But what does "ekes out" mean for a company making as much money as Apple? They're probably impossible to separate, but it would be interesting to compare iTunes store profits to those of other retailers.
It means they are features, not products, as Steve said to the founders of Drobox. They exist to support the true products where Apple makes money. The same will be true of iCloud. They charge money for larger storage allowances, but will never make real money on it - it exists to strengthen the ecosystem that supports the real cash cow.
Thank you for asking that question. I only realy, fully understood what Steve meant, what his thinking was by his comment on Dropbox when writing this reply.
That distinction makes sense. I find Apple interesting in that even their "loss leaders" seem to be profitable, and more, that though they could throw tons of money into something like ebooks to try to hurt Amazon, they wouldn't. Though now I wonder where Apple TV fits in this, since it can't possibly have the same kind of margins that other products do.
Why not? The apple tv must be significantly cheaper in terms of components than an iphone. Its has no touch screen, battery, sensors, or 3G Radio. Why can't this be made for well under $100?
