Also I'm not sure what makes you believe apple is standing still on R&D. You can be assured they are designing away. You think they just pulled out new radical Mac Pro design over the weekend worth of work? Did you see that one coming? You can bet on them doing lots of creative R&D and it more then trying to stuff retina into the ipad mini. Look at the financials on R&D, it's not hard to figure out how substantial it is.
Ok, that new Mac Pro is fscking sweet and I want one, but really, this is not what I'd call R&D. It's design and product development. You know who's doing R&D? Samsung. They're figuring out how to manufacture flexible displays. IBM is dropping huge sums in Lithium-Air batteries.
If we're going to have radically breakthroughs in the next generation of devices, we need radically better battery, or radically more durable, or radically more powerful, or with much faster networks. There are companies dumping tons of money into researching these things.
Apple isn't. Apple is a buyer. They buy the fruits of the raw R&D done by other players, and design a pleasant case to fit it into. The idea of Apple being a chip fab is something that appeals to me. Intel, TSMC, et al, need competition. The idea of Apple researching battery chemistry appeals to me, because they have a concrete application for it that should drive it.
Here's the question: Since Apple is so dependent on Samsung and Sharp, and Japan Display, and others, but they have a huge arsenal at their command, which they could use to develop technology that no one else has or could buy, why aren't they?
Amazon is retailer for the most part they can keep margins low because hardly keep any inventory and make nothing. If product B sells better then competing product A, they could care less. They are not left holding the bag with excess inventory. So I don't know if you intentional tries to confuse by mixing apple and oranges but many can tell the difference between retailers who keep minimal inventory to manufactures.
Btw, you make it sound like wintel was successfull because they had low 1-10%margins. That's simply was never true. Even now in the pc market down turn they are pulling in around 25%. If I didn't know better it would appear you are jumping around on tangents trying to deceive others. Why are you here anyways? Are you a saint for apple competitors, a stock holder, a day trader trying to short the stock, or are you being paid by a competitor. I doubt I'll get an honest answer but I thought I would put it out there. Very odd behavior.
Samsung doesn't make jack in component innovation breakthroughs compared to what they make on fully integrated high margin integrated products like the galaxy phone and you know it. Stop going off on tangents your dancing sucks. Good night.
Those companies went bankrupt because the whole PC market is going down hill. You really think the problem with Dell was their prices? It's like saying "Horse and Buggy manufacturers went out of business after Cars were introduced because they had low margins" No, the problem is, their sales are going down.
Unix vendors got booted out of their markets because they couldn't keep up with Intel in CPUs, only IBM remains with PowerPC. MIPS, PA-RISC, SPARC, et al, they all fell to the Intel/AMD monster. On hardware, they found themselves eaten by Intel and commodity PCs, on software they got eaten by Linux. As a result, many of them, like Silicon Graphics, you know, the company that practically invented 3D and built some of the best desktop workstation designs way before people oogled over Apple designs, tried to enter the PC market, but it was already crowded. They had no where to go execept Hyper-computing with Cray, and that failed too.
Repeat to yourself: Revenue solves all problems. If you've got revenue, even if you've got low margins, you have a business. Amazon knows this very well. Amazon fixes prices and capex in order to set profit as close to zero as possible. However, they can turn a profit at any moment if they wanted.
Apple really had no excuses for high margins for "innovation". They have $100+billion in the bank. They could lose $5 billion a year and still run for 20 years. This reminds me of the way Oil Company tax breaks are defended "They need these tax breaks for R&D and exploration!" Really? Exxon needs subsidies in order to influence them to look for more oil? Give me a break.
The PC mfg don't make much in the way of profits because they have to compete against one another on price and they squeeze each other over selling product. They also spend too much time developing and supporting too many different models. Plus they spend more money per customer with tech support because they didn't develop Windows and they have to be able to support an OS they didn't develop. Support costs are much higher.
The UNIX suppliers found themselves only going after a very specialized workstation environment and LInux is getting more traction for highly specialized systems and then they get squeezed on the hardware side. The server side is where the money is at because they usually get service/support contracts and they can sell consulting services providing the installation of high end Enterprise Applications.
