http://venturebeat.com/2012/09/15/hardware-is-dead/
"...I think this leads to an important conclusion: No one can make money selling hardware anymore. The only way to make money with hardware is to sell something else and get consumers to pay for the whole device and experience.
Obviously, Apple sells more than just hardware. It sells iOS. It sells the Apple Brand. It sells the ability to give someone over 60 an iPad and not require nightly IT support calls from that person. It sells a bit of magic. And people will pay $400+ for that.
Amazon is also clearly way ahead on this model. At the Kindle launch event last week, Jeff Bezos highlighted that Amazon does not make money on the Kindle, it makes money on the content it sells on top of the Kindle. There is a growing awareness of this model in the web..."