Filed under: Analysis / Opinion, Enterprise, Cult of Mac
Analyzing Mac TCO
Want an easy way to start a holy war? Aside from putting a major
holy city from three major religions together in one convenient location, the easiest thing to do is start talking about
the nebulous and nefarious TCO, or Total Cost of Ownership. Let's face it, Apple faithful are going to have their end of the argument (stuff like Macs are made for graphics), and the Windows faithful are going to have theirs (Photoshop starts up faster on a PC). And then there's Linux, where GIF is pronounced JIF (that's a joke, no flames just yet please).
Winn Schwartau has made his stand, like it or not. He says Macs are cheaper overall, once you've accounted for all the stuff you have to do with a computer, not just the initial cost of buying one. Because, as we all know, PC's from Dell are always cheaper. You know, I have purchased three different home theater systems lately, and all of them were cheaper than Bose or Sony— and all of them died within one day of the box being opened. So don't go talking to me about purchase price...
Anyway, Winn not only makes a compelling case, stating the obvious, "Most enterprises do not want users installing software on their machines - they want a box to run mail client and browser, and a couple of Office applications," and the obscure, "owning a WinTel box for three years costs twice as much as owning a MacTel." Better still, back in September of 2005, Winn posted his TCO analysis spreadsheet and PDF, which wil walk anyone through the same process of calculations he used, and can be applied to virtually any system. Naturally, a holy war erupted on his blog. Read through the comments for a ton of fun, or just work the numbers yourself. Or you can give up and call it a draw, as James Maguire did in 2003. Really he said what we're all thinking: Apple stuff costs more, but makes for less headaches in general and that's the bottom line for small to mid-sized businesses. Apple's low cost pitch can be found here.
![TUAW [Cafepress]](http://www.blogsmithmedia.com/www.tuaw.com/media/tuaw-cafepress-promo.png)
Reader Comments (Page 1 of 1)
Joseph Scott said 6:39PM on 3-07-2006
Of course it is pronounced "JIF":
http://www.olsenhome.com/gif/
That is what the inventors of the GIF format called it.
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Hairatic said 6:42PM on 3-07-2006
Any small business owners with experience on both platforms care to comment? I have been researching both options for my family (starting a small business) and the Dell, etc. initial costs are a compelling arguement, but... I know from experience that Macs are just plain less of a pain in the a**!
So who has some real experience here?
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Edsel said 6:43PM on 3-07-2006
Wouldn't an X window system wherein the display server = "light bulb" dumb be cheaper than Mactel/Wintel? Otherwise, Microsoft's OS/App licensing plans makes Apple really inexpensive by comparison.
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GA-Matt said 7:01PM on 3-07-2006
I wish my school tech department would learn this...
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Andrew J Garcia said 7:01PM on 3-07-2006
Hairatic...
I just purchased a Dell server and several client PCs for my small family business. I debated the Apple option for quite a while. The big deciding factor wasn't really the initial or eventual cost, but rather the ammount of knowledge the office workers had about Windows vs knowledge about Mac OSX. I didn't really have the time to sit down and retrain them all on a new operating system.
Just my 2 cents...
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Hairatic said 7:07PM on 3-07-2006
Andrew-
Good point, Thanks!
We are starting from the ground-up and I will likely do the initial training. The applications we will use will be the same as in the windows world, so that learning curve will be the same. General familiarity will be a bit of learning curve, but also provide a potential to train good habits.
Decisions, decisions...
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jbelkin said 7:42PM on 3-07-2006
JIF is peanut butter. GIF is a graphics format though you might as well say PICT now - it's fast becoming irrelevant. No one needs to save 50K on a graphic file anymore.
Another reason that TCO is often misplaced in the analysis is that corporations tend to be divided into the capital expenditures budget and the maintenance/IT budget and never the twain shall meet. Even if the budgets are controled by the same person, to them they are entirely two different budgets because one is depreciable and the other is overhead. If there's an accounting and tax difference, these budgets do not meet.
