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Windows machines. That release garnered rave reviews, even from some of the most technophilic publications around, such as Slashdot and ArsTechnica.
For an encore, Apple should release a version of iPhoto for Windows. After iTunes, it's the next most popular digital-lifestyle application on the Mac. And iPhoto is an excellent product, better in my mind than anything PC makers have offered with the single exception of Adobe's consumer package.
So how big a market could this create for Apple? That's hard to tell. If Apple could convince even 3% of all digital-camera buyers to purchase iPhoto software next year -- say, for $30 -- then it would grab revenues of $45 million. That could conceivably climb to $100 million or more within a few years if Apple manages to merely maintain that market share. That's not a ton of money, but it should be more than enough to cover the cost of the launch. The move would also fit in with Apple's new push to diversify its revenue streams.
SPREAD THE JOY. Beyond that, it would all be gravy and profits. Operating margins for profitable software producers tend towards the mid to high double digits, since everything beyond the initial cost of building the product and selling it is basically profit. That's why Microsoft is filthy rich. Keep in mind, too, that Apple, despite its protestations to the contrary, really is a software company. They've been able to sustain sky-high profit margins on their hardware largely due to their operating system, which is software.
Naturally, this strategy has a few hazards. Apple can't put too many of its prized software products onto Windows machines without diluting the Mac's allure. Why buy a more expensive Mac when you can get all the same software on a PC? However, that might not be as much of a problem in this case because Apple includes iPhoto for free with new Macs. And having a couple of Apple's software offerings on Windows machines will hardly shatter the Mac's overall cachet.
Furthermore, Apple has significantly closed the price gap in the last six months. Apple laptops, in particular, are comparably priced with Windows competitors. That parity, should Apple be able to maintain it, could free the Mac team to sell far more software in the Windows world, where the real money is, and still maintain its cozy hardware business.
EVERYONE'S INVITED. Then there's the marketing-momentum effect. After the spectacular iPod and iTunes Music Store advertising campaign aimed at Windows users (for sure you've seen it -- the one with the brightly colored backgrounds and blacked-out figures boogieing down), Apple's already strong brand appeal among non-Mac heads has likely grown even stronger.
Jobs & Co. would waste this goodwill and buzz by not bringing out another Windows software title sometime in the near future. If Steve Jobs is really serious about the digital lifestyle -- and profits -- selling something to the other 95% of computer users is much better than selling them nothing.