Apple’s Revenue Streams

Apple has multiple revenue streams.  The items that are most often noted are: Macs, iPods, and iPhones.  However, there are other things that contribute to Apple’s bottom line.  The diagram below gives an overview: [Blue = hardware; Orange = software/services] Besides the Mac, iPod, and iPhone, Apple makes money in the following divisions: Accessories   … Continue reading “Apple’s Revenue Streams”

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Apple has multiple revenue streams.  The items that are most often noted are: Macs, iPods, and iPhones.  However, there are other things that contribute to Apple’s bottom line.  The diagram below gives an overview:

Apple Revenue Streams

[Blue = hardware; Orange = software/services]

Besides the Mac, iPod, and iPhone, Apple makes money in the following divisions:

Accessories

 

Apple Display

  • “Made for iPod” program where Apple receives a 10% royalty.
  • Cinema Displays
  • Mice
  • AirPort
  • TimeCapsule
  • etc.

AppleTV

 

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  • The “hobby”

iTunes Content

 

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  • Music
  • Videos
  • Ringtones
  • Audio Books

MobileMe

 

Apple MobileMe

  • “Exchange for the rest of us.”
  • Subscription service.

AppleCare

 

AppleCare

  • Extended warranty.

Software

 

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  • Mac OS X
  • iLife
  • iWork,
  • Final Cut Studio
  • Aperture
  • Logic
  • Shake,
  • Remote Desktop
  • WebObjects
  • xSan
  • App Store where Apple gets a 30% cut of all iPod/iPhone software sold.

Apple has created an entire ecosystem in which it makes one purchase lead to the next.  This is part of Apple’s “Halo Effect,” a brilliant business model, and a continuation of Steve Jobs’ Master Plan.

For example, a customer may purchase an iPod, which may lead to purchasing content from iTunes, iPod accessories, and AppleCare.

If satisfied with the iPod, the user may purchase a Mac, which may leads to Mac accessories such as a Apple Display or TimeCapsule; software purchases; and services such as MobileMe and AppleCare.

If the user then decides to get a iPhone, they contribute to Apple’s revenue stream with the potential to purchase from the App Store, in addition to iTunes content, MobileMe, and AppleCare.

One thought on “Apple’s Revenue Streams”

  1. Jesse,good post.
    Every Apple purchase I have made has been worth the money, especially Apple Care. I love the Genius Bar. The staffing and everything about the Apple Stores are excellent and once I’m there I (should I say my husband?) usually end up buying something.

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