tgingric@magnus.ircc.ohio-state.edu (Tyler S Gingrich) (11/10/90)
NeXT has a significant market positioning problem to overcome. "People BELIEVE that NeXTs are all $10,000+ computers, only usable by higher-ed number cruncher types...." In the past 3 weeks (since I ordered a NeXT Station) I've had numerous people express amazement that I could afford a NeXT computer. These folks are NOT computer neophytes. The bottom line is that NeXT is not getting the word around that they have VERY competitive computers NOT price heavy, number- crunching CRAYS!!! When I informed these folks about the $4995 list price & $3300 edu discount prices on the NeXTStations (plus all the included software) they expressed interest in the system/software (especially Improv from Lotus), but they quickly discounted the machine since 'it's not an IBM'. One of these folks was sitting in front of a BIG-BLUE model 70 running OS/2 with presentation mangler and cursing about not being able to print very easily!! The bottom line is "BE A VOCAL NEXT SUPPORTER". Tell people about the system and if you can code, the write software!! Tyler
UH2@psuvm.psu.edu (Lee Sailer) (11/11/90)
In article <1990Nov9.160743.18770@magnus.ircc.ohio-state.edu>, tgingric@magnus.ircc.ohio-state.edu (Tyler S Gingrich) says: >NeXT has a significant market positioning problem to overcome. >"People BELIEVE that NeXTs are all $10,000+ computers, only usable by >higher-ed >number cruncher types...." This is a very good point. The notion that NeXT is CHeaP has not penetrated at all. I was presenting a talk about the NeXT to a group who kept asking "Yeah, but how much..." and I kept teasing them with "But wait, there's more..." until *finally* I wrote $3000 on the black board. (An educational audience) Several people read an extra zero to the price. They read it as $30,000 dollars. After about five minutes, a guy in the audience suddenly gasped out loud. "Wait a minute -- gulp -- is that $3000?" lee
cyliao@hardy.u.washington.edu (Chun-Yao Liao) (11/11/90)
Why NeXT is not making *any* TV ads? Almost no one knows about or ever
heard about "NeXT computer" here. Some of the poeple (inc professors)
thought it's a very expensive and slow machine, and it's not IBM compatible...
The point is, no one knows about anything of NeXT's new line of product...
which is sad. How can NeXT sell if no one even know about it, specially
the new prices. Any one working at NeXT can tell us if NeXT is planning
to do any thing to get people informed?
cyliao@wam.umd.edu o NeXT : I put main frame power on two chips.
@epsl.umd.edu o people: We put main flame power on two guys.
@bagend.eng.umd.edu o ::::::::::::::::::::::::::::::::::::::::::::
xxxxx@xxxxx.xxx.xxx (reserved) o RC + Apple // + Classic Music + NeXT = cyliaoisaacso@copper.ucs.indiana.edu (Eric J. Isaacson) (11/12/90)
cyliao@hardy.u.washington.edu (Chun-Yao Liao) writes: >Why NeXT is not making *any* TV ads? Almost no one knows about or ever >heard about "NeXT computer" here. Some of the poeple (inc professors) >thought it's a very expensive and slow machine, and it's not IBM compatible... I had wondered about this, too. But when you consider the cost of advertising on TV over the number of units NeXT is selling (compared to Apple and IBM), I think wd'd find a surprising jump in price if NeXT were to go all out with a media blitz. Perhaps they're hoping word of mouth and demos to strategically located constituencies will build a base of customers for them. (Of course, at a computer fest at Indiana University in October, NeXT had only two machines--an 030 cube and a 040 demo machine, vs. dozens and dozens of Macs and PCs, and a good number of Suns, etc. They seemed a bit dwarfed in that particular setting, although there were always people wanting to look at the machines.) Eric J. Isaacson (the other) Internet: isaacso@ucs.indiana.edu School of Music--Indiana Univ. NeXT Mail: isaacso@bartok.music.indiana.edu Bloomington, IN 47405 -- I am NOT the author of A86 and other -- (812) 855-7832(o)/333-1827(h) -- outstanding software...I wish I were... --
agm@cs.brown.edu (Axel Merk) (11/12/90)
