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Flashback Ad!
- Thread starter stevep
- Start date
Flamingtoasters
Well-known member
neato 
I like how this ad displayed some of the prices of other products as well.
But $70 dollars (canadian that is) for a pack of 10 floppies???
That around $50 here in the US, and when inflation is calculated as well...
I like how this ad displayed some of the prices of other products as well.
But $70 dollars (canadian that is) for a pack of 10 floppies???
That around $50 here in the US, and when inflation is calculated as well...
Mac128
Well-known member
Yes, I remember that. And remember those were only single sided 400K disks! If you needed to buy a disk at the computer lab in 1985 they charged you about US $5/disk. at roughly 100% inflation over 25 years, that would be US $100 for 10. Remember in those days a Single Sided 400K disk was the equivalent to a portable 120GB hard drive today which retails for about the same price.
.
MacPlusOwner
Active member
Cool!
$4495. Yep, that's why I never had a Mac back then. Anytime I think picking up a used classic Mac today is too much money, I'll just look at that ad!
$4495. Yep, that's why I never had a Mac back then. Anytime I think picking up a used classic Mac today is too much money, I'll just look at that ad!
beachycove
Well-known member
The advert cuts to the bone in my case, as I vividly remember going to considerable trouble to look (very briefly, as it turned out) at a Macintosh SE in 1987 when I needed a computer as a postgraduate student. I walked out of the shop repulsed by the product, which before seeing the price tag I had really wanted to buy. At about a third of the cost, I ended up buying an Epson IBM clone instead. It served me well.
Similarly, the original Macintosh in 1984 was obscenely overpriced, and no amount of salivation over the technical marvel (which in major respects it wasn't - 128k ram=technical crap), or the fluff of SuperBowl adverts et al., can disguise the fact. The Macintosh was consequently a colossal commercial failure in the months following its launch, as almost nobody could justify paying the kind of money demanded for the machine. The company resorted to gimmicks like the 'test drive' program wherein you were supposed to be able to take a demo machine home for a night and try it out. The trouble was, of course, that your average retailer did not have enough of the fabulously overpriced machines to lend out, not being able themselves to afford to buy wholesale large numbers of what they knew very well that only a handful could afford to buy retail.
You have to wonder whether the 'reality distortion field' supposedly surrounding Jobs at the time was not, in fact, all around the Apple campus, with its smug assurance that their product was so superior to the alternative that the masses would flock to retail outlets to buy the thing, bowing down in worship and all but selling their souls for its sake. Apple had a long and highly unsavoury history of obscene levels of markup on Apple II machines by then, and the company took it for granted that this could continue unabated. The trouble was that the Apple II, despite disgraceful 800% or so markups towards the end of its commercial run, still did not cost the trusting consumer or the Apple II fanbase an absolute fortune in purchase price. The Macintosh, by contrast, did just that. It consequently tanked, which was only justice.
The upshot was that the company, which had geared up to sell millions of the machines, ended up almost folding, and was actively looking for a buyer only months after the Macintosh was introduced. It would all have ended, indeed, but for the advent of desktop publishing. Publishers could afford the machine, and this meant a small but steady volume of sales. And so, the 'computer for the rest of us' became the computer for none but the professional elites.
The Mac's pricing was the work of idiots. Selling a zillion widgets with a 10-20% profit margin works, as the WallMart model shows. The fact of life is that you will only ever sell a few of your widgets when the markup is 100% or more. Apple's directors were greedy and out of touch with reality.
The explanation perhaps lies in the culture of the industry in general, as well as of Apple in particular. I have a friend who has been doing work for Stanford Uni., who tells me that around the technology parks of California, a BMW is an economy car. That's the problem now, and it was certainly the problem then. Apple, whether led by Steve Jobs or by others when His Divine Holiness got the ceremonial boot in 1985 following the abject commercial fiasco of the Macintosh, did not seem to realize that most of the public simply could not afford to sink something approaching a quarter or a fifth of its disposable income on something as ephemeral as a 'personal computer.' Eventually, they went on to drop prices on their consumer products somewhat, but I still don't think they have learned the lesson of decency. They are, in short, still screwing the public. The computer for the rest of us, my gluteus maximus.
Today, I am not poor, but I still remember that experience in 1987 and am very wary of new Apple products and pricing.
