There’s an American colloquialism which says, “It ain’t over ’til the fat lady sings.” In sports the phrase is often used to urge fans to stay with the game even when their favorite team is behind either in the late minutes or moments of the game or there’s a big difference in points, goals or runs in the early going of the contest. While the origin of the term is itself contested, it’s use has become rather common. It was a mantra for Mac enthusiasts during the late 90′s when the Mac v. PC contest appeared to be over.
On my personal blog Posts At Eventide, I’ve stated the iPad is such a significant product release Apple in essence has turned back the hands of time. In 1995 the Windows OS began to capture an overwhelming percentage of the PC market not because it was an excellent update to Windows 3.11 but because Apple stumbled in the migration from Macs with Motorola 680X0 processors to the PowerPC platform. Apple’s executive team at the time miscalculated demand for PowerPC Macs and was overconfident in the value of the Apple brand name to deliver sales at high prices and fat profit margins on older technology.
Fifteen years later, Apple represents perhaps the most stunning corporate turnaround story in US history. Since the return of Steve Jobs to the helm at Apple the value of the company has increased by over $200 billion. The resurgence in Mac sales that started with the release of the original Bondi blue iMac, was accelerated by the development and release of Mac OS X and has been sustained by the success of Apple’s popular line of laptop computers has placed Apple back among the top five PC makers in the United States when measured by unit sales volume. The company’s domestic and global share of overall PC industry operating profits is even greater than the Mac’s unit sales and market share would otherwise suggest.
However, what kicked Apple’s revenue growth and earnings into high gear are two lines of products that were introduced in the first decade of the new millennium – The Apple iPod and the Apple iPhone. For all of the Mac’s newfound success, it’s the two lines of handheld products that boosted Apple to the top tier of America’s most successful corporate enterprises. But it’s a new product, to be released this Saturday, that will once and for all rewrite American technology history. That product is the Apple iPad.
The Apple iPad comes to market this week aggressively priced from the start with an established eco-system in place offering apps, games and entertainment content. It’s a revolutionary device that will transform the way in which we access and consume digital content. It’s a product that isn’t going to so much topple the Windows PC and its dominance in the operating system market as much as it will destroy the economic underpinnings that sustain the Windows PC market. From app developers to book, newspaper and magazine publishers, the economic groundswell building under the iPad’s launch suggests explosive sales for the iPad from the moment the product moves into the market.
The Macintosh is arguably the most successful line of personal computers when measured in economic value to the manufacturer. While most consider the Windows PC the dominant player in the game, few have chosen to notice the growth in Macintosh sales and profits since the Mac’s Intel transition that began with the release of the first Intel iMac in early 2006. By the end of this calendar year Apple may realize more revenue on a quarterly basis than its arch rival Microsoft and within a year Apple’s market cap will surpass the market cap of that company. For those who took their eyes off the contest, they might be surprised to see Apple, from an economic perspective, has retaken the lead. While the iPad isn’t going to replace the Windows PC, iPhone OS devices, including the iPad, will supplant it as the most popular platform for personal computing and communications.
In the coming weeks The Other Mac Blog‘s Colum O’Dwyer will explore the Apple iPad from a user and technology perspective. I’ll be back each week with a look at the economic significance of the iPad to the industries that support it.
Together, from different perspectives, we’ll reveal why, for the Windows PC era, the fat lady has begun to sing.