Apple Is Making "Free" a Strategy

By Travis Hoium – Nov 15, 2013 at 10:37AM

NASDAQ: AAPL

Apple

Market Cap

$2,623B

Today's Change

(0.52%) $0.87

Current Price

$169.89

Price as of April 25, 2024, 4:00 p.m. ET

Apple is giving away more and more of its software and services when you buy its devices. This is in response to Google's free operating system, but it may be targeting Microsoft's PC business as well.

Apple (AAPL 0.52%) is trying to fend off Google (GOOGL -1.97%) from the taking too much share in mobile, while at the same time keeping Microsoft (MSFT -2.45%) from gaining traction in mobile. Apple's solution has been to offer more and more services and software for free, easing some of the sticker shock on Apple devices.

Apple has long offered many free services like iCloud and Photostream for free, but it's now offering iWork, iOS, OSX, and iTunes Radio without charge. What's the reason for the move?

Apple may be leveraging its dominant place in mobile to expand PC sales. The iPhone and iPad are common business devices but the Mac hasn't caught on in corporate America yet. In the video below, Fool contributor Travis Hoium discusses why the PC market may be the real driver of the free strategy at Apple.

Erin Miller owns shares of Apple. Fool contributor Travis Hoium manages an account that owns shares of Apple and Microsoft. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.