If you look at animation for movies and games, Windows is there and Linux is there, but in reality, that's not a HUGE number of users. But Apple is also starting to gain more traction in that area.
Amazon runs on a very small margin, they can't just automatically increase margin whenever they want to. I think Amazon is in a market that traditionally doesn't do well in terms of profits. It's a low profit margin business because all they do is really transaction processing and maybe some warehousing, packing and shipping product. They just OEM their tablets which they make little money on and I don't know how well Kindle going to do in the future. I don't hear much about Kindle anymore.
If you ask why I'm here, it's because I love Apple products, but I don't like the way Apple has been running the company, under-investing, over-litigious, and fostering a cult of zealots. They could be better than that. Any company that such huge profits could be acting better. And Apple fans need to grow up and stop acting so childish.
As for Amazon, if you set their prices at the same levels as WalMart, and drop the crazy CapEx spending, their margins go up to 4%. WalMart has 3-4% margins, banks like $16 billion in profit per year. AMZN is deliberating lowering their margins so as to a) avoid taxes b) aggressively expand distribution centers and c) continue to steal customers by undercutting everyone else. They have a lot of wiggle room to restore profitability, but investors believe in what they are doing, and so continue to finance their current strategy.
You could argue that if they go back to Walmart price levels, they'll lose customers, but Amazon is more than about having cheap prices, it's also the overall experience of features like Amazon Prime. Often, Amazon doesn't have the absolute cheapest price, but I still buy from them for convenience.
Ok, that new Mac Pro is fscking sweet and I want one, but really, this is not what I'd call R&D. It's design and product development. You know who's doing R&D? Samsung. They're figuring out how to manufacture flexible displays. IBM is dropping huge sums in Lithium-Air batteries.
If we're going to have radically breakthroughs in the next generation of devices, we need radically better battery, or radically more durable, or radically more powerful, or with much faster networks. There are companies dumping tons of money into researching these things.
Apple isn't. Apple is a buyer. They buy the fruits of the raw R&D done by other players, and design a pleasant case to fit it into. The idea of Apple being a chip fab is something that appeals to me. Intel, TSMC, et al, need competition. The idea of Apple researching battery chemistry appeals to me, because they have a concrete application for it that should drive it.
Here's the question: Since Apple is so dependent on Samsung and Sharp, and Japan Display, and others, but they have a huge arsenal at their command, which they could use to develop technology that no one else has or could buy, why aren't they?
This post is full of shift it stinks. Comes back when you understand tech *much* better. If Samsung is so great, why they didn't make an iPad before an iPad? Remember, the first Galaxy Tab only used a phone OS. Why did they need Apple to show the way? (The first Galaxy phone was also more than 2 years after an iPhone..)
In fact, why did everyone need Apple to show them the way?
Samsung doesn't make jack in component innovation breakthroughs compared to what they make on fully integrated high margin integrated products like the galaxy phone and you know it. Stop going off on tangents your dancing sucks. Good night.
Who cares what they make in profits in innovation breakthroughs, why is everything related to profit with you people? These advancements push the entire world forward, even if the original inventor doesn't make a dime. I just don't get why you Apple fans are so in love with corporations making profits.
I'm sure drug companies can make a lot more on Viagra than they could make on a cure for a rare form of cancer, but a breakthrough on a rare cancer drug would IMHO be much better than an improvement in hard-on drugs.
Face it, Apple is a parasite when it comes to research and development. They rely on others to make the sunk costs and produce the breakthroughs, then they license the work and make the end products with the margins. AT&T Bell Labs, IBM T.J. Watson, Xerox PARC, Toshiba, Intel, et al What's the equivalent of IBM Systems Journal for Apple? Where's their research papers?
This is a company that is a ludicrously stingy with their money. It is the companies doing crazy, if not commercially successful research, companies that produce high failures, that make the world a better place and push it forward. Toshiba invented Flash memory. Where the hell would Apple be without it?
