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Mon, Oct 13, 2008 - 03:26 PM EDT  —  AAPL: 106.54 (+9.74, +10.06%)  |  NASDAQ: 1787.34 (+137.83, +8.36%)

Microsoft CEO Ballmer on why Apple is thriving
Thursday, July 24, 2008 - 02:40 PM EDT

"Kevin Johnson, the president of [Microsoft's online] division, suddenly and surprisingly resigned late Wednesday, taking over Juniper Networks, and leaving Microsoft's online business in more disarray than it was already in," Jim Goldman reports or CNBC.

In a memo to Microsoft employees addressing Johnson's departure and competition with Google, Microsoft CEO Steve Ballmer also mentions Apple, pointing out that "Microsoft outsells Apple 30 to 1, but elevates the competition to a new level," Goldman reports. "He writes: 'In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving. Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience. Today, we’re changing the way we work with hardware vendors to ensure that we can provide complete experiences with absolutely no compromises. We’ll do the same with phones—providing choice as we work to create great end-to-end experiences.'"

Goldman writes, "It's an interesting take on Microsoft's position in the marketplace as it relates to Apple. Microsoft is indeed losing marketshare to Apple (2.5 million Macs a quarter start to add up!) because of all the well-documented problems and challenges with Windows Vista. But rather than focus on Vista's shortcomings, Ballmer spotlights the strengths of the Mac."

Full article here.

[Thanks to MacDailyNews Reader "JES42" for the heads up.]

MacDailyNews Take: How "narrow" is a platform that is a much better choice for the vast majority of personal computer users who are not short-sightedly shackled to some Windows-only app? That is really the only reason to run Windows and, if that's the only reason why people run your OS, then you'd better keep developers from writing native versions of their apps for Mac (which, as market share increases have a funny way of promoting, they are doing in droves) or you've got absolutely nothing. For example, if Autodesk came out with a good, sound working Mac version of AutoCAD today, Apple would own the architecture market by next week. Architecture firms don't pick Windows because it's better, they're stuck with it for now. The same for the real estate industry, etc.

Furthermore, there is no way that Microsoft "can provide complete experiences with absolutely no compromises." Not unless they dump the HPs and Dells of the world and adopt Apple's vertical integration model (control of the whole widget) and begin producing their own PC hardware. Too many cooks in the kitchen otherwise. Even if Microsoft did that, they'd still be stuck with a bloated, legacy-ridden, mess of an OS. And industrial designers the caliber of Jonathan Ive do not grow on trees. If Microsoft made Windows PCs, they'd end up with another Zune. There really is no good news for Microsoft. They don't have the leadership, they don't have a culture of innovation, and they don't have the winning model. All they have are the vestiges of an illegally-constructed monopoly that they can no longer leverage indiscriminately to run roughshod over the tech industry.

The exact same points above work for iPhone vs. a fleet of clunky, junky Windows Mobile devices from every Tom, Dick, and Harry hardware maker. Just like they worked for iPod vs. Apple's roadkill who all used to use the now-defunct PlaysForSure for their clunky, junky now-defunct MP3 players. Vertical integration trumps horizontal when it comes the end user experience and, drumroll please... end user experience is all that really matters.

Someday the world will look back on the period where Microsoft dominated personal computing as an unfortunate, wasteful mistake. The Dark Ages of Personal Computing is finally drawing to a close. The Apple renaissance is at hand!

Ballmer's full memo is here.

[Thanks to MacDailyNews Reader "Rainy Day" for the heads up.]

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Jul 24, 08 - 02:46 pm Comment from: MidWest Mac

What MDN said.

Jul 24, 08 - 02:47 pm Comment from: Spark

The Apple method of closing the system and issuing Developer Guidelines is vindicated. Ballmer is admitting that the Microsoft way cannot be sustained. Yes, it puts harnesses on developers, but places the end user experience in the primary spotlight, where it should be.

Jul 24, 08 - 02:50 pm Comment from: Macromancer

The Microsoft Myth of Choice (MMC™)

You can buy whatever junky PC box you can find, but you experience will be the same crappy bloated mess, because no matter your hardware choice, it still runs Windows.

At least it makes people FEEL like they have a choice, when they really don't, and that's all that matters.

Jul 24, 08 - 02:50 pm Comment from: shen

""Microsoft outsells Apple 30 to 1"

MS sells computers?

yes, i know it has been said before, but come on! you want to compare OS to OS? fine, drop the OEM sales and how do they compare?

you wanna compare hardware? fine, show me the MS brand computer.

Apple is thriving because they sell quality stuff. MS hawks crap. end of story.

Jul 24, 08 - 02:51 pm Comment from: Macromancer

The other myth is that Apple is proprietary and Windows is not.

Windows is ALSO proprietary. Microsoft owns and controls Windows. It is not Open Source.

