1. Apple has the music download market locked up. I know this isn’t the conventional wisdom. It’s too soon to tell, Microsoft is about to jump in in a big way, the big music labels will jump in eventually, etc., etc. It is true that we are in the very early stages of the transformation of the music business, and that Apple is still a big frog in a small pond. However, Apple is the current leader by a wide margin, and they have implemented a very Microsoft-like lock-in. iTunes only works with iPod. iPod only works with iTunes. They both only work with the Apple Music Store. And, this proprietary universe provides the best user experience, by far. This means that nobody is going to leave the Apple world once they have bought in. All their songs are stored in aac format on their iPods and in their iTunes. And so many more people want in, Apple can’t even meet the demand. Airport Express and the BMW connection just make it all even more attractive and even more sticky. No doubt Microsoft will come out with an iTunes clone that is inextricably bundled with Windows, and they may even give away music players, but it’s already too late. Apple is over the hump. It’s where people want to be. And, unlike the choice between a Windows PC and a Mac, if you want to be compatible with those around you, you choose Apple.
2. OS X is a vastly superior, easier to use, more secure, more networkable, more stable, more compatible, more standard operating system than Windows. This could not be said of Mac OS 9. As a result, nobody switches from a Mac to a PC anymore, but people do, gradually, reluctantly, switch from PCs to Macs. It’s a one-way valve. There is no longer any reason to run a small business or a large corporation on Windows rather than OS X, except inertia. Market share will only increase. There is no danger of decrease. It’s just a matter of time.
3. Apple has a lock on creaters of multimedia, and this includes the ever-increasing number of amateur movie and music makers. Making movies and music on the Mac, compared to a PC, is the difference between joy and despair.
4. Macintoshs are cheaper than PCs. I know they cost more. You can get an eMac for $900 and a comparable PC for $500. But the pressure to upgrade your PC hardware and software is roughly twice what it is for the Mac. If you go the PC route you will find yourself replacing your computer twice as often. This is without placing any monetary value on peace of mind.
5. People like Macs. People want Macs. People settle for PCs. Many PC owners wish they had Macs, but feel, for one reason or another, that they’re stuck with a PC. Nobody who has a Mac wishes he or she had a PC instead.
It all boils down to the fact that, for all these reasons, the movement from PCs to Macs only goes in one direction. Apple is sitting on a huge pile of cash, and they already have enough market share, committed irreversible market share, to keep adding to that pile of cash. And that market share can only grow. The only real risk is the possibility that Steve Jobs will get hit by a bus. Barring such an eventuality, Apple will ultimately prevail. It may take two years. It may take ten years. When they do, the stock will be worth many times what it is now.