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Daniel Eran

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photo Why Apple won't suffer the Osborne Effect
Tech columnists love to rehash old stories and suggest the future will play out just like a vaguely similar event from the past. But as old stories are retold, they become celebrated legends that eventually grossly distort what actually happened.

Consider the much ballyhooed "Osborne Effect." In abbreviated history, pulling an "Osborne" refers to announcing a future product and killing existing sales because customers put off purchases to wait for the next version. It has recently become fashionable to suggest that Apple has done just that by announcing Intel based Macs, and as a result is fated to suffer perhaps unfathomable consequences.

But in reality, Osborne in 1983 had more problems than simply an early announcement of a future product. First, their existing product had heavy competition. Kaypro already had a similar product that was better; the Apple II was a strong competing product that could run Osborne's CP/M software in addition to its own library; IBM's PC was becoming a de facto standard; and Compaq was offering a Osborne-like portable that ran the PC's software.

So Osborne was already poised to go down in flames. It was a small, three year old company with scant customer loyalty or developer base, facing strong competition while struggling with quality control problems in their existing product. A feather could have taken them down. Instead, the company announced a successor product that didn't sell well and they went into bankruptcy within the same year.
photo So what does Osborne's demise have to do with Apple? Consider this: just as Osborne entered bankruptcy, Apple announced the Macintosh, a huge leap forward from their current lineup of Apple II computers. But the Apple II line continued to sell well for another five years, even though the future of Apple was clearly tied to the Macintosh. In 1986, two years after the Mac was introduced, Apple even released a new Apple II: the Apple IIGS, which continued to sell for another seven years!

Similarly, Apple didn't suffer abysmal sales of 68040 based Macs after announcing the move to PowerPC; the last 040 based Mac, the Quadra 630, was quite popular. On the software front, Apple continued to briskly sell versions of Mac OS 7.5, 8 and 9 for another six years after announcing plans to move to Mac OS X in 1997.

Sales of the PowerMac G4 did not implode after Apple announced the G5 at WWDC 2003. Customers were actually so persistent about wanting a PowerMac that could boot the classic Mac OS 9 that Apple was obliged to reintroduce an old model of the PowerMac G4. So the "common knowledge" that customers demand only the bleeding edge, and won't buy products that suit their current needs if they know something new is coming down the road, is simply not true.
photo So announcing a new product, even one significantly advanced over existing products, is not the downfall of every company. In fact, among tech companies, the problem is usually failing to deliver on announcements rather than making announcements too early.

In the case of Intel Macs, it is not obvious that the first of the new machines will be wildly better than existing Power PC Macs. The Mac's future is certainly targeted to Intel's next generations of processors; still, Intel's current chips are not that drastically different in performance and power use than the PowerPCs Apple is currently using.

Customers with an investment in software that takes advantage of Altivec, or has been compiled specifically for the G5, or has been optimized in real use for the PowerPC over the last several years will likely benefit from a slow, progressive transition, rather than holding off purchases in order to prepare for a head-first dive into the first revision of an entirely new hardware platform.

photo Holding off on making a purchase of a PowerPC Mac to wait nearly a year for the first entry level Intel Macs would simply mean forgoing the benefit of having the latest Apple has to offer. Even prior to any Intel announcement, we already knew that a year from now, we'd have faster, more compelling Macs than are currently being sold.

To raise Fear, Uncertainty and Doubt regarding Apple's ability to smoothly introduce new Intel Macs and continue to support PowerPC Macs simply betrays either a gross ignorance of recent events or a panic mongering desperation to have something controversial to print.

Two questions remain:
How long will it be before today's PowerPC Macs become obsolete?
How similar to today's PC will the new Intel Macs be?

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