stratechery
stratechery

A Common Thread

Asymco:

The Windows PC market is contracting. The market data has been showing unit shipment declining for some time with the latest quarter having perhaps the steepest decline for two decades.

What remains undocumented however is how the market looks when considering economic value. A more complete picture would be to show revenues, average selling price (or revenue/unit), operating margins/unit and percent of profit capture.

The resulting picture…

PC Unit, Revenue, and Profit Shares

PC Unit, Revenue, and Profit Shares – Asymco

…looks a lot like this one:

Mobile Unit, Revenue, Profit Shares - Benedict Evans

Mobile Unit, Revenue, Profit Shares – Benedict Evans

Software differentiates hardware. It’s the biggest reason the iPhone is not the Model T.