Apple Sales Explode: It's a Cloud Computing Effect

Among the conclusions one might draw from the explosion of Apple market share in the U.S. PC market--in February 2008 Macs got 14 percent unit share and 25 percent dollar share--is that the "Web" really is becoming a computing utility. The results are drawn from a survey of buyers by NPD Group.

As more things can be done "in the cloud," the operating system of the access device matters less. To use an analogy, we aren't yet to the point of simple mobile phones, where most features except for subscriber identity are properties of the network.

We more nearly are in a position analogous to smart phones, however, where some important functionality resides locally, and much is in the network.

If you like, think about PC use pre-Web or pre-local area networks. Initially, with the exception of connection to a printer, a wide area network connection was not necessary to derive value from a PC. Later, as more PCs appeared in the workplace, it became necessary to connect PCs locally.

Operating system mattered greatly, in those applications. Once people started to interconnect over the wide area network, though, things began to change. Obviously one needed the "right" physical interface to support a dial-up modem service. But beyond that the PC operating system begins to matter less.

The wide area network is designed to work transparently to edge devices, so long as the wide area network transmission protocols and interfaces are supported.

That's what is starting to happen with computing applications and services--and video and audio plus multimedia content now are computing applications. The details of edge devices will matter less once "networked" applications take firmer hold.

To use another analogy, consider televisions. The internal details are unimportant so long as the communications interfaces are standard. A TV must tune to standard NTSC signals now, and then HDTV formats in 2009. The display technology must render those pictures properly. Other than that, the details of device operation don't matter.

That perhaps is one reason buyers now are more free to buy Macs, and abandon the Microsoft operating system: OS choices aren't so important now as more value is drawn from the network.

Pacific Crest Securities analyst Andy Hargreaves says the latest NPD results represent 60 percent Apple unit growth and 67 percent revenue growth over the same period one year ago.

At the same time, overall U.S. PC retail shipments grew just nine percent on a five percent increase in revenues.

Apple saw particular strength in notebook systems, which rose 64 percent in units and 67 percent in revenues, suggesting strong sell-through of the company's new MacBook Air, a device specifically designed to rely on the Web and Internet more extensively than a typical machine.

Apple also saw robust demand for its desktop systems, which grew 55 percent on a 68 percent increase in revenues, compared to the overall retail segment which saw unit sales decline of five percent on a two percent drop in revenues.

Of course, Apple design smarts and the spillover glow from the iPod and iPhone probably are enticing buyers who might not have considered a Mac before.

But users wouldn't be doing so unless they were convinced their computing experience won't not be disrupted unnecessarily. One reasons for that greater level of confidence is simply that much of that experience now hinges on access to the Web and Internet.