In article <isaacso.658353046@copper> isaacso@copper.ucs.indiana.edu (Eric J. Isaacson) writes: >cyliao@hardy.u.washington.edu (Chun-Yao Liao) writes: >>Why NeXT is not making *any* TV ads? Almost no one knows about or ever >>heard about "NeXT computer" here. Some of the poeple (inc professors) >>thought it's a very expensive and slow machine, and it's not IBM compatible... >I had wondered about this, too. But when you consider the cost of >advertising on TV over the number of units NeXT is selling (compared >[...] I agree that TV commercials are very expensive. I believe it would be part of Businessland's responsibility to promote NeXT. I don't think they have done a very good job in that respect. It's about time we can get this machine by mailorder. Axel ---------------------------------------------------------------------------- -- Axel Merk "One needs a certain amount of blindness -- -- agm@cs.brown.edu to see perfection" - Christopher Nuzum -- -- phone/fax (401)272 2262 Brown University Box 53 Providence RI 02912 -- ----------------------------------------------------------------------------
jack@Taffy.rice.edu (Jack W. Howarth) (11/12/90)
Eric,
When Apple released the new machines (Classic,LC and IIsi) they gave
some numbers for the amounts Apple would spend on advertising on TV for
those machines alone and the expected numbers Apple expected to sell. I think
the average cost of advertising was about $40 per CPU. Considering that
NeXT will sell a factor of ten less at best (the probably don't have the
capacity to produce that much more than that...) that would be at least
$400 per NeXT box. Considering that they are almost giving the 040's away
as it is, they could never afford it. The thing I wonder about is considering
that NeXT can barely be in the black as it is, how long will Canon, etc.
bankroll them. I'm sure someone has already written off the factory and
startup costs as unrecoverable. Otherwise, NeXT could never price these
machines so low. Also, is NeXT on the stock market? If it is a private
company, NeXT could be mighty deep in the hole already and just keeping
it mouth shut whereas a public company would have to face up to its share
holders occasionally.
Jack Howarthjack@Taffy.rice.edu (Jack W. Howarth) (11/12/90)
Axel,
If Businessland can not expect to easily recoup the cost of TV advertising
on the new NeXT machines due a combination of low prices and low sales, then
who can blame them for not advertising. As far as I have heard, the real
rush on NeXT machines at Businessland was on their firesale of cubes. Once
they were gone things slacked off. It seems most people who are interested
will probably be academic and will go through educational sales anyway!
Jack Howarthknrgroup@garnet.berkeley.edu (Raymond group) (11/12/90)
jack@Taffy.rice.edu (Jack W. Howarth) writes: > When Apple released the new machines (Classic, LC and IIsi) they gave >some numbers for the amounts Apple would spend on advertising on TV for >those machines alone and the expected numbers Apple expected to sell. I think >the average cost of advertising was about $40 per CPU. Considering that >NeXT will sell a factor of ten less at best...that would be at least >$400 per NeXT box. All this means is that Apple is spending a lot of money on TV advertising. A NeXT TV campaign needs to be nowhere as extensive or expensive. The Mac target market consists of every middle to upper-income household in the Western world. The NeXT market is the higher educational and business communities. By the way, if NeXT sells an order of magnitude less than a $1000 Mac, NeXT will gain complete control of the workstation market. >...they are almost giving the 040's away... Another false assumption based on a comparison of apples and oranges (or Apples and NeXTs). Apple has HUGE profit margins. Can you say 66% or even higher? NeXT can still make a healthy profit while underselling higher cost Macs by a factor of two! You also must take NeXT's advanced manufacturing process into account: it greatly reduces cost, especially labor costs. Apple has a nice automated factory, but Steve Jobs was responsible for that and he has advanced the state of the art even further with the NeXT factory. >...NeXT could be mighty deep in the hole already and just keeping its mouth >shut... It may very well be. However, if recent sales (non-Businessland sales) are any indication, NeXT should dig itself out of the hole much sooner than you think. >As far as I have heard, the real rush on NeXT machines at Businessland was on >their firesale of cubes. NeXT has made some very large sales without the aid of Businessland. NeXT is now very actively in the direct marketing business. As for the Businessland fire sale, virtually every buyer of the old cubes plan to upgrade to the 040 for $1400-$1500. >it seems most people who are interested will probably be academic and will >go through educational sales anyway! That covers about half of the intended NeXT market. The other half is business, and NeXT is getting some large orders from large businesses. Apple never really cracked the Fortune 1000 market. It looks like NeXT is starting to.
