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Why Apple Wants Its Software to Be Free

businessweek.com

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Re: Why Apple Wants Its Software to Be Free

#61

Post by mvkel »

zdw wrote: post #18
blueblob wrote: post #17

Earlier quoted context omitted.

If it was just about apps, why wouldn't they release OS X for all x86* architectures instead of just their hardware? Then projects such as hackintosh/osx86 would be irrelevant.

Increased support burden, by several orders of magnitude. People blaming the OS for hardware deficiencies. Etc. I'm not seeing any upside for Apple if they did this.

Exactly.

This is also the reason they released Mav for Macs going back to 2008. To reduce the support burden of previous OSs

Re: Why Apple Wants Its Software to Be Free

#62

Post by mvkel »

Samuel_Michon wrote: post #56
mvkel wrote: post #14

Disagree. It's about selling apps, not hardware. What holds Apple back is user OS adoption. With iOS updates being free, users can get the latest apps, and Apple doesn't need to worry too much about backwards compatibility. OS X didn't have that luxury until today. With the free play, Apple is giving their customers zero reason to stay on older versions. They want to see 90 percent adoption rates in 6 months. Why? Th…

> It's about selling apps, not hardware. Apple makes very little from app sales, profits from iTunes purchases (including both App Stores) are under $1 billion a year. Apple rakes in tens of billions in profits a year from Mac sales, and even that is a minor business compared to profits from iOS device sales.

Apple doesn't offer ios updates for free to sell more idevices. They do it to keep every single device relevant, and able to run the latest apps.

It reduces their support burden and increases the value of the app ecosystem, however small its contribution to the bottom line. Yeah it only generates a billion on revenue, but it also DIDNT EXIST 5 years ago. That's a crazy growth curve Apple could replicate in the OS X world if they play their cards right.

Re: Why Apple Wants Its Software to Be Free

#63

Post by Samuel_Michon »

mvkel wrote: post #62
Samuel_Michon wrote: post #56

Earlier quoted context omitted.

> It's about selling apps, not hardware. Apple makes very little from app sales, profits from iTunes purchases (including both App Stores) are under $1 billion a year. Apple rakes in tens of billions in profits a year from Mac sales, and even that is a minor business compared to profits from iOS device sales.

Apple doesn't offer ios updates for free to sell more idevices. They do it to keep every single device relevant, and able to run the latest apps. It reduces their support burden and increases the value of the app ecosystem, however small its contribution to the bottom line. Yeah it only generates a billion on revenue, but it also DIDNT EXIST 5 years ago. That's a crazy growth curve Apple could replicate in the OS X w…

Even if Apple were to sell 40 million Macs a year (2 times what it sells right now) and the entire installed base of OS X users were to buy 50 $10 apps a year on the Mac App Store, profits from Mac apps would still be less than Apple makes from selling iOS devices.

Re: Why Apple Wants Its Software to Be Free

#64

Post by ksec »

bradleyland wrote: post #37

The author doesn't understand Apple. Apple doesn't view software and hardware separately. Coincidentally, I just wrote about this, but I'll copy and paste here because it seems relevant. A friend of mine recently asked me how Apple expected to continue making any money while giving away software that Microsoft charges $200 for. Understanding how Apple can give away their software and still make money comes in underst…

I am not quite sure if devices is the right word. I would choose Product instead. But then Product in a sense doesn't include services. ( To me at least ) So they would be a Product and Services Company. Of coz if there are any one words that include both meaning please enlighten me.

Re: Why Apple Wants Its Software to Be Free

#65

Post by adolph »

gshubert17 wrote: post #54
adolph wrote: post #42

Earlier quoted context omitted.

1. My impression was that Apple has had a couple flat/lower year to year quarters in lap and desktops. Their chart of iPad sales shows slowing/maturing of that market segment. 2. Apple sells experiences. If it were selling devices, then software updates for older devices (other than bugs and security/safety) would make no sense. 3. Giving away iWork and iLife is an interesting move that starts building a moat of out-…

> If it were selling devices, then software updates for older devices (other than bugs and security/safety) would make no sense. On the other hand, I am more likely to buy an expensive device, knowing that updates will be available. In my mind, updates help the device retain its usefulness and value.

For the buyer, it's a gamble isn't it? Things could start going down the tubes OS8/9 style (or iOS 4 on 3G) but generally updates bring a bounty of new features and compatibility with services and software. If you are saying you will pay X amount more for a device for Y software upgrades, I wonder what's the difference (profit) between your X/Y and the cost of producing Y? It might actually be negative if the strategic value of software-ecology maintenance was high enough to the producer.

Re: Why Apple Wants Its Software to Be Free

#66

Post by adolph »

bradleyland wrote: post #58
adolph wrote: post #42

Earlier quoted context omitted.

1. My impression was that Apple has had a couple flat/lower year to year quarters in lap and desktops. Their chart of iPad sales shows slowing/maturing of that market segment. 2. Apple sells experiences. If it were selling devices, then software updates for older devices (other than bugs and security/safety) would make no sense. 3. Giving away iWork and iLife is an interesting move that starts building a moat of out-…

Just a nit pick on the word experience. Experience is ephemeral. It has no link to the tangible thing that we're buying. The experience is the result, but I disagree that we can take the abstraction that far. A movie theater sells an experience. An app developer sells an experience. Apple sells devices. When I say device, I mean the totality of the hardware, the operating system, and the core apps. This, to me, is th…

In an existential sense, "experience" is all there is. Maybe the largeness of the term renders it meaningless. I guess my point is that Apple's communications generally don't focus on a device so much as the human experiences the device enables.

Think of the jogging dude ad where the entirety of classic Mac/iPod music sync and Nike Plus integration was displayed as a little slice of life. Sure there are some devices there, but they aren't saying these devices are better than Brand X devices or laying out a feature list. The communication is about how there is an attainable experience of a technologically enhanced life.

There is generally an iCloud featured on the box of Apple's devices. This represents the integration of services to the device (itself an integration of hardware and software). So even at a level focusing on the day of sale something larger that what is in the box is being sold.

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