IF one of the 3 hardware makers were to get out of the industry...

[alpha_dk]

No, in the iPod's case the apple premium is real. The iPod has some of Apple's best profit margins.

Here is an interesting look at the margins on the Nano: (hint - around 50%)
http://businessweek.com/technology/content/sep2005/tc20050921_4557.htm

At the same time, I have yet to *use* (as in, i have not used every MP3 player out there so there might be some) an mp3 player that is more useable than the iPod. And that is why i don't get all these 'iPod killers' that keep being released - they all just cram more and more tech into a larger and larger box, but none of them get *why* the iPod sells. It isn't the tech - its the image and the usability (in my case the usability - i'm sorry, i just like the streamlined nature of the iTunes + iPod ecosystem. Even if my 'main' music library isn't iTunes (it's Amarok), iTunes is still better than most music syncing programs i have used.

Then again, I can't stand Windows CE as it exists on 90% of the non-apple players out there. So maybe its just me.