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

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:

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

RE[5]: ...
by alcibiades on Thu 14th Sep 2006 19:57 in reply to "RE[4]: ..."
alcibiades Member since:

No, not exactly, or not quite like that.

To get to the 10-15% they would have to sell the OS to people other than their present base, ie the ones who will buy Apple hardware to run it. If they could gain this share with the present model, they would probably be fine. But they can't. So they would have to emulate MS in terms of distribution channel, pricing, support and so on. But if they did this, they wouldn't have the same volumes, at least at first. So the R&D would be written off against smaller unit sales. The marketing expenses of the OEM channel would be written off against smaller unit sales. There would be little in this higher cost method of operation compared to MS to differentiate them for consumers. So they might, might, end up playing MS game but at lower volumes.

You can see that its not silly to decide against trying this. I'm not sure if its right or wrong. But reasonable people could decide no.

Reply Parent Score: 1