Snow Leopard Takes a Page

From the App Store

Playbook
www.nytimes.com

A
pple announced and demonstrated all kinds of things this
past Monday at its developers' conference: upgraded laptops,
a new iPhone, a new iPhone software suite for all iPhone
owners, its new Mac OS X 10.6 "Snow Leopard" operating system, and
so on. Lots of goodness, for sure. But to me, one of the most mind-
blowing revelations was a single statistic: 29.

That's dollars, and it's how much Apple intends to charge current
Leopard owners for the Snow Leopard version when it goes on sale in
September. That's $29, rather than the $130 Apple traditionally
charges for new Mac OS X versions.

Apple sells millions of copies of Mac OS X. So why on earth would it

leave so much money on the table? There are two official reasons, one
semi-official reason--and one that may be the real reason.

Official Reason 1: Snow Leopard wasn't intended to be a huge

upgrade. From the beginning, it was meant to be an optimization of
the existing Mac OS X: cleaned up, faster, smaller, more polished.

Which I think is an outstanding goal; who can sustain "200 new

features!!!!" forever?

Besides, come on--think of your current computer or phone. Which,

really, would you prefer: more features, or better speed and
reliability?

Continue reading the main story

Microsoft is essentially pursuing the same mission with its new

Windows 7. It's basically "Windows Vista, refined." The beta versions
are so much better than Vista, it's not even funny.
Celebrate this trend, people. It won't last.

And sure enough, Snow Leopard really is faster--and smaller. Yes,

smaller: The OS occupies only half the disk space of the previous
version, saving you a cool 6 gigabytes. That's a first in the history of
OS upgrades.

Apple says that everything is faster, too: Snow Leopard installation is

45 percent faster, shutting down is 75 percent faster, waking up 50
percent faster, 55 percent faster joining Wi-Fi networks, and so on.
(These are all Apple's measurements, and they're all "up to," but
still.)

Truth is, though, Apple's programmers couldn't just sit by and leave
their ideas on the table; a healthy number of new features did, in fact,
sneak into Snow Leopard. You can edit videos (without having to buy
the $30 QuickTime Pro package, as before) right at the desktop, then
upload them directly to YouTube or MobileMe. Video chats require
only a third as much bandwidth, so even DSL people can get in on the
act. You can copy a single column of text out of a PDF without
including the columns on either side. And on and on.

So much for Reason #1.

Reason #2 is something like, "Well, we wanted Mac OS X to be

affordable, so we can bring its goodness to as many people as
possible."

Newsletter Sign Up
Continue reading the main story

Interested in All Things Tech?

The daily Bits newsletter will keep you updated on the latest from
Silicon Valley and the technology industry, plus exclusive analysis
from our reporters and editors.

Please verify you're not a robot by clicking the box.

Invalid email address. Please re-enter.

You must select a newsletter to subscribe to.

You agree to receive occasional updates and special offers for The
New York Times's products and services.

Thank you for subscribing.

An error has occurred. Please try again later.

You are already subscribed to this email.

View all New York Times newsletters.

• See Sample
• Privacy Policy
• Opt out or contact us anytime

Well, sure, but didn't you want your OTHER Mac OS X versions to
reach as many people as possible?

So much for Reason #2.

When pressed, an Apple product manager admitted that there might

be a third reason for the pricing: "Well, we wanted to put a little
pressure on our friends up North."

That would be Microsoft.

I'm not sure what kind of pricing pressure Apple could put on
Windows 7 at this point; Microsoft's plans are surely in stone, since
Windows 7 ships in October. And Microsoft has also decided, once
again, to pursue its disastrous and confusing plan to ship Windows in
five or more different versions, each with different features (sigh).
Since Microsoft's bread and butter is corporations, who buy Windows
by the pallet, Apple's pricing gesture must seem like little more than a
gnat.

But there's a final possible reason for Snow Leopard's $29 thing: the
App Store Effect.

When programmers write iPhone programs, Apple encourages them

to set a price that's really low--like free, or, if you insist, $1. As a
result, the huge majority of programs in that store are impulse buys.
Nobody blinks at $1; it's less than a soda, and it's something you'll
have for a long time. Price is virtually no barrier at all.
That's quite a bit different from any other software category. Even
shareware usually starts at $20. There's a huge psychological
difference between $1 and $20.

The App Store Effect says this: if you cut a software program's price
in half, you sell far more than twice as many copies. If you cut it to
one-tenth, you sell far more than 10 times as many. And so on.

It's a little counter-intuitive, but this principle has paid off beyond
anyone's wildest dreams. The numbers are staggering: as you've
probably heard, iPhone/iPod Touch fans downloaded 1 billion apps
within 9 months. Some iPhone programmers have become
millionaires within months--yes, selling $1 software--because of this
crazy math. $20 may sound like more than $1, but not when 1,000
times more people buy at $1.

I can't help wondering if Apple has the App Store effect in the back of
its mind with Snow Leopard. If the previous Mac OS X version sold for
$130, then Apple would need five times as many Snow Leopard sales
to equal the revenue.

The App Store Effect says: Oh, baby, that's a no-brainer.

Continue reading the main story

