Apple's $500 or Microsoft's 81% tax?

Apple's $500 or Microsoft's 81% tax?

Summary: Which do you prefer?Even if it were true, Ballmer's "$500 Apple tax" comment is stupid: Microsoft's profits are way beyond Apple's.


Which do you prefer? Even if it were true, Ballmer's "$500 Apple tax" comment is stupid: Microsoft's profits are way beyond Apple's. And, get this: that $500 - if it was real - is a great investment. Here's why.

Margin, margin, who's got the margin? Gross margin is simply the difference between what something sells for and what it costs to make.

Microsoft's GM for the last 5 years: 81.69% Apple's GM: 31.83%

But Microsoft is a much large company than Apple. To put this in perspective in the last 5 years Microsoft had revenues of $232 BILLION.

Apple's revenues were $98 billion.

Microsoft's GM "tax" on customers: $190 billion. Apple's comparable number: $31 billion.

That's right: Microsoft has pulled 6x the gross margin dollars out of customer pockets in the last 5 years than Apple.

Of course, Ballmer invested your dollars in very important products: Zune - crushed by Apple; Live Search - crushed by Google; Xbox - crushed by Nintendo Wii; and, best of all, Vista - crushed by Windows XP!

Not to mention $10 million to Seinfeld for those head-scratching ads. Really, if any other CEO had such a lousy track record he'd be toast. Don't you wish YOU'D been Bill's roommate at Harvard?

What about that $500? Just the cost of anti-virus protection for Windows justifies the mythical $500. For example, Kaspersky anti-virus protection costs $40 a year.

If you invested $500 and that earned $40 a year, that's a return of 8% per year. Excellent compared to bank CD rates - or a 5 year investment in Microsoft stock.

Which ignores another important fact: Mac's retain their value a lot better than Wintel stuff. My 3+ year old MacBook is worth about 50% of its purchase price. A 3 year old Dell is more like 20%.

On a $1200 Mac vs a $600 Dell that's almost $500 right there. Ouch.

The Storage Bits take For all his flaws, no high-tech CEO matches Steve Ballmer for pure entertainment value. Who else would urge consumers to settle for their product because they can't afford the best?

Steve Jobs' Reality Distortion Field can mesmerize millions. Ballmer's reality distortion field, alas, extends only to his ears.

Comments welcome, of course. A good friend had to buy a new Wintel because it was so compromised with malware that the local tech couldn't fix it. AND she'd been paying for anti-virus "protection."

Topics: Banking, Apple, Government, Government US, Microsoft, Security

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  • Just my opinion . . .

    I'm not going to compare Apples to MS based products, but I would rather pay 81% gross margin and save $500.

    Also, even if I have to buy AV software for the Microsoft device, at $40 a year, for 5 years (maximum ownership for a laptop in my experience)I still save $300.

    The author doesn't understand finance very well. And if he's using a Mac without AV protection, he probably doesn't know IT, either.
    • Of course he understands, and he made good points.

      Another huge saving is that you don't have to keep coaxing the thing along, nor fix this and fix that and install this and scan that.

      Anybody building their tech atop Windows systems is not taking their I.T. seriously.
      • What are you even talking about????

        "Another huge saving is that you don't have to keep coaxing the thing along, nor fix this and fix that and install this and scan that"

        It's really crappy lines like that that tend to get Windows users who know better ticked off. I don't even know what you mean when you say coaxing it along?? What does that mean? I spent significantly less for my Windows based computer and got better hardware then an Apple and I don't have to coax it to anything I tell it to. It just does it flawlessly.

        You, like so many Apple apologists, seem to really follow the dumb Apple guy commercials to a tee. While hard core Apple fanatics seem to think those commercials are a hoot Windows users who know a thing or two know that a lot of what the commercials imply, or even come right out and say sometimes are a lie.

        Fix this fix that?? Again, what are you talking about?? I cant even imagine who you think you are fooling aside from possibly yourself. Its already common knowledge that in most repair shops about 10% of the computers in for fixes are Apples so I don't see how that is somehow disproportionately in favor of Apple? Please explain? Forget it, you cant without lying.

        And scan this scan that? Fine. Fall into a lifestyle of scan nothing and just keep praying that Apple never hits 15% market share too because Apple has the OSX swiss cheese operating system with nothing built in to protect it if someone decides an Apple system is worth anything to get into. OSX has gotten by with shabby shabby security for years because its always been the low market share misfit pretty boy that most of the public doesn't want any part of, but if it does eventually gain just enough market share that some hackers take serious notice...well, Apples OSX has already been proved to be swiss cheese compared to Vista so its bye bye at that point for OSX.

        Come back again some day when you have a point thats not already going down in flames before your even sitting at your keyboard.
        • Constant fixing

          By "coaxing this and fixing that", he means:
          Reinstalling windows every month or so (depending on
          how many new programs you install and try out).
          Always updating and keeping track of virus programs
          (scanning everything).
          Reformatting harddrive every 6 months (or perhaps
          little less).
          Defragmenting (if you are still using a filesystem from
          the 60's, then you will have to defragment.)