smithw@hamblin.math.byu.edu (Dr. William V. Smith) (11/12/90)
In-reply-to: knrgroup@garnet.berkeley.edu's message of 11 Nov 90 23:06:16 GMT >That covers about half of the intended NeXT market. The other half is >business, and NeXT is getting some large orders from large businesses. Apple >never really cracked the Fortune 1000 market. It looks like NeXT is >starting to. This is correct. The Fortune 500 market has been cracked by NeXT, and in a pretty big way. A great many more than those announced 15,000 orders have been placed since Sept. 18th. I understand from an old accounting friend with one of the big 8 in San Francisco that (NeXT) company insiders are really worried about the shipping delays caused by late delivery of the 68040, because of the vapor rumors going around the business. Jobs had to do alot of fence mending recently with big clients. Apparently there was also a great deal of disappointment over other broken promises to NeXT from Motorola. Ok, I'll keep my mouth shut. You can kill the posts about comp.sys.next.rumors. -Bill- -- __________________Prof. William V. Smith____________________ EMail: smithw@hamblin.math.byu.edu or uunet!hamblin.math.byu.edu!smithw SMail: Math Dept. -- 314 TMCB; BYU; Provo, UT 84602 (USA) NeXTmail: smithw@mathnx.math.byu.edu Phone: +1 801 378 2061 FAX: +1 801 378 2800
knrgroup@garnet.berkeley.edu (Raymond group) (11/12/90)
gft_robert@gsbacd.uchicago.edu writes: >...Apple's profit margins are around 50%, plus or minus (generally plus). >And that's before their profit margins dropped with the new low-priced >machines. The figure of 66% I heard was from one of the books written about Apple (perhaps West of Eden). At any rate, the machines under discussion here are the high-end Macs (the various Mac IIs). These machines probably have even healthier profit margins than other Apple machines, since the hardware differences between the low-end and high-end Macs is not as significant as their prices make them out to be. I wrote: >>NeXT can still make a healthy profit while underselling higher cost Macs by a >>factor of two! gft_robert replies: >I'd be very curious to see the business analysis that is behind the statement NeXT will not give you its business analysis. However, I believe that NeXT is selling its low-end machines at a profit. A Mac IIfx roughly equivalent to a $5000 NeXTstation would sell for over $10,000. The basis for this comparison you've seen in the NeXT thread in comp.sys.mac.misc. I wrote: >>Apple never really cracked the Fortune 1000 market. It looks like NeXT is >>starting to. gft_robert replies: >Uh, yeah, right...to say that it [Apple] never cracked the business world is, >well, silly. Particularly if you consider that the 15,000 to 20,000 orders >Next has (supposedly) piled up "starting to crack" the business market. Mac has cracked the business market, but NOT the Fortune 500/1000 market. Even John Sculley admits this in Odyssey. What I hear about the NeXT and the Fortune 1000 companies is mostly rumor; but the rumors do seem to indicate that large companies are eyeing the NeXT because of its incredible software development environment. You see, large businesses write their own software or hire a custom house to write it for them. The NeXT is ideal for this.
