My Computer Mechanic

Apple vs. Microsoft – Is this a real competition any longer?

Most of us remember the funny Mac vs. PC ads on television. Funny ads, but they didn’t increase Apple’s sales at all. Most of us also remember the kinda funny ads with Jerry Seinfeld and Bill Gates hawking Microsoft. They too didn’t increase Microsoft sales at all.

So what conclusion can we draw from this? The battle between Apple and Microsoft is really no battle at all. The real battle is within Microsoft itself!!

Apple is the true innovator in the market place today. Do you know what the “I” in front of iPod, iPhone, and iPad stand for? INNOVATION and Apple is delivering. These three products are all innovative products and caused a huge stir of “me too” products from dozens of other companies. That is the definition of innovation. Because of Apple’s success, they have taken the top spot as the largest technology company away from Microsoft. Case closed – Apple wins.

But, what about the real battle? The battle is within Microsoft itself.

As a graduate business student at the University of Arizona in the mid-1970’s, I was very interested in business history. I have been saying for a while now that Microsoft is showing all of the signs that it is in a long, slow decline. Microsoft got to the top not by delivering great products but by Bill Gates’ approach to business competition. Gates made Microsoft the defacto operating system and productivity suite for the world. This is what kept Microsoft at the top for so long – products that were “good enough” and great marketing. Don’t panic however; this momentum will keep Microsoft as the defacto operating system and productivity suite for a good while longer.

After Gates left on July 1, 2008, Microsoft started going downhill at a little faster pace. The pace is slowly gaining momentum.

The first mistake Microsoft made was in picking Steve Ballmer as the new CEO. Ballmer was then, is now, and always will be a fine business-to-business salesman. That’s it!! In his two plus years driving the ship at Microsoft, he has watched Apple surpass Microsoft’s worth by $50 billion.

Then, Ballmer started striking out over and over again. Vista was a failure of monumental proportions. The Yahoo merger crashed and burned. Sales of Microsoft Office have actually declined. Bing, Microsoft’s relatively new search engine, is bleeding huge amounts of cash. The introduction of the Kin mobile phone was a total failure. And, the introduction of the new Phone 7 Smartphone has been greeted with reviews that say it’s an improvement on Windows Mobile, but it’s still 3 years behind Apple iPhones, Google Androids, and RIM Blackberries.

Under Ballmer, Microsoft has become a “me too” company. Not innovating a thing, just trying to keep up with everyone else and not doing a very good job at it.

Now, Windows 7 is a very worthwhile operating system that we like very much. So was Windows XP SP3, and over two-thirds of Windows users have continued to stick with it. Rumors of Windows 8 have begun to surface, and all of us are holding our breath that we don’t get another Vista. With Microsoft it has truly become a guessing game.

I see Microsoft as having several choices. First, it can (and should) kick out Ballmer and get rid of its current bureaucratic management style and get someone who can lead Microsoft into being a truly innovative company. Nah, that’s not going to happen!

OK, so Microsoft could split itself into smaller, more nimble companies that could … no, that’s not going to happen either!! All companies age and get slower. Microsoft has moved into its rich, fat and happy stage. People, both inside and outside the company, know that it’s happening, but Microsoft and its current employees aren’t ready to stop living the dream of becoming another “Microsoft millionaire.”

Eventually, a massive failure or two will either get the company to make the necessary changes or it will slowly – very slowly – die. Some companies have made the necessary changes in the past. IBM turned itself around when the mainframe computer market died. Ford seems to be doing it. Microsoft is still in denial. Its moment of crisis has yet to arrive. It will. As Microsoft continues to lumber into the future, the day will come when it fails. The question then will be – Can Microsoft pick itself back up? We’ll see.