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Rob Enderle: HP's iPod Will Outsell Apple

by , 11:00 AM EDT, August 27th, 2004

According to long-time Apple doom sayer Rob Enderle, HP's branded iPod will be outselling the Apple's own product that has become a cultural phenomenon. HP introduced its iPod, called "Apple iPod from HP," today during a press event introducing many new consumer electronics products from the computer company (see TMO's full coverage for more information).

The Apple iPod from HP is the first iPod licensed by Apple to a third party, and marks HP's first serious foray into the world of music players. Mr. Enderle's comments come in a Reuters article covering today's announcements. From that article:

This year's unveiling is Palo Alto, California-based HP's third consumer electronics showcase since it launched the "Big Bang" three years ago, and it reflects PC makers' efforts to move into new markets as the overall PC industry matures.

"HP is certainly a major contender in this race to get into the living room," said Mike McGuire, an analyst at Gartner G2. "They already have a substantial installed base with printers, PCs and handhelds."

[...]

"The expectation on the iPod is that HP's version will probably outsell Apple's version relatively quickly," [analyst Rob Enderle of market research firm Enderle Group] said, due to HP's broad distribution at electronics retailers.

There's more on HP's push into consumer electronics in the full article.

The Mac Observer Spin:

"The expectation is..." That's a clever turn of phrase intended to make it seem that Mr. Enderle is merely passing along conventional wisdom. Of course, such a notion is hardly that; in fact it is quite novel. This latest comment about Apple is merely the latest rambling from a man who has yet to accurately call one thing about the company.

It's not that we have anything against HP -- far from it -- but the notion that a company with little success in selling lifestyle is going to sell more units of a lifestyle product like the iPod than a lifestyle company like Apple is simply amazingly stupid.

HP is likely to have a lot of success with the iPod, and it is also likely that the company will be able to bring the music player to new segments of the market that wouldn't touch an Apple-branded product (think corporate), but outsell Apple? It's simply not going to happen.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:mrmgraphics Posts: 825 Joined: 05 Sep 2003
Subject:

+

A look on HP's website leaves me wondering if the "HP-branded iPod" is really going to be an Apple-branded iPod sold by HP. (The HP home page even features the Apple logo.) It appears more like the latter; regardless, does it matter who sells more iPods: Apple or HP? They're still iPod sales, after all.

http://www.hp.com/

Close Name:pyxl8 Posts: 171 Joined: 24 Dec 2003
Subject: And the HP iPod is....

....<gasp> EXACTLY THE SAME as a regular iPod! After all the suspense, the big news is: it's a white friggin' iPod. So why it the world will it sell MORE than the "Apple" version? It's not even BLUE as people predicted, which would have at least made it uniquely HP's.

I don't get it... And where in the heck did Rob hear "the expectation on the iPod" predictions from?!

-Ken P

PS: Well, the iPod printable tatoos that HP will be offering are kinda cool, but I don't need to buy THEIR iPod to get those! Check out the press release at:
http://www.hp.com/hpinfo/newsroom/press_kits/2004/digitalexplaunch/music.html

Close Name:Aftermac Posts: 42 Joined: 25 Sep 2001
Subject: Not so fast

I wouldn't be so quick to say that HP's iPod is going to sell more or less units than the standard Apple variety. The greatly expanded retail presesence that HP brings to the table could be enough in itself to sell more units than Apple. Also, take into consideration how many more computers HP sells than Apple; those customers may well buy an iPod with their new computer instead of ordering it seperately from Apple.

Furthermore, it's not like this would be a bad thing. Apple is still making money, while increasing brand recognition (not that the iPod isn't already the Kleenex of mp3 players).

So, to summarize, it is entirely possible that HP sells more than Apple... and YAY if they do!

Close Name:Tiger Posts: 1018 Joined: 17 Jun 2003
Subject: Ignore Enderle

And maybe he'll go away. He gets his name on this website about as much as the Kennedy's do on MSNBC.

Close Name:kenaustus Posts: 602 Joined: 27 Jun 2003
Subject: Apple would love that

The more iPods Apple sells the happier Apple will be. The only time Apple benefits is when you buy one directly from the Apple Store - all other sales are to resellers, including HP.

