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Comment by ben336 | Hacker News Reader

They make their money off the hardware though. And plenty of people use Apple hardware without using Apple services. I have an iPhone/iPad/Mac, and don't use Apple services for email/document/storage/photo backup etc. I appreciate their OS software and hardware, but for the most part think there are better options for pretty much all of their services.

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Does not matter. When you buy an Apple product, you are basically supporting their services as well. And as far as I know, you are more or less forced to have an iTune account if you have an Apple device, right ? So you are tied in to their services at least for the distribution of applications (on mobiles).

You can't say "where they make their money" doesn't matter. Of course it does.

An iTunes account is required for App Store purchases, but that's about it. You can load on Google e-mail, maps and browser after that, if you wish. The point is that Apple doesn't make money from its services, so it has less of an incentive to stop you.

ITunes is a distribution service. They make money off it. It's like saying "Valve is just doing games" where most of their money comes from selling the contents of others. When you have a monopoly on distribution on a specific platform, that's a service where people are locked into using. I don't know how to explain it in any other way to you.

No-one is arguing that they make money from it. Nor is anyone arguing that Apple doesn't do services. They are arguing that they make far more money on hardware sales than services, and thus are primarily a hardware company.

Do you have any source such as the latest annual report as to how much more they make on hardware vs software/content? Is it really far more ?

From their Q4 results, as analyzed by AnandTech, about 11% of their revenue is from "iTunes/Software/Services". The rest is hardware.

http://www.anandtech.com/show/8633/apple-q4-fy-2014-fiscal-r...

Except they're tied. The way you get Apple services is buying Apple hardware. You can't buy most Apple services separately from Apple hardware, and you don't get charged for many Apple services aside from the purchase price of the hardware.

The debate over whether Apple makes money off hardware or software is ridiculous. Every iPhone contains both Apple hardware and software, and works in concert with Apple services, designed to be a cohesive whole. It's ONE experience, designed top to bottom to work together. That's Apple's entire value proposition.

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