7 ms·

I think in this case, it's a bit galling since Apple clearly does and has eaten the cost of codec licencing - HEIF/HEVC, and AAC before that.

ChuckNorris89 4y ago
Unfair comparison. Unlike Microsoft, Apple doesn't sell the OS to consumers though, it sells you a whole device, or better, a whole ecosystem, who's profit margins are way higher than what Microsoft makes from selling $99/$139 Windows licenses to consumers, so of course they can afford to eat the cost.
- xyzzy_plugh 4y ago
  Firstly, Microsoft's profit margins are significantly higher than Apple's, so this doesn't make any sense to begin with. Second -- how much do you think Microsoft makes from selling a $99/$139 license? They can most definitely, absolutely, without a doubt afford to eat the cost.
  - jimbob45 4y ago
    Firstly, Microsoft's profit margins are significantly higher than Apple's, so this doesn't make any sense to begin with. Are we talking OS only or everything else?…because there are two different answers for those.
  - ChuckNorris89 4y ago
    >Firstly, Microsoft's profit margins are significantly higher than Apple's I was talking about profits Microsoft exclusively makes from selling the $99/$139 Windows licenses to consumer, not the profits of Microsoft entirely. Two different vastly different things. >Second -- how much do you think Microsoft makes from selling a $99/$139 license? They can most definitely, absolutely, without a doubt afford to eat the cost. I dunno. How much does it make selling an OS at the price of two video games, while supporting it with updates for 10 years and paying devs US salaries to work on it for those 10 years? Enterprise customers are Microsoft's bread and butter as those also buy the full AD, Azure, O365, Outlook, etc. package plus pay for support, but I can't imagine they make much money selling just an OS and 10 years worth of development for only $99/$139 to consumers who don't buy anything else out of the Microsoft ecosystem. Keep in mind that Windows 95 retail box would cost consumers $209($409 in today's money), and you imagine that Microsoft is now making a huge profit on selling Windows to consumers today at 25% the original price with the much higher complexity and development costs of today's software? I wouldn't be surprised to learn that the consumer $99/$139 price points are actually loosing Microsoft money, similar how consoles are doing, but Microsoft is subsidizing it from the enterprise profits, to maintain the Windows market share monopoly, otherwise consumers would just switch to Linux if they had to pay more than a hundo for Windows. In fact, you don't even have to pay for Windows (legal gray area). I activated my Windows 11 Pro copy with some CD key from Windows 7 I found online and it activated just fine. If Microsoft was actually making a profit on selling Windows licenses to consumers, they would have some serious DRM in place that would rival that of video-games, but the way I see it, it's not making them any money, which is why they don't bother enforcing even the most basic kinds of DRM, which in turn, explains to me why they penny pinch the $0.99.
    - arcticbull 4y ago
      > I was talking about profits Microsoft exclusively makes from selling the $99/$139 Windows licenses to consumer, not the profits of Microsoft entirely. Two different vastly different things. How exactly are you calculating Apple's margin on macOS and iOS? How are you attributing the sales price hardware to macOS/iOS, hardware, apps, tools and services, iWork, Photos, iMovie? > I dunno. How much does it make selling an OS at the price of two video games, while supporting it with updates for 10 years and paying devs US salaries to work on it for those 10 years? An absolute metric boatload. > Keep in mind that Windows 95 retail box would cost consumers $209($409 in today's money), and you imagine that Microsoft is now making a huge profit on selling Windows to consumers today at 25% the original price with the much higher complexity and development costs of today's software? Yes, that's how economies of scale work. Windows 95 seems to have sold 40M copies total [1] whereas they sold about a billion copies of Windows 10 by 2019. [2] [1] https://techland.time.com/2013/05/07/a-brief-history-of-windows-sales-figures-1985-present/ https://techland.time.com/2013/05/07/a-brief-history-of-wind... [2] https://www.theverge.com/2019/9/24/20881418/microsoft-devices-windows-10-billion-million https://www.theverge.com/2019/9/24/20881418/microsoft-device...
    - jasomill 4y ago
      Windows Enterprise is a superset of consumer Windows, so, given the existence of the former, the marginal development cost of consumer Windows is limited to the comparatively modest set of Windows features that few enterprise users care about — many of which are directly attributable to gaming, which, like Office, is another solid Microsoft revenue stream — plus any additional costs associated with producing and distributing multiple editions of Windows with different feature subsets. Moreover, I believe Microsoft no longer charges for consumer Windows upgrades because they save more money by supporting fewer distinct versions of Windows (with security patches and compatibility with other Microsoft products sold to consumers like Office and games) than they previously made on consumer version upgrades. Finally, the overwhelming majority of consumer Windows license sales are to OEMs bundling Windows with new PCs, and these licenses offload the burden of frontline technical support on the PC vendor. Taking all these things into account, it would actually surprise me to learn that Microsoft loses money on consumer Windows. As for "serious DRM", are you certain this would actually increase Windows sales enough to offset lost revenue (Office, Game Pass, search advertising, etc.) from consumers who would otherwise be running pirated Windows? So what to make of the 99¢ codec charge? My guess is lawyers: one could make a reasonable argument that there is no material difference between bundling HEVC with Windows and making it available as a free download for all Windows users.

