Apple

Apple came out on top of a recent PC industry customer satisfaction survey.

(Credit: CNET)

Apple easily outdistanced its peers in a PC industry customer-satisfaction survey conducted by Forrester Research that found PC companies are only slightly more well-liked than insurance companies.

An overall satisfaction rating of 80 percent was good enough for Apple to trounce the second-place finisher, Gateway, which scored 66 percent. Forrester surveyed 4,564 U.S. consumers online in October in compiling the results, which were published Friday on the research firm's Web site.

Apple and Gateway were followed by HP, Compaq, and Dell, respectively in the survey results. (Compaq, though part of HP, is generally counted separately in branding surveys because it is marketed very differently than HP-branded computers.) Gateway was the only Windows manufacturer to crack the 65 percent barrier, which is equivalent to an "okay" rating in Forrester's survey. Apple's 80 percent score fell into the "good" category.

The University of Michigan conducts a similar survey each summer and usually comes up with similar results: Apple leading the pack, but amid poor ratings for the overall industry. Only Internet service providers, cable/satellite companies, and health insurance companies scored worse as industries than the PC industry in Forrester's survey; even airlines scored better than PC companies.

The timing of Forrester's release of this data is likely not a coincidence, as Apple this week has responded to Microsoft's latest PC ad campaign with statements emphasizing the Mac experience. Poor customer satisfaction ratings are the downside of Microsoft's marketing message that Windows PCs are the bargain alternative to Macs, in that sometimes, you get what you pay for.

Apple's MacBook, shown on the left, and Dell's Studio 15, at right, are vying for consumer attention this holiday season.

Two-thirds of prospective PC buyers in the U.S. plan to buy either a MacBook or a Dell laptop this holiday season, according to a study released Monday by ChangeWave.

ChangeWave's survey of 3,699 consumers found that of those looking to buy a laptop over the next 90 days, 33 percent indicated a preference for the Mac, and another 33 percent said they would buy a Dell. The survey cited Apple's recent MacBook redesign and Dell's reputation for value as the driving forces behind those results, but notes that Dell's consumer business only accounts for about 20 percent of its overall sales. No one is having a good year selling PCs to businesses, according to ChangeWave.

And unfortunately for both companies, the number of consumers looking to buy a new computer is smaller than it has been during past years. Most years, the holiday season is easily the most active period of the year for Mac or PC shopping, but ChangeWave's research indicates that just 8 percent of respondents plan to buy a new laptop this time around, down from 11 percent last year.

Is the MacBook Air overpriced? Competitive offerings from Dell and Toshiba reveal that the MacBook Air may not be so extortionately expensive.

A MacBook Air rival, Dell's Latitude E4200 starts at 2.2 pounds for about the same price.

(Credit: Dell)

Of course, it all depends on your perspective: $2,499 for a laptop is a lot of money. But put the Air into the context of its product category--ultraportable laptop--and you see that, by comparison, it's not necessarily overpriced.

(Note: Here we're talking about the just-announced update to the MacBook Air.)

Let's start with Dell's recently announced ultraportable laptop (or 'subnotebook," choose your nomenclature). The 12.1-inch Latitude E4200 is priced at $2,495 configured with a 128GB solid state drive, 2GB of memory, an Intel Core 2 Duo ULV SU9400 processor running at 1.4GHz, the Intel Graphics Media Accelerator 4500MHD, and a 6-cell battery.

(Note: I am not going to draw a comparison with the Dell Latitude E4300 as it does not fall into the category of an ultrathin--less than 0.8 inch thick--laptop the way the E4200 and Air do.)

How do the Air's features fare by comparison? Pretty well. The $2,499 Air also includes a 128GB solid state drive and 2GB of memory. That's where the apples-to-apples comparison ends (pun not intended). It bests the Dell in two significant areas. Despite being less than 0.8 inch thick like the E4200, it uses a more-powerful 1.86GHz Intel processor and Nvidia GeForce 9400M graphics. This is a crucial difference for some users who want the portability but need more horsepower.

