4 ms·
Can someone help a poor liberal arts major? I see "costs $1.3 billion to run" and I think "Apple loses $1.3b a year on the iTunes store." But reading the artic
by jfruh 15y ago
Can someone help a poor liberal arts major? I see "costs $1.3 billion to run" and I think "Apple loses $1.3b a year on the iTunes store." But reading the article and the constant Apple talk about breaking even makes me think that what they're trying to get at is "the infrastructure for the store and payments to artists and app creators costs $1.3b a year, but Apple's 30 percent cut of everything produces about $1.3b a year in revenue, so it all works out," which is a very different proposition, yes?
- cooldeal 15y agoYour first thought is wrong, because "costs" is very different from "takes a loss of".
- jfruh 15y agoWell, OK, but is my second thought right?
- ugh 15y agoApple's revenue is $1.3 billion and since they about break even their costs are about $1.3 billion. Your second thought is consequently not in line with how cost is usually defined. If you are using the usual definition of cost the title of the submission is not misleading. Price is what you charge your customers, cost is what you have to pay to make the product, revenue is the number of sold products times the price, profit (or loss) is revenue minus number of sold products times the cost.
- pflats 15y agoAlmost. The site quotes the money that Apple keeps "after paying content owners but before paying for other costs". The 1.3 billion doesn't include paying the record/movie labels, bands, or app developers, but does include everything else. In other words, "the infrastructure for the store and payments to everyone other than artists and app creators costs $1.3b a year, but Apple's 30 percent cut of everything produces about $1.3b a year in revenue, so it all works out."