Apple, Microsoft duke it out over college student computer market

PC and Mac computers with logos for Windows and Apple.

Bob Moon: The back-to-school shopping season is second only to holiday sales for many of the nation's retailers, which explains why Apple and Microsoft are locked in a "battle of the freebies" right now. Unlike past years, Apple is not offering a free back-to-school iPod to students who buy a Mac. This year, they have to settle for a $100 gift card good for App Store or iTunes purchases. Microsoft has upped the ante with a free Xbox game console to students who buy a Windows 7 PC. And at least one analyst reports Mac sales are suffering in recent weeks.

Andrea Gardner looks at this early lesson in what makes a good deal.


Andrea Gardner: It's a hot summer day at the University of California, Riverside. First-year grad student Carissa Duran sits in a shady spot using her brother's old netbook to shop for a computer. She needs to buy a laptop before school starts next month. All summer, she's been considering her options. First, there's the Mac.

Carissa Duran: They're really attractive. There is, you know, that image that comes with Apple, and everyone needs to have one. I figured maybe I should just go with a Macbook to start.

On the other hand, she says, PCs are more compatible with the computer system on campus. They're also less expensive than Macs.

Duran: You want to squeeze every single penny out of every dollar that you have because you're strapped and you're just trying to survive college and not eat Top Ramen all weekend.

According to consumer research firm Student Monitor, about one in eight college students plans to buy a computer this year. When asked if they'd buy a Mac or PC, students were split about 50/50.

Apple declined to comment, but Microsoft spokeswoman Janelle Poole from Microsoft says college students are an important demographic to pursue.

Janelle Poole: They have a huge amount of influence in what technology decisions are made in a household. Not only for themselves, but also they have an opportunity to influence their parents. You know, this is a group that's grown up living and breathing technology as part of their daily lives.

Right now PCs have about 70 percent of the student market. But Apple has been steadily cutting in to that dominance -- Eric Weil with Student Monitor says the company has gone from 5 percent of the student market in 2001 to 30 percent today. He says growing consumer preference towards portability has helped.

Eric Weil: Apple was fortunate enough to be out there at about the same time that we saw this migration, this shift from desktop computing to laptop computing.

Weil says Apple has been able to capitalize on the popularity of the iPod and iPhone to drive customers to its laptops. Microsoft seems to be following the same strategy -- by giving away their popular Xbox consoles.

Back at U.C. Riverside, grad student Carissa Duran says that offer is just too good to pass up. Not because she likes video games, but because she will probably sell the Xbox on Craigslist.

Duran: At the least, I'm sure -- brand new product worth $200 -- you can sell it for $150.

And that will buy a lot of ramen this semester.

In Los Angeles, I'm Andrea Gardner for Marketplace.

About the author

Andrea Gardner is a journalism professor and writer in Pasadena, Calif.

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