You want a tangent? The style of thinking exhibited by you is exactly equivalent to the Republicans moaning over Department of Energy investments and loans into energy research. Solar panels not profitable, companies going bust, Solyndra! Let's cut investments and only do things with zero risk and profit! Apple may be more profitable, but in my book, companies like IBM or AT&T did far more for the world by pushing basic science and engineering forward.
Apple is a jewelry company by comparison, making trinkets, and not knowing how to mine the silver they use.
I think the article is pretty spot on. Yep, Apple is making more money and higher margins than other manufacturers- at the expense of the 'irrelevant' thing called market share.
You could go back in time about a year and find the same article, just substitute 'iPad' for iPhone, and 'Android tablets' for Android phones.
A year ago (actually, not even a year ago) the 'cheerleading' was along the lines of Apple phones having 70%+ of the profits, so who cares if Android is gaining market share?
Fast forward to now. A recent analysis and article shows Samsung surpassing Apple in profits. Of course that analysis is debunked and refuted and then the author comes back with his own more favorable that shows.... Apple making 53%, Samsung 50%. If someone as biased as AppleInsider can only cite that as the best info for their side that's not really terrific data. I'm good with either set of data because it really isn't important to me who is ahead. It might make fans feel good if their horse is slightly ahead, but the reality is- how in the hell do you go from 70% to only 53% profits in a year? Market share.
Apple leading in tablet margins and profits. Yep. Is it an article that really needed to be written? Is there anyone out there claiming Apple doesn't make the highest margins or profits in tablets? I haven't seen any articles or data along those lines. If Apple chooses to ignore market share that is fine. It may even be necessary if their goal is to provide high quality products with a high caliber user experience. If that's the path they do choose, its likely in a year from now we'll see an article that some analyst now shows Samsung is making more money than Apple in tablets which will be refuted to show that Apple is actually making 50.1% of the profit and is actually still 'winning'
Market share is important, and it is a precursor to profits. If giving it away is a deliberate strategy of Apple that's okay and their fans should appreciate Apple for it. The expectation should be that profits will follow but lag market share.
This post is full of shift it stinks. Comes back when you understand tech *much* better. If Samsung is so great, why they didn't make an iPad before an iPad? Remember, the first Galaxy Tab only used a phone OS. Why did they need Apple to show the way? (The first Galaxy phone was also more than 2 years after an iPhone..)
In fact, why did everyone need Apple to show them the way?
Son, I've been working in the tech industry since the beginning of Silicon Valley. Come back when you understand the difference between basic research and products. What Apple does is applied technology, not basic research. Where are the papers?
Note: it doesn't count if you simply buy the finished tech (ala Siri, which was originated at SRI), as opposed to funding the research yourself with your own employees.
If Apple does basic research, why do they get their speech tech from Nuance and their AI from SRI? Google hires researchers, like Ray Kurzweil, gives them resources and grants to work on projects, not products. Apple is a shell company by comparison, going to the supermarket to buy and license the technology developed by others and than prepackaged into a shiny aluminum frame.
I've give them props on design. But they don't invent technology, they package it.
It's a lot easier to erect a ridiculous strawman and then viciously attack him than it is to engage in a sensible conversation about any of the facts presented, isn't it?
What were Microsoft's software profit margins again? Well above 40%.
1990s PCs are not mobile devices. You could also mock change in the 1940s by comparing automobiles to the previous generation's trains, or in the 1970s insist that computers would always fill a room and that no individual would ever need one, and you can today insist that Apple's decade of profitability is a fluke and that Real Soon Now we're all going to have razor thin commodity phones that aren't garbage. But you'd be wrong over and over, just like you are in virtually every scathing comment you post.
rjc999 thinks the government should steal Apple's cash and give it away to universities. Oh and thinks the new MacPro is just Apple putting other companies R&D in to a pretty case.
All you need to know about this poster right there.
This post is full of shift it stinks. Comes back when you understand tech *much* better. If Samsung is so great, why they didn't make an iPad before an iPad? Remember, the first Galaxy Tab only used a phone OS. Why did they need Apple to show the way? (The first Galaxy phone was also more than 2 years after an iPhone..)
In fact, why did everyone need Apple to show them the way?
