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Apr 98 Factory Floor

Volume Number: 14 (1998)
Issue Number: 4
Column Tag: From The Factory Floor

Neil Ticktin, MacTech Publisher

by Dave Mark ©1997 by Metrowerks, Inc., all rights reserved.

If you are an old-time Mac programmer like me, chances are you remember the original Macintosh technical journal, then called MacTutor. Remember the MouseHole? Aztec C? Light speed Pascal? MacTutor filled in the technical holes for a lot of aspiring Macintosh developers. If I recall correctly, it was at August MacWorld when I first met Neil Ticktin. Word was that MacTutor was having some difficulties, and Neil was going to take over the magazine to see if he could make a go of it. We talked about my doing a regular column for beginners, starting with the January 1992 issue of MacTutor.

Now it is more than six years later. The magazine changed names to MacTech, grew a new look and feel, has been through a number of personnel changes from top to bottom, added a mail order catalog, absorbed Apple's develop magazine, and helped spawn MacWorld's Developer Central. It has been a wild ride. At this past January MacWorld, Neil and I had some long talks about the state of Mac development and the direction Apple was taking the Mac OS. Make no mistake here, Neil is no hard-core developer. But he has a unique perspective on the state of the Mac that I thought you might find interesting and valuable. So, without further ado...

Dave: How has Apple's shrinking market share affected MacTech Magazine?

Neil: The interesting thing about MacTech Magazine is that it targets developers, not users, and, as a result, tends to be a good future indicator. For example, MacTech had less readers in 1995-6 which preceded Apple's decline. MacTech, over the past year/year and half, has actually had growing readership. And, in addition to that, we launched MacTech Japan which has done very well. So, we're pleased with how things are going -- and we think that 1998 will be a much better year for developers than 1997 was.

The interesting thing about market share is that people are generally talking about sales of computers, not installed base. To most developers, installed base is what is important. And, if you look at Macs in current use as a percentage of all personal computers, you probably would see market share closer to 10%. And the percentage is probably larger if you talk about active Mac users compared to the overall number of active personal computer users. Now, as a developer, do you care how many machines Apple sells? Or do you really care about how many customers can buy your product?

The disparity caused by sales market share and installed base market share comes down to two things. First, in most cases, Macs are better built and will last longer than their WinTel counterpart. Second, Apple has done a pretty good job of backwards compatibility which translates into preserving their customers' investments. This may not be the most profitable thing for Apple, but it does wonders for the customers. It's unfortunate, but OS and hardware vendors make more money if they build products that become obsolete quickly. This is not what Apple or the Macintosh are about.

Dave: I was surprised with the lack of Rhapsody presence at January MacWorld. While there were some Rhapsody apps being shown at Developer Central, there was no mention of Rhapsody at all in Steve Job's keynote. Where do you see Rhapsody going from here?

Neil: For a while there, Apple was into selling the future. Apple seems to have learned the lessons of the past, and today, Apple focuses on selling what it can deliver right now. In addition, with Mac OS 8, Apple realized that the Mac OS still has legs. These two things, I believe, are the main reasons behind Apple's down playing of Rhapsody (or maybe it was just up-playing the Mac OS) at Macworld San Francisco.

Also, I think that you will see some blurring of the benefits of future Mac OS's in comparison with Rhapsody. Apple has eluded to bringing more modern OS features to the Mac OS -- whether this comes from Copland work or Rhapsody work being integrated into the Mac OS, we've not seen yet -- but it looks to be coming.

As a Mac OS or even OPENSTEP developer, you should watch the Mac OS efforts. It may be the case that the feature you really needed gets incorporated into the Mac OS -- and today, that has a lot bigger set of customers.

