Potential customers for this fall into a few categories, including:
1. Parents who don't know a lot about tech, but whose kids need "a laptop" for school.
2. Kids & young adults who want a macbook to run something like GarageBand but have a very limited budget *and* also don't otherwise know much about tech.
3. Schools.
4. School-like programs, like software dev clubs & summer camps.
These customer types need a low price, but they also need A LOT of *support*. The support is the product here.
Yes, you could personally get a more powerful computer by getting a refurb 16GB M1 MacBook Air somewhere by bargain hunting. But you will need to hunt; right now on the official refurb store the cheapest MacBook Air is $929. If you're shopping on eBay, now you've got a machine with a ton of wear cycles on the SSD, and dubious amounts of damage.
If you, personally, have the time & energy for that, it *IS* a better choice.
So, back to the MacBook Neo and why it is interesting.
If you're reading this, you probably shouldn't buy it. But you should be aware that so many people *are* going to buy it, that it's going to set a consistent new minimum standard for software. For one thing, lots of apps are going to want to start targeting "fits into a MacBook Neo's memory envelope", which is to say, 8GB minus macOS overhead. Cheap hardware exists now, but not enough of it deployed consistently enough for app devs to care.
@glyph true, but I think the iOS precedence does make it more likely.
If I were working at Apple in a leadership position and involved in this project, this would be the first step in a 20 year plan to take large market share from Windows. So it'd be pointless to kneecap the Neo; you'd want it work as well as it can so as people need more power they're happy to pay more b/c of the trust established