Earlier quoted context omitted.
Apple makes money chiefly by selling devices to the public. Joe needs a phone, walks into an Apple store plays with an iPhone and buys one. Suprise works here because of the burst of publicity and the ease of purchase. This approach is based on limited supply and tries to maximize dollars per unit. Microsoft's Windows platform makes money chiefly by selling OS licenses to hardware companies like Dell. Every month the…
> and tries to maximize dollars per unit. I've never really understood this line as applied to Apple, since I don't recall them dropping prices after the initial release. If they did I'd expect a "wait two months for the prices to drop" meme, but I've never heard that recommendation.
Even so sometimes your margin goes down but the consumer price is the same like when Apple expanded ipad sales thru Walmart/Best Buy/Target/whoever 6 months after the ipad launched when their supply started to ramp up. Their margin for an ipad at Best Buy is what 15% lower then if they sell it direct but the customer pays the same price.