What about all of the semiconductor work Apple does (which Bob Mansfield is now going to focus on full time)? That's not other people's R&D. Same with battery life. Tests show battery life for iPad min and 4th gen iPad is better than Android and Windows tablets. And lets see how many PC OEM's are able to match the MacBook Air's battery life. Once again that's Apple R&D.
The way I look at it, every year, PC capabilities went up, and prices stayed the same or got lower. You can talk all you want about Microsoft's margins, but Microsoft was selling Windows for less than 10% of the cost of a PC. The massive progress in GPUs and CPUs was the result of hyper-competition in the PC market and the legacy of that was billions plowed into semiconductor processes that Apple is now benefitting from, standing on the shoulders of all of that progress. The PowerVR GPUs in Ax chips are derived from desktop GPUs that went up against the heavy hitters of NVidia and ATI and failed, and so they pivoted to mobile where the tile-based-deferred-renderer architecture works much better from an efficiency standpoint.
If you walked into a PC shop in the 90s or early 00s, you'd see the same bewildering array of name and no-name PCs, from big brands and from uber-cheap Asian manufacturers. They'd all have roughly similar specs, and they'd all be dirt cheap, and they'd all be obsolete in a few months or a year. What's happening in Android is no different than what happened with the PC.
The PC got commodified and vendors could only compete on price and specs. You see the same with Android, except they're also trying to "skin" things to differentiate, which Microsoft limited or prohibited for Windows.
But the fruits are already here. The Nexus 7 2 destroys the iPad Mini. Way way better screen. More powerful. Cheaper. The only thing the iPads have going for them are the existing IOS apps market. Honestly, if there was no iOS native apps, and all you had was a Web browser, iPad would be in deep trouble. Sooner or later the App Store's advantages in content will be eroded.
It's pretty simple. Apple has little competitive differentiation when it comes to hardware technology. Everything they use is bought and licensed from the same Asian manufacturers -- screens, ARM cores, GPUs, sensors, et al. They have only two defenses against the pressures to commoditize: 1) iOS and 2) try to sue competitors.
As Microsoft proved in the 90s, path dependency in operating systems is a powerful factor in maintaining market share. The first mover advantage and existing apps provide powerful consumer incentives to "opt in" to where the greatest number of apps are. Remember how people used to whine about buying a Mac because it couldn't run their favorite Windows application? Apple had to fight tremendously against that to convince people they could find alternatives on OSX.
Now Apple is in the boat that Microsoft was. A familiar whine is people discussing Android is "I can't find my app on Google Play", and Google will have to continue to work to showing there are indeed alternatives.
What the downfall of Microsoft has shown is that, although it is difficult to unseat competitor with a large software ecosystem, it can be done.
The reality is, mobile computing is going to be commoditized just like PCs were, just like TVs were, just like cars were. It is unstoppable.
Yet Today people still buy plenty of " expensive" macs when they could have cheap pcs for a fraction of the price. People will continue to buy, and pay a premium for iPhones iPads as long as apple continues to offer the best overall user experience.
But the fruits are already here. The Nexus 7 2 destroys the iPad Mini. Way way better screen. More powerful. Cheaper. The only thing the iPads have going for them are the existing IOS apps market. Honestly, if there was no iOS native apps, and all you had was a Web browser, iPad would be in deep trouble. Sooner or later the App Store's advantages in content will be eroded.
...because as we know, Apple's current products are always beaten by other's products which have yet to ship.
Apple has no plans whatsoever to ship an iPad Mini with a higher resolution screen, faster processors or graphics or more RAM. Doomed I tell you, DOOMED!!!
Wake me up when you yokels stop holding your breath for a repeat of the 90s.
Is this really what you want, to pay a 39% margin? Do you want into a car dealership and negotiate with the sales agent to pay MSRP or above?
Competition is supposed to drive down prices, if you're deliberating cheering for one company to win everything and set monopoly prices, you're a moron.
Has it ever occurred to you that Apple has high profit margins because they have a better supply chain and don't sell budget products.