Jul 24, 08 - 02:52 pm Comment from: L.A. Punk

He's starting to feel the heat......starting. smile

I think that after the comments made by uncle Steve during his 4Q results and all the speculation after about more affordable Macs and as a result greater market-share, it's no surprise to see a reaction come from ballmer.

Things are going to start heating up real quick!

Jul 24, 08 - 02:55 pm Comment from: Blue Dream

Emergency board meeting at Apple...soon to reinvent and base their strategy on what Steve Ballmer thinks. Buy stock in Krispy Kreme!

Jul 24, 08 - 02:56 pm Comment from: Buster

....and the lord looked down and saw it was good....

Jul 24, 08 - 02:57 pm Comment from: Mike

Please oh please let there be a Mac version of AutoCAD somewhere in the future.

Jul 24, 08 - 03:00 pm Comment from: Shadow

I would have to check my facts a little but it seems the Baldmer is living in the past.

At 30 to 1 Apple's share would be just over 3%. A couple of years ago that was true.

Now try 15 to 1and Apple's share becomes almost 7%. That is a lot closer to reality Mr. Baldmer.

Welcome to your nightmare.

Cheers

Shadow

Jul 24, 08 - 03:02 pm Comment from: t

At what point do you think MS will drop office support for apple. I think apple decided to go into creating an office suite because they knew once they started taking market share that is the first thing MS will pull.

Jul 24, 08 - 03:06 pm Comment from: Anonymous©

Well, the Microsoft Way is the lowest common denominator experience. Everyone's experience sucks. Trying to satisfy everybody, you only satisfy nobody.

Jul 24, 08 - 03:10 pm Comment from: @t

You're accurate.

Jul 24, 08 - 03:16 pm Comment from: bc

Maybe MS will use Apple's missteps in the Mobile Me rollout as a template for the "experience" - oh, wait, they do that already wink

Jul 24, 08 - 03:16 pm Comment from: Harvey

Just for fun: Steve Ballmer cannot name is son Colin Michael, because then he'd be Colin M. Ballmer.

Which might be a good thing to do.

Ballmer's on to something: Imitate Apple more. Great innovation! I bet someone will say no one has ever done this before.

Jul 24, 08 - 03:17 pm Comment from: pDK

@Shadow
That's what I'm saying. Where the hell does he get 30 to 1 from? It looks to me like we're closing in on just 10 to 1. Keep Ballmer in and we'll get to 50% sometime in the next decade.

Jul 24, 08 - 03:19 pm Comment from: His Divine Shadow

Macromancer

At least it makes people FEEL like they have a choice, when they really don't, and that's all that matters.


That's funny, because that's exactly what's wrong with the politics in the USA right now. You have two rightwing viewpoints arguing intensely within a narrow range of opinions and everyone sees this and thinks that issues are being "debated", when in fact it's just the status quo with fireworks. People think there is lively discussion, when it is in fact narrowly controlled noisy obfuscation.

Jul 24, 08 - 03:20 pm Comment from: McIntosh

@ Mike

... and a Mac version of ArcView too!!

Jul 24, 08 - 03:20 pm Comment from: Harvey

With iWork, Apple has slowly been preparing itself for the day when there is no more feminist software for the Mac. (By feminist software, I mean Ms Word, Ms Excel, Ms PowerPoint, and so on.)

Jul 24, 08 - 03:21 pm Comment from: Harvey

I think Microsoft needs to learn the difference between "choice" and "confusion."

Jul 24, 08 - 03:24 pm Comment from: MCCFR

Either it's an end-to-end experience or there is choice.

Unless MSFT develops mandatory reference platforms and endows them with software that works in a uniform way across those platforms, Ballmer's Johnny Come Lately half-assed commitment to end-to-end user experience is a waste of the electrons that were used to transmit around Microsoft's Empire of Mediocrity.

If you go to glassdoor.com and look at the posts by MSFT personnel, you get a flavour for what it's like to work for Microsoft – yet another management re-org and yet re-visioning of MSFT's role in the world developed by a man who isn't smart enough to use anti-perspirant is hardly likely to do anything to improve Ballmer's rating amongst his troops which is about as average as it can get.

The problem for Microsoft is that it can't work out what it wants to be: software behemoth? online services giant? advertising leviathan? Will the real Slim Shady please stand up?

Even worse, it can't work out how to get to where it wants to go: complete end-to-end experience? So-called partnerships? Internal creativity? Acquisition of second-string players? Commitment to open standards? Extinguishing competition and denigrating the open source movement?.

I do hope that someone ultimately puts Ballmer out of Microsoft's misery, but not for four or five years or so.

Jul 24, 08 - 03:26 pm Comment from: t

@Harvey

I agree - I think though MS is between a rock and a hard place. If they don't support apple with their office suite then it would be viewed as predatory action by a monopoly. It they do support it then they are just feeding apple's growth.

