Apple preparing new upgrade fees

CNET News.com ^ | January 3, 2003, 12:14 PM PT | Joe Wilcox

[savedbygrace]

When they introduced iCal, they made it clear it would be free only for a limited time.

OTOH, iSync doesn't seem like a product they can rationally separate from their advertised digital hub.

[savedbygrace]

Are you all speaking a foreign language? :-)

iYes.

[Billy_bob_bob]

Ok, let's clear this up. The thing they are calling iCal is a nice scheduling program, iTunes is their music jukebox/CD burning program, and iSync is their utility that allows for your Palm Pilot or other PDA to sync up to your Mac. Then there is iMovie, which is a moviemaking utility that also allows for easy importing of your movies from your digital camera, and iDVD which is a DVD burning utility. Last but certainly not least is iPhoto, which is a very nice digital photo program that works seamlessly with the vast majority of digital cameras on the market today.

Yeah, I know. The whole "iName" deal gets a bit cutesy over time, but it's the kind of branding that really pays off in the long run. At least they're trying to do the marketing thing right this time around.

[HAL9000]

Apple has used this product strategy for a long time. They introduce new software and distribute it to everyone for no charge. Later, Apple includes it free with the purchase of a new computer, but existing owners pay an upgrade fee to get the newest version.

When the Macintosh was first introduced, MacWrite and MacPaint were free. Now those programs are integrated into AppleWorks, and upgrades cost about $60.

Years ago, all Mac OS updates were free. Now, users pay about $100 for major OS updates and incremental updates are free.

QuickTime was free when it was first introduced. Now everyone gets the playback software free, but can pay $30 to upgrade to the optional Pro version for authoring features.

As the profit margins on hardware continue to decline, Apple will continue to develop software as a revenue source.

[Bush2000]

I don't blame Apple, frankly. They have some huge challenges, not the least of which is how to derive revenue from a smaller customer base. If anything, Apple customers should look at this move as a way to support the company in a way that allows it to continue providing products that they want.