That said, let me state the obvious: heat will always be an issue when a relatively high-speed processor is squeezed into a very small space. That's why, presumably, Dell, Toshiba (below) and Lenovo (X301 ThinkPad) have all opted for more power-frugal ULV (ultra-low-voltage) Intel processors. The Air does not use a ULV processor.

Form factors: The Air uses a larger 13.3-inch display and is slightly wider than the Dell overall, as this video shows. The bigger screen and wider keyboard can be an advantage or disadvantage. Apple may strike a better balance of weight and keyboard/screen size, but you get more portability (based on specified weight) with the Dell.

Apple does not bundle, as standard, an external media drive with the Air, however. Dell does. That weighs in Dell's favor.

The E4200 also beats the Air on ports. Packing in 1394, VGA, RJ-45, USB, and eSATA/USB Combo ports. And a docking connector. (No docking station for the Air.)

Toshiba's new ultraportable, the Portege R600, is also a close rival (based on a feature comparison only) to both the Air and the E4200. Like the Dell, this comes with a 12-inch screen, the Intel Graphics Media Accelerator 4500MHD, and a 1.4GHz Intel Core 2 Duo ULV SU9400 processor (lower performance than the Air's).

Like the E4200 and Air, it can be configured with a 128GB solid state drive.

Unlike the E4200 and the Air, it squeezes in an optical drive into a form factor less than 0.8 inch thick--in its favor. And offers 3GB of memory as standard, more than the E4200 and the Air.

The R600 also beats the Air on ports. With VGA, 3 USB ports, and an eSATA/USB combo port, in addition to a docking connector.

And the price: $2,999 for the version of the Portege R600 with a 128GB SSD. That's about $500 more than the Air and E4200, so you pay for the extra functionality in that ultraslim form factor. (Correction: the price spread is $500--not $600 as originally stated.)

(For those readers who may want to compare the Sony Vaio ultraportable to the Air go here to see the Vaio TT series. And here's a CNET review of the ThinkPad X301.)

The latest MacBook Air masks a lot of new electronics under an old skin.

To me, the new MacBook Air (MBA) is truly a second-generation product despite its unchanged appearance. But before I explain why, let me clarify where I am coming from.

I have been using an MBA for the last eight months. Why the over-priced Air? I am a minimalist when it comes to computers (though not necessarily when it comes to spending money on computers). The more spartan the laptop is, the better. In a well-executed design this translates to more portability, which, for me, takes priority over performance and ports.

And this is especially true for the Air. The economy of design dictates lower performance and fewer connectors than mainstream laptops.

Updated MacBook Air has new processor, chipset, graphics, and solid state drive

(Credit: Apple)

Having said that, the new Air seems to have made significant gains in performance. (Again, this is a preview, so only benchmarks will bear this out.) The Air uses Intel's newest Penryn-architecture low-power mobile processors, not the older Merom processors--which were, let's be honest, already dated even way back in January when Apple launched the Air.

Penryn-class processors come with 6MB (versus the Merom's 4MB in the previous Air) of cache memory and faster front-side bus speeds (1066MHz versus 667MHz). Of course, other MacBooks use Penryn chips too but it is significant that these powerful mobile processors are now being squeezed into the Air's form factor.

The widely reported use of Nvidia's GeForce 9400M graphics is another big plus. This is a step up from Intel's integrated graphics, which for too long has really been the only choice for subnotebooks and ultraportables. Better game playing and the ability to drive Apple's new 24-inch LED Cinema Display as well as the 30-inch Cinema HD Display are other benefits. (More on the GeForce 9400M here.)

And let's not forget memory. The Air uses DDR3 memory versus the DDR2-specified chips of the previous Air. DDR3 delivers better bandwidth and lower power consumption than DDR2.

Storage. Generally speaking, solid-state drives are faster than hard disk drives, especially when reading data. The Air and the ThinkPad X300 legitimized SSDs. The new Air takes this to the next level with a larger 128GB solid-state drive (versus the previous model's 64GB SSD). The newer 128GB (and larger-capacity) solid-state drives are based on multilevel cell technology. MLC allows larger capacities at lower cost. But MLC-based drives typically don't deliver the performance of single-level cell (SLC) drives. Dell, for example, offers its Latitude E4200 ultraportable with both high-performance SLC drives and lower-performance MLC SSDs.

