Apple makes really small Mac cheap as chips

Apple has launched its latest barrage at wavering PC users with a Mac that scrapes in under the £350 barrier.

In a tried and tested marketing ploy, Apple is calling the starter Mac the 'Mac mini'. CEO Steve Jobs said in his keynote speech at the Macworld Expo event in San Francisco: "We think people understood iPod mini and we think they're going to understand the Mac mini."

The "most affordable" Mac comes in at £339 and comes with the newly released iLife '05 suite of applications. Jobs described the Mac mini as "BYO DKM - bring your own display, keyboard and mouse." The 'headless Mac' is inches tall and comes in any colour as long as it's white.

The cheaper Mac mini has 1.25Ghz PowerPC G4 Processor and a 40GB hard drive. For an extra £60, desktop buyers can net themselves a 1.42Ghz G4 Processor and a 80GB hard drive.

"We want to price this thing so people thinking of switching have no more excuses," Jobs said.

Users will obviously have to bring their own peripherals - Jobs promised "any industry standard" models would be compatible - PC switchers will have to accustom themselves to the Mac OS, Panther, which ships with both models as well as potentially investing in Apple's add-on hardware.

With a tempting price and Apple's favoured stripped-down design - like the latest all-in-one Mac but in reverse - Cupertino looks to be putting the moves on the PC users that have a fondness for the iPod.

An attempt to capture the technology 'thin end of the wedge' may well pay off for Jobs and co.

A recent survey of new iPod users by financial analyst company Piper Jaffray found a halo effect.

The research found that six per cent of iPod users had made the switch and another seven per cent said they were planning to dump their old PC desktop for an Apple machine.

Also at Macworld, Apple's Jobs unveiled new flash-based iPods and a software productivity suite called iWork to compete with Microsoft Office.