Do you think Samsung makes the same margins from all of it's phones? No. They make the real dollars on the S4 and next to nothing on the bottom feeder shit. This is why they have to sell 2.4x as many phones to still fall short of Apple's profits.
Daniel, once more, I sincerely thank you for all your hard work. These articles are priceless.
To everyone around me, it's a known fact that I love Apple. But, I'm not being called an Apple Fanboy!
I respect Apple as a company and Apple has become my role model not because I've been using their products only. But because they have worked damn hard to get to where they are today.
In a few years, some other company (NOT Amazon, Google, Samsung, Microsoft and others!!) will probably take over but Apple will be always remembered as the ONE and ONLY true American Success Story.
Back to AI, your 100% honest and well-researched articles are much appreciated.
Nice article! Frankly, very restrained and thorough compared to previous articles at this site which have contained embarrassingly empty cheerleading, blind propaganda and name calling.
Strategy Analytics has to employ "research" to come up with this claim because Samsung doesn't actually report how many phones, smartphones, tablets, cameras or set top boxes it sells (or even the inventory numbers it ships) and doesn't report the profit share of any of these products segments.
Daniel this week:
Quote:
Apple, Inc. iPad is obliterating Samsung, Google's Android in tablet profits
How can you be certain that Apple is obliterating Samsung's tablet profits when Samsung doesn't report its profits per product segment? It's probably true but it would be great if you could be consistent rather than picking and choosing your side each week depending on whether the report is favorable to Apple.
Son, I've been working in the tech industry since the beginning of Silicon Valley. Come back when you understand the difference between basic research and products. What Apple does is applied technology, not basic research. Where are the papers?
Note: it doesn't count if you simply buy the finished tech (ala Siri, which was originated at SRI), as opposed to funding the research yourself with your own employees.
If Apple does basic research, why do they get their speech tech from Nuance and their AI from SRI? Google hires researchers, like Ray Kurzweil, gives them resources and grants to work on projects, not products. Apple is a shell company by comparison, going to the supermarket to buy and license the technology developed by others and than prepackaged into a shiny aluminum frame.
I've give them props on design. But they don't invent technology, they package it.
.
Nonsense. If it's your position that they buy parts and put the together like the PCs? Even when they buy companies they hardly let the tech stagnate. Osx is a far cry from next. They continue to spend $$$$ developing Siri, maps, etc. They continue to patent improvements in all sorts of software and hardware designs. Applied? Yes... But what research is done in any field without an intent of applying that information? Life sciences... Applied to better medicine. Theoretical physics.... Intended to apply toward star travel or some other grand idea. Don't for a second believe google research is about anything other than apply the data toward making money!
Comments
Quote:
Originally Posted by snova
Also I'm not sure what makes you believe apple is standing still on R&D. You can be assured they are designing away. You think they just pulled out new radical Mac Pro design over the weekend worth of work? Did you see that one coming? You can bet on them doing lots of creative R&D and it more then trying to stuff retina into the ipad mini. Look at the financials on R&D, it's not hard to figure out how substantial it is.
Ok, that new Mac Pro is fscking sweet and I want one, but really, this is not what I'd call R&D. It's design and product development. You know who's doing R&D? Samsung. They're figuring out how to manufacture flexible displays. IBM is dropping huge sums in Lithium-Air batteries.
If we're going to have radically breakthroughs in the next generation of devices, we need radically better battery, or radically more durable, or radically more powerful, or with much faster networks. There are companies dumping tons of money into researching these things.
Apple isn't. Apple is a buyer. They buy the fruits of the raw R&D done by other players, and design a pleasant case to fit it into. The idea of Apple being a chip fab is something that appeals to me. Intel, TSMC, et al, need competition. The idea of Apple researching battery chemistry appeals to me, because they have a concrete application for it that should drive it.
Here's the question: Since Apple is so dependent on Samsung and Sharp, and Japan Display, and others, but they have a huge arsenal at their command, which they could use to develop technology that no one else has or could buy, why aren't they?
Amazon is retailer for the most part they can keep margins low because hardly keep any inventory and make nothing. If product B sells better then competing product A, they could care less. They are not left holding the bag with excess inventory.
