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Path: utzoo!watmath!looking!brad
From: brad@looking.UUCP (Brad Templeton)
Newsgroups: net.micro.mac,net.micro.atari
Subject: Re: Atari ST vs. Apple Mac - Margins and rip-offs
Message-ID: <275@looking.UUCP>
Date: Thu, 30-May-85 00:00:00 EDT
Article-I.D.: looking.275
Posted: Thu May 30 00:00:00 1985
Date-Received: Thu, 30-May-85 20:30:52 EDT
References: <123@watmum.UUCP> <2081@sdcc6.UUCP> <347@aurora.UUCP> <994@peora.UUCP>
Organization: Looking Glass Software, Waterloo, Ont
Lines: 18
Xref: watmath net.micro.mac:1519 net.micro.atari:838
Summary: 

One can hardly accuse Jack Tramiel of being ignorant of financial
management and margins.  He only built one of the most successful
and profitable computer companies around.

You are right that the ST has a lower margin than the Mac.  That's because
you're not paying for all that valuable advertising.

The MAC costs about $200 to make.   With the normal 5X basic cost rule
for hardware margins, it should sell at $1000, which is what it DID sell
for in the consortium schools.   At the $1000 price, Apple made a reasonable,
although not apple-like profit.   At the $2500 price, if there was a 40%
markup at the dealer, apple got $1500, or $500 extra per machine. And they
spent it on all that advertising.

Advertising sure adds to the value of a machine, so you know you got
your money's worth from your Mac.
-- 
Brad Templeton, Looking Glass Software Ltd. - Waterloo, Ontario 519/884-7473