Similarly, the original Macintosh in 1984 was obscenely overpriced, and no amount of salivation over the technical marvel (which in major respects it wasn't - 128k ram=technical crap), or the fluff of SuperBowl adverts et al., can disguise the fact. The Macintosh was consequently a colossal commercial failure in the months following its launch, as almost nobody could justify paying the kind of money demanded for the machine. The company resorted to gimmicks like the 'test drive' program wherein you were supposed to be able to take a demo machine home for a night and try it out. The trouble was, of course, that your average retailer did not have enough of the fabulously overpriced machines to lend out, not being able themselves to afford to buy wholesale large numbers of what they knew very well that only a handful could afford to buy retail.
You have to wonder whether the 'reality distortion field' supposedly surrounding Jobs at the time was not, in fact, all around the Apple campus, with its smug assurance that their product was so superior to the alternative that the masses would flock to retail outlets to buy the thing, bowing down in worship and all but selling their souls for its sake. Apple had a long and highly unsavoury history of obscene levels of markup on Apple II machines by then, and the company took it for granted that this could continue unabated. The trouble was that the Apple II, despite disgraceful 800% or so markups towards the end of its commercial run, still did not cost the trusting consumer or the Apple II fanbase an absolute fortune in purchase price. The Macintosh, by contrast, did just that. It consequently tanked, which was only justice.
The upshot was that the company, which had geared up to sell millions of the machines, ended up almost folding, and was actively looking for a buyer only months after the Macintosh was introduced. It would all have ended, indeed, but for the advent of desktop publishing. Publishers could afford the machine, and this meant a small but steady volume of sales. And so, the 'computer for the rest of us' became the computer for none but the professional elites.
The Mac's pricing was the work of idiots. Selling a zillion widgets with a 10-20% profit margin works, as the WallMart model shows. The fact of life is that you will only ever sell a few of your widgets when the markup is 100% or more. Apple's directors were greedy and out of touch with reality.
The explanation perhaps lies in the culture of the industry in general, as well as of Apple in particular. I have a friend who has been doing work for Stanford Uni., who tells me that around the technology parks of California, a BMW is an economy car. That's the problem now, and it was certainly the problem then. Apple, whether led by Steve Jobs or by others when His Divine Holiness got the ceremonial boot in 1985 following the abject commercial fiasco of the Macintosh, did not seem to realize that most of the public simply could not afford to sink something approaching a quarter or a fifth of its disposable income on something as ephemeral as a 'personal computer.' Eventually, they went on to drop prices on their consumer products somewhat, but I still don't think they have learned the lesson of decency. They are, in short, still screwing the public. The computer for the rest of us, my gluteus maximus.
Today, I am not poor, but I still remember that experience in 1987 and am very wary of new Apple products and pricing.
II2II
Well-known member
I agree that high margins hurt Apple, but that is mostly because it is hard to attract a broad range of developers if their potential market is small. And if you don't have the software, you can't get many users on board. In industries where you don't have that symbiotic relationship between vendors, it would be perfectly acceptable to have a high margin and low volume product. After all, businessess really only need profitability to survive.
Mac128
Well-known member
Beachy, that was one of the most scathing, acrimonious, points of view I have read regarding Apple in a few paragraphs. I think you might want to consider therapy over your SE experience to get that behind you. :beige:
You make a claim here that is the first I have ever heard of it. "only months" after the Mac was introduced, the company was reeking record profits and selling more Macs than they could produce. As far as I know Apple did not consider being sold to another company until sometime in the mid 90s, when the company really started facing a decline thanks to poor management. What exactly is your source on that?
Also, blame Jobs all you want, but it was Jean Louis Gassee and to a lesser extent John Sculley who made that SE ridiculously priced. Gassee is responsible for suggesting they sell the keyboard separately. As for that, the Mac was riding high between 1987 and 1990, record profits for some of the most expensive equipment in the world all predicated on the fact that the Mac was better than anything else. And you know what? Depending on what you needed a computer for, it was. I walked out of a store in 1989 with the same result, not enough money to pay for the thing. Long story short I got over it and still think the Mac is the best value in the world. I have never had a friendly encounter with a Windows box and hopefully I have left those days behind me forever. But more to the point, the Macintosh sold like gangbusters for 6 months. You make some wild claims about how nobody could afford it, but the fact is, hundreds of thousands bought the Mac worldwide, enough to keep it puttering along despite sluggish sales until the 512K Mac came along and then the Plus. I personally bought a used 128K Mac which was one of the best investments I have ever made. It got me through a lot of years despite its limited RAM. As for the price, again you can blame Jobs, but Sculley is the real culprit there, raising the price higher than it needed to be. Also, part of Apple's problem during that period was poor management and not being able to deliver key accessories, like the 400K external drive and numeric keypad. And Apple priced the Mac XL within cannibalizing range of the 512K and it sold like hotcakes until somebody forgot to order parts. Early '85 was definitely lean for Apple, but they were far from going under. There was a major reorganization with Jobs being ousted and developing a new strategy without him.