gft_robert@gsbacd.uchicago.edu (11/12/90)
------ In article <1990Nov11.230616.15911@agate.berkeley.edu>, knrgroup@garnet.berkeley.edu (Raymond group) writes... [...] >Another false assumption based on a comparison of apples and oranges (or Apples >and NeXTs). Apple has HUGE profit margins. Can you say 66% or even higher? I can say it. But it isn't so. Apple's profit margins are around 50%, plus or minus (generally plus). And that's before their profit margins dropped with the new low-priced machines. Their profit margins are still high for the industry. >NeXT can still make a healthy profit while underselling higher cost Macs by a >factor of two! I'd be very curious to see the business analysis that is behind this statement (since Next is privately held, I'm assuming you had to guess at some of the figures when making out the balance sheet, but it still would be interesting). >That covers about half of the intended NeXT market. The other half is >business, and NeXT is getting some large orders from large businesses. Apple >never really cracked the Fortune 1000 market. It looks like NeXT is >starting to. Uh, yeah, right. Apple does not have a large share of the business market, due in large part to what I think we can all agree were bad moves by Apple management, but to say that it never cracked the business world is, well, silly. Particularly if you consider that the 15,000 to 20,000 orders Next has (supposedly) piled up "starting to crack" the business market. Robert ============================================================================ = gft_robert@gsbacd.uchicago.edu * generic disclaimer: * "It's more fun to = = * all my opinions are * compute" = = * mine * -Kraftwerk = ============================================================================
bostrov@storm.UUCP (Vareck Bostrom) (11/12/90)
In article <1990Nov9.160743.18770@magnus.ircc.ohio-state.edu> tgingric@magnus.ircc.ohio-state.edu (Tyler S Gingrich) writes: >"People BELIEVE that NeXTs are all $10,000+ computers, only usable by higher-ed >number cruncher types...." Interesting, most people I talk to think that NeXTs are all $10,000+ computers, with an extreme lack of power. Most are not aware that there is a 68040 NeXT available (well, orderable). They think of them is overpriced toys (remember the IBM RT?). >In the past 3 weeks (since I ordered a NeXT Station) I've had numerous people I got the same response when I ordered my 040 cube. >When I informed these folks about the $4995 list price & $3300 edu discount >prices on the NeXTStations (plus all the included software) they expressed >interest in the system/software (especially Improv from Lotus), but they >quickly discounted the machine since 'it's not an IBM'. One of these folks >was sitting in front of a BIG-BLUE model 70 running OS/2 with presentation >mangler and cursing about not being able to print very easily!! My friends discounted the machine because 'it's not a SUN 4'. I still can't figure out why so many of the people I used to work with didn't like NeXTs. They seemed fairly fast, though not rockets, at least as fast as the 3/80's. The opticals were slow, but I expected that the hard disk next's were faster. Thoes people absoultely HATED NeXTs. At one time, we had gotten a HP 1.2 GB drive system, and had no hp to plug it in to. It was a standard SCSI 2 drive, 60 pin. It wouldn't connect to the NeXT straight away, but a friend and I started looking for a way to connect it, planning to use the NeXT as an NFS server. (awesome bus, CISC chip.. should be better than one of the Sun's). We thought we might have to go buy a cable to connect the drive and NeXT, so we talked to our boss, who talked to his boss, and got "He says he would be willing to connect the drive to the NeXT if you can do it for less than $3. He would be willing to spend up to $100 to connect it to a Sun. In other words, don't connect it to the NeXT. Because the Suns belonged to the AI people, and we managed to dig up a cable from our mac lab, we decided to format the drive and plug it into the NeXT anyway, just to have a look at a NeXT with a 1.2 gb disk on it. When we got that done, we had to take it off. Sigh. Bottom line is, there are people who don't like NeXT's, period. Would a NeXT make a better NFS server than a Sun 4/60 (SPARCstation, not SPARCserver)? >The bottom line is "BE A VOCAL NEXT SUPPORTER". Tell people about the system >and if you can code, the write software!! I am , now. I used to be a NeXT person, then wavered and went to Sun for a while, then came back to NeXT after a bit of thought. A Sun is a workstation, not a personal computer. And an IBM 386 or 486 is a personal computer, not a workstation. I need both. The NeXT is both. >Tyler > - Vareck (bostrov@mist.cs.orst.edu)
jack@Taffy.rice.edu (Jack W. Howarth) (11/12/90)
Robert,
I also wonder how many of those 15,000-20,000 orders are logic board
upgrades for cubes. On those, I would be surprised if NeXT made a dimes
profit!
