Two Things About the Apple Tax: It Doesn’t Just Apply to Apple, and It Isn’t a Tax

By  |  Tuesday, January 6, 2009 at 3:54 am

vistalogoIn a move that’s apparently a new tradition, Microsoft is once again helpfully assisting reporters ready themselves for whatever news Apple will reveal this morning by talking up the idea of an “Apple Tax.” The idea is based on the undeniably-true proposition that you can buy Windows PCs with better specs than Macs for a lot less money.

But once again, the e-mail I got from a Microsoft representative takes a heavy-handed approach to making this perfectly valid point. “Apple continues to impose the Apple tax” was the subject line, a notion repeated in a statement within the message so important it’s in boldface: They continue to impose the Apple Tax on consumers even in the midst of a very challenging recession.”

What’s with the “impose?” What makes it a “tax?” Apple isn’t the Sheriff of Nottingham, and it can’t impose anything on anyone. (As Microsoft’s own e-mail points out, the world is bursting at the seams with other choices, most of which cost less than Macs.) All it can do is try to convince consumers that the products it sells are worth the money. If it can’t do that, it’ll eventually go out of business. (Hey, it almost did in the mid-1990s.)

Reasonable people can and do disagree on whether Macs are good values, but every purchase of one represents a willful decision by a person to spend money. That’s more of an investment–sensible or not–than a tax.

Then there’s the fact that computers with Mac-like features and Mac-like price premiums exist in the Windows world, too–most obviously in the form of Sony’s classier VAIOs. With computers as with most things in life, you’ll probably pay extra for fancier materials and more stylish design. But Microsoft isn’t about to start talking about a Sony tax or a VooDoo tax.

Lastly, Microsoft’s price comparisons are all about specs. (I’ve taken a similar approach in the multiple PC/Mac price comparisons I’ve written.) But the biggest differences between PCs and Macs has nothing to do with hardware–it is, of course, the operating systems the two platforms run. I suspect that if you talk to virtually any happy Mac user, he or she will mention OS X first, will say that it lets him or her get more stuff done in less time than Windows, and will strongly feel that it’s worth paying more to get a computer that runs it. Like I said, some price premiums are investments.

Look, there’s a reasonable argument buried in Microsoft’s hype painting Apple as a recession-ignoring, customer-abusing totalitarian tax collector. (Which is a portrayal as unfair in its own way as Apple’s depiction of PCs as being incapable of much except for running spreadsheets.) You can get a powerful PC for a lot less than a Mac. PCs do immensely greater choice–for everyone from gamers to businessfolk to those on very tight budgets–than the handful of models offered by Apple. There are meaningful features such as Blu-Ray drives which are commonplace on PCs and unavailable on Macs.

These facts presumably explain at least in part why more than nine people choose a PC for every one person who chooses a Mac. But the people who opt for Macs aren’t the victims of a tyrant or goofballs who don’t know any better. And I’d love to see Microsoft–who counts more than three-quarters of Macheads as customers for Office–acknowledge that fact.


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17 Comments For This Post

  1. pji Says:

    Waaa Waaa Waaa. This is just like the linux crowd, which I am a proud member, complaining about the Micro$oft tax. You know, where you can’t buy a big box PC without a copy of Windows… Build you own and dry your tears, you filthy emo sissy!

    Anyway – Apple should charge whatever the market will bear. If people will pay 1,000% more, for the same hardware, to be a member of the “Apple Elitist Tool Club” then so be it, just let me buy a few thousand shares first 🙂 You’re not getting MORE for the money, you’re just getting DIFFERENT. Rock on – if different is your thing…

  2. Lance Jungmeyer Says:

    Amen Harry.

    I converted to a Macbook Pro about 7-8 months ago. I do not miss a PC that invariably crashes several times a day, with the result being lost work.

    I’m still getting used to new keystrokes and sometimes it’s hard to find some features on a mac. But I wouldn’t go back.

    In my previous job, I had a macbook pro with parallels desktop. Every time I ran Windows on there, bad things happened. This just goes to show that the problem probably has more to do with windows vs OSX than it does PC vs mac.

  3. ediedi Says:

    Anyone else find it weird that MS send e-mails criticizing a competitor? Is this acceptable business practice? I think it doesnțt earn them any credibility, quite the opposite.

  4. Josh Says:

    I’m a Mac user (and a PC user since DOS) and I think that the “Apple tax” does make sense if you look at it from a software perspective. This is the perspective from which Microsoft is probably viewing things anyway. Think about it: if you want OS X, you must pay for overpriced Apple hardware. The hardware isn’t necessarily better than its competitors, if one judges by benchmarks and failure rates. Despite this, Apple hardware can be anywhere from 10% to 100% more expensive than its competitors. That seems to me to be a tax on those users who love OS X, but would prefer to pay less for the hardware (like me).

  5. Vulpine Says:

    Personally I have two squawks with your blog today:

    First off, when comparing like for like, the Mac is no more expensive than a PC; unless you build the PC yourself. Yes, I agree you can buy cheaper PCs with similar basic specs like processor speed, RAM and hard drive, but this leaves out the other standard equipment in that otherwise similar Mac. Bluetooth is standard in nearly every Mac desktop and laptop. 802.11x is available in virtually every model, including the Mini. The iSight webcam is available as standard in the iMac and almost every current laptop. These things are patently ignored in every PC-centric comparison I see. And through personal experience working for one of Apple’s component suppliers, I also know that their specifications are tighter and more rigidly enforced than any other basic-level computer manufacturer including Dell and HP… or at least were up until recently. When actually comparing equivalent over-the-counter machines, the Mac is no more expensive than the PC.

