sub-$1,000 computers before, but buyers always wanted more.

This is 1998

Today users aren't content with 64KB or 1 MB of RAM, with a floppy-only computer. We insist on at least 16 MB RAM, multi-gigabyte hard drives, fast CD-ROM players (and sometimes DVD), a couple megabytes of VRAM with accelerated video, stereo sound, a fast modem, and a 200 MHz processor.

And we consider that an entry level system.

Sorry, Mr. Brickley, but we don't want Model T computers, even though entry level computers may seem like that compared with the latest Power Mac G3 or Pentium II machine.

To sell a computer for $500, it has to cost under $300 to produce. Figure the cost of a hard drive, a fast CD-ROM player, and a motherboard with RAM and integrated video. Add a case, a keyboard, a sound system, a modem, and a power supply, plus licensing for the operating system and the cost of some bundled software.

The industry will comfortably break the $1,000 with viable new systems by Christmas, but with all the features buyers demand, the only $500 computers we'll see this Christmas are from liquidators unloading old inventory. LEM

Further reading

Dan Knight has been using Macs since 1986, sold Macs for several years, supported them for many more years, and has been publishing Low End Mac since April 1997. If you find Dan's articles helpful, please consider making a donation to his tip jar.

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