PCWhen Steve Jobs took the reins of Apple in 1997, it operated in the personal computer sector. Examining the PC industry right now using Porter's five forces model reveals multiple threats Apple faces. Within the industry there is a strong threat of new entrants into the market. The parts used to build PCs were sold as a commodity, making entry accessible to many different competitors. The case states that, due to standardization, PC manufacturing companies have been able to significantly reduce research and development funding. Additionally, standardization has made it difficult to differentiate between real PCs. Apple has been able to differentiate itself slightly through hardware quality and significantly through its proprietary operating system. They also began to differentiate themselves through PC component packaging with the release of the first iMac. Apple faces a strong threat of rivalry in the PC industry as well. There are numerous competitors, from Lenovo to Dell to Hewlett-Packard. Compared to these companies, Apple is a small company and holds only a small market share in the industry. Domestically, industry growth is slowing as more than 60% of American households already own a PC, but internationally there is some opportunity to contain some of the threat because growth is rapid. Thanks to the large number of suppliers and standardization of parts, there is a low supplier threat to Apple. Where Apple takes some risk is from the processor manufacturer, Intel. Intel is a large company and competes with only a few other companies in that particular industry, leaving Apple vulnerable to price changes in the PC's most expensive component. There is the threat of future supplier integration... half the paper... more than buyers for all three products. In fact, Apple recently surpassed the 10 billion mark of music downloads from the iTunes Store, demonstrating the huge number of shoppers and purchases those shoppers are making from the iTunes Store. Overall, Apple currently has a strong strategic advantage in these areas. While these benefits are important, they are not sustainable due to the research and development efforts of other companies and the thought that consumer electronics are becoming more of a consumer commodity than luxury goods. If Apple does not work to maintain high barriers to entry through its powerful knowledge base and by keeping the market growing rapidly by introducing niche products, they can expect their rivals to catch up with them technologically and potentially surpass them due to their greater financial capacity to market their products.