Google offers Android for free (for now since an Oracle win against Google could mean billions in damage and Google may have to start charging for Android) is an incredible strategy that hardly anyone else can duplicate. It puts Microsoft in a bind with respect to Windows Phone 7. And with Google offering Chrome OS for free, it could one day rival and put a dent into Microsoft's Windows revenue.
However, that is years if not decades away and from the looks of things for Chrome OS, that just isn't going to happen at all. But Apple may have taken a page of the Android strategy and offer OS X Lion for dirt cheap at $29.99 against Microsoft's $80 to $220 price range with a new copy of the Pro version at $200.
Could Apple have offered Lion for free? The answer is yes but it doesn't have to. It's about making a statement against Microsoft's dominance in the PC market and debunking the myth that Mac costs more than a PC. It sends a signal to buyers if future versions of Mac OS will be cheaper to upgrade than Windows.
And this is the most important point of all. By reduce Lion's price to just $30, Apple has reduced the cost of owning a Mac $190 compared to a Windows PC.
Apple can do this because its core business is both software and hardware and it makes most of its money through selling hardware. Apple's Mac sale growth has outpaced the PC market growth every quarter for the last 5 years. With this $30 Lion move, Apple has made sure that its win streak will continue for years to come.
Don't look surprised if the OS X upgrade after Lion comes in at $20 or the one after that at $10.
Note: Apparently, Forbes has a similar idea.
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