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Report: Apple Mulling Price Cuts For Macs

Rough economy, rise of netbooks said to be pushing Cupertino-based Apple to slash prices for its 13-inch MacBooks and entry-level iMacs.

"Apple is tailoring changes to a pair of its offerings that will help drive down prices of some the most popular Macs," AppleInsider reported Thursday. The Web site cited sources as saying Cupertino, Calif.-based Apple's biggest concern was finding a way "to combat the proliferation of budget notebooks -- often called netbooks."

The two product lines that will supposedly begin appearing at undetermined but lower price points are Apple's 13-inch MacBook laptop, available now at $999 in a polycarbonate casing or for $1,299 in the new aluminum unibody casing, and its 20-inch iMac desktop, which AppleInsider believes Apple could begin offering in an entry-level SKU for between $1,000 and $1,050, down from the current $1,200 price tag on Apple's retail Web site.

Apple saw its shipments of Macs shrink by 3 percent in its recently concluded financial quarter ending in March. That led market researcher Gartner to conclude that Apple's share of the PC market in the U.S. had dropped to 7.4 percent from about 8 percent in the fourth quarter of 2008. The global PC market as a whole shrunk by 6.5 percent year-over-year, according to Gartner.

In the first quarter, Apple suffered a 1.1 percent drop in share in the U.S. PC market compared to its position in the first quarter of 2008, according to Gartner. That drop was not nearly as precipitous as that experienced by Dell, which lost 16.3 percent of its market share year-over-year and was overtaken by Hewlett-Packard as the top seller of PCs in the US.

But of greater interest to Apple than the jockeying between the top two PC makers, according to AppleInsider's sources, was the movement by netbook market share leader Acer in the slot immediately above Apple in the PC market share sweepstakes. Acer has gone from owning 9.1 percent of the PC market in the U.S. in the first quarter of 2008 to controlling 13.6 percent in the latest quarter.

With overall demand for PCs still difficult to predict for the rest of the year, Acer recently lowered its netbook sales outlook for 2009. But the Taiwanese computer maker has already enjoyed considerable success with its Aspire One netbooks. And Acer could soon have another ultra-small form factor winner on its hands with the AspireRevo, a mini-desktop PC based on the Nvidia Ion graphics platform for Intel Atom processors that offers 1080p video playback, can run Microsoft's Windows Vista and Windows 7 operating systems, and is likely to retail for about $300.

Apple is apparently concerned enough with possible losses of sales to netbooks that it feels the need to devise a temporary pricing strategy to staunch the bleeding, according to AppleInsider's sources, at least until the company is ready with a rumored tablet PC that Apple is said to believe can take on netbooks in the marketplace.

Meanwhile, a national ad campaign being run by Redmond, Wash.-based Microsoft in the U.S. in recent weeks has pretty plainly accused Apple of charging a higher price for products on the basis of what Microsoft contends is a purely aesthetic advantage over most Windows-based PCs rather than any kind of technological edge. Apple itself, of course, has run its "Mac vs. PC" for years, poking fun at Windows-based computers.

But according to AppleInsider's sources, while the Microsoft ads may be annoying to Apple, they are not a factor in Apple's rumored price-cutting plans.

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