Apple (NASDAQ: AAPL ) will soon bid farewell to its last computer with an optical drive, according to DigiTimes. While 9to5Mac says DigiTimes "doesn't have the best track records" with rumors, ditching the non-Retina version of its 13-inch Macbook Pro would make sense for a number of reasons.
Simplifying product portfolio ahead of new categories
Ending production of its 13-inch non-Retina MacBook Pro later this year would not only mark the end of disc drives at Apple, but it would also mean Apple could finally have an entirely Retina MacBook Pro lineup. Apple discontinued its 15-inch non-Retina MacBook Pro last year.
Perhaps Apple's plan for products in new categories in 2014 is sparking efforts to consolidate older product lines. Further, a recent report from The Wall Street Journal asserts that Apple will be launching products faster and more frequently in the future, a move that would also support the idea of simplifying existing product portfolios. Whatever the reason, it's simply a logical manufacturing and marketing step that shouldn't surprise investors.
Further, the move reinforces just how fast preferences change in consumer electronics. In late October 2012, Apple's senior vice president of worldwide marketing, Phil Schiller, said the non-Retina 13-inch MacBook Pro was Apple's best-selling notebook. In another example, one study in October 2013 by Localytics reported that the popular iPad 2 still made up the lion's share of Apple's tablet sales, at 38%. But the launch of Apple's iPad Air and its Retina iPad mini quickly changed that. Now, Apple is getting ready to discontinue the legacy, non-Retina iPad 2 according to AppleInsider's source that is "familiar with Apple's plans."
Apple's Mac business is still important
While Apple's iPod business is clearly fading, with first-quarter unit sales down a whopping 52% from the year-ago quarter, Apple's older Mac business is firing on all cylinders. In fact, in Apple's first quarter, Mac unit sales and revenue saw faster year-over-year growth than Apple's iPhone and iPad businesses. And at 11% of total revenue, the Mac business is still meaningful to the company's results.
DigiTimes report of a planned discontinuation of Apple's non-Retina 13-inch MacBook Pro was accompanied with a prediction that Apple "will replace the product line with thinner models equipped with a Retina display." In light of Apple's successful Mac business, refreshed models would likely be valuable for the company.
Cannibalization of its own products has always been a strategy Apple takes on vigorously. "If you don't cannibalize yourself, someone else will." Apple's ability to rapidly cannibalize its important Mac business suggests Cook is still taking Jobs' policy seriously.
Apple investors should happily wave goodbye to optical drives and embrace better technology.
The next big revolution in tech?
Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980s, before the consumer computing boom. Or purchasing stock in e-commerce pioneer Amazon.com in the late 1990s, when it was nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play," and then watch as it grows in EXPLOSIVE lockstep with its industry. Our expert team of equity analysts has identified one stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.