I'm surprised no one here has mentioned the obvious solution: go with the Apple model and build Ubuntu machines.
Sure, Apple made some money from selling OS X at $129. It's making less now. But new OS sales were never the reason for Apple to remain closed source. That had more to do with branding/marketing. Not many people remember that one of the reasons Steve killed the affiliate program is that the Mac affiliates were making better machines than Apple, and people were buying them instead of a "Mac". That reduces Apple's revenue, but more importantly dilutes their brand.
Ubuntu, on the other hand, has a very different brand proposition from the start. Open is their brand. But so is "convenience", and what could be more convenient than a machine for which you don't have to do research to find out if all the drivers will work?
Just as Apple's goal was to be a hardware company, which sold an operating system to help sell hardware, Canonical would do well to sell a, er, canonical hardware configuration for the purpose of selling the OS. One of the debilitating downfalls of OSS OSes is the lack of reliable/assured compatible hardware (video drivers being a notorious examples). Arrange for manufacture of a "reference design" system with a "it just works" Ubuntu distro thereon for those willing to forgo hardware options to assure a functioning, no geeking-tweaking, Linux platform.
Great idea. Hey, this is Y-Combinator - somebody get on it!
I have had two machines from them: a netbook and a laptop. (I build my own desktop machines.) Overall they have been decent purchases, but...
The netbook: wireless driver for the builtin never worked. I had to buy (and carry around) a USB wifi stick.
The laptop: fingerprint scanner has never worked.
There may be workarounds, but the whole point of buying from an ubuntu-specific vendor was that I shouldn't have to mess around with figuring out why my hardware doesn't work.
A site which won't even show home-page pictures until I roll the cursor over them? (An observation meaning little on its own, but much in light of bstpierre's experience.)
The trouble is Canonical is and has always been a software company, and Apple is a hardware company (or at least its roots were).
To make Canonical in a hardware direction under the Canonical brand, at a level to compete with existing hardware manufacturers, would take a fantastic amount of investment.
They are making steps in partnering with hardware manufacturers, see the recent Dell linux laptop, and the OEM engineering services they provide for e.g. set top box manufacturers.
But I think it's unlikely you will see Ubuntu brand hardware any time soon.
Nowdays I think Chinese manufactures make it pretty easy to grab one of those unbranded computers and just sell it with your own brand. Is this not the case?
Simply rebranding basic hardware isn't going to compete with the likes of Apple.
Cheap and cheerful (read: shoddy) hardware would quickly damage the Ubuntu brand, and the good hardware is locked up tight by the big brands. Canonical would need to put in some serious volume or R&D of their own to get good hardware that would lead to a viable Ubuntu hardware brand.
Ubuntu users, at least at the moment, are quite picky about the specs of their PCs.
The way to go would definitely be partnering, and Dell is an obvious choice. There could be a "Ubuntu by Dell" brand, with a "white-label" Dell store under the Ubuntu domain, and they would work together to make sure all hardware is fully supported, is tested and ships with sensible defaults. On the other side, Dell would work with Canonical to make sure only supportable components are sourced, and even, over time, apply mild pressure on its suppliers to provide decent drivers.
Dell (or whoever does this) could win considerable dev/geek sympathy and mindshare with a move like this.
"Mac affiliates were making better machines than Apple"
So by Apple killing this the consumer loses the option to use better machines?
Personally, I wish that I could buy Apple hardware with OSX as an added "option". I could knock $129 off the price by using my own OS. But, truthfully, it's not about price. By being able to use my own bootloader and my own OS^1, I could avoid the sort of hoop jumping longtime Mac users (e.g. John Battelle and Rob Pike) have recently described.
1. At least, having Apple make this easy, not make the user resort to extensive hackery to do it.
Apple makes beautiful hardware. That part of Apple has not changed. The mounting annoyances, if you haven't noticed, all come from Apple's efforts to lock down and exert total control over software.
The idea of paying for Ubuntu, as code, only shows how far afield some Linux users have drifted. There is a difference between paying for support and paying for a license to use some (free) code. If you need help, pay for support. Suggestions to force everyone else to pay for use of free code because you need help make little sense. Is that what this is, or have I misread it?
Sure, Apple made some money from selling OS X at $129. It's making less now. But new OS sales were never the reason for Apple to remain closed source. That had more to do with branding/marketing. Not many people remember that one of the reasons Steve killed the affiliate program is that the Mac affiliates were making better machines than Apple, and people were buying them instead of a "Mac". That reduces Apple's revenue, but more importantly dilutes their brand.
Ubuntu, on the other hand, has a very different brand proposition from the start. Open is their brand. But so is "convenience", and what could be more convenient than a machine for which you don't have to do research to find out if all the drivers will work?