Jack Howarthknrgroup@garnet.berkeley.edu (Raymond group) (11/12/90)
>Robert, > I also wonder how many of those 15,000-20,000 orders are logic board >upgrades for cubes. On those, I would be surprised if NeXT made a dimes >profit! None, zero, zippo, nada of the 15,000 orders announced on Sept. 18 are upgrades. They are all orders for WHOLE machines. This point was made very clear at the announcement and in subsequent press releases. As for NeXT making no money on the upgrades. I think they'll make some, but not as much as say most other companies which gouge their customers for upgrades, if upgrades are even possible!
vehaag@crocus.uwaterloo.ca (Viktor Haag) (11/13/90)
In article <56039@brunix.UUCP> agm@cs.brown.edu (Axel Merk) writes: >In article <isaacso.658353046@copper> isaacso@copper.ucs.indiana.edu (Eric J. Isaacson) writes: > >>I had wondered about this, too. But when you consider the cost of >>advertising on TV over the number of units NeXT is selling (compared >>[...] > >I agree that TV commercials are very expensive. I believe it would be >part of Businessland's responsibility to promote NeXT. I don't think >they have done a very good job in that respect. It's about time we can >get this machine by mailorder. Another problem with adverts on the tube is the recent media blitz by Apple. Hardly a day goes by when I watch TV (once every other day or so) and do no see either the 'but people *like* using the Mac' ad or the 'dying PC meets Mac Classic' ad. In order to get any sort of penetration out of network ads right now, NeXT would have to lay down a hell of alot of capital. I am not sure that NeXT needs to get itself involved in TV adverts - if you stop and think, there are really only two companies that do it: Apple and IBM. Sun doesn't Apollo doesn't, Silicon Graphics dosen't, Amiga (gasp) doesn't. All of these companies seem to be surviving. I feel that the NeXT is going to be bought by the informed user, who knows what he wants, and what he is going to get by buying a slab or a cube, and not bought by a user who buys it 'cause it looked cute on TV. NeXT is not a machine for everyone, its a machine for everyone who knows what a good machine is. vik -- "We murder to dissect" Wordsworth
portnoy@athena.mit.edu (Stephen L. Peters) (11/13/90)
In article <1990Nov12.163730.18300@watdragon.waterloo.edu> vehaag@crocus.uwaterloo.ca (Viktor Haag) writes: >... I am not sure >that NeXT needs to get itself involved in TV adverts - if you stop and think, >there are really only two companies that do it: Apple and IBM. Sun doesn't >Apollo doesn't, Silicon Graphics dosen't, Amiga (gasp) doesn't. All of these >companies seem to be surviving. Yes, but Amiga put out a campaign when it was just starting that NeXT hasn't done even to generate initial interest in the machine. Don't Sun and the others mentioned advertise in magazines for businesses? Where is NeXT advertising? I barely see them *anywhere*!!! All the information that I've received resulted from an initial foray into the campus computer store and picking up the NeXT brochure, and my following it up by actively looking for more info!!! >I feel that the NeXT is going to be bought by the informed user, who knows >what he wants, and what he is going to get by buying a slab or a cube, and not >bought by a user who buys it 'cause it looked cute on TV. NeXT is not a machine >for everyone, its a machine for everyone who knows what a good machine is. Yes, but there has to be some way for a buyer to become informed. If a person walks into a Businessland or other store, and says he wants good graphics, some nice sound capabilities, but has NEVER HEARD of NeXT, how likely is he going to want to be steered towards a system he has heard of, like a high-end Mac or PC? Before people get informed, they need to get the information. Advertising campaigns are made so that people can hear what the machine can do for such-and-such a cost, and then can gear their information-gathering towards their interests. Someone who doesn't know what the NeXT is, and thinks it's a 10 grand machine that won't do what he wants, won't spend too much time disproving his own theories. Stephen Peters