Last but not least is price. OK, so $2,499 is not a steal (for the 1.86GHz model with a 128GB SSD). But look at it this way, you get a lot more for the same price as the previous Air. You get a faster processor, better graphics, speedier memory, and a larger solid state drive. Though I wouldn't call this a great deal by any means, Apple could have priced it higher. (Apple has been known to push the envelope on pricing.)

Longstanding Issues

Let me also address some longstanding issues I've had with the Air. I currently use one of the original models--launched back in January--that comes with a 1.8GHz processor and 64GB solid state drive. The Air's aluminum body is wonderful, but it hasn't maintained the tolerances that it had at first. Specifically, the seams just below the keyboard sometimes creak (for lack of a better word) and, at times, noticeably expand and contract. Let me be clear: this is not a big issue and is noticeable only occasionally. Most users probably wouldn't notice this.

Heat. I hesitate to cite heat as an issue because every laptop I have ever owned has had heat issues--some much worse than the Air's. It's a little like complaining about your car's engine block getting warm. But because the aluminum body itself acts as a heat sink of sorts, excessive heat can become an issue when the Air is pushed to its limits. That is, a lot of open applications and a heavy workload.

Screen response time. This could be subjective to some extent but the LCD's response times seem to be slower than, for example, the response times I get from my other laptop: the 3.3-pound HP 2510p. In other words, whenever I go back to working on the 2510p after working on the Air for a while, I feel that the screen response times are better on the 2510p.

But overall the Air is an amazing piece of engineering and a delight to use.

(For another MacBook review, go here.)

Apple blew away its PC industry peers in this year's American Customer Satisfaction Index, perhaps because it was the only company that didn't release a Windows Vista PC.

The University of Michigan released its annual ACSI scores Tuesday for the PC industry, and Apple took top honors for the fifth straight year. Apple was the only company in the PC industry other than Dell to post an increase in customer satisfaction in 2008 compared to last year, said Claes Fornell, a professor at the university and head of the ACSI.

The ACSI scores measure a consumer's overall satisfaction with a company, which includes product quality, value, customer service, and essentially anything else that impresses or annoys a customer of a particular company. Apple scored an 85 on the index, its highest score ever and a full ten points higher than second place finisher Dell.

Fornell attributed Apple's score to the clear success the Mac has had among the U.S. public, but also pointed out that dissatisfaction with Windows Vista might have hurt the scores for the other companies, such as Hewlett-Packard and Gateway. HP, the market leader in PCs, is measured by its two PC brands--HP and Compaq--and both brands saw about 4 percent drops in satisfaction compared to last year.

The scores were assembled during the second quarter through thousands of interviews, and so therefore don't reflect the launch of the iPhone 3G and MobileMe, two black eyes for Apple's customer service this year. Fornell said he would expect Apple's score to level off next year in any event, as "we have never seen a gap between the leader and the rest of the pack this big. If we are correct in that it has something to do with the launch of Vista, the other guys will of course correct that and come back a little bit."

Dell has decided to stop selling most of its consumer notebooks that use Advanced Micro Device's chips on its Web site, promoting those systems instead through its new retail strategy.

There are still a handful of AMD notebooks available on Dell's site, but only one Insprion system targeted at home users. On the business side, you now have to wade through several Dell Web pages before you stumble upon an AMD-based laptop. Two are available, a Vostro and a Latitude, and both are being promoted as small-to-medium business systems.

The Dell Latitude D531 laptop, one of the few remaining on Dell's Web site with AMD processors.

(Credit: Dell)

"To ensure we deliver the best value to our customers, Dell regularly adjusts its product offerings, and how customers can purchase those products," Dell said in a statement. "Currently the majority of our consumer AMD-based systems are available through our retail partners such as Wal-Mart, Best Buy, and Staples, and through telephone sales."