Rhapsody is coming along, and there is developer support of it. There are a number of tools vendors already supporting Rhapsody: Metrowerks, AAA+, SNAP, TipTop, OpenBase, etc... And, that's for an OS that has no real market today. When Rhapsody is ready, I would expect Apple to take the approach of easing it in with as little cannibalization of the Mac OS as possible. Hopefully, they will be able to expand the market for developers, not just replace what we already have. That means that you'll see special attention paid first to those users who have the greatest need for features only found in Rhapsody.

As a Rhapsody developer, you should pay attention to what Apple is targeting first. If you don't match your efforts to where the potential customers will be, you will probably have a problem.

Dave: How do you see the economics of selling into the Mac OS market in 98?

Neil: Interesting thing about Mac OS 8 -- it's been selling well. In fact, according to a November 97 SofTrends report, Apple took the top market share position in August 97 with 35.1% of units sold, compared to Windows 95 at 27.8%. This was the first time that any Mac title attained the number one ranking. Read this again -- the Mac OS outsold Windows 95. Now yes, this is a brand new OS vs. a 2 year old OS, but it is a good indicator that the Mac is a lot healthier than the media would lead you to believe.

Another interesting point to think about is that Microsoft operating systems certainly have some 90% of the installed base. But realize that this is divided between DOS, Windows 3.1, Windows 95 and Windows NT. There are some pieces of software that run on both 95 and NT, but a lot of software has separate versions for each of these OS's, or maybe just doesn't run on them. The NT market share is far less than the Mac OS. And, when I saw numbers last summer, only 19% of the market had upgraded to Windows 95 -- nearly two years after it's release, and it's market share was not even double the Mac OS installed based at the time.

A couple of years ago, we were looking at the business prospects for Mac developers. What we found is that yes, obviously, the Mac has a smaller market size. But, interestingly, when you look at the Windows market, factor in the disproportionately higher marketing, tech support, QA, development, and other costs -- the return on investment was higher on the Mac than it was under Windows. Today, that return has evened out, but it still looks like the Mac OS development is close to the return on investment that Windows development has.

And, all of this is during a time that has been hard for Apple. As of this writing, 1998 is looking to be a much stronger year for Apple and the Mac. Apple just turned it's first profit in a while (and remember, due to prior losses, Apple has tax free profits for a long time to come). A lot of shakeout has already happened, and some developers (like Casady & Greene Inc.) reported that this last Macworld was one of their best shows ever! Now is the time of opportunity for Mac developers as the market starts to grow and prosper.

Don't get me wrong, I don't want to blindly support Apple or Macintosh -- we just do things that make sense around here, and we make up our own minds. Win95 has certainly a lot more units out there. As a developer though, you need to make decisions based on what you know about what you can do -- not what some reporter, finance person, or Wintel marketing person tells you. I can tell you from experience, there are a lot of people out there that are succeeding on the Macintosh, and wouldn't give it up.

Dave: What kind of changes do you see coming down the pike with Developer Central?

Neil: As you know, MacTech and Apple created Developer Central together in January 1995. Today, now in our 4th year, Developer Central continues to push the envelope -- demonstrating not only tools for the Mac OS, but Rhapsody as well. You may have noticed that in Macworld Expo's roundup, Developer Central was listed as one of the top 3 successes of the show with about 45 technologies showcased, it represented some 10% of the exhibiting companies at the show.

The cool thing about Developer Central this past January is that we are seeing some really neat things pushing the envelope. Take products like Resorcerer, which is getting support added disassembling code. Or, AAA+'s Joy which can be used to really learn a lot about Rhapsody development. This is just to name a couple of cool tools -- there are a lot more.

Dave: I thought it was interesting that you were asked to present at the Eddy awards at January MacWorld. What do you make of that?

Neil: Over the past couple of years, the Mac community has come to realize how important developers are. This year, Macworld and MacTech magazines joined together to really give the developer community the level of support it deserved. Which tools received nomination status, let alone the winner status, was a hard decision. There were so many different products that are worthy. We're very proud of the finalists and the winners. We're very pleased that Macworld Magazine agrees that developers are critical and that we've joined together to reward them.