It's hard for "normal" people to understand - it;s EXACTLY like buying a car. No "normal" person looks the sticker, dickers a little and buys it if it matches the basic checklist (tires, engine, seats, etc ...) even if you ignore design, you look at how reliable the make is, what the resale is, etc ... to the capital budget guy, that's actually annoying. He/She has X numbers of desktops to drop a computer on. They want to spend X. They go by the IRS table on depreciation to zero for X number of years. They could care less that after 2 years a Dell might be worth $50 but a Mac worth $300. They are not going to bother to try and guess what it might cost - easier just to write it to zero. To them a computer is the same as a air conditioner, a building or a parking lot. As long as it serves the minmal needs of the department needing it and he's willing to put it in his budget - done.
IT is an entirely different budget often controled by someone else. Unless they have to slash budgets, their job is to keep things running - not make waves or change EVERYTHING and what if everyone hates it? This applies to OSes as it does to office cahirs and pens. No point in rocking the boat AND while they might shave a few slivers of budget here and there to be a "hero" - no one in IT now marches in and shouts, "I'll save this dept. 30%! Just stand back - at least not now. IT is now just another bureaucracy run by guys who are there to save their jobs, make incremental improvements and ask for slight increase every year in their budget.
It's not a Mac-PC-Linux thing. Even if a respected company like GE tomorrow said, we can slash IT costs 20% - buy our OS ... who wants to step up and put their job on the line?
Of course, this is a generalization and there are people actively working to save on TCO because they can see the waste but you also have to be secure within the company to try and cross two dept budgets. Most people are just not up to it.
Plus, corporate America could really care less. THey have "computer savvy" employees who cannot figure out where the ON button is or try to use the word PASSWORD as their password. Who wants to then try and grab a bit of HR or Training's budget to train 200, 500, 10,000 employees on how to use a Mac? Three dept budgets? You are gutsy or a fool.
If you're not jaded like me or haven't spent much time in the corporate world ... go to the DMV and see how they use computers to "speed" up life as we know (of course, it's inperceptable to the human eye but like the universe expanding, the DMV is ever so slightly inching forward). That's your dull PC at work. You think replacing them with Macs will change that universe & ours?
No.
People who run businesses where the money will come out of their own pockets and they understand saving $50 today but spending 2 days of their time later in trying to print landscape is not worth it - those people buy Macs.
We can't save everyone. We can only help those who are willing to help themselves. Sorry Steve Ballmer, you are on your own.
* BTW, It's "Pour-cha," NOT Pourch for that German sports car. THAT is important to learn. Unless you're joining the GIF Advisory Board - no one cares.
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Diego said 10:49PM on 3-07-2006
A couple of things here...
First, companies should really examine their IT overhead. It is my experience that most IT departments are given carte blanche because it's perceived that they do some kind of "voodoo" that can't be audited. Having been in that environment, introducing something that is easy to maintain is at cross-purposes to the general activities of self-preservation and attaining personal credentials on the company dime. I have yet to see an IT department that doesn't look down on the general staff. Anything that is easy to use and requires little maintenance would erode their superiority and way of life.
But having said that, it is -tons- easier to have everyone on thin-net. jbelkin is right, there are a lot of dolts out there who can't even operate a telephone, and worse: tinkerers who think they know what they're doing. Unfortunately, Apple is not going to solve that.
Second, data management is no different than IT, but what is asked is: How can we make ourselves look necessary to keep the suits from investigating out-of-the-box solutions? Data management is a big deal. There's some folks getting stupid-rich out of programming solutions that don't do more than the system they're replacing. Can Mac compete here? Well, not when MS says they will give us perks (free licenses, certification, hard cash) if we bind our ware with their XYZ product. Or when [PC. mfg. that starts with "D"] says if we tie the ware to requiring a dedicated server at the client's site we could see some green from it.