So I don't know if you intentional tries to confuse by mixing apple and oranges but many can tell the difference between retailers who keep minimal inventory to manufactures.
Btw, you make it sound like wintel was successfull because they had low 1-10%margins. That's simply was never true. Even now in the pc market down turn they are pulling in around 25%. If I didn't know better it would appear you are jumping around on tangents trying to deceive others. Why are you here anyways? Are you a saint for apple competitors, a stock holder, a day trader trying to short the stock, or are you being paid by a competitor. I doubt I'll get an honest answer but I thought I would put it out there. Very odd behavior.
Quote:
Originally Posted by rjc999
Those companies went bankrupt because the whole PC market is going down hill. You really think the problem with Dell was their prices? It's like saying "Horse and Buggy manufacturers went out of business after Cars were introduced because they had low margins" No, the problem is, their sales are going down.
Unix vendors got booted out of their markets because they couldn't keep up with Intel in CPUs, only IBM remains with PowerPC. MIPS, PA-RISC, SPARC, et al, they all fell to the Intel/AMD monster. On hardware, they found themselves eaten by Intel and commodity PCs, on software they got eaten by Linux. As a result, many of them, like Silicon Graphics, you know, the company that practically invented 3D and built some of the best desktop workstation designs way before people oogled over Apple designs, tried to enter the PC market, but it was already crowded. They had no where to go execept Hyper-computing with Cray, and that failed too.
Repeat to yourself: Revenue solves all problems. If you've got revenue, even if you've got low margins, you have a business. Amazon knows this very well. Amazon fixes prices and capex in order to set profit as close to zero as possible. However, they can turn a profit at any moment if they wanted.
Apple really had no excuses for high margins for "innovation". They have $100+billion in the bank. They could lose $5 billion a year and still run for 20 years. This reminds me of the way Oil Company tax breaks are defended "They need these tax breaks for R&D and exploration!" Really? Exxon needs subsidies in order to influence them to look for more oil? Give me a break.
The PC mfg don't make much in the way of profits because they have to compete against one another on price and they squeeze each other over selling product. They also spend too much time developing and supporting too many different models. Plus they spend more money per customer with tech support because they didn't develop Windows and they have to be able to support an OS they didn't develop. Support costs are much higher.
The UNIX suppliers found themselves only going after a very specialized workstation environment and LInux is getting more traction for highly specialized systems and then they get squeezed on the hardware side. The server side is where the money is at because they usually get service/support contracts and they can sell consulting services providing the installation of high end Enterprise Applications.
If you look at animation for movies and games, Windows is there and Linux is there, but in reality, that's not a HUGE number of users. But Apple is also starting to gain more traction in that area.
Amazon runs on a very small margin, they can't just automatically increase margin whenever they want to. I think Amazon is in a market that traditionally doesn't do well in terms of profits. It's a low profit margin business because all they do is really transaction processing and maybe some warehousing, packing and shipping product. They just OEM their tablets which they make little money on and I don't know how well Kindle going to do in the future. I don't hear much about Kindle anymore.
If you ask why I'm here, it's because I love Apple products, but I don't like the way Apple has been running the company, under-investing, over-litigious, and fostering a cult of zealots. They could be better than that. Any company that such huge profits could be acting better. And Apple fans need to grow up and stop acting so childish.
As for Amazon, if you set their prices at the same levels as WalMart, and drop the crazy CapEx spending, their margins go up to 4%. WalMart has 3-4% margins, banks like $16 billion in profit per year. AMZN is deliberating lowering their margins so as to a) avoid taxes b) aggressively expand distribution centers and c) continue to steal customers by undercutting everyone else. They have a lot of wiggle room to restore profitability, but investors believe in what they are doing, and so continue to finance their current strategy.
You could argue that if they go back to Walmart price levels, they'll lose customers, but Amazon is more than about having cheap prices, it's also the overall experience of features like Amazon Prime. Often, Amazon doesn't have the absolute cheapest price, but I still buy from them for convenience.