The other nice thing is that Apple can count each iPod shipped to HP as a "sale", meaning that Apple will always be ahead of HP in sales. Rob is a bit further off this time than he usually is - which is something in itself. Only RC will agree with him.

Close Name:Guest
Subject: HP does not have any iPods to sell......

Still a vapor lock in channel inventory

Close Name:Guest
Subject: How is he still employed

I want a job like that! I want to be able to just make stuff up be constantly wrong and still be paid. It's not fair!!

Close Name:Guest
Subject: Wrong Wrong Wrong

Quote
Guest wrote:
I want a job like that! I want to be able to just make stuff up be constantly wrong and still be paid. It's not fair!!


No doubt RC is on his payroll!

View Name:RealityCheck -   Troll Posts: 392 Joined: 06 May 2004
Subject: hLemmings Beware-4G iPod Quality Problems Widespread
Close Name:Guest
Subject: HP use to invent, now they just rebrand...

HP use to be the dynasty of corporate America, now they are really a loser company even Dell makes them look bad.

Why would Apple want to tarnish their reputation by dealing with HP? Apple be careful!

I use to work at the Boise site, now it is almost deserted. Lots of good people there fell victim to bad management.

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject: Um...

But they DID put their logo on them.

Close Name:DawnTreader -   TMO Staff Posts: 15039 Joined: 04 Jan 2002
Subject: Re: hLemmings Beware-4G iPod Quality Problems Widespread

Quote
RealityCheck wrote:
Reports from Mac fanboys that 4G iPod quality problems are isolated have been proven false.


Years ago Orson Welles did a famous radio broadcast of War of the Worlds. Some people (the most gullible among us) actually believed aliens were attacking the earth. Some people reportedly took out rifles and began shooting at the sky in the hopes of stopping the alien invasion.

It’s kind of the same thing here. Intelligence truly is a gift. I've long believed the less astute among us will look for problems and conspiracy theories wherever they might go. It's easier than trying to adapt to a sometimes complex world they can't understand. In the case of the Orsen Wells broadcast the less astute began shooting at the sky. The more astute chose to separate fact from fiction.

The computer world is changing. We can either adapt and make use of the emerging products and technologies or remain ignorant and seek comfort in rumors, conspiracy theories and self-created illusions.

The iPod is changing the way people purchase and use music. The astute among us will embrace the change. The less astute will seek comfort in half-truths, conspiracy theories and just about anything they hear that supports their antediluvian ideas. Their ignorance is revealed with every comment they make.

In other words, stupid people have a way of saying stupid things. In the case of RealityCheck it happens over and over again. Nothing learned, nothing gained. A waste of space. This is all RealityCheck's version of shooting at the sky.

edited to fix typos



Last edited by DawnTreader on Fri Aug 27, 2004 12:59 pm; edited 2 times in total
Reply | Quote
Close Name:Guest
Subject: HP is so hard up.....

They'll be rebranding Kenmore washing machines next up...

and yes HP even makes Dell look good!!

Close Name:pyxl8 Posts: 171 Joined: 24 Dec 2003
Subject: Perfect job

Quote
Guest wrote:
I want a job like that! I want to be able to just make stuff up be constantly wrong and still be paid. It's not fair!!


Try the Weather Channel

-Ken P

Close Name:Guest
Subject: Much Ado About Nothing

What does it matter which party sells more of which? Either way, Apple's brand is still in the picture and Apple gets a piece of each iPod sold by HP. This is all about Apple revenue and market share of an Apple-created and Apple-controlled product. Do you want the REAL story here? Okay -- here goes:

If Enderle is right in his speculations, then it means that overnight the iPod market share will skyrocket beyond its already high level and that in short order (I would estimate within a year or 18 months, if Enderle is correct) the installed base of the iPod will more than double as well.

THIS is the truly big story here -- not which company sells more than which.

Can you imagine this mentality applied to any other company? In regard to the Windows OS, for example, consider that Microsoft wins whether Dell sells more Windows computers or HP does -- they are still all Microsoft sales at the end of the day. And so it is with the iPod. Enderle is just a reflexive naysayer who has a gift for missing the REAL story.

