Is Apple South Africa Rotten To The CORE?
My previous post and, more specifically, the last comment that I made sparked an idea (read: epiphany) . Everyone claims that we are paying too much for Apple products in South Africa (I myself made that assumption), based ob what Apple products cost in the USA, multiplied by the exchange rate and then compared to the local selling price. Should we not be comparing apples with apples (sorry … lame pun) and be looking at comparative PC prices as well?
I did a bit of research and came up with the shocking truth (or a reasonable, unbiased version thereof).
The test/criteria:
- Choose one Apple desktop unit that can be built with PC spares
- Determine its PC equivalent (or as near as possible)
- Compare local and international prices for both the Mac and the PC
- Apply the same, using a laptop
- We used an exchange rate of R8.00 to the US Dollar
For the desktop unit we compared the Mac Pro Quad-Core to its PC equivalent – I use the term “equivalent” very loosely here; there is no processor (that we could find) currently available off-the-shelf in South Africa that matches the Mac chipset, but for the purposes of this exercise we needed a chipset that we could find locally to compare its price to USA prices. It is therefore a given that the Mac will offer better performance (which you might want to take into account when you calculate value for money).
Mac Pro 2.66GHz Quad-Core:
- One 2.66GHz Quad-Core Intel Xeon “Nehalem” processor
- 3GB (three 1GB) memory
- 640GB hard drive
- 18x double-layer SuperDrive
- NVIDIA GeForce GT 120 with 512MB
Available from:
- apple.com at US$2,499.00 or R19,992
- digicape.co.za at R27,999.00
- zastore.co.za at R27,999.00
Our PC equivalent:
- Intel Xeon 2.4GHz E5530 socket LGA1366 Quad core
- Kingston Hyper-X KHX11000D3LLK3/3GX 3x 1Gb/1024Mb
- ASUS P6T7-WS SuperComputer LGA1366
- Seagate st3640323as Barracuda SATA 640Gb 3.5″
- Asus EN9600GT/HTDi/512
- Gigabyte® X3 ATX Chassis
- Coolermaster RS-A00-EFAM Real power 1000w PSU
- Enermax Aurora Aluminum Keyboard
- Microsoft Mo-MoBD Wheel Optical Mouse
- 22x DVD-RW optical drive
- Microsoft Windows Vista Business Edition 64 DSP
The Totals:
- Components bought in USA at US$1,928.00 or R15,424.00
- Components sourced locally at R24,020.00
What this boils down to:
- The Mac price difference is R8,000.00 or 40% more expensive than the US price
- The PC price difference is R8,596.00 or 55% more expensive than the US price
- The Mac is R4,568.00 or 30% more expensive than a PC in the USA compared to R3,979.00 or 15% in South Africa
This prompts me to ask the question: “Who has really been screwing us?”. Core’s snotty attitude aside, it should be really obvious that the whole “we need more competition” debate also loses all integrity, seeing that we could find plenty of local suppliers for PC spares – prices seem to vary from expensive to ridiculously cheap (we used average figures/prices for our calculations) where most components are concerned – availability does not seem to be an issue.
If you are still not convinced that PC suppliers are screwing us just as badly, take a look at our comparison between laptop prices …
MacBook Pro
- 2.8GHz Intel Core 2 Duo
- 4GB 1066MHz DDR3 SDRAM – 2×2GB
- 320GB Serial ATA Drive @ 7200 rpm
- SuperDrive 8x (DVD±R DL/DVD±RW/CD-RW)
- 15-inch Glossy Widescreen Display
- NVIDIA GeForce 9400M graphics processor with 256MB
Stacks up against an HP Notebook – 8530w thus:
- Intel Core 2 Duo T9600 (2.8Ghz)
- 2048MB DDRII 800MHz 1 DIMM
- 320GB 7200rpm
- DVD+/-RW
- 15.4 WUXGA WVA + CAM
- NVIDIA FX770M 512MB
And the pricing?
- Macbook Pro US$2,249 or R17,992.00 compared to R25,499 locally – 40% more expensive
- HP Notebook US$2,200.00 or R17,600 compared to R28,206.00 (iShop) or R32,228.00 (ZAPS Online) – 60% to 80% more expensive
You do the math. It goes without saying that we need to take VAT and shipping costs into consideration and also the fact that the fixed exchange rate of R9.00 to the US dollar that CORE claims to have agreed upon with their suppliers will not necessarily be the same as what PC distributors are paying. We think by omitting these the playing field should be level enough though.
