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Can Apple become the business choice?

Despite the hype around Apple's announcements which has techies getting up at all hours to watch them, it's rare that Apple CEO Steve Jobs ever unveils something that's really interesting to IT managers.
Written by Renai LeMay, Contributor on

Despite the hype around Apple's announcements which has techies getting up at all hours to watch them, it's rare that Apple CEO Steve Jobs ever unveils something that's really interesting to IT managers.

Jobs lounging with the iPad

Jobs lounging with the iPad.
(Credit: James Martin/CNET)

Apart from the odd sporadic confirmation of support for a feature like Microsoft Exchange that is clearly aimed at the enterprise, or an update of its Xserve server line, Apple's products are usually aimed squarely at the consumer.

This situation and other issues has left Apple out in the cold when it comes to the corporate and government sectors.

And yet, despite lacklustre interest from Apple itself the demand exists from users. Australian chief information officers admit they regularly get requests from staff for Macs as desktops.

So what does the future hold for Apple in the enterprise?

State of play

The latest figures show Apple is rapidly growing its share of the Australian overall desktop PC market. In late January, the company revealed it had boosted its Macintosh sales in Australia by 70 per cent year on year. Australian statistics from analyst firm IDC showed Apple's share of new PCs being shipped (including enterprise and consumer) as of September 2009 — the most recent period accounted for — was approximately 7 per cent.

Australians bought just under 1.2 million units in the period (including corporate and consumer sales), which would place total Apple unit shipments in that quarter at approximately 84,000. Analysts attribute Apple's growing consumer market share to a number of factors, including the halo effect from its iPod and iPhone lines, its strong security and stability story, and even the quality of its hardware build.

You only have to walk into an official Apple store to be able to see the buzz around the company's consumer offerings. It's audible.

It's also easy to find large and small organisations that have Macs embedded throughout their operations. Tier-two banking and insurance giant Suncorp runs some Macs in its operations. Chief information officer Jeff Smith says the bank has them "in spots".

"We do use them as there are certain things we can do better on a Mac, like with user interface development and usability," he says. "They are invariably easier to manage and more secure." Smith says this is an important factor when you consider the amount of money that businesses pay to secure their infrastructure.

It sounds like a marketing campaign, and it is, but it's true. You turn a Mac on and it works. No DLL hassles, no driver issues and NO CRASHES.

Simon Garlick

There's also the deal that may well have been Apple's largest coup in the Australian enterprise — half a decade ago the NSW Roads and Traffic Authority (RTA) deployed 1200 Apple G4 iMacs in registry offices across the state.

Chilli Chocolate Marketing consultant Simon Garlick says when he first helped to start the marketing and communications agency, from day one he imposed a "Mac only" company IT policy. "I don't have time to play IT guy making sure people have security patches installed, that they're not using some security nightmare browser (that is, IE), that antivirus apps are updated, and so on and so on — but I don't have budget to hire IT guys," he says.

"Yeah, it sounds like a marketing campaign, and it is, but it's true. You turn a Mac on and it works. No DLL hassles, no driver issues and NO CRASHES. We all have iPhones, the office has AirPort Wi-Fi access points, everything works seamlessly together."

Then there's the education sector. In February this year, the vendor published an extensive case study about a University of Newcastle roll-out that saw the educational institution's School of Design, Communication and Information Technology move its entire laboratory hardware infrastructure across to Apple, although students can still run Windows on the machines for some applications.

However, the obvious rejoinder to all of these examples is that they play to Apple's traditional strengths in the design and education communities. It's clear that Apple's share of the market is higher in these sectors and in the consumer space than it is in the mainstream enterprise, where it continues largely to be left out of the mega-deals that vendors like HP and Dell enjoy.

Apple's problem

We hate to pull out the Gartner magic quadrant here, but sometimes it's necessary to do just that. In an October 2009 report, the analyst firm gave Apple the worst rating out of all the major vendors — ranking the company below Acer, Fujitsu, Lenovo and market leaders HP and Dell — when it comes to the mainstream enterprise desktop.

