> So a company selling operating system CDs is a hardware vendor, I suppose.
Not unless they're selling them for about twenty cents each (the cost of a blank CD, plus handling). The CD is indeed hardware, but the value in this case isn't the hardware, it's the copy of the software embedded in it. The hardware is incidental to their business, and could be trivially replaced with any other convenient storage medium, or even no hardware at all (e.g. direct download).