Om Malik on the MacBook Neo

Om Malik opines on the MacBook Neo, Apple's new budget laptop with a mobile phone chip inside, and all of the premium Apple vibe on the outside. But, what is the logic for releasing such a product, as Apple generally hasn't been interested in competing in the lower end of the market? Malik takes a defensible position: its a Trojan Horse.

Apple needs to convince millions of people to buy this low-end laptop, and steal users away from Chromebook and Windows ecosystems. And hope that these switchers could eventually buy more things from Apple, especially those high-margin services.

But, will that strategy be effective? A $599 laptop is certainly "cheap" for a Mac, its not all that competitive with even cheaper Chromebooks, which dominate in education. I am sure that Apple will pursue that market, and high-volume purchasers like schools will get an even lower price point, but I have a hard time being convinced that they'll unseat Chromebooks as the dominant computer by volume in education, but I wouldn't be surprised if they earn a significant revenue share.

That said, there is some market context that Malik explores:

The timing for the launch of the new Neo computer is fortuitous. Microsoft’s ham-fisted approach to grafting Artificial Intelligence (AI) into Windows 11 has been an unmitigated disaster. Whether it was privacy-invading Recall, barely good Copilot or invasive advertising, Windows 11 has left many long-time Windows users searching for alternatives including Linux.

This is where it gets interesting to me. Spendy MacBook Pros are a common choice for businesses, in spite of their high price point. Personal computers are a different story, and the mid-market is flooded with popular laptops with similar pricing to the Neo. I'd wager that a home computer buyer is much more likely to choose a MacBook Neo, which is a premium product compared to the cheap plastic alternatives running an increasingly crap Windows experience. Malik's Trojan Horse thesis makes more sense to me in this specific market, where iPhones hold a very strong market share, and the services drag is sky high. I'll be interested to see how it unfolds!