The iMac G5: Elegant-But A Lost Opportunity

No question about it, Apple Computer's new iMac G5 is beautiful. The
minimalist design, whose echoes of the iPod are entirely intentional, would
grace any desk. Although I have some quibbles with the details, the iMac offers
outstanding performance at a fair price. Still, lovely as the iMac is, I think
Apple may be blowing an opportunity to expand its market.

This is the third generation of iMacs, and the only family resemblance is an
all-in-one design radically different from anything else on the market. The
previous iMacs put their guts in a hemispherical base and used a clever arm that
let you position the 15- or 17-inch displays just about anywhere you wanted. The
new versions mount all the electronics behind the wide-screen 17- or 20-in.
display that is only about two inches thick, and the entire unit stands on a
curved aluminum foot.

Apple cools the system with large, slow-turning fans, so it's
whisper-quiet. If you add the optional wireless networking card ($79) and
Bluetooth module and wireless mouse and keyboard package ($99), the only wire
running into your iMac will be the power cord. Mac OS X is the best
personal-computer operating system today by a fair margin, and the iMac comes
preloaded with Apple's very good suite of iLife programs, including iPhoto and
iTunes for picture and music management, respectively, and the Garage Band music
composition and recording system.

The hardware is beautiful, the software is beautiful - so what's wrong
with this picture? For one thing, some functionality seems to have been lost in
the interest of aesthetics. The previous generation of iMacs allowed almost
unlimited adjustment of both horizontal and vertical screen angle and a
considerable range of height. The new models offer effortless vertical tilt, but
only up to 30 degrees. Horizontal movement is accomplished by swiveling the
entire unit, which has a slippery plastic pad on the bottom of the aluminum
foot. There is no height adjustment at all, a serious blow to good ergonomics.
The iMac has a full complement of ports, including three USB and two FireWire
sockets and even a digital audio link, but all the connectors, as well as the
power button, are in the back. This keeps the front and sides perfectly clean,
but it means you have to turn the unit to plug anything in.

Price is another concern. The cheapest iMac, the 17-in. with a 1.6 gigahertz
G5 processor, doesn't sound too bad at $1,299. But Apple prices all of the
iMacs with a bare minimum of 256 megabytes of memory, which will hobble
performance. Bringing that to 512 MB adds $75; moving to a gigabyte, which you'll
want for Garage Band or any serious photo or video editing, adds $225. Throw in
the wireless options, and the base iMac is up to a hefty $1,702, while the
20-in. version goes well over $2,000. By contrast, you can get a Dell Dimension
4600 with a 3.2 GHz Pentium 4, a gigabyte of memory, and a 17-in. flat panel
display for $1,164. Elegance is expensive.

Considering the excellence of the software, Apple deserves a larger share of
the market than the low single digits it has been able to garner, and consumers
deserve more access to Apple products. The average selling price of a desktop PC
is below $750, and few go for more than $1,000. But Apple's only sub-$1,000
computers are two dated eMacs, bulbous all-in-ones with 17-in. CRT displays.

With any real improvement in Windows at least two years away, I think Apple
could shake the industry by offering, for $700 or less, a PC-like Mac box for
which consumers would provide their own displays. The company wouldn't have to
scrimp on features or quality; the unit would lack the elegant design of the
iMac G5, but it would still be a Mac. Given Apple's obsession with beautiful
but expensive industrial design, there is almost no chance we'll ever see such
a product. And that's a shame, both for Apple and for its prospective
customers.

In BusinessWeek. Copyright 2004 by The
McGraw-Hill Companies, Inc