Why Apple can afford to charge so little for Snow Leopard

August 12, 2009, 12:12 pm · 9 comments · Filed under: Apple, Business

Apple will charge just US$29 for the next major release of Mac OS X. Most previous versions have cost US$129. How can they afford to charge so little? Because Snow Leopard will pay for itself by retiring software debt.

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The excuse Apple give for not charging more is that there aren’t very many new features, but as someone who spends all day every day in front of my MacBook, “better, faster, easier” is something for which I’d gladly pay full price.

My theory (backed up by exactly zero insider sources) is that Apple want to get Snow Leopard on as many Macs as possible because this version focuses on retiring software debt, dramatically cutting the cost of future innovation, not to mention support.

What is this “software debt” I speak of? It is the added complexity that accrues in software when developers focus more on features than on the changeability of the system. According to Agile Journal (thanks to Richard Paul for the link), there are the following 5 sources of software debt:

Building software, especially software as complex as an operating system, involves thousands of trade-offs. When you’re trying to ship, sometimes you have to choose between cutting corners to get something done or cutting features. Apple have done a good job, in my opinion, of managing this balance, but inevitably cruft crept in. Snow Leopard represents Apple letting their fields lie fallow, so to speak. They are forgoing scads of new features to focus on tightening things up. And, I’m glad.

For the record, the Bible exhorts farmers not to plant every 7th year. It’s been 7 years since the first (usable) version of Mac OS X (10.1), the last version given away free. Coincidence? I think not!

By focusing on software debt, Apple will reduce the cost of developing and supporting future versions of OS X. They also make every user’s computing experience more efficient and stable. It’s a win all around. Enough of a win to justify chopping US$100 off the price.

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9 comments

The obvious problem that Microsoft had with Vista was that it was just incompatible enough — with older hardware, older devices like scanners, older software — that many users stuck with XP.

Apple could have faced the same with Snow Leopard. Yeah, great that your GPU can shoulder some of the compute burden on some apps, or that it’s 64-bit. Neither seems to do me, the owner of a 3+ year old MacBook Pro (Core [1] Duo) one scintilla of good. Doubly so if all the app vendors look at their installed user base and decide that creating a SL version isn’t worth the hassle just to get some of the minor features of SL, that many users won’t be able to exploit because they passed on the upgrade.

So a cheap upgrade lets app developers know that any user who is minimally willing to spend money on software will have SL, and that their REAL customer base will be SL.

Apple can forgo a few dollars from users, but it cannot afford the luxury of its core user base treating OSX as a Vista: maybe nice, but not worth the upgrade hassle and expense. By pricing it down, they make sure nobody has a good excuse to stand pat unless they mark themselves as old-fashioned, and keep the developers building great apps around Apple technologies. Especially good for games (where the new OS features could mean greatly improved development times), scientific, engineering and media apps where the number of copies sold can be small but benefits big. Maybe other categories, too, that Apple has no reason to cede to Win7.

★ Posted by: Walt French · August 13, 2009, 5:47 pm

Great points, Walt. Sounds like we agree that Apple want to get Snow Leopard on as many machines as they possibly can, for a variety of reasons.

I think another area where Microsoft went wrong with Vista was having so many versions. When technology blogs feel compelled to create feature matrixes to help users decide, your product line is probably too complex. Apparently, Windows 7 has the same number of versions. When will Redmond learn?

★ Posted by: Andrew Hedges · August 13, 2009, 6:37 pm

Come on guys, you say that “Apple want to get SL onto as many machines as possible” when its incompatible with PowerPC chips. What they want you to do is buy a new Mac. Easy to give away $100 when you stand to make $799 and upwards from new machines. Apple being cynical, yeah right.

★ Posted by: Martin Kelly · August 13, 2009, 8:19 pm

I’m now very conflicted. I had intended to wait until the release of Snow Leopard to upgrade my OS, and thoght I might as well get a brand new computer because why would I spend NZ$199 for a new OS?

But if it’s going to be closer to NZ$60, that’s hard to justify getting a new computer for! :)

Still, not the worst problem to have…

★ Posted by: Simon Young · August 13, 2009, 8:32 pm

@Martin,

Talk about technical debt! It’s been exactly 3 years since the last Macs with PowerPC processors were sold. That seems like a very reasonable transition period to me. Having to continue to support PPC would be quite a burden at this point. A mistake Microsoft have made, in my opinion, has been bending over backwards for the sake of compatibility. It’s held back Windows as a platform.

@Simon,

As Martin points out, the difference in the cost of the OS is small compared to the cost of the hardware. As always, the question to ask is “do I need this now in order to be more productive?”

★ Posted by: Andrew Hedges · August 13, 2009, 9:12 pm

I think you hit the nail on the head! In every big system, “dirt” accumulates over the years, the whole architecture deteriorates as decisions that were correct years ago are no longer valid.

I was hoping that Apple would do a complete system overhaul at some point, and I’m glad they do. Of course that also means some pain for som users, but honestly, the whining IMHO is much louder than the actual pain.

I still have (among other Macs from G4 to 2009 8-core MacPro) a G3 Flower Power-iMac (remeber those?) which runs Tiger very usably, and Apple still provides security and Safari updates. So this machine is still useful as an Internet/mail/office-device. It would not be usable for any media-oriented work.

Do I care for SL on it? Nope!

★ Posted by: Financegozu · August 13, 2009, 10:48 pm

I’d add that one big reason to price Snow Leopard small is, simply, that a lot of Mac Intels won’t be able to use several of its main features:

How many of you would accept to pay $129 then, specially if you happened to have nought a Mac with an ATI which was the “better” or “best” GPU buying option?

★ Posted by: Snafu · August 14, 2009, 12:57 am

@Andrew

One of the selling points of Macs has been their longevity. 3 years is not that long a time frame to make PowerPC chips obsolete. Why don’t Apple offer a trade in policy (use some of the $29 Bn cash fund we helped to create) on PowerPC machines for a new Intel Mac. Good for the environment as well as Apple could recover all the obnoxious and dangerous chemicals it has been using for years.

★ Posted by: Martin Kelly · August 18, 2009, 4:11 am

One of the amazing things with every version of OSX for me is how better it ran (faster, did more, etc.) than the previous version. I have a TiBook which I still use on occasion running Tiger. My kid uses my aluminum Powerbook on Leopard.

I am really looking forward to Snow Leopard coming out, even though much of it is incremental improvements, for the cleaned up and optimized code Apple seems to produce at every turn.

★ Posted by: vanderwal · August 26, 2009, 1:41 pm

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