Thursday, January 13, 2005

Mac mini and the future of Apple

To my mind, Andy Ihnatko comes closest to nailing the real significance of the Mac mini:

Ihnatko - Thoughts on the Keynote || The Mac Observer: "The Mac Mini is probably the first grand experiment in marketing a desktop computer as something that could (conceptually, at least) be blister-packed next to the cellphone headsets and off-brand CD players over at Wal-Mart. [...]
The Mini's a $499 piece of hardware, but still, I'm inclined to wonder if it'll be the first true Impulse Buy computer. I can easily imagine someone wandering into a mall Apple Store and thinking You know, we've been thinking of buying a second computer for the house... The Mini's packaging and presentation seems to shrug and say 'Sure, why the hell not?'"

The megahertz race held off commoditization of computers for a long time, but at this point most of us have all the raw processing power we'll ever need. For years now, the performance bottleneck in the way most people use computers has been network bandwidth, not processing power. Increasingly, each new generation of mainstream computer models is likely to be substantially cheaper with only slightly faster performance, rather than substantially faster at only a slightly lower price. There will still be a high-end market for people doing serious video and the like, and Apple will continue to be all over that niche. Steve Jobs devoted a substantial portion of the keynote to Apple's video-related software products. But for the rest of the market, I think Apple has accepted the inevitable and decided to run with it.

At $499 it's not there yet, but a few years down the road, devices with the same power will sell for $99 or even $49. At that price, why not have one in every room in the house? And if the house is on a WiFi/Airport network, why not cluster them? Then if we do feel the need for a performance boost, we just stop by Best Buy on the way home from work and pick up another CPU to drop into the cluster. Gradually the computer fades into the background and processing becomes an invisible infrastructure service, like electric power (generated by the home fuel cell out in the garage next to the water heater?). Locations without computing capability to (wirelessly) plug into will become as rare as locations without electric lighting. Depending on availability of bandwidth, we'll keep our data--our Home folders and iTunes playlists, and possibly our applications--either on a server or on our cellphones.

Why cellphones? Obviously we'll want our data available anywhere and everywhere, and Firewire hard drives (like the iPod itself) are already plenty portable. But the ultimate limiting factor on the size of PDA-like or iPod-like devices is going to be the controls and displays, not the data storage, and they're not likely to shrink to a size where we won't notice we're carrying them. So why carry more than one device? Phones are already increasingly supplanting PDAs, and of course Motorola announced its iTunes-enabled phone last week. Since demand for mobile voice service isn't going away, and folding iPod-like functions into the phone is presumably easier than grafting a phone onto an iPod, the logical evolution is for everything to be absorbed by the cellphone.

Note the implications for Apple. It seems that iPods as such won't be around forever. The biggest rumor that didn't materialize at MWSF was the iPhone, so for now it appears that Steve has been telling the truth and Apple really isn't interested in entering that space. How about Macs? For now even Andy's impulse-buy Mac mini is a device that people are willing to devote time, thought, attention, and brand loyalty to. But it's hard to imagine a company like Apple that thrives on design and customer involvement producing the sort of commodity hardware that the mini points toward. So it seems that both of Apple's major product lines represent transitional technologies. Ultimately I think the cellphone is likely to pack a CPU as well--why not? Maybe that'll turn out to be the right time for an Apple iPhone, at least for a few more years until such superphones are commoditized too.

What else does this evolution leave for Apple? Obviously putting the CPU in a cellphone-sized package means no built-in CD/DVD drive, but even if network bandwidth doesn't end up making DVDs obsolete, I really can't see Apple as a peripheral drive maker (talk about your faceless commodities!). One element that, by its very nature, isn't going to fade into the background is the display, and I can easily see those continuing to get bigger rather than cheaper for quite some time yet. Even in recent iMacs, the computer seems to be vanishing into the display. There will probably also continue to be demand for laptops alongside superphones, since displays and optical drives won't be part of the ubiquitous background infrastructure. But the need for portability means laptop displays aren't going to get any bigger than they already are, so laptops are probably not far from commodity status either.

The big unknown, if things play out as I've envisioned them on the hardware side, is the software. Is the long-term master plan to make OS X (XI?) the operating system of the ubiquitous background computer? This is where my crystal ball starts to get cloudy....

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