This post is full of shift it stinks. Comes back when you understand tech *much* better. If Samsung is so great, why they didn't make an iPad before an iPad? Remember, the first Galaxy Tab only used a phone OS. Why did they need Apple to show the way? (The first Galaxy phone was also more than 2 years after an iPhone..)
In fact, why did everyone need Apple to show them the way?
Quote:
Originally Posted by snova
Samsung doesn't make jack in component innovation breakthroughs compared to what they make on fully integrated high margin integrated products like the galaxy phone and you know it. Stop going off on tangents your dancing sucks. Good night.
Who cares what they make in profits in innovation breakthroughs, why is everything related to profit with you people? These advancements push the entire world forward, even if the original inventor doesn't make a dime. I just don't get why you Apple fans are so in love with corporations making profits.
I'm sure drug companies can make a lot more on Viagra than they could make on a cure for a rare form of cancer, but a breakthrough on a rare cancer drug would IMHO be much better than an improvement in hard-on drugs.
Face it, Apple is a parasite when it comes to research and development. They rely on others to make the sunk costs and produce the breakthroughs, then they license the work and make the end products with the margins. AT&T Bell Labs, IBM T.J. Watson, Xerox PARC, Toshiba, Intel, et al What's the equivalent of IBM Systems Journal for Apple? Where's their research papers?
This is a company that is a ludicrously stingy with their money. It is the companies doing crazy, if not commercially successful research, companies that produce high failures, that make the world a better place and push it forward. Toshiba invented Flash memory. Where the hell would Apple be without it?
You want a tangent? The style of thinking exhibited by you is exactly equivalent to the Republicans moaning over Department of Energy investments and loans into energy research. Solar panels not profitable, companies going bust, Solyndra! Let's cut investments and only do things with zero risk and profit! Apple may be more profitable, but in my book, companies like IBM or AT&T did far more for the world by pushing basic science and engineering forward.
Apple is a jewelry company by comparison, making trinkets, and not knowing how to mine the silver they use.
I think the article is pretty spot on. Yep, Apple is making more money and higher margins than other manufacturers- at the expense of the 'irrelevant' thing called market share.
You could go back in time about a year and find the same article, just substitute 'iPad' for iPhone, and 'Android tablets' for Android phones.
A year ago (actually, not even a year ago) the 'cheerleading' was along the lines of Apple phones having 70%+ of the profits, so who cares if Android is gaining market share?
Fast forward to now. A recent analysis and article shows Samsung surpassing Apple in profits. Of course that analysis is debunked and refuted and then the author comes back with his own more favorable that shows.... Apple making 53%, Samsung 50%. If someone as biased as AppleInsider can only cite that as the best info for their side that's not really terrific data. I'm good with either set of data because it really isn't important to me who is ahead. It might make fans feel good if their horse is slightly ahead, but the reality is- how in the hell do you go from 70% to only 53% profits in a year? Market share.
Apple leading in tablet margins and profits. Yep. Is it an article that really needed to be written? Is there anyone out there claiming Apple doesn't make the highest margins or profits in tablets? I haven't seen any articles or data along those lines. If Apple chooses to ignore market share that is fine. It may even be necessary if their goal is to provide high quality products with a high caliber user experience. If that's the path they do choose, its likely in a year from now we'll see an article that some analyst now shows Samsung is making more money than Apple in tablets which will be refuted to show that Apple is actually making 50.1% of the profit and is actually still 'winning'
Market share is important, and it is a precursor to profits. If giving it away is a deliberate strategy of Apple that's okay and their fans should appreciate Apple for it. The expectation should be that profits will follow but lag market share.
Quote:
Originally Posted by matrix07
This post is full of shift it stinks. Comes back when you understand tech *much* better. If Samsung is so great, why they didn't make an iPad before an iPad? Remember, the first Galaxy Tab only used a phone OS. Why did they need Apple to show the way? (The first Galaxy phone was also more than 2 years after an iPhone..)
In fact, why did everyone need Apple to show them the way?
Son, I've been working in the tech industry since the beginning of Silicon Valley. Come back when you understand the difference between basic research and products. What Apple does is applied technology, not basic research. Where are the papers?
