Crunch point
- Article 63 of 77
- Information Age, June 2003
Apple wants to take on the enterprise, but its target audience will take a lot of convincing.
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Apple is irrelevant. That is the almost universal belief of corporate IT buyers.
Its systems use a proprietary operating system instead of the ubiquitous Microsoft Windows; they don't run standard software; they don't fit into corporate networks; and they are incompatible at practically every level with 'proper' business machines. In summary, Apple computers are little more than expensive toys for designers.
“Apple no longer speaks to the people who are doing typical IT work in most companies,” says IDC analyst Dan Kusnetzky. “Microsoft speaks to them.” The company's recent move into selling music downloads just compounds the argument that its energies are focused elsewhere.
But many of Apple's detractors might be surprised to learn that the company is now the biggest vendor of Unix-based computers (its latest operating system, OS X, is a variant of the FreeBSD version of Unix); that it sells rack-mounted servers that support mainstream computing standards such as Active Directory and J2EE; that it has developed storage disk arrays that are capable of storing up to 2.5 terabytes of data at a fraction of the cost of its competitors ($4.40 a megabyte, compared with $13.60 a megabyte); and, perhaps most surprisingly, it also has a native version of Microsoft Office.
Almost unnoticed, Apple has gradually built up an arsenal of enterprise-friendly computing products. The question now is can it change the perceptions of the majority of IT buyers and realistically compete against Hewlett-Packard, IBM and Sun for a slice of the corporate IT budget?
Bite size
Apple's track record in the enterprise market is not a successful one (see box, On the sidelines) and its market share remains woefully small. In the fourth quarter of 2002, for example, Apple had a 3% share of the PC market, according to analyst company IDC. In the enterprise server market, it barely registered.
But the company has won considerable praise for its new high-end server, Xserve. And, since the product's launch in mid-2002, Apple has notched up a number of customers in life sciences and digital content creation, who use clusters of the dual-processor Xserve to tackle mammoth computing tasks.
But these more technical types of customers are somewhat unique as they generally write their own software. Standard business customers rely on a large collection of server software, such as databases and systems management tools, many of which are not compatible with Apple.
Apple's biggest problem has always been that it produces machines that cannot directly run software designed for PCs with Intel processors and a Windows operating system. People who need particular pieces of software that have no Mac version have had to buy PCs to run them reducing Apple's market share. This has meant fewer mainstream developers have found it profitable to develop Mac versions of their software. So more people have had to buy Windows machines.
This has been Apple's greatest hurdle, argues John Handby, chief executive of CIO networking organisation, CIO Connect. “It is all about standards. If you want to run Microsoft applications, you get a machine designed to run Microsoft products. A corporation will look at the de facto standard and go with it because it's just easier and cheaper.”
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