Really, after reading your tirade, I'm really not sure why you even use Macs. Nevertheless, just clarifying a few points of misinformation.
beachycove
Well-known member
I am an Apple fan because of the work of unsung hardware and software engineers and designers, not because of the ethos of the corporate entity or because of the fuzzy feelings evoked by the glitz. The corporate entity called Apple, in particular, was c. 1984 an absolute zoo exhibiting some of the worst business practices imaginable.
I am a big fan of what those engineers produced; I have used Macs since 1991, and today own, counting them all up, Newtons and all, some 50 discrete pieces of Apple hardware, but this does not mean that I should allow myself to be fooled by the corporate hype, or that I should welcome its occasional over-extraction of the contents of my wallet.
As for what really went on in corporate HQ in and around 1984-85, Apple's projections were for 80,000 Macintosh sales a month in 1984. Months went by during which it sold 5,000 units a month. Overall on the financial year, it did better, selling 250,000 by year end, largely owing to massive sales to wealthy American Universities like Stanford (not, you will note, to consumers). Overall in 1984, the company sold only 25% of the number of machines it had spent a fortune gearing up to produce (1,000,000 units p.a. was the target). It was, in fact, Lisa-time, only this time it was worse, as the company had no other product under development. Most of the profits in 1984-early 85 (up to 70%) still came from Apple ][ sales, and everyone knew that this particular version of retro-computing could not go on forever. The Apple ][ was largely ignored amid the advertising surrounding the Macintosh, which was geared to making the machine compete with IBM and regain market share. Steve Wozniak resigned at this time in protest that his successful creation and ][ team were being simultaneously milked and ignored by the company, while Jobs, whom he had come to distrust, was a failure who shone in glory.
Consider this: virtually the entire Macintosh team resigned after the machine went public, many being distraught at the revelation of the pricing. Having damaged their health in many cases to get the product to market, with a visionary goal of changing people's lives somehow through this revolutionary technology, they learned that Apple, Inc., proposed to screw the world instead with the product they had created. I'm with the engineers, frankly, and glad now that I can own samples of their work. And yes, I do also appreciate the sense of style that Jobs in particular gave the machine.
On the corporate level, however, it seems that Jobs either hid the commercial facts away as best he could, or else believed his own rhetoric and did not care to check the facts, but finally the facts about sales came out in meetings with the shareholders, the board got thoroughly spooked, and Jobs was ousted in April of 1985. That is what happened. Why else would Apple have booted him at this time, if the Macintosh was his moment of economic triumph?
That the company's future was in profound doubt in 1984, and that a buyer was sought, is pointed out in Michael Malone's Infinite Loop, which is not a flattering study but is at least ruthlessly honest about the goings on.
Now, I will grant that the perception that the Macintosh was egregiously priced at $2500 US/ pushing $4000 CDN in the advert, is just a perception, as is my sense that the company was screwing its customers by asking that sum for the machine. I also grant that this is what much business looks like, or would like to look like, at the best of times. As a consumer, however, I found the Macintosh's descendent, the SE, absurdly and indeed grotesquely overpriced in the later 80s, and I believe that that is why, as a consumer product, the original Macintosh itself was a commercial failure. It did nothing to eat into the ground that the cheaper IBMs had gained, or to regain the market share that the Apple ][ once had (40% of the market!), and in fact what happened after 1984 is what we now all now know: the Macintosh became a niche product with something under 10% of market share, restricted in its usage largely to schools, universities, and publishing/ graphics settings — and longsuffering zealots like me.
It was the expanded memory of the Macintosh 512 (which the engineers had allowed for secretly, though Jobs had expressly forbidden it c. 1983) and the introduction of laser printers and desktop publishing that rescued the Mac and the future of the company.
A Raskinesque $975 people's computer, then, the Macintosh was not. It's a crying shame, because the Macintosh could have been sold at least closer to that price, and subsequent events (including this consumer's walking away from an SE in 1987) might have been very different.
That, as they say, is my $.02's worth.
I am a big fan of what those engineers produced; I have used Macs since 1991, and today own, counting them all up, Newtons and all, some 50 discrete pieces of Apple hardware, but this does not mean that I should allow myself to be fooled by the corporate hype, or that I should welcome its occasional over-extraction of the contents of my wallet.
