Consumers do not see profit, they see price tag. Hardware comes with a price tag, so the options are sell at cost or find a way to subside the hardware.
With Apple pushing for ever so cheap App Store software so much so it is willing to drastically cut its own premium software's price. The potential for a software subsided hardware business is diminishing fast. While Apple may forever lost the ability to sell hardware at 100% markup, Microsoft in the mean time is losing the ability to sell software for $100 and more . It is already reality in consumer space, and the price structure is collapsing too in the business world.
Microsoft has the money to give millions of Surfaces away for free, then what? It kills all its OEM in the process and can not make the money back on 30% software sales cut. And next year Apple brings out fucking iPad 4... Genius plan then?
Consumers do not see profit, they see price tag. Hardware comes with a price tag, so the options are sell at cost or find a way to subside the hardware.
With Apple pushing for ever so cheap App Store software so much so it is willing to drastically cut its own premium software's price. The potential for a software subsided hardware business is diminishing fast. While Apple may forever lost the ability to sell hardware at 100% markup, Microsoft in the mean time is losing the ability to sell software for $100 and more . It is already reality in consumer space, and the price structure is collapsing too in the business world.
Microsoft has the money to give millions of Surfaces away for free, then what? It kills all its OEM in the process and can not make the money back on 30% software sales cut. And next year Apple brings out fucking iPad 4... Genius plan then?