So what do you think? Is CORE the rotten Apple in the bunch that is the SA computer market? Could they have done less damage by taking a different stance towards their consumers? You decide, but I’ll tell you this … next time I buy a Personal Computer, chances are it will be a Mac.
Sources:
http://titan-ice.co.za/
http://www.zaps.co.za/
http://www.take2.co.za/
http://simplicity.co.za/
http://www.prophecy.co.za/
http://www.zastore.co.za/
http://www.digicape.co.za/
http://www.apple.com/
http://www.ishoponline.co.za
http://www.google.com/products
Well done! This is a brilliant article. If I were Core/Apple I’d GIVE you a Mac Pro for the research trouble
Jokes aside, it is extremely interesting.
The one thing I think one should mention is that with Macs the options are limited, while thats not the case with PC. It is very cool to see them being compared side by side.
Pity that ol’ RJ behaved like a spoilt brat since an exercise like this would have been much more valuable than him having a little hissy fit on Twitter :/
Comment by Stii — July 6, 2009 @ 3:28 pm
@stii I had a chat with my assistant (who did the research and has a lot of PC retailer experience) about the very fact that your options are somewhat limited.
That said though, if you are shopping in the high end market, it really would seem that you will get more bang for your buck (spec wise) – as noted in the post, we couldn’t find off-the-shelf solutions that matched the spec of the Mac Pro and even the HP equivalent to the MacBook Pro will need a bit more RAM factored in.
…next one’s a Mac – you may hold me to it
Comment by Jayx — July 6, 2009 @ 3:35 pm
Great post and everything you say is very true. While Core has lowered prices (and we’re extremely grateful) there is still a price difference of around 4K with the UK cost of the entry level 2.53Ghz 15-inch model. What this means is that there is a near 20% difference between our cost and the cost in the UK. Crazily, you could almost fly to London (thanks to the low cost of recession starved airlines), buy a Macbook Pro and come back here for about the same price.
The simple fact though is that the issue with Core is not just about price. It boils down mostly to service and shocking attitude. When something takes 6 weeks to fix due to waiting for parts it is not acceptable.
The simple truth is that regardless of whether the PC industry is ripping us off equally doesn’t really make it acceptable for Core to do the same.
I’ll say it time and time again, all we want is some dialogue and explanations like this rather than sarcasm and derision. I’ll also be buying a Macbook Pro (and probably putting Windows 7 on it) but I’ll get it from the US or UK for a much cheaper price.
Comment by SaulK — July 6, 2009 @ 3:39 pm
@SaulK I agree with your statement about CORE’s attitude and that two wrongs don’t make a right, but this whole argument started when the local Mac fans started questioning CORE’s “exorbitant” pricing, used that as a foundation for all their subsequent arguments and underlined the fact that we need more competition in the market.
What this post is set to prove is that competition definitely isn’t getting us anywhere and that the whole price issue is nothing more than a storm in a teacup.
What CORE could/should have done is to provide facts (similar to those that form the basis for my post) and engage with their audience in finding a workable solution to the service related issues that are rampant, thus instilling confidence among Apple consumers, rather than letting emotions and people’s perception of the status-quo get out of hand.
Comment by Jayx — July 6, 2009 @ 3:53 pm
Great article, I’m a little surprised at how much the PC based machines actually are (as I’ve been using Apple products for the past eight years).
One thing you could also throw into the mix is the “value proposition”, namely Mac OS – some may see this as unimportant, but the OS along with all the applications and tools at has out of the box plays a major role in my decision making – something that no PC maker offers.
Cheers!
Comment by iDale — July 6, 2009 @ 4:01 pm
@Jayx: Of course competition will make no difference and you’ll notice we’ve tried to avoid the CORE/CAB saga. To be honest, the Stopcore movement is clearly winning with a recent drop in prices making an even less compelling reason for the site to exist.
I’m afraid that the attitude of “storm in a teacup” is exactly why we as South African’s are ripped off on everything from bread to electronics. We are totally complacent and expect things to be expensive. I’m personally tired of that and worry that you’ve admonished all importers for ripping off South African’s due to this being widespread.
If CORE had provided us with these facts (even though we know them) and tried to interact with us the situation would have been vastly different. In reality it’s irrelevant discussing what should have been done and I don’t think your comparison is fair as it’s an Apple with Oranges debate. We’ve never said we are unhappy because Apple costs more in SA than PC’s. Maybe one day if CORE drops their prices a little bit more then we can go after the guys importing PC hardware!