Let me educate you as to what REAL Research and Development is: http://researchweb.watson.ibm.com/journal/index.html
Here's another example: http://www.sri.com/
Note: it doesn't count if you simply buy the finished tech (ala Siri, which was originated at SRI), as opposed to funding the research yourself with your own employees.
If Apple does basic research, why do they get their speech tech from Nuance and their AI from SRI? Google hires researchers, like Ray Kurzweil, gives them resources and grants to work on projects, not products. Apple is a shell company by comparison, going to the supermarket to buy and license the technology developed by others and than prepackaged into a shiny aluminum frame.
I've give them props on design. But they don't invent technology, they package it.
All you need to know about this poster right there.
Yet Today people still buy plenty of " expensive" macs when they could have cheap pcs for a fraction of the price. People will continue to buy, and pay a premium for iPhones iPads as long as apple continues to offer the best overall user experience.
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Originally Posted by rjc999
But the fruits are already here. The Nexus 7 2 destroys the iPad Mini. Way way better screen. More powerful. Cheaper. The only thing the iPads have going for them are the existing IOS apps market. Honestly, if there was no iOS native apps, and all you had was a Web browser, iPad would be in deep trouble. Sooner or later the App Store's advantages in content will be eroded.
...because as we know, Apple's current products are always beaten by other's products which have yet to ship.
Apple has no plans whatsoever to ship an iPad Mini with a higher resolution screen, faster processors or graphics or more RAM. Doomed I tell you, DOOMED!!!
Wake me up when you yokels stop holding your breath for a repeat of the 90s.
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Originally Posted by rjc999
Is this really what you want, to pay a 39% margin? Do you want into a car dealership and negotiate with the sales agent to pay MSRP or above?
Competition is supposed to drive down prices, if you're deliberating cheering for one company to win everything and set monopoly prices, you're a moron.
Has it ever occurred to you that Apple has high profit margins because they have a better supply chain and don't sell budget products.
Do you think Samsung makes the same margins from all of it's phones? No. They make the real dollars on the S4 and next to nothing on the bottom feeder shit. This is why they have to sell 2.4x as many phones to still fall short of Apple's profits.
Apple is not in the budget bottom feeder market.
To everyone around me, it's a known fact that I love Apple. But, I'm not being called an Apple Fanboy!
I respect Apple as a company and Apple has become my role model not because I've been using their products only. But because they have worked damn hard to get to where they are today.
In a few years, some other company (NOT Amazon, Google, Samsung, Microsoft and others!!) will probably take over but Apple will be always remembered as the ONE and ONLY true American Success Story.
Back to AI, your 100% honest and well-researched articles are much appreciated.
rjc999,
Competition is NOT about driving prices down ONLY, done for the day and go to bed good night sleep!
Lada cannot compete with Mercedes by lowering their prices in order to bring more business! WTF?!!!!
And, when was the last time Google hired some Einsteins to develop something useful, ANYTHING on its own?!!!
Do some research ... Son!
Daniel last week:
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Strategy Analytics has to employ "research" to come up with this claim because Samsung doesn't actually report how many phones, smartphones, tablets, cameras or set top boxes it sells (or even the inventory numbers it ships) and doesn't report the profit share of any of these products segments.
Daniel this week:
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Apple, Inc. iPad is obliterating Samsung, Google's Android in tablet profits
How can you be certain that Apple is obliterating Samsung's tablet profits when Samsung doesn't report its profits per product segment? It's probably true but it would be great if you could be consistent rather than picking and choosing your side each week depending on whether the report is favorable to Apple.
Nonsense. If it's your position that they buy parts and put the together like the PCs? Even when they buy companies they hardly let the tech stagnate. Osx is a far cry from next. They continue to spend $$$$ developing Siri, maps, etc. They continue to patent improvements in all sorts of software and hardware designs. Applied? Yes... But what research is done in any field without an intent of applying that information? Life sciences... Applied to better medicine. Theoretical physics.... Intended to apply toward star travel or some other grand idea. Don't for a second believe google research is about anything other than apply the data toward making money!