Jeff Mincey

View Name:RealityCheck -   Troll Posts: 392 Joined: 06 May 2004
Subject: DawnTreader - Look Who's Shooting At The Sky
Close Name:Guest
Subject: iPod is maufactured by BMW

There is nothing Chinese about it None of Apple products are manufactured in Asia. I know because my mom told me so.

So there.....

Close Name:DawnTreader -   TMO Staff Posts: 15039 Joined: 04 Jan 2002
Subject: Re: DawnTreader - Look Who's Shooting At The Sky

Quote
RealityCheck wrote:
DawnTreader couldn't refute the ipodlounge survey results that proved 4G iPod quality problems are widespread, so he goes into a rant about Orsen Wells. Talk about shooting at the sky.

This is another gigantic I told you so. Why don't you Apple idolators simply admit the truth that 4G iPod quality is deplorable. Maybe if Apple hadn't outsourced iPod production to Chinese peasants and political prisoners quality would have been better.


RealityCheck, there's nothing to refute. In other words, get a life. Seriously.

The iPod Lounge has reported problems before. These issues were addressed in the last conference call with analysts.

If product problems were widespread Apple is obliged under the law to identify the issues, release a public advisory and provide an avenue for cost-free repair.

Until such time as an advisory is issued, I suggest finding better quality fiction than trolling discussion boards looking for problems.

Close Name:acdc1174 Posts: 723 Joined: 16 Apr 2004
Subject: Re: Perfect job

Quote
pyxl8 wrote:
Quote
Guest wrote:
I want a job like that! I want to be able to just make stuff up be constantly wrong and still be paid. It's not fair!!


Try the Weather Channel

-Ken P


He he he...too funny. I have a question though. Is HP simply an Apple reseller when it comes to these iPods? If so, I didn't see any substantial markup on the website, so that would tell me that apple is splitting its margin on the pods w/ HP. Not the best way to make short-term $$, but a great way to get more product out there and increase revenue via ITMS. But since I wasn't asked for my input on this business model, I don't know. Does anyone have any idea?

Close Name:hulugu Posts: 24 Joined: 26 Sep 2003
Subject: Lies, statistics, and damned lies

So because 42% of the readers of a relatively small website, albeit a neat one devoted to the iPod, you believe automatically that there are wide-spread problems with the 4G iPod?
Take a statistics class or at least read a book, and you will find that small samples of people will legitimize any claim. Furthermore, you will learn that self-reported statistics are often the least valuable samples.
Thirdly, did you read the comments wereby a significant amount of people were noting no problems at all.
The 4G iPod might have a huge problem, but I notice that many other manufactures also have had problems, including the much vaunted Intel. The computer-market, and the peripherial, of which the iPod belongs, still have not matured and there is still a significant fault tolerance built into the market because of the inherent complexity that each of these devices have. The iPod not only contains a hard-drive, chips, display, speakers, etc. but it will be handled by people who may not be as careful as they should be.
The 4G iPod may be inherently flawed, but this is a worthless stastic.

But, as annoying as you are, you serve a useful purpose, you show the complete lack of subtitly that plagues the Mac-haters. You have a visceral emotional reaction towards Apple and those who like it, as if somehow you could stanch the creation and use of a product that somehow makes you foam at the mouth even if it's just a product.
You might consider counseling.

Close Name:jimothy Posts: 612 Joined: 04 Jun 2004
Subject: It's not identical

The "hPod" looks a lot like the regular iPod, but it turns out there is an user interface difference: You select playlists using Reverse Polish Notation.

Close Name:Guest
Subject:

Hey Realitychick,

I don't read this site much, but when I do, you seem to always manage to post something negative about Apple or their iPod.

What is it that you really want? Have you sent Apple an email with your concerns? Your constant trolling here seams pointless to me. And why here anyway?

Let me enlighten you: People think either you're:
1) Bitter or
2) pathetic.
3) Really despirate fpr some kind of attention, which is well... pathetic I guess...

Close Name:Guest
Subject: What an idiot

"The expectation on the iPod is that HP's version will probably outsell Apple's version relatively quickly," [analyst Rob Enderle of market research firm Enderle Group] said, due to HP's broad distribution at electronics retailers.

----

I'm pretty sure that that is exactly why Apple is doing this. More exposure for the iPod without having to partner with a bunch of retailers.

