Is That a MacBook, and Another, and Another?

I couldn't quite understand the problem. Her friend had phoned Microsoft about 10 times over two days because she couldn't get e-mail. The woman said that an error message indicated that her account had been canceled for some unknown reason. My sister tried to help, and referred to it as a MSN account, so I couldn't figure out if it was a Live ID, Live Hotmail or MSN problem.

Yesterday, a Microsoft tech told my sister's friend that Outlook Express had become corrupted and that she needed to use someone else's copy to connect to her account. Somehow, the logging in would fix the problem, the tech said.

My sister and her friend were in an Internet cafe, where the other nine people, including my sister, had Macs! I had to ask about this. I was thinking: Guatemala, emerging market and cheap PCs running Windows.

"They were all young people," said my sister of why there were so many Mac notebooks. To her, age was reasonable explanation enough.

Are younger people more likely to buy Macs? In a totally unscientific test, I searched for "Mac' at MySpace and got back 142,000 hits and 467,000 for MacBook. Vista brought back 28,400 hits and Windows 1.1 million. But only 99,000 search hits for iPod, a hugely successful product, is reason to take all the results as meaningless.

Whoever is buying, Apple notebooks are definitely moving at retail. According to NPD, Mac retail notebook share is around 10 percent.

Apple is having success in a hot PC category. IDC predicted that U.S. notebook shipments would exceed desktops in the third quarter. Notebook shipments already exceed desktops in Europe and Japan and IDC predicts the same worldwide by 2010.

Apple is getting operating system benefit that surely Microsoft would like to eventually realize for Windows Vista. During the opening keynote for Apple's World Wide Developer Conference on June 11, CEO Steve Jobs said that 67 percent of active Mac users are on current OS version Tiger. Another 23 percent use predecessor Panther.

Jobs described this fact as "unprecedented in our industry for two-thirds of an install base to be running the latest and greatest release of an operating system."

I wouldn't go that far. Apple released Panther in October 2003 and Tiger about 18 months later. Windows XP reached similar threshold during similar time frame—as measured by U.S. household primary PC operating system—based on research conducted when I was an analyst.

Vista for Macs
Microsoft shouldn't let Apple go unchallenged, particularly if some segment of younger consumers really prefers Mac portables. Businesses bank on product choices in youth leading to lifelong brand loyalty. I've seen studies suggesting the current baby boom generation—from about age 11 into the early twenties—is a fickle group about brand choices; brand loyalty isn't as strong as their forebears. But they are more likely to be peer-influenced than the older group of boomers or GenXers. Right now, Apple is a cool brand, thanks in part to iPod. Apple peer influence could be an overlooked phenom.

Thanks to Apple, newer Macs are all capable of running Windows Vista via Boot Camp. Microsoft doesn't have to cede anything to Apple, which from a Windows perspective could be just another OEM. People aren't going to just pay loads extra for Windows Vista. Microsoft will need to entice buyers by using subsidies or incentives to offer, say, free Windows Vista through the channel on new MacBook or MacBook Pro SKUs.

Back-to-school buying season would be great time to offer something, even a rebate for full cost of the software. Better yet, offer students that buy a MacBook or MacBook Pro and Office 2004 Student and Teacher Edition a free copy of Vista Premium. Free with rebate is one option, but not what I'd recommend. Another option: Microsoft work could work with universities that subscribe to campus site volume licenses to easily make Office 2007 and Windows Vista Ultimate available for Mac notebooks.

A friend's daughter is going to school in Philadelphia, and the school offers discounted, pre-configured and build-to-order notebooks from Apple, Dell and Lenovo. If the university has a Microsoft campus license, Vista should be a pre-load option provided and supported by a Microsoft partner. Leopard's delay until October opens up back to school for Microsoft, whether for Vista laptops or Mac notebooks running Vista.

Operating systems usually aren't the first or even the fifth function people consider when buying computers. IT managers typically choose operating systems based on applications. Consumers weight factors like appearance, size, performance and the like—or in the case of some younger consumers because of "cool."

That cool Mac notebook could just as easily run Windows Vista as the primary operating system. But Microsoft will need to make lots of marketing efforts and engage its channel as ally.

Editor's Note: Apple's developer conference is reason for this week's unusual number of Mac posts. We blog with the view of Apple as Microsoft competitor.

Editors Note: For clarity, the story was updated with Tiger release information.

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