As for what really went on in corporate HQ in and around 1984-85, Apple's projections were for 80,000 Macintosh sales a month in 1984. Months went by during which it sold 5,000 units a month. Overall on the financial year, it did better, selling 250,000 by year end, largely owing to massive sales to wealthy American Universities like Stanford (not, you will note, to consumers). Overall in 1984, the company sold only 25% of the number of machines it had spent a fortune gearing up to produce (1,000,000 units p.a. was the target). It was, in fact, Lisa-time, only this time it was worse, as the company had no other product under development. Most of the profits in 1984-early 85 (up to 70%) still came from Apple ][ sales, and everyone knew that this particular version of retro-computing could not go on forever. The Apple ][ was largely ignored amid the advertising surrounding the Macintosh, which was geared to making the machine compete with IBM and regain market share. Steve Wozniak resigned at this time in protest that his successful creation and ][ team were being simultaneously milked and ignored by the company, while Jobs, whom he had come to distrust, was a failure who shone in glory.
Consider this: virtually the entire Macintosh team resigned after the machine went public, many being distraught at the revelation of the pricing. Having damaged their health in many cases to get the product to market, with a visionary goal of changing people's lives somehow through this revolutionary technology, they learned that Apple, Inc., proposed to screw the world instead with the product they had created. I'm with the engineers, frankly, and glad now that I can own samples of their work. And yes, I do also appreciate the sense of style that Jobs in particular gave the machine.
On the corporate level, however, it seems that Jobs either hid the commercial facts away as best he could, or else believed his own rhetoric and did not care to check the facts, but finally the facts about sales came out in meetings with the shareholders, the board got thoroughly spooked, and Jobs was ousted in April of 1985. That is what happened. Why else would Apple have booted him at this time, if the Macintosh was his moment of economic triumph?
That the company's future was in profound doubt in 1984, and that a buyer was sought, is pointed out in Michael Malone's Infinite Loop, which is not a flattering study but is at least ruthlessly honest about the goings on.
Now, I will grant that the perception that the Macintosh was egregiously priced at $2500 US/ pushing $4000 CDN in the advert, is just a perception, as is my sense that the company was screwing its customers by asking that sum for the machine. I also grant that this is what much business looks like, or would like to look like, at the best of times. As a consumer, however, I found the Macintosh's descendent, the SE, absurdly and indeed grotesquely overpriced in the later 80s, and I believe that that is why, as a consumer product, the original Macintosh itself was a commercial failure. It did nothing to eat into the ground that the cheaper IBMs had gained, or to regain the market share that the Apple ][ once had (40% of the market!), and in fact what happened after 1984 is what we now all now know: the Macintosh became a niche product with something under 10% of market share, restricted in its usage largely to schools, universities, and publishing/ graphics settings — and longsuffering zealots like me.
It was the expanded memory of the Macintosh 512 (which the engineers had allowed for secretly, though Jobs had expressly forbidden it c. 1983) and the introduction of laser printers and desktop publishing that rescued the Mac and the future of the company.
A Raskinesque $975 people's computer, then, the Macintosh was not. It's a crying shame, because the Macintosh could have been sold at least closer to that price, and subsequent events (including this consumer's walking away from an SE in 1987) might have been very different.
That, as they say, is my $.02's worth.
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Mac128
Well-known member
Malone's book is notoriously biased against Apple and Jobs in particular. However, I think to what you are referring is Apple's attempt to raise capital in the face of what they perceived as failure. Keep in mind Apple was worth $1.5 billion at the end of 1984, no debt and healthy liquidity. The Mac did not hit the $5K/mo. until about July, but quickly recovered to manage over 300,000 units by 1985. Even though the Freemont factory was designed to produce 1,000,000 units/year, Apple did not lose money because it didn't, and corporate never intended it would. The fear was that 1984 was comparably one of the least profitable years in its history and for a company that was used to enormous profits, disconcerting (they earned $300 million profits in '84). Jobs took it personally that his inflated projections which no one wanted to tell him was unrealistic to begin with, failed to be met. He and Sculley cooked up several ideas to raise capital, several of which involved selling about 25% (and no more) of the company to Compaq, or GE, or ATT, among others. However, they ultimately decided not to sell any portion of Apple for risk of losing control in a leveraged buyout. They had plenty of capital and Jobs felt strongly about his plans for BigMac, which had he not been ousted, might have brought OS X to Apple during the 90s. But Apple, never sought to be bought out 100% by anyone, nor was such a proposal ever brought before the board.
