It would be unfortunate if in fact it was bought mainly by existing Mac users looking for a cheap upgrade. For example, I have a 1st-version 12" PB - 867 Mhz. The 1.25 Ghz Mac Mini would be a useful upgrade, especially if I took the BYO option of an 80 Gb HD. That, plus a 512 Mb RAM upgrade, would put it up to just over �400. That's a lot less than the money for a basic iMac or even a bottom-level PowerMac. Yes, the specs aren't as good, but to be truthful they're probably good enough.
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