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November 2, 2012

How Apple Manages to get high margins with lower RD spending

How Apple gets away with lower R&D spending  Apple is ranked 12th in terms of what it spends on product research and development . The Company is just a fraction ahead of Hewlett-Packard and just above Dell And it is far below the often innovation-challenged behemoths Microsoft, Nokia, RIM and others.

Asymco's Horace Dediu has put together some chartshowing how Apple’s R&D spending trends. While Apple spent $758 million on R&D during the first fiscal quarter of 2012, it’s a very tiny sliver of the company’s overall sales, which were $46.3 billion

 Bloated bureaucracies spend a lot of money on innovation and occasionally make something new and interesting. Steve Jobs’ insistence on maintaining a startup mentality within Apple (even with 30,000 corporate employees) and the company’s ability to only focus on a few things at a time mean Apple can spend less and get much more for its investment.