We can get a little crazy with analogies. The proprietary item you are buying is the car. The car maker may buy other proprietary parts to make that car, just as a consumer electronic company buys proprietary parts to make their products. But you are still buying the end product.
Your missing the point. The consumer themselves can by the tires. Of course tires are included with the car, but you can replace them with others (not bought from the car maker) and they are compatible (but not proprietary). But this isn't a technology related analogy, so, whatever.
So Google has already made Android profitable? Pretty good for a product that hasn't even been released yet. Symbian was not a exactly a smashing success. They didn't show a profit at all until two years ago, and then Nokia bought them out and turned it into a not-for-profit corporation. Great business plan. Palm had similar problems. Windows Mobile (and its predecessors) have also been a struggle for Microsoft, which is why I say that this component model is difficult to duplicate, even by the companies who should understand it best.
The point of my comment was to show that to component model works. You can debate each example, but the fact is that it exists. Google hasn't made android profitable, but it has garnered huge interest in it, with many of the leading phone manufacturers promising compatible devices. Symbian (well, its derivatives) is by far the leading Smartphone OS. Palm isn't a component model as they build their OS for their devices. Windows Mobile has nearly every major phone maker signed on (except Nokia) to make WinMo phones, with a growing market share.
Even then, what about the TV industry? As stated before, numerous companies purchase LCD panels from Sharp, Samsung, and the like.
While none of these component models hold a candle to the success of Windows, you can't exactly write it off as a "historical fluke", unless your willing to ignore all the examples I gave above.
And what model does Microsoft follow for the Xbox? End-to-end. Even so, it's taken them years to make this product show a profit, and they still have a huge hole to climb out of, so it will be years at best before it's into the black. The point I am making here is that the markets would never tolerate this from Apple. Apple is expected to make money right out of the box with their new products -- which they have.
I never stated the Xbox wasn't end-to-end, I was responding to the criticism of the system. The markets would never tolerate this from Apple because they don't step near anything that doesn't lead to high profit margins. That's not the type of company Apple is, and as history would show, that's not the type of company Apple should be. However, why should this rule apply to everyone? Microsoft is able, and willing, to pour money into a project which they feel will lead to success in the future. And right now, they are right on the ball. The E&D division has been posting profits for the last year and that doesn't look to be ending any time soon. Of course it will take some time to climb out the red, but not every business decision has to lead to an immediate result.
Look at Sony, the pronounced king of consoles last generation. They are in last place right now and around $3 Billion in the hole. Apparently this isn't the same market as a portable media player, or a cell phone. If Sony, who has been in the console race since 1994 can't make an immediate success, I'd say its says something good about Microsoft to start from scratch in the middle of a console "revolution" where everything is becoming increasingly expensive to produce, and become what they are now.
Good luck to them, really. Apple could do with some decent competition to keep them on their toes.
