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| Summer 1992 | ||||||
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| ANALYSIS Higher ed still a NeXT priority Despite NeXT's push to broaden its commercial market, higher-education marketing efforts are still going strong. by Jonathan Littman Emerging new commercial markets have caused some observers to question whether NeXT is wavering from its original goal of producing a superior higher-education machine. But educators, NeXT executives, and industry watchers say that the broadening markets are critical to NeXT's continued success in the educational market. And they add that despite naysayers, NeXT's marketing efforts in higher education are stronger than ever. The numbers bear out those claims. Twenty of the top forty North American NeXT sites are universities, according to a 1992 NeXTWORLD survey that excludes government sites. About one-third of all NeXT machines are installed in universities, according to NeXT. Today, 20 to 25 percent of all new NeXT sales are to higher education. The current ratio is similar to that which Apple and Sun sell to higher education, one that NeXT believes is ideal for seeding the fertile grounds of higher education while maintaining the commercial profit margins necessary to offer deep university discounts. "The reality of the world today is that higher education can't get our best pricing unless we are successful in selling to other markets," said Ronald Weissman, NeXT's director of strategic marketing. "It's no accident that we were able to get our prices down from $6500 in 1988 to less than $4000 today. We've done it by broadening our markets." Most educators agree that there are practical advantages in increased commercial sales. "The more boxes out there, the better," said John Link, professor of art at Western Michigan University. "It just gives us more software to choose from." NeXT sells to more than 300 universities, many of which serve as hubs that sell NeXTs to smaller local universities or colleges, bringing the total number of official NeXT campuses to more than 450. Distribution depends on the campus's preference. At some universities, NeXTs are distributed directly by the institution; at others, faculty, students, and administration buy NeXTs from the campus computer store. Last year, Massachusetts Institute of Technology was NeXT's largest educational reseller. NeXT ranked Number 2 to Apple, selling 120 workstations to IBM's 90, although still a distant third to Apple's 2200 Macs. "NeXT coming from nowhere has really done quite a job," said Jeff Solof, manager of MIT's computer store in Cambridge. Ask NeXT how it sells to higher education, and the answer is Mathematica, Mathematica, Mathematica. "We continue to be the best machine for Mathematica," said David Spitzler, manager of higher-education marketing. "We're making sure people continue to know Mathematica is the best thing since sliced bread." NeXT has continued bundling the sophisticated mathematics and modeling program with every workstation sold through the education channel. It also works closely with Wolfram Research, and attends Mathematica conferences and seminars. The investment pays off, because Mathematica is more than a math program. Educators are expanding the versatile program's use beyond traditional mathematics to economics, statistics, psychology, and a variety of other disciplines. Mission-critical applications But while Mathematica has been a constant in higher-education marketing, one of the latest developments reflects commercial trends. Many new sales are being generated by the ease with which educators are developing custom NeXT applications, much as their counterparts are doing in business. "Mission-critical applications are not suited only to financial services or government," said Spitzler. "At many universities, faculty are using NeXTstep to write programs or utilities in a day to illustrate a concept on the screen quickly. They might be preparing a lesson, a lecture, or a presentation." Often professors deploy their custom apps with standard applications, the most common being Mathematica, FrameMaker, and Improv. That same need for integration is finding its way campuswide, as many universities are learning from the business world and adopting NeXT for traditional office automation. Beyond these core markets and the traditional disciplines of math, computer science, engineering, physics, and English, markets are emerging in speech and hearing, language, chemistry, biology, and psychology. NeXT's allegiance to higher education isn't hurt by the fact that Weissman was NeXT's former director of higher education, and he hasn't forgotten his, and NeXT's, roots: "If you are looking at where we are spending our time, higher education gets a fair or fairer share than any other market." Finding the purse strings Efforts increasingly have focused on reaching the departmental buyers who make up the higher-education market. Last year, NeXT attended only two major education conferences; this year it plans to attend six or eight, many in new fields. A close relationship with publisher Addison-Wesley, which sponsors many of the conferences, is part of the strategy. "We need to reach the people making the purchasing decisions in higher education," said Spitzler. "Increasingly, those decisions are being handed down to the department chairman." Lately, some of the evangelizing has come from the universities themselves. "Six months ago, NeXT had to be the advocate," said Spitzler. More recently, some universities have volunteered faculty eager to demonstrate their achievements to new higher-education users. It is a potent cross-fertilizing that NeXT believes cements existing sales and seeds new ones. Still, NeXT isn't counting on immaculate conception. "They give you a heck of a lot of attention," said Western Michigan University's Link. "The technical help from the regional technician has been terrific. If he says it will work, I believe it will work. We've been able to make a number of purchasing decisions because we can trust what he says." NeXT's volunteer campus consultants provide project-based technical support and guidance. "It's important for us to have people who can add value locally," said Weissman. "At many of our best accounts where we've got exciting projects or quality research going on, we have students who understand that NeXT technology helps the campus achieve its goals." Twice a year, 6000 subscribers receive NeXT On Campus, a company publication that highlights university application stories. Campus resellers receive a monthly update from NeXT on new products, prices, and policies. NeXT also tries to provide personal attention for the resellers. "We try to work with the resellers on pricing and promotions," said Kathi Kaplan, higher-education channel manager. Superior technology, of course, has long been NeXT's marketing draw, and the company's executives say the following six to nine months will see a new emphasis on high volume and multimedia data applications for higher education. NeXT, as the searching engine for wide ranges of information networks, promises to not only be a significant draw for higher education, but for business as well. But despite NeXT's technology edge, industry watchers say price sensitivity will remain critical, even if the economy picks up. "The amount of money universities had [available] to invest has dried up," said Michael Roberts, vice-president of networking at Washington, D.C.-based Educom, the nation's leading educational consortium on information technology. "Higher education has deployed several million PCs. It's not the first time around anymore." An education for NeXT Higher education as percentage of NeXT's installed base: 33 percent NeXT sales to higher education: 20 to 25 percent Number of universities reselling NeXT machines: 300 Number of universities officially using NeXT machines: 450 Source: NeXT Computer | ||||||