As I understand it, of of Apple's big competitive advantages was that they contracted for essentially the entire output of 1.8 inch hard drives so no-one else could use them.
Yes, but only after they had a large volume of iPod sales, I think. Apple has also used their scale with iPhone to buy components in such large volumes none of their competitors can get a lower price, which means Apple can actually be price competitive when they perceive it in their interest to do so.
