Apple (AAPL): The Mac Finally Moves Beyond Consumers, Sells To Small Businesses

April 22, 2008 by Douglas A. McIntyre

The knock on sales of the Apple’s (AAPL) Mac has been that they are limited to consumers, colleges, and media companies. But, as Mac purchases grow at a rate of close to double that of PCs,  Apple is beginning to get adoption by selling a lot of Macs to small and medium-sized businesses.

Apple sold over two million Macs in the last quarter, up 53% from the same quarter a year ago. Most analysts think the next quarterly report will show that Apple sold over two million Macs again.

Research firm Gartner says its expects the market share of the Mac to go from 6% in the US and Europe this year to 12% in 2011. Part of the reasoning behind the prediction is that many computer users prefer the Mac OS system to Windows Vista. That preference is going beyond consumers and into businesses. Polling firm ChangWave says that "Apple is also likely to crack the historically resistant corporate market." The company’s figures show Mac adoption at enterprises is already increasing at a robust pace.

Part of the move toward Mac enterprise sales may be lead by IBM (IBM). The huge hardware and software company wants to offer an alternative to PCs and the Microsoft (MSFT) Windows Platform. Starting late last year, IBM Research began looking at how well the Mac would perform in a business environment. Results so far have been extremely positive. An IBM endorsement would open a lot of doors at big companies.

The really large barrier to the Mac at companies with a lot of employees is IT departments that do not want to support two sets of computers and two operating systems. The bigger the operation, the harder it will be for the Mac to get in. To some extent the fact that the Mac can run Windows will help overcome this.

The problem of system support is much less acute at smaller businesses where computer use can be a matter of a relatively small number of people deciding what hardware and software they want. Based on Census data, of the 5.9 million businesses in the US, almost 2.8 million have 1 to 4 employees. Over one million businesses have 5 to 9 people.

If Mac market share does double over the next three years, Apple will almost certainly have to rely on greater business adoption. For the time being it is the smaller companies where the Mac faces the least resistance.

Douglas A. McIntyre

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