Minority Report: How Apple will survive the downturn

Forget cheap laptops

Forget cheap laptops

While other companies scramble to change strategy to ride out the recession, Apple appears to be sticking with its tried-and-true approach, says Seb Janacek.

Steve Jobs has been fielding questions about future products and company strategy in an unusually direct way in recent months, reflecting a more relaxed approach for Apple.

Apple has a long history of protecting its secrets fiercely but in the run-up to some recent Mac and iPod announcements, it moved away from its traditional tactic of sending its legal team in to deal with websites that featured images and details about imminent releases (see my recent column on this topic).

In a similarly relaxed fashion, Jobs took the opportunity to answer questions on potential up-and-coming products from Cupertino during a recent profits report call with analysts, a generosity possibly prompted by news of massive iPhone sales during the quarter.

Most interesting were his comments around low-cost Macs and how Apple will address its key markets during the economic downturn.

There's been a considerable buzz about Apple potentially increasing its market share by releasing lower-priced laptops and entering the nascent netbook market.

The former rumour was scotched when the new MacBooks failed to meet pricing expectations (the lowest Apple got was an entry-level MacBook costing $999, when many had speculated it would go as low as $800). And Jobs has ruled out an immediate move into the netbook market.

On the subject of netbooks, Jobs said on the recent profits call: "We'll wait and see how that nascent category evolves, and we have got some pretty interesting ideas if it does evolve."

He added that the iPhone fits into this category as it allows the user to access the web, email and other basic applications.

Also on the call, Jobs stressed the company will continue its strategy of marketing high-quality kit to particular customer bases and hedge its bets on people buying into the brand to increase its market share.

He added: "We've seen great success by focusing on certain segments of the market and not trying to be everything to everybody so I think you can expect us to stick with that winning strategy."

The low-cost computing sector is clearly not part of its plans.

Jobs said: "We don't know how to make a $500 computer that's not a piece of junk and our DNA will not let us ship that. But we can continue to deliver greater and greater value to those customers that we choose to serve - and there's a lot of them."

As for those $500 "piece of junk" Macs: the product managers of the Mac Mini must be wincing. The $599 'headless Mac' is clearly a product somewhat at odds with the Apple philosophy.

The basic Mac was introduced as an ideal low-cost switching machine but its value for money is debatable compared with offerings from other PC manufacturers.

The Mac Mini has seen few updates since its inception and should be in line for an update at January's MacWorld event. If it isn't, then the writing may be on the wall for the little computer.

You heard Jobs: it's just not in tune with Apple's genetic makeup - regardless of economic ups and downs.