Comment by SaulK — July 6, 2009 @ 4:03 pm
Hope I don’t come across as agro (reading my last post makes me wonder). Just passionate on the matter
Comment by SaulK — July 6, 2009 @ 4:07 pm
@iDale, yes, it is difficult to not take performance advantages and value-adds into consideration, but you cannot put a value to that without a great deal of thumb-sucking – that’s where opinion comes into play.
The reality is that more people buy low spec PC than high-end ones, but then the Mac is not really an option/consideration … maybe I should throw a Mac mini into the equation and see what we get?
Comment by Jayx — July 6, 2009 @ 4:10 pm
@SaulK I took it as a given that (more or less) all Apple consumers (more specifically Mac users) are extremely passionate about the product.
I am also concerned that we are paying as much as we do for computers, bandwidth, cellular devices and almost every other product – more alarmingly: fuel, food, electricity and other products essential to maintaining a reasonable lifestyle, but that is a topic for a whole new debate.
The Apples vs Oranges debate aside though … can you imagine the revolution if all consumers were as passionate about taking on retailers as the Stopcore crowd is? Pity such a high percentage of our population doesn’t have access to the internet.
Comment by Jayx — July 6, 2009 @ 4:35 pm
I have found similar problems when trying to source prices for Apacer products. Apacer in The Netherlands gives me its worldwide recommended *retail* pricing but when I compare it to the local store prices they are often charging double (or more). It was especially noticeable about a year ago when the price, internationally, of flash-memory technology dropped noticeably and the manufacturers were passing that on to the distributors and retailers… except here, where the prices still went up for about six months and then started coming down… slightly. More recently the prices locally have been better, but they’re still not good.
Comment by mjw — July 6, 2009 @ 5:19 pm
After seeing the real specs behind the shiny exterior I was truly surprised at what Apple puts into their hardware. This has me looking at Apple computers in a new light.
Comment by Raptore — July 6, 2009 @ 8:06 pm
Nice, detailed, factual stuff. A far cry from the emotionally-charged antics we’ve gotten used to of late. Again, not to take away from the legitimate concerns of many ZA Apple users at all…
I did a similar thing in my feature in last month’s issue of our webzine MacAction, debunking the Apple Tax myth, and I was using the pricing structure before the most recent reforms and self-build PCs as a comparison. Not certain I can post the link here, it’s one of the free magazines on Mymag.co.za though.
So it looks like you don’t need convincing after all!
Here’s another price comparison to go and make, SA vs US… any model or make of car!
Comment by Russell — July 7, 2009 @ 4:36 pm
Why bother with local suppliers? I am sure that one has people visiting now and then, I just got a freind to bring me back a Macbook pro from NY and saved R 8000.
The local Apple guy have to ver the warranty if there is a problem.
Comment by serge — August 26, 2009 @ 9:19 am
Has anyone considered freight charges and import duties which could be as high as 35% given that these are imports. Once you add these on to the US price suddenly the local delers are only making a profit of +- R1,000 against the cost given of R27k this leaves a profit margin of 3.8%
Comment by Shaun Devine — December 4, 2009 @ 3:35 pm
Thanks for your input Shaun … import duties should be the same (I’d guess) for both PC and Mac products. I’m not disputing whether we are paying too much for Apple products or not, I am merely weighing up prices across the board for both PC and Mac.
Comment by Jayx — December 4, 2009 @ 3:44 pm
The trouble with CORE is not the price but the tardy after-sales service being offered. That takes the goat.
Comment by ebusinessuk — January 13, 2010 @ 9:24 am
I do agree, Apple by far exceeds most of its peer on the technology front…I myself use an Apple iPhone and find very few other mobile devices to compare. It is pity however that support and service in SA is as dismal. I know that the ‘world’ still consider us a 3rd world country. Apple products are however in great demand and used to a great extend by many a SA citizen and yes, I think Apple should do something to up their game as far as service is concerned. The support alone that we give by using their products necessitates it.
And Vodacom as a support seeing as they now have the contract for iPhone in South Africa is little to be mentioned. I recently updated my software to 3.1.2 that required my phone to be jailbroken again for SA use…they did not even know what the hell I was referring to. I think there are many a more savvy iPhone user out there than what is employed by them
Comment by Jacques — January 13, 2010 @ 4:39 pm