Why Microsoft Should Fear Apple

It isn't about Apple's market share or even its quarterly sales numbers. It's about perception.

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The point is that Apple isn't necessarily the most expensive hardware vendor out there. And given the productivity and reliability of Mac hardware, it's not as expensive as it may seem. Of course, if you don't already have Macintosh expertise in your helpdesk, then it's a big deal to add. But more and more companies have already accepted that challenge.

The problem in assessing Mac total cost of ownership comes at the low end. Apple should create economy-oriented, business-class desktop and notebook hardware. The iMac is a home machine. And while the MacBook is fairly inexpensive, there are too many tradeoffs -- such as its Chiclet-like keyboard -- for it to succeed in the business world. (Not everyone agrees with me on this point. Some believe that Apple's consumer Macs are enterprise-worthy.)

Since Apple offers very few SKUs, it's almost impossible for enterprise buyers to save money by specifying this or that lesser feature in order to reduce cost. Without a model specifically designed for low-end business desktops, Apple just isn't competitive there.

Microsoft's Buzz Kill

There was a time when people jokingly described Apple as Microsoft's advanced software lab. Anyone who follows operating systems -- please, be objective if your knee-jerk reaction is to disagree -- has to realize that Microsoft has imitated literally hundreds of features and behaviors of Apple's OS X. Yes, there are some advantages that originated with Microsoft (such as file icon thumbnail previews). But OS X is clearly leading the desktop OS parade. Everyone is copying Apple -- and with good reason.

The time for joking has passed. Microsoft hasn't exactly failed with Vista. But it's more like a double than a home run. Apple is innovating not just with the software and hardware it creates, but with the value proposition it is building in the marketplace. Apple hasn't ever been particularly good about that before. Sure, it's managed to appeal to people's aesthetic sensibilities, but almost never to people's wallets. While Macs still aren't cheap, you get a lot more bang for the buck than you once did.

And that's why Microsoft should read the vibe and think twice about ignoring Apple this time. Microsoft nearly missed the boat on the Internet last decade. It backed into a giant antitrust brouhaha. It has had huge problems with security this decade. Through its own inattention to Internet Explorer, it allowed Mozilla's Firefox to gain a bridgehead on browser market share. Even dyed-in-the-wool Windows enterprises are fed up with me-too Microsoft upgrades, the never-ending blizzard of security patches, the increasing hardware requirements for Vista, volume licensing snafus, and a litany of other complaints and sore points.

Nothing lasts forever. The bloom is coming off the rose on Microsoft. I would never put it past the software giant to come up with a way to remake itself in a better light. But the current course doesn't appear to me to lead in that direction. As much as Apple is doing things right, Microsoft is doing things wrong. That's a great combination for Apple, if it can keep walking the current tightrope.

In the end, this is about perception. It isn't about Apple's market share or even its quarterly sales numbers. (Apple's notebook computer sales for the fourth quarter were 4.1% of all portable computer sales, according to DisplaySearch.) What this is about is that Apple is reaching the right people with its product, winning new converts, Windows user by Windows user -- and creating buzz.

How do you measure buzz? You don't. It's something that experienced people in this industry can just feel. And that's the condition Microsoft should fear. Because buzz can turn into something much harder to combat than sheer numbers.

Scot Finnie is Computerworld's online editorial director.

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Copyright © 2007 IDG Communications, Inc.

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