Apple makes 2.3x as much profit on OS as Microsoft does

First the incredible news that Apple had surpassed Microsoft in overall profit. Now Horace Dedieu points out that Apple’s software platforms now enables it to earn more than double the amount of profits Microsoft garners from Windows.

The profits are split between iOS and OS X on Apple’s side. The iOS platform enables about 75% of Apple’s overall profit, with record sales of the iPhone and lower but still strong sales of the iPad in Q2. Just four years ago iOS only counted for 50% of profit.

The OS X platform enables about 20% of Apple’s profits, which is also a growth from last year.

Dedieu points to these numbers as evidence that Apple is succeeding based on their integrated platform-and-hardware model.

The post-PC era is being kicked off by a new business model where profits are being concentrated in a hardware+software+service integrator.

You’ll recall that this is the very thing that many saw as the problem with the Mac in its less successful days. The pressure to license the OS and become a sole distributor of software like Microsoft was strong. If Apple had taken the bait and become a software only company it would never have developed the iPhone and iPad, devices that use the iOS platform.

That platform now enables Apple to generate enough profit to outstrip Microsoft’s Windows by 2/3.

The message is a simple one. Making software and selling the hardware that runs it is the business model with the strongest future. Microsoft wasn’t interested in this back when Windows was king, but now that profits are slipping, it’s something that they can’t continue turning a blind eye to.