iPod contributes 12-14% of total company revenues, a number trade experts consider will continue to increase. With this enhance comes strain on gross margins, because the blended iPod gross margin of 20% compares unfavorably with Apple’s corporate common of 27-28%. The iPod helped augment Apple’s progress by increasing its addressable market from the core computer market, which continues to develop, but at slower rates. To extend penetration of the rapidly rising MP3 participant market, Apple launched the iPod Mini internationally in July 2004, and HP’s iPod launch is scheduled for later in summer.
Apple’s entry into the digital music player market (MP3 market) with its in style iPod expanded the company’s addressable market and signaled a turn in Apple’s strategy. The iPod is a cultural phenomenon that's capitalizing on the convergence of digital client electronics and the computer, and Apple’s position as an early mover enabled it to realize the number-one place in the marketplace. iPod adoption continues to accelerate, with little indication of a slowdown. It took Apple roughly 18 months to sell its first million iPods, however its second million got here in six months and its third million got here in four. In actual fact, it appears that only its suppliers can gradual it down, in particular the arduous-drive distributors, that are having a tough time assembly demand. Industry consultants imagine that iPod’s development will remain robust within the foreseeable future and don't anticipate any significant buyer fallout stemming from Apple’s lack of ability to satisfy demand.
An evaluation of the launch of the Sony Walkman in 1979 indicates the market opportunity for a revolutionary portable music player will remain sturdy for a number of years to come back and Apple is expected to keep up a robust share for the next few years (not like Sony’s experience with the Walkman).
While iPod and iTunes generate vital awareness of the Apple product, they have done little to develop Apple’s core Mac business. Consultants attribute this primarily to Apple’s aboveaverage pricing, along with continued ignorance on the a part of consumers relating to the compatibility of Windows and Mac. With regard to pricing, the typical shopper desktop PC retails for $1,019, which is $280 under Apple’s low-finish worth level on Apple’s now, discontinued flat-panel iMac. Moreover, the business ASP is falling as many of the progress available in the market is taking place within the sub-$1,000 market.
With regard to the compatibility of Home windows and Mac OS X, even though Apple made a concerted effort to teach customers concerning the ease with which these two merchandise work together, it has fallen on deaf ears for probably the most part. Apple made some progress by its retail stores, the place it estimates half of Mac purchases are from first-time buyers, however for Apple’s inventory to work over the long run, the company wants to keep up share in opposition to Home windows, at a minimum. Understandably, Apple wants to avoid promoting PCs at a loss, but sadly the growth prospects for $1,000-plus PCs are limited. This presents a conundrum for Apple longer term, but for now it maintains its current strategy. Incidentally, Apple’s revenue share has held significantly better, and while this isn't an usually-discussed topic, revenue share is probably extra important than unit share.
![[Valid RSS feed]](http://www.look4articles.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
![[Valid RSS feed]](http://www.look4articles.com/images/rss.jpg "XML Feed For RSS")