Apple and CompUSA: For Better or Worse?
Dan Knight - 3 February 1998
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It's the talk of the internet: Apple has apparently inked an exclusive deal with CompUSA as the only national (U.S.) Macintosh reseller.
What does this mean to us?
First, it means Office Max, Sears, Best Buy, Circuit City, and a host of other retailers will be liquidating their unsold Apple inventory. You could see some real bargains. A lot of hardware might end up back at Apple, which means it will eventually appear on the refurbished list in a mail order catalog.
Second, this means your local authorized Apple dealer no longer has to compete with stores more comfortable moving boxes than supporting Mac users. (Not that we need much support....) There will be less slices of the Mac OS pie now that most of the clones are gone and many halfhearted Apple resellers have been disenfranchised.
Third, it means you may be able to walk into a CompUSA store and find one or more Mac aficionados. You will be able to find software, printers, input devices, CD-ROM drives, and all the other thinks Windows users are used to finding, if the local CompUSA is any indication.
Fourth, it means a larger share of the Mac market for CompUSA. As the only national chain carrying Apple product, it is conceivable they will see 20-30% of their volume come from Apple and Mac-related product. After all, everyone can sell you a Wintel computer, but only CompUSA, regional chains, and local dealers will offer Macintosh.
Fifth, Apple now has a strong range of options for Mac buyers:
- Apple's online store
- Mac-specific mail order catalogs
- CompUSA
- Several regional chains
- Dedicated pro-Apple local dealers
Frankly, Apple has never been in a stronger position, not since IBM played upstart and stole the personal computer market in 1981.
Apple finally has a product line with good power, excellent pricing, enough depth (although lacking on the low end - thank goodness for Umax), and enough hunger for a focussed market attack. It's make it or break it for Apple. Crazy Steve is at the helm, a visionary whose practicality sometimes takes a back seat to his vision (witness NeXT, an operating system just coming into its own after ten years).
Apple is thinking different. Powerful computers at reasonable prices. OS updates on schedule. Reeling in Claris so Apple can profit directly from OS upgrades. Shutting down Power Computing so Apple could survive. And now giving CompUSA and local dealers a chance to make a living selling the Macintosh by eliminating at least half the competition.
It's a risk, but I think it's a smart one. Apple will only increase market share if it is being sold by people who know and love the Mac. By getting CompUSA to set up an Apple store with Mac savvy employees, Apple has a chance to win over some who shop at computer superstores. (Before, the chance was very, very slim.)
Bottom line: Apple, CompUSA, and your local dealer all stand to benefit from these changes in the status quo. Apple is becoming a lean, mean profit machine while it still has strong cash reserves.
Remember Rocky's comeback? Remember the Chrysler comeback?
Now it's Apple's turn.
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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