In addition to the other points that have been raised - Office is expensive! True, Apple's hardware also tends to be pretty expensive, but when you can buy a new iPad for $400 (or MacBook for $900) that'll last several years, an extra $50-$100 per year for Office 365 is a significant addition. Even on more expensive hardware, that's likely the most expensive software purchase most users will ever make... which means that rational or no, some users will shy away from it... and they'd be stuck without an office suite. In comparison, iWork used to cost ($80 back in the days of iWork '09, later $5-10 per app for the rewrites) but has been free for a while now.

Google Docs is free, but as a browser-based interface it's slow and nowhere near the kind of native experience Apple likes to promote; it requires an internet connection on anything but Chrome; it will never be a poster child for the latest macOS features like trackpad-pinch-to-zoom or Versions or the share sheet or whatever. That's on the desktop; on iOS, Google has a set of native apps but they're quite feature-limited.

Also, both Word and Google Docs are owned by companies that directly compete with Apple, and the apps promote the respective company's ecosystem (e.g. for storage, they push you to OneDrive and Google Drive respectively rather than iCloud). For better or worse, Apple wants to control the whole experience and make it all seamless. Not to mention that Apple probably wants to avoid situations where in the future it could be held hostage to some extent by the owner of a 'must-have' app for its platform.

There are less popular alternatives, but they all have their own problems.

Personally, I neither need to open people's Word documents nor have particularly strenuous requirements for a word processor or spreadsheet (or presentation software, but I'm pretty sure Keynote has some fairly decent pluses compared to PowerPoint anyway). So I am quite satisfied by iWork.

LibreOffice on the other hand is free and can actually be a replacement for Excel. I wish Numbers would be a reasonable alternative but it's missing all of the features that actually make Excel useful.

Office 365 is actually a pretty good deal!

> Versions

Interesting example, considering Drive had that way before Apple did.

Native feel, reliability, and responsiveness make the iWork apps pleasant to use, if you don't need the full feature set of what MS Office apps offer (e.g., making a "Table of Authorities" in a legal brief). Sometimes one can make better looking documents too.

I find Keynote in particular to be fantastic compared to PPT, especially back when Office 2010 was Microsoft's offering, and wasn't retina-ready. Keynote handles vector graphics well and does pretty crazy animations that PPT would choke on.

Numbers, for example, is surprisingly capable & way nicer to use than Excel or Google Docs for a home user.

I tried to go iWork only for a while and numbers barely made it for me. It had too small a level of functionality and in exchange was more complicated than it needed to be to get a small amount out. I found Soulver (a re-imagining of the calculator interface) was both simpler and more powerful for straightforward calculations -- by the time it tops out, Numbers has probably topped out.

But the home point is a good one: Numbers was great for making up a weekly chores sheet for the kid, easily decorated with fun photos and such. Still: does that justify Apple's investment?

I tried to use Numbers for some biology work when I was in school and found it frustratingly difficult to use. I'd type something in to a cell, it'd autocomplete, I'd cancel the autocompletion, but it still did not give me full control over the cell. There were other things that were frustrating and just flat out didn't make sense, like the way it would fill data automatically.

Platform lock in.

You are right that Apple needed iWork for iOS/Mac because they couldn't depend on Microsoft. But, now that they've got iWork it's another tentpole Apple can use to keep consumers locked into their platform.

Except that iWork is free on the web

Numbers, Sheets and Keynote are all free apps. Office for Mac is not.

Keynote for iOS also serves as a very reliable and easy to set up presentation remote.

I switched from Keynote to Google Slides purely for the collaboration. I very much doubt I'll switch back.

If I send a non-Mac-user a Keynote presentation they'll import it to PowerPoint and send me back that, which I have to import, etc.

I find it interesting that web apps are actually better than desktop apps for this stuff. Even five years ago I would have questioned that ever happening.

There's a web version of Keynote, though.

I doubt they spend that much on it and it gives SMB's an additional cost savings by going with Macs; if they don't NEED office the Apple iWork software can be good enough to serve their purposes.

I worked on Microsoft Works back when Apple Works was kicking their butt. Eventually that got cancelled in favor of just "Office".

Apple's works apps are vastly better than microsofts. Yes, Microsofts do have 30+ years of features shellacked on like so many layers of paint, but I've never needed to do something in Works that I haven't been able to do. And the hassle of dealing with the terrible UI, and terrible experience of microsoft products effectively renders their (presumed I don't really know at this point) additional features useless.

I regularly use Pages, Numbers and Keynote. All three are great and I value my macs that much more because they are there.

Recently I tried downloading LibreOffice because I wanted A visio like drawing program. I've been looking for one of these for years and they all suck- Omnigraffle, visio, etc.

MacDraw was perfect, it's exactly what I need.

Only drawback in Works is there's no Macdraw replacement. (eg: a sorta object oriented drawing program- the drawing capabilities of keynote are very close and so that's what I use.)

Google docs apps are far less capable than the Works apps. Calling them toys seems silly. Google's apps are clumsy yes, but they don't do much at all, nothing more than Works as far as the areas I care about... and they run in the browser poorly. Even Works apps work better in the browser.