Windows PC makers typically haven't had to compete with Apple on the low end, but that changes with the Neo, says S.Y. Hsu. The memory shortage might complicate things, though.

The Apple MacBook Neo’s $599 starting price is a “shock” to the Windows PC industry, according to an Asus executive.

Hsu said he believes all the PC players—including Microsoft, Intel, and AMD—take the MacBook Neo threat seriously. “In fact, in the entire PC ecosystem, there have been a lot of discussions about how to compete with this product,” he added, given that rumors about the MacBook Neo have been making the rounds for at least a year.

Despite the competitive threat, Hsu argued that the MacBook Neo could have limited appeal. He pointed to the laptop’s 8GB of “unified memory,” or what amounts to its RAM, and how customers can’t upgrade it.