Linked by Thom Holwerda on Thu 14th Sep 2006 16:00 UTC, submitted by Sonia Mehta
Apple "I want Vista to be a better OS than it's been promoted to be, but at the same time, I also want OS X to finally receive the public adoption that it deserves. Now is the time for Apple to creatively promote its Macintosh platform with OS X. This is the critical hour, and if Apple is able to take advantage of the uneasy feeling that many have towards Vista, then they could attract an untold amount of new users."
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RE[2]: ...
by evangs on Thu 14th Sep 2006 16:36 UTC in reply to "RE: ..."
evangs
Member since:
2005-07-07

Which goes to show, having a larger market share doesn't necessarily translate into healthier profits.

Reply Parent Score: 5

RE[3]: ...
by alcibiades on Thu 14th Sep 2006 17:04 in reply to "RE[2]: ..."
alcibiades Member since:
2005-10-12

The empirical evidence is that profitability plotted against market share is U shaped. Companies are usually very profitable at low shares (because they are niche producers and highly differentiated - think high end Hi Fi companies making tube amps, for instance). And they are profitable at high shares because of economies of scale.

In the middle you are not differentiated but are relatively high cost, and so you can't get premium prices or sell cheap enough, so you get poor returns. In the phrase, you are different but not differentiated. That is, you are different from the high share guys, but not in a way that adds any value to your customers.

So the danger for Apple would be, sell a lot of OSs, but not reach MS economies of scale, and become so much a standard product that they were not valuably different. It isn't silly to decline to try it. What is really silly however is articles like the OS Weekly one that seem not to even understand the problem exists.

Edited 2006-09-14 17:05

Reply Parent Score: 3

RE[4]: ...
by ma_d on Thu 14th Sep 2006 17:26 in reply to "RE[3]: ..."
ma_d Member since:
2005-06-29

So basically, if Apple were a 10% market share company they'd be dying slowly but as a 3% share they're strong.

It does make sense the way you explain it but it's not really the way we consumers want to see it either!

Reply Parent Score: 1