Apple Price Premium

One interesting aspect that we didn't touch on today during the open/closed discussion was how it relates to pricing.  I'm sure we've touched on this before at some point, but I think it's worth noting again that by maintaining a closed system, Apple retains a degree of pricing power that other computer manufacturers don't have.  With the commoditization of the PC market, margins on PC hardware are slim, while Apple enjoys huge margins and even raises prices occasionally.  

This helps make the company very profitable, but I wonder what effect the continuing-to-worsen economy will have on Apple computer sales.  Apple doesn't really address the low end of the market and it's becoming a lot more likely that consumers will opt for a $500 Dell PC laptop than double or triple that for a Mac.  For Macs to really gain market share there would need to be a rebalancing of the goals of growing market share vs. high margins.  There are segments of the computer market that apple doesn't now address - clearly they value the margin side more and Steve Jobs has said before that they won't cut margin.    

Interestingly, they have maintained high margins and taken huge market share with the iPod (see info on ipo margins here).  I wonder though if the same is possible with personal computers.