ChuckNorris89 4y ago

Unfair comparison. Unlike Microsoft, Apple doesn't sell the OS to consumers though, it sells you a whole device, or better, a whole ecosystem, who's profit margins are way higher than what Microsoft makes from selling $99/$139 Windows licenses to consumers, so of course they can afford to eat the cost.

xyzzy_plugh 4y ago
Firstly, Microsoft's profit margins are significantly higher than Apple's, so this doesn't make any sense to begin with. Second -- how much do you think Microsoft makes from selling a $99/$139 license? They can most definitely, absolutely, without a doubt afford to eat the cost.
- jimbob45 4y ago
  Firstly, Microsoft's profit margins are significantly higher than Apple's, so this doesn't make any sense to begin with. Are we talking OS only or everything else?…because there are two different answers for those.
- ChuckNorris89 4y ago
  >Firstly, Microsoft's profit margins are significantly higher than Apple's I was talking about profits Microsoft exclusively makes from selling the $99/$139 Windows licenses to consumer, not the profits of Microsoft entirely. Two different vastly different things. >Second -- how much do you think Microsoft makes from selling a $99/$139 license? They can most definitely, absolutely, without a doubt afford to eat the cost. I dunno. How much does it make selling an OS at the price of two video games, while supporting it with updates for 10 years and paying devs US salaries to work on it for those 10 years? Enterprise customers are Microsoft's bread and butter as those also buy the full AD, Azure, O365, Outlook, etc. package plus pay for support, but I can't imagine they make much money selling just an OS and 10 years worth of development for only $99/$139 to consumers who don't buy anything else out of the Microsoft ecosystem. Keep in mind that Windows 95 retail box would cost consumers $209($409 in today's money), and you imagine that Microsoft is now making a huge profit on selling Windows to consumers today at 25% the original price with the much higher complexity and development costs of today's software? I wouldn't be surprised to learn that the consumer $99/$139 price points are actually loosing Microsoft money, similar how consoles are doing, but Microsoft is subsidizing it from the enterprise profits, to maintain the Windows market share monopoly, otherwise consumers would just switch to Linux if they had to pay more than a hundo for Windows. In fact, you don't even have to pay for Windows (legal gray area). I activated my Windows 11 Pro copy with some CD key from Windows 7 I found online and it activated just fine. If Microsoft was actually making a profit on selling Windows licenses to consumers, they would have some serious DRM in place that would rival that of video-games, but the way I see it, it's not making them any money, which is why they don't bother enforcing even the most basic kinds of DRM, which in turn, explains to me why they penny pinch the $0.99.
  - arcticbull 4y ago
    > I was talking about profits Microsoft exclusively makes from selling the $99/$139 Windows licenses to consumer, not the profits of Microsoft entirely. Two different vastly different things. How exactly are you calculating Apple's margin on macOS and iOS? How are you attributing the sales price hardware to macOS/iOS, hardware, apps, tools and services, iWork, Photos, iMovie? > I dunno. How much does it make selling an OS at the price of two video games, while supporting it with updates for 10 years and paying devs US salaries to work on it for those 10 years? An absolute metric boatload. > Keep in mind that Windows 95 retail box would cost consumers $209($409 in today's money), and you imagine that Microsoft is now making a huge profit on selling Windows to consumers today at 25% the original price with the much higher complexity and development costs of today's software? Yes, that's how economies of scale work. Windows 95 seems to have sold 40M copies total [1] whereas they sold about a billion copies of Windows 10 by 2019. [2] [1] https://techland.time.com/2013/05/07/a-brief-history-of-windows-sales-figures-1985-present/ https://techland.time.com/2013/05/07/a-brief-history-of-wind... [2] https://www.theverge.com/2019/9/24/20881418/microsoft-devices-windows-10-billion-million https://www.theverge.com/2019/9/24/20881418/microsoft-device...
  - jasomill 4y ago
    Windows Enterprise is a superset of consumer Windows, so, given the existence of the former, the marginal development cost of consumer Windows is limited to the comparatively modest set of Windows features that few enterprise users care about — many of which are directly attributable to gaming, which, like Office, is another solid Microsoft revenue stream — plus any additional costs associated with producing and distributing multiple editions of Windows with different feature subsets. Moreover, I believe Microsoft no longer charges for consumer Windows upgrades because they save more money by supporting fewer distinct versions of Windows (with security patches and compatibility with other Microsoft products sold to consumers like Office and games) than they previously made on consumer version upgrades. Finally, the overwhelming majority of consumer Windows license sales are to OEMs bundling Windows with new PCs, and these licenses offload the burden of frontline technical support on the PC vendor. Taking all these things into account, it would actually surprise me to learn that Microsoft loses money on consumer Windows. As for "serious DRM", are you certain this would actually increase Windows sales enough to offset lost revenue (Office, Game Pass, search advertising, etc.) from consumers who would otherwise be running pirated Windows? So what to make of the 99¢ codec charge? My guess is lawyers: one could make a reasonable argument that there is no material difference between bundling HEVC with Windows and making it available as a free download for all Windows users.