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Why Apple Is So Sticky

Hugh Pickens writes "'Sticky,' in the social sciences and particularly economics, describes a situation in which a variable is resistant to change. For websites or products it usually means that visitors or customers keep coming back for more. Now Fortune Magazine reports on an analysis by Deutsche Bank's Chris Whitmore on what makes the (iTunes-based) iPhone-iPod-iPad platform so sticky and why it's going to get harder, not easier, for Apple users to switch, no matter what Google and the rest of Apple's competitors have up their sleeves. Whitmore says the investment Apple's customers have made in content for those devices in terms of apps, videos, and music purchased at the iTunes Store creates Apple's 'stickiness.' Apple has an installed base today of about 150 million iTunes-dependent devices that could grow to more than 200 million by the end of 2011. Whitmore comes up with a cumulative investment in those devices of about $15 billion today, growing to $25 billion by the end of next year. 'This averages to ~$100 of content for each installed device,' Whitmore writes, 'suggesting switching costs are relatively high (not to mention the time required to port). When Apple's best-in-class user experience is combined with these growing switching costs, the resulting customer loyalty is unparalleled.'"

7 of 595 comments (clear)

  1. Re:The question is by Lemmy+Caution · · Score: 0, Flamebait

    Apple only makes computers as long as the story isn't about overworked, stressed employees killing themselves. Then, some third-party in China makes computers and Apple is just an innocent customer.

  2. OMG for the 1000000th time... by zenasprime · · Score: 1, Flamebait

    Burn your DRM ladden iTunes Music Store purchaces to disk then rip that disk to mp3 (or whatever format of your choice). OMG DRM free music from the iTunes Music Store that you can "jump ship" with! I know... it's almost rocket surgery, but come on! lol

  3. Re:The same can be said for Microsoft's domination by Anonymous Coward · · Score: 0, Flamebait

    Cost to switch to Apple are more greater. QED

  4. Apples past by AHuxley · · Score: 0, Flamebait

    Apple grew from the 1970's Xerox parc era when a lot of cash was poured into understanding the child like mind and the early gui.
    The rest of the USA/world has finally been dumbed down enough to catch up after a few decades of seeing computers as productive 'work'.
    Apple also has that rare not used before feel to many seem to need now vs just like work at home for most MS users.
    So Apple gets the cult, secret society, terrorist cell like 'only we really understand' bounce too.
    Will it last? Depends on price, OS quality, DRM lock in errors and developer control.
    Apple feels like something new to the herd for now. Anyone who understand the past know Apple has lost it all and recovered before.
    Intro bandwidth plans and closed room meadia deals make itoys feel "free" and cheap, but the total long term control is an issue.

    --
    Domestic spying is now "Benign Information Gathering"
  5. Re:The same can be said for Microsoft's domination by Waccoon · · Score: 0, Flamebait

    That's true only of businesses that lock themselves into the platform. IE6, anyone?

    It's not hard to switch to Linux/OpenOffice if you actually know you can do it. Hell, just fire up a bootable CD and try it out. Microsoft doesn't own the hardware.

    Mac? Another beast entirely. How many people buy Macs simply because they believe they'll never, ever get a virus? People stick with platforms that keep them ignorant.

  6. Re:Apple "It Just Works" by aristotle-dude · · Score: 0, Flamebait

    I call bullshit on this one.

    I call BS on your BS. I use iTunes and I like a couple of things about it, but it has its problems.

    - Have you ever tried moving music in your library? Have fun cleaning up the invalid entries.

    Why would you feel the need to do that? Are you running out of disk space?

    - In Windows there's all sorts of resource hogging software - services and helpers running ALL the time, regardless of if I'm using iTunes

    Are you running a really old PC? Do you have a lot of crapware installed?

    - Ever tried to recover music back from your iPod? You use to be able to do that once upon a time, but they decided that there was too much potential for piracy

    Ever hear of backup? There are plenty of third party applications for both Windows and OS X that let you move music from an iPod to your computer but you really should be using a proper backup mechanism.

    - My clickwheel has never quite worked right on my iPod. I should have had that fixed under warranty early on, but who knows how long I owuldn't have had my iPod for and what sort of cost/hassles I'd have gone through to RMA. Apple was making it VERY hard to RMA at one point here in Australia. The local consumer body had to step in.

    Maybe they made it hard to RMA because of a high incidence of fraud?

    - The click wheel interface sucks for large collections of music. Searching for a song on the iPod can be a pain.

    - They make you jump through hoops to use certain features like Genius. In some countries you, like Australia you have to create an iTunes account and supply your credit card. When you "turn off" or don't enable Genius it still gets in the way

    - Damn iPod screens attract scratches like moths to a flame. Keep some brasso handy.

    *Sigh* Maybe you should RTFM. You can create smart playlists in iTunes or on the fly on the iPod using the current song to generate a genius playlist.

    You might want to get some help for your OCD or accept that plastic does scratch especially if you keep other things in your pocket with your iPhone.

    --
    Jesus was a compassionate social conservative who called individuals to sin no more.
  7. Re:Apple "It Just Works" by Concerned+Onlooker · · Score: 0, Flamebait

    'Some of their stuff does "just work" but much of it doesn't..."

    Actually, I think you just made that up. The only Apple software that didn't "just work" for me was the initial version of Numbers, which has since improved vastly. Everything else has worked like a charm.

    --
    http://www.rootstrikers.org/