Even if VS is better than Xcode (and I have no problem believing that it is), I don't see how that's a win for Apple. First off, Apple isn't in the game of admitting that their products suck, and they certainly wouldn't encourage people to go out and buy PCs.

Secondly, Apple doesn't make that much money off app store sales, they make by far the most money off of the hardware. This includes (though with decreasing relevance) mac hardware sales. This may not discourage all that many mac purchases, but will it really increase iPhone purchases? It isn't like Apple is having a hard time getting apps on the store as it is, they are already dominating in terms of volume. Not to mention, this would be reaching out to a world of developers that Apple has spent the last decade insulting as being incapable of producing quality products, exactly the kind of "crap" the "review" process and 3.3.1 are designed to "prevent".

The only argument in the back of my mind that strikes me as particularly persuasive is that Apple is gearing up way ahead of anyone's predicted schedule to simply stop making macs altogether, at which point they would need a solid alternative development platform.

The most important feature of the iPhone is the App Store. Many iPhone commercials and ads are simply showcases of apps in the App Store and this is not a coincidence. More (good quality) apps in the App Store means more iPhone, iPod Touch and iPad sales for Apple.

>> Secondly, Apple doesn't make that much money off app store sales, they make by far the most money off of the hardware.

Do you know this for a fact, or are you speculating? They don't break out app store sales in their 10-K, but consider quarterly hardware sales from Q4 2009:

  - 3 million Macs 
  - 9 million iPhones
  - 21 million iPods

In the same period, users downloaded 400 million apps, although it's unclear how many were paid. App sales are almost 100% profit, compared to the 20% net margins on hardware.

Of those 400 million apps, the best guesses suggest that fewer than 10% of downloads are paid. Estimates have put the values at about 10-20 cents per dollar app. The costs are fixed though, so they do make much higher profits on more expensive apps. But the app store ecosystem hasn't made that a huge factor.

Even under optimistic assumptions: 100% profit, average sale price of $5, 15% paid downloads, the numbers are not good:

    400,000,000*0.15*5*0.3 = 90,000,000

That's nothing compared to the billions they are posting in profit each quarter.

The hardware margins are also almost certainly much higher than 20%, probably over 30% on a lot of the higher end hardware.

Well, now we now.

At WWDC 2010, Jobs announced that Apple has paid out over $1 billion to app developers.

That means Apple has pocketed $428.6 million from their 30/70 revenue split.

A small amount of their total margins since the App Store was introduced in 2008.

"simply because previously it only allowed developing for Windows Mobile which is, honestly, something nobody really cares about"

It's something nobody cares about now, but back in 2007/2008 (when the last version of VS was released) it was a sensible choice. The iPhone was new and there was no app store yet, there were no android headsets yet, and the palm pre didn't exist. Granted, things have changed enormously since then, and that's yet another knock against Visual Studio's slow release schedule.