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:
- “Made for iPod” program where Apple receives a 10% royalty.
- Cinema Displays
- The “hobby”
- Audio Books
- “Exchange for the rest of us.”
- Subscription service.
- Extended warranty.
- Mac OS X
- Final Cut Studio
- Remote Desktop
- 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 reply on “Apple’s Revenue Streams”
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.