Will this ever change? Well, let me ask you this, where are the OS X enterprise dev tools?
Saying the Mac is cheaper to operate is inconsequential.
As an aside... You would be surprised how many modern international companies are operating on datasystems that are -ancient-. COBOL anyone?
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zoffdino said 12:18AM on 3-08-2006
Although being a Mac user, I think the TCO comparison is ridiculous for several reasons:
1. Why Windows need a pop-up blocker when Firefox is used? It came built in with a pop-up blocker, folks!
2. An additional email client aside from Outlook/Outlook Express for Windows? Come one, we paid $300 for MS Office, remember.
3. Office installation is shorter on Mac OS X? Having installed Office on both platforms, I can say that they are roughly equal.
4. Mac OS X can be updated in 15 mins (0.25 hrs)? The fact is that I don't even know how long it takes. I just let it do the work in the background. However, many updates don't require a reboot, which is guaranteed if you're on Windows.
5. Installing back-up software takes 6 mins - 1 hr on Win and 15 min - 30 min on OS X? What the hell!
Having correct some of the numbers (which I will not release here), I came out with the conclusion that Mac cost more or less the same as Windows in the long run. That being said, I hate all the weirdos that happen on Windows and the beauty of Macs, which contribute a lot to my mental health (this is priceless, I tell ya).
One of the hidden cost involved with Mac is that of the training cost. Sure, OS X is easy to use, but after years on Windows, you mind is kinda set to a certain way. I recently bought an iMac G5 for my 19-year-old cousin. It took me one full day to educate her about the Mac, how to get system info, install/uninstall application, the "drag-and-drop" nature of Mac.... She still complained after the first week but after a months, she is a Mac addict too.
At my place of work, people are reluctant to switch to Mac. The reason: it's only good for graphics! For years, I've been trying to tell those people that Mac is an extremely stable platform that can be used for almost anything. The dinosaur managers and even the mintly hired undergrad don't even know what is a Mac. And those are IT students.
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Richard Dalziel-Sharpe said 3:07AM on 3-08-2006
I started up a home based business in 1990, at the age of 50. For a year or so managed to run it without a computer. As the business was a success (lucky me) I decided that I could probably run it more efficiently if I had a computer.
I spent some time researching, as I knew nothing about computers and had, at that time, never sat at a keyboard of a typewriter let alone a computer. My studies led me to Apple and a Mac. I paid nearly $7000 Australian for a Centris 660AV. It had System seven, Clarisworks, Best Books (myob's predecessor) a touch type instruction application which I cant remember the name of, and Norton Disk Doctor.
The first thind I did was to teach myself to touchtype. Then migrate all of my business to the computer. Within three months I had my business running solely from the Mac. I doubt very much that this would have been possible using Windows 3.1.1 and the Microsoft array of software available at that time.
Whilst the Windows world has caught up to Apple in many ways, there are still simple usability flaws in the basic structure of how Microsoft choose to implement its GUI. Whether Vista will improve on this we have yet to see.
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Scott Gardner said 7:37AM on 3-08-2006
Hairatic, I'd be glad to discuss this with you. My contact info is on my site. Give a call or email any time.
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Daniel David said 9:38AM on 3-08-2006
I do believe the image with this post is of Virginia Tech's top-10 supercomputer SystemX. Built with 1100 Xserve G5s the system ranked #7 in the world, and is the only Apple system in the top-10.
Prior to being rebuilt with Xserves, the supercomputer consisted of PowerMac G5 systems and consumed twice as much floorspace. Computing power of the Xserve system reached 12.25 Teraflops.
For more you can check out their website:
http://www.tcf.vt.edu/
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Brian Fahrlander said 10:04AM on 3-08-2006
Return On Investment (ROI) is more important that Total Cost of Ownership (TCO).
Like what ya want, but since Linux is building on top of good, mature code and has been for a long time, some day it's going to be extremely hard to top it, no matter how much money is available.
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