I think it is a good point, and they could probably survive about 2.5 years of losses without too much pain - but Apple's margins back in the 1990s were pretty

I think it is a good point, and they could probably survive about 2.5 years of losses without too much pain - but Apple's margins back in the 1990s were pretty good also: what hurt them was that sales dropped off a cliff, so their good margins weren't enough to save them... There could be a number of factors that would hurt them, like margin compression, reaching market saturation, etc. All the ailments that Business Schools will warn you about... However, they (IMHO) have become arrogant and out of touch with their users. VISION is their problem. They need the MacBooks and desktop Macs to be seen as very desirable, in order to project the "creative people buy Apple" halo over the rest of their products.