Why Apple Switched

Since Paul and Joe have both discussed Apple's move to Intel let me explain in one word why I think the decision was made.

Supply.

I heard it near the end of an interview Steve Jobs conducted with CNBC's Ron Insana right after yesterday's announcement. He was asked about the success of the iPod and iTunes, where Apple has an 80% market share rather than the 3% we're used to in the PC world.

Here's what Jobs said, from my notebook.

"We’re thrilled that we seem to be in stock in most places, which is something we didn’t do before."

How many sales has Apple lost over the years because supplies were tight or just expensive? Neither Motorola nor IBM could ever supply the quantities Apple needed, at the prices Apple needed, in order to be anything more than a minor irritant to the WinTel suppliers like Dell and H-P.

But the iPod proved things have changed. If your stuff is better now, it's possible to ramp-up production fast enough to hold your lead. IBM could not do that for Apple. Intel can.

Yes, this is reading a lot into a little quote, but you have to parse Jobs carefully. He doesn't say much, and most of what he does say is so heavily couched in happy talk as to be meaningless.

So here's the bottom line. If you saw an Apple on a shelf, at the same price as a Windows PC, or even a little lower, would you buy it?

We're going to find out.