Dave: What options do you think are available to developers who are new to the Macintosh? How about long-time Mac developers?

Neil: It all depends on what your goals are, what your project is about, and what market or functionality segment you are in. I know that you've heard this a million times before, but just because the Windows market is bigger, doesn't mean that it's better. For example, if you are in an education or creative market, these are extremely strong for the Mac. Likewise, if you don't want to build a large organization for marketing, QA, testing, tech support, etc... you may be very satisfied with a smaller Mac market with greater profit margins, less competition, and in general, a lot less hassle to bring your product to market.

What we hear today from long time Mac developers is that during the past year or so, they've forced themselves to look around at options beyond the Mac OS. Most have looked first at Windows NT or Java.

What they've concluded in many cases is that even with a lot of progress behind NT, it's still Windows. It still is not a pleasure to use. You still have to reinstall software, fiddle with drivers, spend hours installing a hard drive, etc... It still is a poor interface by comparison to the Mac. And the little voice inside their head, the artist side of them, says "I don't like this as much as the Mac. Do I really want to work on something I don't like?"

Java is another beast entirely. There are a lot of really cool things behind Java. And, the notion of cross platform development is appealing. Unfortunately, even with a lot of progress here as well, it's not quite ready for "prime time". And, with all of the power struggles over Java, people are concerned. So, developers are using Java -- and are keeping an eye out for where's applicable.

So, with those experiences, developers have been saying "Hmmm... maybe the Mac OS is not such a problem. Maybe I just like working on it and the business proposition is ok and there is opportunities there. And, if Apple is able to deliver on Rhapsody, I can move my development there and then target Rhapsody, Rhapsody on Intel, Mac OS, Windows 95 and Windows NT all with one set of sources." So, Mac developers are looking for a high quality environment to work in, and be successful at it -- a combination of Mac OS, Java and Rhapsody seem to be the key for most.

Dave: Can you contrast the US market with the Japanese market and offer some suggestions for developers who want to move into the Japanese market?

Neil: First, let me say that Japan is a wonderful market. It's a wide open Mac market that you need to explore. It is a long term play, and you need to carefully look at your options. Don't expect to fly in, find a partner, fly home and have the deal done in a week. It usually takes months to put something in place.

Market share for Macintosh in Japan is roughly double that of the U.S. for a country that has almost half as many people as the U.S. population. Apple sells about 25% of its units into Japan. And, unlike the problems in the Japanese PC market due to an economic downturn, the Mac market has been much stronger.

Japan offers a completely different type of economy than we are used to in the U.S. For example, a copy of MacTech Magazine goes for US$5.85 on the newsstand. In Japan, MacTech Japan sells for ¥2500-¥2800 -- roughly equal to about US$20 or more. And, to give you an idea of the developer market, MacTech Japan has consistently sold well. Similarly, companies like Metrowerks Japan have done exceptionally well in this market.

The first suggestion that I can offer is to GO to Japan. You need to learn about the culture, and experience something like a Macworld. Look at magazines on the newsstand, and visit shopping areas like Akihabra. You will almost definitely need a Japanese partner to succeed. You won't be able to penetrate the market without someone having a native understanding of what is going on. You should talk to fellow developers and see who they have used. A personal recommendation for a local partner is an excellent way to go.

Dave: Any advice you'd like to offer to the Mac developer on the edge, considering moving to the Windows market?

Neil: First of all, figure out which platform is the best way to deliver your product. If you are in education or creative, the Mac is the definite winner. But, if you are doing legal or accounting software, Windows is probably your better bet. Worry about creating great products for whatever platform and then sell the benefits of that product. Remember, on the internet, no one knows you're a Mac. So, if you have something they definitely need -- who cares what machine it runs on? Or use the Mac as your place to do your primary development, and then deliver on multiple platforms if that makes sense for you. It all comes down to what you want, and what you know about where your product can succeed.

 
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