Why Apple Owns the High-End: First Mover Advantage

But how does a company that owns only 8 percent of the handset industry revenue, according to Bernstein Research, kick so much butt

Apple plays almost exclusively in the high end of the handset and computer markets, which translates into mighty profits. In the handset industry, for instance, Apple commands nearly a third of all profits while being only the fifth largest vendor.

Bernstein Research analyst , said: "Even if we exclude the operating losses generated by Motorola and Sony Ericsson, Apple still accounted for 25 percent of industry profits. iPhone's success is akin to Apple's position in the PC industry-where the company enjoys an estimated 25 percent of industry profits, despite capturing only 6 percent of industry revenues."

Apple, of course, is known for delivering stylish high-end products. Its MacBook Pro line consistently ranks among the highest performing laptops, according to the InfoWorld Test Center, a sister Web site to CIO.com.

Oppenheimer analyst Yair Reiner contends that Apple delivers good . He says iMacs, for instance, match up favorably against Dell and HP's All-in-One's on a price-to-performance basis. "Apple's pricing has been perpetually misrepresented and misunderstood over the years," he told me earlier this year. "With a few notable exceptions, such as the MacBook Pro, Apple has typically offered more hardware for the money than competitors."