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And while history has shown us what competition will do to margins in an increasingly commoditized hardware category, this is a new type of cycle where margins have held up for Apple despite competition.
FORBES: Apple and Google: Why Current Market Share Results Don't Matter Yet, Part 2
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One bright spot should have been sales of the iPod digital music player, which Apple breaks out in the "peripherals and other hardware" category.
FORBES: Apple Swings To Loss
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While unit sales of most of Apple's computer lines were down in the fourth quarter of 2002, sales in its "peripheral and other hardware" category, into which the iPod falls, grew by more than 50% versus the year-ago quarter.
FORBES: What Is Apple Baking?