Re: [NTLK] OT macworld 04 pix

From: Martin Joseph (martyNT_at_barknaturalpet.com)
Date: Fri Jan 09 2004 - 00:35:11 PST


On Jan 9, 2004, at 12:20 AM, Brian Pearce wrote:

>> But I dont think they will, because they make no margin on the
>> hardware.
>
> "They make no margin on the hardware"?!
>
> As a standard practice, Apple does not go into specifics on the gross
> margins for different product categories -- but going by the quarterly
> reports, margins tend to be in the range of 25%-27% (26.6% in the last
> reported quarter), and tend to fluctuate the most depending on the mix
> of (low margin) consumer product or (high margin) professional product
> sold in a given period. (Expensive airfrieght costs for shipping out
> new products tends to lower margins, as well.)
>
> About 90% of Apple's revenue comes from hardware sales -- that's quite
> a substantial amount for a product category with "no margin".
Very true.
Brian is completely right. Only when you compare Apples margins with
microsofts do they look thin....
>
>> Make no mistake, if Apple really decided to be purely a software
>> company they'd port OS X to Intel commodity hardware and sell it like
>> crazy.
>
> And we'd soon find the company either drastically reduced or out of
> business altogether. (In any case, the remaining revenue from "beyond
> the box" sources wouldn't allow for much in the way of R&D.)
Again likely true unless you multiplied the user base up to levels much
larger then the existing mac installed base.

Quick math shows they would need to sell approximately 22.5 million
copies of OSX per quarter to generate a similiar top line revenue as
they currently do from combined hardware and software sales.

Still if the PC hardware side wasn't such a mess of crappy product it
could be doable. Supports cost would be MUCH higher then mac based OSX
and then you would also have the whole issue of multiple binary
versions for each platform(OSX photoshop for x86 versus OSX photoshop
for PPC), ala beos.

Marty

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