Everyone Else Is Doing It, So I Guess I Will Too...(Parse Apple's earning announcement)

Most of the focus is going on the iPad and iPhone segments, which are going extremely well for Apple, but what is also very interesting is the surge for the Mac segment.  Tim Cook specifically called out in the earnings meeting (transcript) that this surge is being driven by the MacBook Air.

This is very important to the broader PC industry for a couple of reasons.  First, MacBooks are now among the highest performing Windows PCs if you want a windows PC.  Second, they are the most aggressively priced laptops in the market.  They are cheaper than almost any other similarly configured PC available, in many cases hundreds of dollars cheaper.

It's not clear yet if or how this aggressive pricing is being delivered.  Apple's margins were slightly lower in the last quarter, but not by much.  That means that so far, Apple may be doing this mostly with leverage from it's enormous volume purchases of flash memory.  When you combine iPods, iPhones, and iPads, all of which dwarf MacBook Air sales, the result is a level of flash memory consumption far in excess of any other company in the world.

While it hasn't affected Apple's premium image at all, there could be far reaching impacts across the PC industry from such aggressive pricing.  For the first time ever, a MacBook is cheaper than all its main competitors and if Apple lets prices drop even a bit on the lowest end MacBooks over time - say down to $800 or $700 - the upper end of the iPad line - it could start taking away big chunks of market-share.

Even at $700, Apple's MacBook Air would at the base entry would be more costly than most Dell or HP consumer laptops - but that might not matter.  Limited storage levels are easily offset with growing online backup for big things like Photos and videos and the enormous performance boost from using an SSD could persuade people to trade up.

Apple already took about 20% of the US consumer PC market and the company has over 90% of the market for PCs above $1,000.  Total market share is nearing 10%.  Though it's still a long way off, if that share reaches 30%, it could represent a tipping point for Microsoft and the PC industry and lead to a runaway transition away from Windows.

Up Up And Away: MacBook Air sales power Mac market share.