Gartner said that Apple's enterprise problems are that it lacks global service, sales and support capabilities focused on the enterprise.

"Apple doesn't focus on large and mid-size customers, and hasn't made significant investments in the sales and support necessary to serve them," Gartner said in a separate note specifically on the vendor earlier in 2009.

Longhaus research director Sam Higgins says he doesn't see Macs often being purchased in bulk by enterprises as part of the sort of corporate roll-outs that Dell and HP enjoy. Apple has a "false shadow" in the enterprise sector in that there is a lot of talk about the vendor in big business because of its strong consumer presence. "But the shadow is exactly that — a shadow," he says.

The problem is no longer that Mac OS X doesn't support the same breadth of desktop software that Windows does — after all, Macs can run Windows natively via Apple's Boot Camp tool, or in virtualised environments through software like Parallels.

The problem, for Higgins, is that the breadth of software tools for managing a bulk number of Apple desktops isn't as wide as in the Windows space. So while Macs may creep in around the enterprise edges — particularly when special users like CEOs demand them — the analyst says it's hard to give them "full citizenship" in terms of being integrated with organisations' desktop standard operating environments.

"It's the English as a second language problem," he says.

Higgins points to the success of Research in Motion's BlackBerry device in the enterprise as a comparison, noting the sophisticated management tools available for the device. Windows laptops also, he says, have security tools to deal with cases of theft. "The difficulty with anything in the enterprise is manageability and governance," he says.

IBRS analyst Joe Sweeney says his group has seen very little uptake of Macs in Australia's large to medium enterprises. In terms of larger organisations and the public sector, he says that "by far the biggest issue" for IT managers in thinking about their corporate desktop PCs is determining how they will manage the upgrade to Windows 7 — whether they will choose the traditional PC, or look at desktop or application virtualisation solutions.

Even Apple's education sector advantage is eroding, with Sweeney pointing out that the Federal Government's Digital Education Revolution initiative was further entrenching Windows in schools.

The opportunity

To a certain extent, the problems and state of play regarding Apple Macs in the Australian enterprise have been the same for some time. However, this seems set to change.

Firstly, there is broad agreement that employees are increasingly demanding the ability to bring their own technology into Australian enterprises — and that technology is increasingly Apple-flavoured.

Mortgage Choice chief information officer Neil Rose-Innes says the group used to set a standard for desktop and laptop machines that its staff and franchisees could use to run the company's corporate applications.

Now it's moving towards a much simpler minimum configuration that reflects the fact that users want choice on their desktops, and they often don't want a separate desktop, laptop, netbook or even smartphone for business and work. They want to bring their device in.

"My personal view is that there's legs on it," he says of the Mac.

Higgins says CIOs are handing users the budget for their desktop or laptop and allowing them to purchase it themselves. He gives the example of a user who might want to buy a high-end Alienware gaming laptop to use as their corporate and home machine — contributing some money themselves, perhaps through a salary sacrifice arrangement, and using some of the corporation's IT spend.

"It's like bringing your own car," he says, noting most organisations don't operate their own corporate motor fleet any more. "There's a whole stack of psychological staff and employment benefits that can come from operating those kind of things."

Facilitating this change in approach is the corporate migration to web-based applications such as Salesforce.com that don't require software to be installed on a users' desktop but are accessed through a web browser.

Mortgage Choice, for example, last year switched its corporate email platform from Lotus Notes to Google's Gmail — which is as fully functional on a Mac as it is on a PC, and is accessed through a web browser.

Ultimately, with demand from users balanced against the challenges of running a corporate IT department, the future of Apple Macs in the enterprise is still too close to call.

"I think it will take a little bit of time," says Suncorp's Jeff Smith. "But the reality is it is a productive environment for people. I think it will have a growing space. I think the leading indicator is the consumer area and market shares have been growing big time and that is going to flow into the business area."

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