Keep in mind, that CA price was for a bundle of products (Mac, Ext. FDD, ImageWriter) that cost US $3,400. Also, the equivalent IBM with 64 kB of RAM and a single 5 1/4 inch floppy drive and monitor sold at introduction for US $3,005 (almost $10,000 today). While later models sold for much less, they were not as successful. One of Jobs' strategies to make the Mac more profitable was to drop the price significantly and make up the difference in volume. Of course Sculley was not confident enough to risk that. Instead he opted for getting rid of Jobs, which created the vacuum in which Apple failed to push any clear agenda for growth.
Perhaps. But the GUI had already made its mark on the world and was not going away, everyone knew it including Bill Gates who had already announced Windows for the IBM in 1983. The expensive LaserWriter had been initiated in 1983, so Apple knew even then the promise of the Mac in business. Given the success of the Apple II well into the 90s, it is unlikely Apple would have not recovered and the Mac, or IIGS eventually taken off, even without the help of the desktop publishing industry. But there are many what-if scenarios one could explore with Apple. The fact is, Apple put more Macs into education in those early years because Jobs knew the power of seeding future computer users. Combined with an industry that saw a $10,000 investment in hardware as equal to or superior to a much more expensive printing press oriented business model ensured its success. There are lots of technologies the average consumer can't afford when first released, but if worthwhile, it will eventually become affordable thanks to mass production. The Mac is no different if artificially inflated.
The idea of a $975 Mac in 1984 is laughable. At the time the Mac was launched, Raskin's original "people's" Mac was essentially represented by the IBM PCjr, which was a dismal flop in the marketplace. Considering the cost of development (including the Lisa from which much of the Mac was derived) and the hardware necessary to support a GUI environment, there is no way the Mac could have been priced under $1,000. But it did not need to be priced over $2,000 either.
In 1987 a girlfriend in college (pre-law) took the advice of her father and put together a state-of the art IBM PC clone. It cost more than the expensive entry-level Mac II, much less the SE, but the perception was that it was more powerful, reliable and would last longer. I typed a few papers on that thing. It was a miserable experience. Ultimately both of those contemporary Macs outlived the usefulness of the PC. But even if you had money, the perception of what the Mac could do still did not sway more conservative views, particularly when confronted with established business practices. Apple's biggest problem was that it was perceived as a toy, regardless of the price.
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beachycove
Well-known member
So thanks for that advert, SteveP. You might say that it brought back a lot of memories!
JDW
Well-known member
Today is the first day I've read through this thread. I've found it to be fun, especially the first post by beachycove, which if put in a single-page letter form in a magazine with an IBM stamp on it, it could be taken as an ad for IBM or IBM clones!
But it is this quote that made me think of Steve Jobs and "Apple pricing":
Beachy, we need you on AppleInsider forums and other Mac forums where we talk about the missing mid-range tower, disdain for glossy screens, and clone solutions (Psystar, EFI-X, etc.) spawned by Apple's disdain for any market segment that refuses to buy in to its existing Mini--iMac--Mac Pro lineup. It's amazing how many blind defenders of the status quo there are out there. And I say this as an Apple lover and owner of nothing but Apple Mac equipment since 1984. Indeed, I probably would have a 2009 iMac sitting on my desk right now if it weren't for that glossy screen (and to a lesser extend, that "chin"). Even so, my G4 Cube and 68k Macs continue to serve me well.
Thanks for the ad posting. It's really struck a chord in me as well.
But it is this quote that made me think of Steve Jobs and "Apple pricing":
For truly, Steve and other Apple execs recognized the same thing. They knew they had the best engineering out there, and charged as much as they could for it. I do not say this in defense of Apple. It's just fact.
Beachy, we need you on AppleInsider forums and other Mac forums where we talk about the missing mid-range tower, disdain for glossy screens, and clone solutions (Psystar, EFI-X, etc.) spawned by Apple's disdain for any market segment that refuses to buy in to its existing Mini--iMac--Mac Pro lineup. It's amazing how many blind defenders of the status quo there are out there. And I say this as an Apple lover and owner of nothing but Apple Mac equipment since 1984. Indeed, I probably would have a 2009 iMac sitting on my desk right now if it weren't for that glossy screen (and to a lesser extend, that "chin"). Even so, my G4 Cube and 68k Macs continue to serve me well.
Thanks for the ad posting. It's really struck a chord in me as well.
