I’m shrinking! Can Apple out-Eee the Eee?

David Braue
13 October, 2008
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Another month, another Apple launch – but this time, as the invite said, the spotlight is on notebooks.

“About bloody time,” many of you will be saying, and you are right: it has, after all, been at least three months since the last MacBook update, which is more than long enough for even the most jaded Machead’s Visa card balance to get a bit closer to zero.

Back in the days when Apple’s product launches were indeed top secret, rumours about the launches tended to be wildly exaggerated, fanciful creations merging madness and intuition, that were occasionally correct. These days, the spot-on nature of most predictions has really taken the fun out of it: like judging the Olympics diving competition, it’s possible to know exactly what’s going to happen by assembling all the rumours in one list, throwing out the most ridiculous top 20 percent on top and bottom, and ranking the rest.

Still, observers try to spice up the launches by adding a bit of speculation. Consensus seems to be that Apple will, as always, make this round of MacBooks lighter/thinner/smaller/faster/slower. Some are pining for faster graphics, many others just want a smaller screen.

Almost all are pointing to the low-end notebook range as a place where Apple’s product line is sorely lacking, and they’re right; step down from the 13-inch Macbook ($1499) and you’ll fall quite a way before you hit the iPod touch, the next lowest-priced, portable thing that one could call a handheld computer.

The obvious comparison is to the ASUS Eee, a family of low-cost notebooks that started last year with a 7-inch Linux model that can now be had for less than $300 if you look carefully. The Eee was hailed for trying to bring Linux to the mass market, but those dreams are now just dust in the Windows, so to speak; the Eee hero product is now by a 10-inch model that, with a chunky hard drive and Microsoft Windows, would be like any other low-end notebook except for its energy-efficient Intel Atom processor and relatively low price.

By rebuilding the idea of the traditional Windows notebook from the ground up, ASUS has caused a seismic shift in that segment of the market, forcing competitors to rethink their value propositions and the differentiators between notebook models. Consumers are questioning why they would pay thousands for a notebook – MacBook or not – when they can get an Eee or its equivalent for $600 to $700.

Apple cannot act like ASUS, however, since it is the only player in the Mac notebook market – and moves to lower the median price of that market will only hurt its bottom line. If Apple wants to be part of this market, it needs a way to create a new, smaller product that can out-Eee the Eee without cutting its own proverbial throat. Shareholders love great products as much as the rest of us, but if they cut into profits Apple can expect them to be savage.

The answer lies in the App Store.

Apple can’t afford to bring down the price point for its MacBook family, but it can fire a shot across the bow of the Eee and its rivals by releasing a totally new product along with the expected MacBook refreshes. And that product, I think, will be less a 10-inch Macbook than a 10-inch iPod touch.

Imagine a paper-light, paper-thin device akin to the MacBook air, which turns on a half second after you open it and is instantly available for wireless web surfing and a host of productivity applications. I will, for today’s purposes, call it the MacBook flight.

The MacBook flight won’t feature Mac OS X like higher-priced MacBooks – or, at least, not overtly. Rather, it will run an OS X derivative, work like the touch (and probably have a similar touch interface through an enhanced touchpad) and run applications that are downloaded from the App Store.

It will have 32GB or 64GB of flash RAM, so there’s plenty of space for persistent applications and user data. It will also run on Intel’s Atom chip, providing power efficiency and a battery life of five to six hours. It will automatically synchronise data for backup through MobileMe, automatically update itself and the applications running on it, and it could theoretically include a U-SIM card and 3G modem that keeps it connected all the time (if this last prediction comes through, it would actually be more of a 10-inch iPhone).

By channeling applications to the device via the App Store rather than making it a Mac OS X free-for-all like the higher-end MacBooks, Apple can address the low-cost portables market while retaining value at the higher end; at the same time, it can recoup lost profits from the sale of applications to run on the flight.

To make this work, however, Apple is going to have to do more to encourage serious developers to build serious applications for the flight; it cannot be primarily a content-playing device, like the iPod touch. There’s going to have to be a proper offline office suite – a mobile version of iWork, for starters – and enough useful tools that people don’t feel constrained by the device’s limits. There will also be better support for web apps, with seamless full-screen access and smart caching to compensate for spotty mobile coverage.

Ultimately, the flight will be the path by which Apple gets the mass market to consider the “cloud” in a real way: by offering a stripped-down device that’s small, sexy, and eager to be connected all the time, it will be the big brother to the iPhone – a device for use not when walking, as the iPhone is, but when sitting down.

Now, of course, Apple could do something completely different – all these rumours about “Brick” and a hypothetical new manufacturing process seem different if not a bit irrelevant – and surprise us all. But I think it will eventually need to release a product like the flight.

Because the App Store has allowed it to maintain a bifurcated application delivery channel that can be seamlessly extended to new devices – Apple is in a unique position to make something like this work without affecting its other products. Heck, I’d probably buy one.

Would you? Share your thoughts in our pre-event thread at the AMW Forums.

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