James Tauber

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Apple on Intel and the Osborne Effect

A number of people (such as Jeff Nolan) have suggested that Steve Jobs's announcement of the move to Intel will hurt Apple due to the Osborne Effect.

If Steve had announced that a G6 PowerMac or G5 PowerBook was going to ship in 2006, wouldn't that be just as likely to cause an Osborne Effect?

So even if there is an Osborne Effect, I don't think see why it should be attributed to the switch per se.

Mind you, given there are always new technological innovations, holding off on something you were planning to do now because of an announcement about a release a year away doesn't make that much sense to me. A quarter or two maybe. But not a year.

But then again, no one said the Osborne Effect was rational. Just that (some) humans think that way.

Comments (2)

jeff on June 9, 2005:

It's equally irrational to suggest that any Osborne Effect is simply binary - it's there or it's not - without taking into account the amplification factor related to the announcement itself. If Jobs announced a G6 and not a Pentium powered Mac we wouldn't even be having this discussion.

It's also somewhat disingenuous to equate a new announcement concerning a line extension (e.g. G6) to that of a full processor migration (Power to Pentium). Anyone who has been around this business for more than a few years can remember when Apple moved from the 68000 to the Power platform and will recall that transition was not handled well, despite the very real benefits that moving to the new processor family brought.

Finally, I am a consumer and was committed to buying a new Powerbook until the recent announcement caused me to consider the ramifications of buying a platform that will be end-of-lined in less than a year. Not only is that fully rational, it's actual behavior by a prospective customer and Apple should be very concerned about it. It's not a question of the strategy, it's about tactics - what will Apple do over the next year to minimize concerns like mine and reassure existing customers that the transition will be non-disruptive with regard to future software upgrades, fixes, hardware support, and vendor support.

James Tauber on June 9, 2005:

Granted that there are degrees of Osborne Effect. I guess my points are that: (1) if I were looking to buy a PowerBook right now and Jobs had announced a G5 PowerBook available in, say, 3 months, I would be no less likely to hold off until then than if he'd announced an Intel PowerBook; (2) A year is a long time to hold off on buying a new laptop if you were intending to buy one right now. Finally, I shouldn't have suggested holding off was irrational. My last para would have been better stated as "no one said the Osborne Effect was about rationality". In other words, arguing about the rationality of going ahead versus holding back doesn't really help determine whether an Osborne Effect is likely or not.

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Created: June 8, 2005
Last Modified: June 8, 2005
Author: jtauber