It's hard to see this as anything but a blow to AMD, which is coming off one of its worst years in recent memory. With these moves, Dell has positioned AMD's notebook chips as the budget-friendly alternative, which is never great for the brand. And that's despite the fact that AMD has done fairly well with its notebook chips over the last few years, even though its first true mobile design--as described by the company--won't ship until later this year.

After years of fealty to a direct sales strategy, Dell has in recent months begun to roll out its products to retail stores, even going so far as to rub elbows with the blue shirts at Best Buy. There, a wider range of AMD systems remains available. And Dell continues to offer several AMD-based desktops and servers on its Web page, which despite the new retail presence, still accounts for most of Dell's business.

But after AMD spent so much time and effort trying to win Dell as a customer, it has to be disheartening to see its Texas neighbors relegate their chips to the bottom-feeder part of the market. With new notebook chips due out fairly soon, AMD could be in a position to start moving back up the ladder into more powerful and profitable systems.

That's assuming, of course, it can get those chips out on time, and without incident. That's something AMD's customers are likely worried about coming off the Barcelona and Phenom debacles.

It seems we're all just searching for a way to keep score.

The beauty of sports is that there is always a winner. The beauty of life is that it's not like sports. Sometimes you win, and sometimes you lose. Sometimes you get two-thirds of what you expected after leaving something on the table to get that far, and sometimes you fall short of a goal but find yourself better for the experience.

That's why we have sports, to amuse ourselves with contests that fulfill a need for clearly defined winners and losers but that don't turn the world on its side or redistribute billions of dollars. We expect our teams to win, and we're saddened when they don't (thanks a lot, Yadier Molina) but there's an inherent assumption that's it's all just for fun.

Back in the real world, however, it's a little messier. The sad admissions made by Dell yesterday underscore how those lines can blur.

Dell revealed Thursday that its internal accountants gamed a system--with the knowledge of senior management--designed to reward companies that hit their numbers. It's usually a single number that determines the stock market's reaction to a financial earnings report: earnings per share, or net income divided by the number of shares outstanding.

No matter what positive news might be contained in an earnings release, if EPS comes in even a penny below estimates, watch that stock price fall the next day. Just last month, the current darling of the tech stock crowd--Google--reported earnings per share 3 cents lower than expectations. Despite a 58 percent jump in revenue, a 28 percent increase in profits, and a whopping overall EPS of $3.56, the company's stock fell 5 percent the next day, and it hasn't recovered.

Everyone's guilty in this game. The stock market buys and sells based on that number, perhaps the revenue figure as well, but with little regard for the broader picture. A media report will talk about a company's brilliant execution, or start looking for scapegoats, based on a 2-cent swing in EPS. Executives are heavily compensated with stock options that make them obsessed with keeping the price as high as possible.

The most egregious periods of Dell's earnings manipulation prevented the company from missing its earnings per share targets by a few cents. Would that have taken away from the fact that during that period, Dell's overall performance was still far stronger than the rest of the PC industry, and maybe the entire tech industry? Dell executives apparently thought so, and they probably would have been right had the real numbers been reported.

This, of course, doesn't excuse Dell's actions, which illustrates the thorniness of the problem. Missing those targets would have served as a warning sign for investors that the company was fallible after all, perhaps giving them some time to bail out before Dell's myriad problems were unable to be concealed by creative accounting. Some metric is clearly needed to assess performance, but what?

Another reason to love sports is statistics: clear barometers of who is good, and who is not. If you get a hit 3 times out of 10, complete 60 percent of your passes, or put the ball in the hoop 2 times out of 5, we like you.

The problem is we're doing the same thing with massive corporations, organizations with thousands of employees and customers whose performance can't be summarized by a single number, even two. And the reward--or punishment--attached to those numbers doesn't correspond with reality.

I'm not smart enough to have a solution at the ready. But let's take the sports out of business. There are always going to be winners and losers in a capitalist system, and investors need to have a way of measuring whether they are getting a proper return on their outlays. The business community needs to figure out a broader way to draw conclusions about a company than a single number that is apparently very easy to manipulate.

Then, let's take the sports out of politics.