          Is there any other modern OS you have to do this in?
          • FUD and Ignorance

            I guess if you don't have anything to put on your system in the first place, especially games, you won't need to uninstall. How convenient.

            Which file system from the 60's? XP actually optimizes the layout of file *fragments* to speed up the boot and application loads, and that's been done in 2001. I bet Apple coulnd't simply use the slow disks PC manufacturers stuffed into the laptops 9 years ago.

            Here:, see Boot and Runtime performance.
          • You're out of your mind

            I have had the same XP installation on the same HD for 4 years now and my machine sizzles. I wont reformat until Windows 7 comes out and I'll go for a nice fresh start. If you have to install Windows more then once every several years you don't know anything about computers at all and should be banned from the net as a hazard. Or at the very least restricted to Linux use only so your user profile will be minuscule low and no body will be looking to attack your machine.

            If you don't know, just maybe your not a bare faced liar and just plain ignorant instead, I will clue you in. All and everything you just complained about never happens with Windows unless you are an idiot. So grow up.
          • Cayble, you moron

            Most people want to use a computer like they use a
            toaster. You turn it on, it works, it's simple. Therefore,
            Mac is a better product. No crashes, no freeze-ups, no
            viruses, no unexplained changes in your settings, no
            registry edits to worry about. So an average person can
            use it reliably to get his job done. And for that, you pay a
            little more...
          • Ok.....

            Thats exactly what I and everyone else does with their Windows machines. I am all my families and friends tech if they need something fixed. I get absolutely no calls ever, so your point is a washed up decades old argument that seems to stick around in some people brains that are not growing anymore.

            Everytime someone gets nailed with something, I asked questions and what do you know, they went to some porn site and got social engineered into loading something. Outside of that I haven't seen any of the issues you talk about. Also funny how hardware issues get lumped into a windows issue all the time. I personally manage 200 windows systems and I have too much time on my hands that I get bored, so maybe I am just that lucky or Windows is truly a stable OS. You choose?
          • And you call Cayble a moron?

            Most folks stopped using Windows 3.1 about 14 years ago. Do try to keep up, won't you?

            Even ME wasn't as bad as you pretend, and I considered it an ongoing root canal.
            Dr. John
          • I haven't had to reformat or reinstall...

            since my original installs on all three of my systems (XP). That was now ...mmhhh ... between 6 and 7 years ago. My laptop also has been flawless thus far...about 4 years and counting. Maybe we need to separate hardware and vendor errors from operating systems. Most of my hardware on my homebuilds was 2nd rate stuff (I never buy top-of-the-line) at the time, although I do tend to stick with brand names (Abit/Sony/etc). Again, so far no failures of the OS. I had one secondary drive peter out on me and I lost some scanned photos (no backup at the time, had just completed the project).
            At the local college, there are usually at least 2-3 Macs down in any of the resource rooms. HARD.
        • Put down the crack pipe

          Security through obscurity is a myth. Pure FUD. All the cyber criminals in the
          world, not one single OS X virus. Every one of them knows full well about
          OSX, and it's millions of users who, by far, have higher incomes than the
          average PC user.
          • Get back on your crack pipe because its all you know

            Either your a moron, or you think the rest of the world is a moron. I'm not going through the whole procedure again because I have done it and dozens right here at ZDNet have done it for the delusional Apple Jacks who still like to say no Apple viruses. There have been Apple viruses for years. Look it up. Twit.
          • So....

            Bring us the info that proves what you say is right. Bring some articles or white papers that show us that OSX is not able to get nailed with a virus or malware. As I recall Apple has patched more security holes than windows in the past 2 years, so I guess that is just for kicks that Apple patches security holes? Am I wrong, why would someone patch something that has no hole in it. Also remote execution holes too which could be exploited for a worm, so please explain since you are so confident in your analysis. I just want to clear up the FUD and I am sure you can help us all with that. We are waiting...............
          • Welcome to planet Earth.

            "...not one single OS X virus>"

            Really? You actually wrote that in a public forum?


            And then, you added the bit about incomes!

            Maybe Balmer should have hired you instead of Jerry. You're much funnier.
            Dr. John
    • NO AV here. Have been using my MacBook Pro 2.6Ghz Core2Duo for 3 years.

      Nothing going on here except saving money!
      No More Microsoft Software Ever!
      • NO AV here. Have been using my PCs running Vista & Win7 for 3 years

        Nothing going on here except saving FAR more money than Mac Users.
        • Good one!

          Very funny, BTW.
        • De-void of original thought, I see. (NT)

          No More Microsoft Software Ever!
        • WinXP No AV

          I've been running the same install of XP Pro for six years on a p4 2.4 GHZ pc with no OS reloads, no AV, no limited users, and no problems - and my computer boots as quickly as it always did!

          My secret? A firewall, and good browsing practices.
      • scales

        On this side we have free AV software. On this side, we have the Apple tax, the really hefty one included with Macbook Pro's, that's still vulnerable.

        Release the balance!

        Wow! The Macbook side slammed down so hard, it fell off the balance!

        Dr. John