They're the same iPods just in different packaging. HP is an iPod reseller. An HP sold iPod is an Apple sold iPod.

Close Name:Guest
Subject: Bryan

Most of time Mr Ederle says stupid thing about almost everything regarding Computing... but actually this one, we have to read it between lines... Well if HP outperform Apple, excelent news for Apple and Apple's Stock holders.

HP will pay Apple (premiun price for sure) for each iPod sold; if you want a tune, HP re-direct you to Apple iTunes
so this is almost risk free deal for Apple and selling cost is HP effort... So Bryan, just forget some of the Mr Ederle non-sense comments

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject: Re: Perfect Job

Quote
acdc1174 wrote:
He he he...too funny. I have a question though. Is HP simply an Apple reseller when it comes to these iPods? If so, I didn't see any substantial markup on the website, so that would tell me that apple is splitting its margin on the pods w/ HP. Not the best way to make short-term $$, but a great way to get more product out there and increase revenue via ITMS. But since I wasn't asked for my input on this business model, I don't know. Does anyone have any idea?
One important detail to notice is that HP is taking the responsibility of supporting these iPods. So that right there saves Apple some $ over an iPod that they sell. So that helps to offset the fact that HP is getting a cut. Plus HP is doing its own marketing too!

Close Name:cooner Posts: 30 Joined: 17 Aug 2004
Subject:

Quote
acdc1174 wrote:
I have a question though. Is HP simply an Apple reseller when it comes to these iPods? If so, I didn't see any substantial markup on the website, so that would tell me that apple is splitting its margin on the pods w/ HP. Not the best way to make short-term $$, but a great way to get more product out there and increase revenue via ITMS.


My guess is that HP is reselling these iPods like any other chain -- Best Buy, CompUSA, MacConnection -- would resell them. Essentially Apple sells them wholesale to the reseller at a reduced price (but still making a profit) so the reseller can make a profit as well. Only difference with HP is it's a much bigger deal, so Apple is producing somewhat specialized iPods just for them to sell.

So yeah, Apple makes a bit less profit than if you bought it direct from them online or at an Apple Store. But the trade-off is that the iPod gets much more exposure (especially to people who don't browse in the Apple Store), more places for people to make impulse buys while they're out shopping, and more advertising (as in retail sales flyers, or HP's announcement today). In HP's case, the fact that HP is also taking on technical support is a bonus to Apple.

Everyone wins; honestly, neither company would have agreed to this partnership unless both had something to gain by it, both financially and perceptionwise. After all, not every company is Real.

Close Name:John F. Braun -   TMO Staff Posts: 233 Joined: 11 Jun 2001
Subject: Conspiracy

Quote
DawnTreader wrote:
The computer world is changing. We can either adapt and make use of the emerging products and technologies or remain ignorant and seek comfort in rumors, conspiracy theories and self-created illusions.


This would explain his ignoring surveys that use proper methodology with a large sample size (recent ones being PC Magazine, Consumer Reports and ACSI) and latching on to negative reports using a small number of people. How very sad.

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject: Re: Conspiracy

Quote
John F. Braun wrote:
This would explain his ignoring surveys that use proper methodology with a large sample size (recent ones being PC Magazine, Consumer Reports and ACSI) and latching on to negative reports using a small number of people. How very sad.
But how could that survey not be accurate? It's not like those individuals who DID have problems would be more motivated to take the survey than those who didn't have any problems. That sounds like a nice accurate data set to me!

Close Name:Guest
Subject: Production already stretched to limit!

Already Apple can't keep up with the accelerating demand for iPods - viz. the run on them in Japan and elsewhere. How on earth are they going to satisfy the enormous demand increase predicted by Enderle as a result of tapping a new big segment of the market?

James Kuipers

Close Name:jimothy Posts: 612 Joined: 04 Jun 2004
Subject: Resellers

Quote
kenaustus wrote:
The more iPods Apple sells the happier Apple will be. The only time Apple benefits is when you buy one directly from the Apple Store - all other sales are to resellers, including HP.


What? Apple still makes money when iPods are sold by resellers, be they Target, CompUSA, HP, etc.

Close Name:pyxl8 Posts: 171 Joined: 24 Dec 2003
Subject: Troll's lack of subtitly?

