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Running the 2008 Mac Numbers with Tim Cook

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During Apple's special event in Cupertino to announce the new models of the MacBook, MacBook Pro, and MacBook Air, Steve Jobs started off by introducing Apple Chief Operating Officer Tim Cook to recap some of the numbers showing how well the Mac is doing. (There was some immediate speculation that Jobs intentionally handed the baton to Cook for this portion of the keynote as a way of acclimating the media to other Apple executives presenting; Jonathan Ive also handled a chunk of the keynote, and Phil Schiller participated in the Q&A session at the end.)

As with the article I wrote after the last special event (see "Running the Numbers with Steve Jobs," 2008-09-09), these numbers are only those Apple wishes to share, and there's seldom any independent confirmation of them. Nonetheless, they're as good as we get most of the time, and it's always interesting to see what Apple chooses to emphasize.

Cook led off by noting that in the last reported quarter, Apple sold 2.5 million Macs overall, which is not only a record, but also the continuation of a significant upward sales trend for Macs. That's in contrast to the rest of the computer industry as well, apparently, since Cook claimed that Mac sales have outpaced the industry for 14 of the last 15 quarters - since 2004. (The sole exception was the quarter in which Apple started the transition to Intel-based Macs.) In the last few quarters, Mac sales have grown by two to three times the rate of the rest of the industry.

Apple didn't give specific credit to particular models, although Cook cited the iMac and MacBook Air as being "far superior" to similar PCs, and Steve Jobs later commented that the MacBook is "the best-selling Mac ever" in a context that implied he was talking specifically about the MacBook itself, and not the MacBook/MacBook Air/MacBook Pro family. Who knew? But I'm not surprised, since the MacBook has long combined a reasonable amount of power in a nicely sized unit - it's the sweet spot of the laptop line for me.

Those sales have given Apple a significantly increased market share, growing from what Cook identified only as "single digit" market share to 17.6 percent of unit sales in the United States retail market. Even better is the revenue share, where Apple has 31.3 percent. That's because Macs are generally priced on the high end of the spectrum; although it's usually difficult to find comparable PCs for much less, there are less-capable PCs available for notably lower prices. You get what you pay for, but on the other side of that, manufacturers of low-priced hardware also receive what you pay.

Cook didn't clarify what "U.S. retail" encompasses, since a large number of PCs are sold outside of the traditional retail channel, in bulk sales to corporations, governments, and other large organizations. It's possible that Apple is dropping those sales out of the comparison to make their numbers sound better. At the same time, retail sales are often indicative of what consumers are spending their own money on - in this case, nearly $1 out of every $3 spent on computers goes to Apple.

The retail Apple Stores play a notable role in Apple's success. According to Cook, Apple now has 247 stores in 8 countries, with 400,000 visitors per day. But what's really important is that 50 percent of the Macs sold in the Apple Stores are to people who are new to the Mac. Even accounting for the fact that the Apple Stores have become common meeting places for young people who want to check their email and check out the other people checking their email, that's still an impressive number. It's even more impressive if you consider that, at this rate, Apple Stores will receive about 150 million visitors in a year.

Cook also called out Apple's gains in the education market, which long ago was an Apple bastion, but which, over the last 10 years or so, gradually moved towards lower-priced PCs from Dell and others. Cook claimed that Apple has surpassed Dell to become the top seller of laptops in education, with a 39 percent market share. He also showed a slide of Mac market share at an unnamed major university going from 15 percent in 2002 to 47 percent in 2008. Last year I wrote about Mac usage at Cornell University (see "Mac Market Share Rising at Cornell University," 2007-09-13), noting that Apple's market share had grown from 5 percent in 2002 to 21 percent in 2007; in 2008, Macs were used by 27 percent of dorm residents connecting to the campus-wide ResNet. (Oddly, in both of the last two years, 6 percent of students were using Windows on an Intel-based Mac.)

To conclude the run through the Mac numbers, Cook showed a slide that demonstrated how Apple's overall sales have grown over the last few years, from 4.5 million Macs in 2005, 5.3 million in 2006, and 7.1 million in 2007. In the first three quarters of 2008, Apple has already sold 7.1 million Macs, the same as all of 2007.

And as you'll read elsewhere in our coverage of the keynote, Apple's new laptops are only going to help push that number to new heights.

Oh, and one more thing.

To start off the question-and-answer session at the end of the event, Jobs said, "110 over 70, this is my blood pressure. This is all we're going to talk about Steve's health today. If you want to see it go higher, ask him more questions about it." No one took the bait.

 

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