After a long wait, Microsoft has finally unveiled the pricing information for the next Windows release, Windows 7, which will arrive at the shops on October 22. Interestingly enough, Europe will get full retail copies for upgrade pricing because of the whole Windows 7 E thing not being tested when it comes to upgrades.
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Member since:2008-04-10
I'm not sure "loss leader" logic can be applied to something infinitely reproducible after design. Each DVD it's on must cost them a couple of cents, and the cardboard box, not much more. Probably the most expensive thing in an OS X retail box, in terms of manufacturing, is the manual (do they have manuals in the box, or are they all digital now?)
For example, Microsoft claim to be selling Windows XP at a loss now. They aren't, it's infinitely reproducible. The only calculable loss comes when XP cannibalises potential Vista market share (like on netbooks, not that you can squeeze Vista onto one and still use it), but even then, the price of XP itself is entirely profit. I'm sure they paid their XP development costs off long ago, and since OEMs just stamp a disk image onto every machine, shipping is taken out of the equation for MS.
Member since:2006-02-05
Software has an insane amount of R&D cost. Microsoft says they have about 80 devs working on windows. At an average of probably about 90k/yr, that is 14.4 million dollars (assuming a 2 year release cycle) just for developer salaries. And developers are just the tip of the iceburg. It mounts up pretty quick; testers, manufacturing/shipping, marketing, support (retraining at least), technical writing, artwork, usability testing, 3rd party licensing, legal, etc, etc, etc.
130$ is next to nothing, considering the amount of work going in to an operating system. If you look at the size of the potential market, if Apple isn't losing money on osx, they are about breaking even. The only reason they are even making OSX is to sell their hardware. It may not be exactly the same thing as selling cheap bread to get people in the door, it is close enough that the analogy stands.
Member since:2005-07-06
130$ is next to nothing, considering the amount of work going in to an operating system. If you look at the size of the potential market, if Apple isn't losing money on osx, they are about breaking even. The only reason they are even making OSX is to sell their hardware. It may not be exactly the same thing as selling cheap bread to get people in the door, it is close enough that the analogy stands.
I wouldn't say you're too far off with the 'cheap bread' analogy given that it was Steve Jobs who said that Mac OS X is the heart of a Mac; without Mac OS X, Apple computers would be just yet another x86 PC out there with some minor tweaks here and there.
With that being said, if Windows 7 is all they can produce after throwing millions or possibly billions at the project - then I'd hate to see what a failed project looks like.
Edited 2009-06-26 11:29 UTC
Member since:
2006-03-27
The phrase you're looking for is "loss leader". And also, no it's not. A loss leader is something a middleman (shop) sells at a loss, i.e. white bread in supermarkets which tends to be sold at less than wholesale to encourage further buying.
It doesn't apply in this case at all. How do you know they're not making money off individual copies of OS X? They're not middlemen, they develop it, there's no wholesale price.
EDIT: Spelling
Edited 2009-06-25 16:01 UTC