Quote
hulugu wrote:
But, as annoying as you are, you serve a useful purpose, you show the complete lack of subtitly that plagues the Mac-haters.


"Subtitly??!!!" Who would want any of THAT anyway?!!

(I nominate that post for Typo of the Month")

-Ken P

Close Name:NomadSoul Posts: 2 Joined: 30 Jul 2004
Subject:

Quote
Biff wrote:
Quote
John F. Braun wrote:
This would explain his ignoring surveys that use proper methodology with a large sample size (recent ones being PC Magazine, Consumer Reports and ACSI) and latching on to negative reports using a small number of people. How very sad.
But how could that survey not be accurate? It's not like those individuals who DID have problems would be more motivated to take the survey than those who didn't have any problems. That sounds like a nice accurate data set to me!


It could easily not be accurate. Whenever I have a product go bad on me, I tell everyone about it. When a product does what it is supposed to do, I hardly ever tell anyone. Complainers always get much more publicity. Negativity Sells.

Close Name:Guest
Subject: jbelkin

In theory, Apple can make a little more by selling the ipod themselves only but if you factor in the "free" PR, marketing from Hp, Hp's website and Tv ads, it's worth it.

Apple can also drive costs lower because they are not bearing the full burden of having to sell the entire marketplace.

As much as we don't need validation, plenty of PC people still think of Apple as 'the weird computer.' This is really a stamp of approval from a company they trust (I believe their printer market share is around 45%) and know. You'd be surprised at the number of people who cannot figure out how to get their CD tracks into an mp3 player - so while they want to join the mp3 revolution - they just don't quite know what to make of Apple. It's either 'out of their league' or dismissed as a 'not-a-PC company" so while people might be intimdated to go into an Apple/Tiffany store - HP is more like Macy's.

While I'm not going to wrap my ipod, the tattoo still looks like a cool idea - so they're thinking already! It's only good for us.

Close Name:jacrav Posts: 268 Joined: 04 Jul 2001
Subject: Rob C and R Enderle

Enderle is to the media what RC is to TMO forums, always good for a chuckle.
Always trust them to find something inane to say about Apple and its products. Thank God for them; without them life would be dull.
GO RRob CEnderle ! You’re the A-Team of irrelevance !

Close Name:Guest
Subject: Insulting Chinese workers by labelling them "peasants&q

"political prisoners" shoots your credibility to hell. Where's the "reality"? Cite some reports that Apple is using "peasants" and "political prisoners". RC should be named RDF as your Reality is uniquely your own. I can't even imagine what a litte litte life you have that you need to go to a Mac website to troll. Who are you going to convert? They're fanatics by you own admission. Fanaticism by definition is irrationally based, so why try to reason with fanatics? It's pure idiocy. If you think Mac fanatics need a "reality check", you really need to look in the mirror if you think trolling amongst fanatics makes any sense. Who's the bigger fool?

Close Name:Guest
Subject: HP Selling more iPods than Apple ??

A closer look at this idiots dumb comment just shows how stupid he really is !!

How can HP ever sell more iPods than Apple ?? .... Think about it... Is Apple GIVING truckloads of iPods to HP to sell to the general public ??

uhhhhh ..... I dont think so

Apple is selling truckloads of iPods to HP ... and in turn ... HP will put their logo on them... and "re-sell" them ...

So... bottom line ..... Apple will always be selling more iPods than HP...

Doesnt this remind you of the Michael Dell / iPod experiement ??

Close Name:Brutno Posts: 198 Joined: 28 Aug 2002
Subject: Too Funny

Quote
jimothy wrote:
The "hPod" looks a lot like the regular iPod, but it turns out there is an user interface difference: You select playlists using Reverse Polish Notation.


I remember the first HP calculators. 1 ENTER 2 PLUS EQUALS, IIRC.
Thanks for the trip down the twisted memory lane.

Close Name:Guest
Subject: RPN on iPod

Great post jimothy! I love it!
I like RPN. I remember fondly entering matrices in RPN for my linear algebra classes. Those were the days...I still use my hp calculator with RPN daily too!

Maybe Apple can license the iPod to Microsoft and they can then redo the interface so that users have to control it through Visual Basic or maybe some good ole' retro DOS commands! LOL!

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