New Apple TV genius business

[mikced76]

I am not trying to bash the new Apple TV and I might actually get one but don't you guys agree to some extent that the idea behind the Apple TV approach seem not to distant from those NBA, MLB etc collector books for pictures from when we were young. You buy the inexpensive book with a beautiful cover from which the company makes very limited profit (the Apple TV hardware). The book itself has no or very limited value to you unless you purchase the relatively expensive trading cards to fill the book.

Some will probably reply that the TV shows are only 99 cents but still this is where they will make the profit, not so much from the device.

I am not saying this is wrong in any way just that it is a genius sales and marketing approach. Has been and always will be.

Mike

 

[waw74]

HP doesn't sell printers, they sell ink
Gillette doesn't sell razors, they sell refills.

there are numerous things that work like this.


although it sounds like most of the money still goes to the content providers

…Regarding the App Store and the iTunes stores, we are running those a bit over break even and that hasn’t changed. We are very excited to be providing our developers with a fabulous opportunity and we think that is helping us a lot with the iPhone and the iPod touch platform.

http://mediamemo.allthingsd.com/20100225/apple-billions-of-songs-billions-of-apps-not-much-profit/

 

[CWallace]

Apple is actually more of the reverse of the traditional model - they make their money off the hardware (yes, the new TV is dirt cheap for an Apple product, but look at it - iSupply will probably show it has less than $25 in parts) and the iTMS and App Store are there to drive sales of the hardware.

While it seems the majority of posters feel 99 cents is far too expensive for a rental, you can be sure that if Apple truly had the power to dictate terms to the content providers, the price would have been 9 cents because that would sell even more iOS devices.

 

[bigpatky]

HP doesn't sell printers, they sell ink
Gillette doesn't sell razors, they sell refills.

there are numerous things that work like this.


although it sounds like most of the money still goes to the content providers

http://mediamemo.allthingsd.com/20100225/apple-billions-of-songs-billions-of-apps-not-much-profit/

in the case of the iphone/ipod touches, there's no doubt that apps, or to be more specific, good apps, is one of the biggest drivers of hardware sales for apple. they don't need to make a profit on apps for it to be an integral part of their business model.

 

[iowamensan]

If that's the case, they won't like me. I've had my Apple TV for several years now and have never even really thought about using it to rent/buy something from iTunes store. I just want to stream my own content, which it works great for.

 

[WiiDSmoker]

If that's the case, they won't like me. I've had my Apple TV for several years now and have never even really thought about using it to rent/buy something from iTunes store. I just want to stream my own content, which it works great for.

Which is why the Apple TV is the way it is now.

I'm on your side though; I won't ever be renting/buying from iTunes.

 

[d21mike]

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I thought Apple was making a lot of money from the app store.

 

[WiiDSmoker]

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I thought Apple was making a lot of money from the app store.

I think the last revealed figure was around 300-450 million so far. Not sure

 

[winstonterr]

Hi,
I have to make a trivia night Poster for my friend and have no idea where to start?Does anyone have step by step directions to make on on Photoshop?I have a macbook computer and all the software is working.I just have no idea on how to make a poster and i really want to help my friend out with this.Do you know of any good videos on youtube that are good for me to learn from???

 

[nwcs]

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I thought Apple was making a lot of money from the app store.

They make a lot of money but the profit margin is very small. I'd love to see the infrastructure diagram for the network hosting the iTunes services. Must be pretty impressive.

 

[newagemac]

They make far more money from hardware sales than from iTunes and the App store. If you like at a pie chart breakdown it's only a tiny sliver. I can't remember the figure but I think it was about 2% of their profits.

They aren't really trying to make money off of iTunes and App store sales/rentals. They just need them to sell their hardware. The better the content and apps available for their devices the better their devices will sell. It's a means to an ends. They want to sell you iPhones, iPads, and Apple TVs. They can't do that without content and apps.

In fact, they would probably give the content and apps away free if they could but the content providers/developers ain't having that.