jbelkin

Apples to Apples: Will History Repeat Itself as Android Gains on the iPhone?

First, it's clear that market conditions are different - the easiest one you might understand is that unlike the days of yore where MS could buy up distribution - with the internet, no one can. You may not realize this market share does NOT equal margins or ROI. Apple makes $600-$700 PER iPHONE SALE including iTunes (with margins of 35-40%) - how much does GOOGLE make? ZERO. That's right. They are hoping to make money down the line with search and of course, stab WIN Mobile in the head and jump ahead of Yahoo ... but its two different strategies - Apple is more than willing to concede the "free" market share to Google - Google is free to take 100% of the $49 smartphone market while Apple much prefers the 70% market share (like the ipod) of the top of the $600 smartphone market (with subsidy). Bottom line, guy, it's a new century - you might want to understand a little more before committing it to the internet.

Apple's AT&T Deal Is Costly

For a guy who claims to be a numbers guy, you don't do much calculating yourself.

Apple is selling an EXTRA 400,000 or 1+ million phones where other cell phone manufacturers might sell a few thousand more ... that's right - not on the network but still buying ...

This would be a problem if Apple was subsidizing each phone sale but it's NOT- every one at FULL PRICE 100% of the time.

As for people who can't/won't switch to AT&T ... how much does AT&T make for this customer? That's right - ZERO.

How much does Apple make? That's right $400 to $500 DOLLARS!

Versus ZERO.

It's ALL found money. Even better, Apple has to provider ZERO tech support - how much savings is that?

And with everyone that goes overseas that's not "legal," that just adds to the cachet of the product. How many products are considered FREE ADVERTISING & MARKETING for a company yet they made $450 TODAY?! Not to mention every Iphone sale is potential iTunes sales (even overseas ones either have stores or if they have a US credit card can buy tracks & movies) ...

By your math, since everyone on this planet doesn't have an iPhone, that's a trillion loss?

So you prefer possible future monthly revenue versus a $450 sale today? The future monthly stream is never guaranteed even if you sign up a carrier - people drop out, people don't pay ... but you don;'t factor that in because it's too hard?

The real world is more complex than just A+B-C ... or perhaps you should stick to analysing industries that aren't so complex.