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January 3, 2013

Slate: Why Apple Killed the Netbook

(Continued)

PALO ALTO, Calif. —

The second reason Apple didn't make a netbook was that it couldn't make a netbook. The principal difference between Apple and most other tech manufacturers is that Apple prizes profits over market share. Sure, Apple, like all companies, wants to sell a lot of widgets — but given a choice between making $10 billion by capturing 10 percent of the market or $1 billion by capturing 90 percent of the market, Apple will always choose money over sales. (You'd think this was obvious; don't all companies want to make money? Nope: Apple sells fewer PCs than most other companies, but makes much more money doing so than all of its rivals.)

That's why Apple couldn't make a netbook. Netbooks were a market-share play — at $300 to $400 each, PC manufacturers were making very little on each one sold, so the only way to succeed was to get a huge slice of the market. Apple had no interest in playing that game; why spend time and effort selling something you wouldn't make any money on?

Even if you don't use the iPad or the Air and have no interest in ever buying an Apple product, pretty much every mobile computer you can buy today was inspired by the two devices that Apple ginned up to fight netbooks. In netbooks' demise, Apple emerged victorious — but so did the rest of the PC industry, and so did we users.

Manjoo is Slate's technology reporter and the author of "True Enough: Learning to Live in a Post-Fact Society." 

 

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