    My other complaint is the first sentence of your last paragraph: [i]”These facts presumably explain at least in part why more than nine people choose a PC for every one person who chooses a Mac.”[/i] The statement should now be “… explain at least in part why [b]less[/b] than nine people…” For the last four years, even up to the last quarter reported, Apple’s computer sales of all models averaged 30% or more growth year over year than any of its competitors in the US and has repeatedly, though not necessarily consistently, exceeded 10% internet share of installed machines. Considering that a massive proportion of those PCs are operating out of corporate offices while the majority of the Macs are operating out of private homes, this shows a significant bite out of Windows’ once 95%+ domination. Add to this the fact that Linux has taken a near 5% bite of its own, up almost 300% from just 5 years ago, and that puts Windows at less than 85%, though the PC platform is still near 90%.

    Microsoft is now doing everything it can to force current users into Vista while rushing to get W7 released; in my opinion finally realizing what Microsoft was trying to do with their overlong development of Longhorn. Even taking recently posted reviews of Vista SP1 compared to XP SP3 shows that XP has been hobbled–slowed down–in order to help Vista finally show superior performance specs. Yes, Vista has been essentially repaired; but XP took a hit in the process.

    Conclusion: Apple must be doing something right. People are proving willing to pay for Apple’s hardware despite Microsoft’s claim of an “Apple Tax.” Microsoft also did nothing to help themselves with the fiasco that was Vista even before official release. By the time Microsoft got around to fixing Vista, it was too late.

  6. AdamC Says:

    Installing and using the Windows OS is a tax itself on one’s time and money.

  7. ppgreat Says:

    Methinks Microsoft doth protest too much. And on the eve of Macworld we should be surprised?

    How many versions of Vista do I have to wade through to try and figure out what I need? And how many for the Mac?

    How long does it take to setup a Windows machine from scratch?

    What is the party line on Zune malfunctions and Vista? Wait it out.

    The hubris of any monopolist is that people assume that they have no viable choices and in the face of the threat of viable choices they spread FUD.

  8. Michael Says:

    Using the word “tax” is sneaky… “Apple tax” is a muddled conception of why Apple charges what it does. (A tax is compulsory and for the state.) Marketers — Apple too — and politicians do this a lot. Bad, ultimately, for the consumer.

    “If language is not correct…the people will stand about in helpless confusion.” -Confucius

  9. JakeB Says:

    Amazing how confused people can be about a free market. I don’t recall seeing a gun put to anyone’s head forcing them to buy Apple. OTOH, a few years ago when Microsoft had ~95% market share, you could make a pretty good argument that most people were compelled (by a monopoly) to buy Windows. A tax would be like being forced to pay for Windows on every PC you bought, whether you wanted Windows or not. And that never happened, did it? Oh wait . . . .

  10. joecab Says:

    You have to put a price on the operating system and user experience. If you did, I doubt Vista wouyld get more bang for the buck.

    Also, if this is an Apple Tax, I wonder what Microsoft called it back when their deals with computer makers had them pay a fee for every computer they sold, whether or not it had Windows on it?

  11. Chip Says:

    Microsoft needs to be careful with this, because another way to look at it is:
    “This is how much people are willing to pay to avoid using Windows.”

  12. Vaughn Says:

    Many of you are correct that Apple is free to charge whatever the market will bear. There is nothing wrong with this. I would actually like to own a Mac but I think it is cost prohibitive and not worth the money. I can do everything that I need to do with Ubuntu that I could with OS X.

    I just don’t understand why they can’t make a good lower cost computer. I’ve heard a lot of terrible things from people who’ve tried to use the Mac Mini on a regular basis.

  13. ex2bot Says:

    I do pay more for less. I do admit Apple machines are too expensive. I don’t think it would hurt Apple to knock two or three hundred dollars off its machines.

    But I pay more for less. I pay more for fewer yellow speech bubble notifications, for no “Genuine Advantage”, no “Activation”, or product key, for fewer control panels (because OS X’s Preference Panes are better organized), and fewer “wizards”. To name a few. For the sake of brevity I’ll leave out awkwardly organized configuation windows, lack of interoperability with non-Windows OSs, Microsoft’s historical heavy handedness w/other companies, ME, and all the often annoying trial software most machines come with.

    [Now, I know there are a lot of good things about Windows. Heck, I use it myself sometimes because it’s an excellent game machine. But I definitely prefer OS X.)


  14. jonk.. Says:

    any company who forgets about the leap year in their software has no authority on a software “tax”, i’d pay 1000 times to keep such kludge off my desktop.

  15. Simon Says:

    “any company who forgets about the leap year in their software has no authority on a software “tax”, i’d pay 1000 times to keep such kludge off my desktop.”

    That was a hardware bug not a software bug. Toshiba made the hardware for the 30 not Microsoft.

  16. Jeff Says:

    A Microsoft tax is an OS that doesn’t work right. Plug-ins that don’t work. And mucho dinero for firewalls, anti-virus, anti-spyware software.

  17. Naime Says:

    While I’m not sure you can call it a tax, Apple does impose restrictions and fees on resellers and developers that do not exist on the PC side. As a reseller to academic institutions, if we wanted to be authorized to sell Apple computers, we would have to agree in the legal contract to not sell any other brand of computer. We also would have to pay an annual fee to Apple for the privilege of selling their products. As a developer, we would also have to pay an annual fee of several thousand dollars to be allowed to develop for the platform. And of course, as a PC manufacturer, Psychsoftpc, not to be confused with those other guys, are not allowed to legally make Mac clones.