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Apple Computer

Apple Computer: The iPod, the iMac, and the Business Lessons of Closed Systems

Steve Jobs has had much to celebrate lately. But the Apple CEO was particularly happy in February 2006 when he announced that the iTunes Music Store had sold its billionth song, to a teenager in Michigan who had bought a copy of Coldplay's "Speed of Sound". That milestone is all the more impressive when you remember that Apple has numerous competitors in the digital music world. Yahoo music Unlimited and the legal incarnation of Napster are gunning iTunes customers. Sony and Samsung are trying to create iPod slayers.

And the field is only getting more crowded. By the summer of 2006, Amazon may launch a digital music service with a branded MP3 player, possibly made by Samsung. It is already being referred to in the industry as the iPod. Amazon won’t discuss its plans, over 40 years old it refers to them as "the NPR crowd" who aren’t as likely to own iPods as MySpace users. The more impressive when you remember that Apple has numerous competitors in the digital music Yet Apple's challengers all face the same problem: Job’s company will no doubt dominate the digital music market for years to come. That's because Apple has learned its hard lesson about closed systems.

In the microcomputer desktop market, Apple shrank from an industry leader to a

Niche player because it designed closed systems with proprietary hardware and software that were often incompatible with thousands of application software products that proliferated in the PC universe. Microsoft set out to replicate the basic features of the Macintosh operating system in each succeeding version of its Windows OS, encouraged software developers to write apps for it, and then licensed Windows to mass-market PC manufacturers like DELL, HP, and IBM. When the technology dust settled. Apple ended up with barely

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