Tuesday, July 19, 2011, 08:00 pm
Apple plans incremental feature additions to new Macs and iOS devicesApple has announced plans to defer revenue from sales of new Macs running OS X Lion and new iOS devices to account for new features that will be delivered after their original sale, including iCloud services.
Mac OS X 10.7 Lion will become available through the Mac App Store tomorrow for $29, and also begin shipping with new hardware. To properly account for the value of features Apple plans to provide over the lifecycle of the release, the company will defer $22 of revenue on each new Mac sold with Lion.
This accounting practice will enable the company to release new features without requiring users to pay an additional fee. Apple previously deferred revenue collected from iPhone buyers to account for new features it progressively added to iOS to similarly meet legal requirements pertaining to the recognition of revenue for products that are improved or changed over time.
The company did not use deferred accounting on the original iPod touch however, instead originally choosing to provide new software features via updates that required a nominal fee to obtain. That practice not only confused customers but also prevented some iPod touch users from upgrading to the latest version of iOS.
Apple wants all of its Mac and iOS users to adopt the latest available version of operating software possible, as this simplifies the task of managing software updates and patches and makes Apple's development platforms as free from software platform fragmentation as possible.
Apple will be using deferred revenue accounting for both Macs and iOS devices in order to roll out new features that are broadly and quickly adopted by users (and developers).
Among the features Apple plans to add to both Mac and iOS devices is iCloud, an assortment of web services that include Photo Stream media sync; Contacts, Calendar and Mail; and "Documents in the Cloud," a new service third party developers can tap into to keep files in sync between a user's Macs and iOS devices.
By deferring revenue from both Macs and iOS devices (Apple said it will defer $16 for each iPhone and iPad sold, and $11 for each iPod touch), Apple will be able to incrementally add iCloud features and other significant functionality without worrying about running afoul of federal accounting rules.
At the same time, third party developers can be more confident that users will seek out and use apps with iCloud integration features, as buyers won't need to subscribe to a separate service as was formerly the case with MobileMe, Apple's previous incarnation of its online services, which attracted a few million subscribers but was not universally embraced by Mac or iOS customers.
On Topic: Mac OS X
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