DevinC said:
I guess I'm just trying to understand Apple's philosophy better and WHY they are taking the approach that they are doing now instead of allowing OS X to run on any PC-based hardware. Apple is different from any other company and their business model is what has aroused my interest.
I'll run these numbers again as the same question keeps coming up...
For the sake of argument lets work with these numbers... we'll say Apple makes $100 on each copy of Mac OS X, and we'll also say that the average price for Apple hardware is $2000 and the average profit on that hardware is $800. Let us also put Apple's market share at 4% for this.
Apple would need to sell 8 copies of Mac OS X for every Mac that isn't bought because someone put Mac OS X on another companies PC. If this cuts Apple's hardware business in half (dropping their new hardware market share to 2%) how much market share would Apple have to gain with Mac OS X on PCs to brake even?
Apple would have to have 16% market share (a total of 18% including the 2% from their own hardware sales) to make up for the loss of half their hardware sales.
And we are strictly talking about profits above and beyond what it cost Apple to make these things.
Now factor in the fact that Microsoft has pointed out that about 35% of Windows installations are pirated. Why would Apple get off any easier than Microsoft in this area?
So Apple would actually need to reach nearly 23% market share (or 25% total) to brake even with where they are now. And that is only if they lose half their hardware business. If they dropped their hardware all together they would need about 50% market share to stay as profitable as they are right now.
Even if they could reach 10% market share (which they possibly could by dropping their hardware business and letting everyone just buy Mac OS X for any PC), that is about one fifth of the current profits they are currently making at 4% market share restricting Mac OS X to Apple hardware.
No company is going to take a path to
less profits... and Apple is no different. Mac OS X at 50% market share is a complete fantasy, and that number is the only one that could make them break even...
we aren't even talking about an increase in profits, we are only talking about breaking even here.