Jul 24, 08 - 03:27 pm Comment from: Macaday

Ballmer is just making an excuse for their continuing failure.

XBox and Zune are in the Apple model and they haven't made a blue bean of profit for Microsoft...

Down the toilet it goes methinks.

Jul 24, 08 - 03:27 pm Comment from: Hopefully

Between things like Google Apps, iWork, and Open Office, MS pulling support from other platforms won't be a problem.

Jul 24, 08 - 03:32 pm Comment from: Jooop

I don't agree with MDN that if Microsoft adopted a vertically integrated model like Apple and produced Microsoft-branded computers we'd suddenly see Apple quality coming out of Redmond. Remember Microsoft is responsible for the vertically-integrated, Microsoft-branded X-Box, and those things have an absolutely astounding failure rate (red ring of death anyone?) and sound like a running hairdryer (and throw off about as much heat).

As Steve Jobs said in that famous mid-1990s interview, the real problem with Microsoft is that they have absolutely no taste.

Jul 24, 08 - 03:36 pm Comment from: REALTORben

Two things. First, when Ballmer (who is the ugliest SOB ever to be a CEO) mentions "narrow", he is speaking of hardware, not the experience. Basically he means that you can install any one of 500 graphics cards. On macs, you don't have nearly that many choices. Basically, what he should have said is "we cater to both the high and and the cheap POS end, however, mac only caters to the high end. We want to do both, but with the user experience mac users enjoy".

Second, as far as MDN's note, the real estate industry can start shifting over to mac (as a Realtor who uses a Mac full time). I won't ever use windows for Real Estate again. The company, Real Estate Success Tools builds the best realtor business management software. It's built in FileMaker and it works in all OS's with unlimited users attached. If you are in real estate, go to getrestnow.com and get their software, it's well worth it. Hopefully, the software makers for title and mortgage industry follows suit, and we can all drop the window POS's.

Jul 24, 08 - 03:37 pm Comment from: Shadow

@pDK

The good news is I think BALDmer really believes what he is saying. I hope he never finds out the true numbers until it is too late. That should be in about 3 years I would guess.

Cheers

Shadow

Jul 24, 08 - 03:38 pm Comment from: Olmecmystic

Looks like the seat is starting to get a little warm for Uncle Fester.

The Yahoo hostile takeover has dragged on all year, and it wasn't the answer ANYWAY. Now the co-architect of that strategy has bailed (or was pushed, as the case may be). They just lost $488M(!!) in 90 days trying to execute that strategy. Ballmer finally has to acknowledge that Apple has a good end-to-end user experience that M$ does not. The money that M$ has to blow in such large amounts in one business quarter STILL COMES FROM Winblows and Office.

Wall Street is starting to shine the spotlight on the leadership that got Micro-Sloth into this mess. That's actually good AND bad at the same time. It's good that Ballmer is about to get exposed as the overpaid charlatan CEO, luckiest dorm-room assignment recipient in the history of business, but it may be bad for us as Apple fan/users.

What if M$ did what Apple did and bring in someone of competence and vision who orders that every ongoing project at M$ be paraded in front of him and instruct them to justify their existence or be eliminated? What if M$ then cut all legacy ties to their old OS and finally built a modern, 21st century OS with security, open standards, and ease of use as the priorities? What would actual COMPETITION instead of copycatting coming out of Redmond look like?

We'll never know 'cause I just woke up.

Never mind!

Peace.
Olmecmystic cool smile

Jul 24, 08 - 03:39 pm Comment from: dave

Apple is thriving because they are focused on what actual users want.

Microsoft is not thriving like Apple is because they are focused on what big business wants.

Jul 24, 08 - 03:40 pm Comment from: Falkirk

Question: What does the first paragraph of the story have to do with the rest of the story? It's unrelated and should not have been included.

Weird.

Jul 24, 08 - 03:41 pm Comment from: GizmoDan

Excerpts from Ballmer's email:
"Drive end user excitement for our products."
". . . drive developers to create rich applications for Windows."
". . . driving change in business models through advertising, subscriptions, and online transactions."

Steve Ballmer drives to change you to what he needs.
Steve Jobs provides what YOU want ant need, without trying to change you.

Let's throw Ballmer in the back seat.

Jul 24, 08 - 03:42 pm Comment from: @Harvey

Microsoft office is "feminist software"?

I'm totally baffled by your use of that term in this context.

Can you explain in more detail what Microsoft Office has to do with feminism?

Jul 24, 08 - 03:50 pm Comment from: 84 Mac Guy

The reason a Mac version of AutoCAD doesn't exist is that AutoCAD is a convoluted bird's nest of spaghetti code just like Windows. The only way to make a POS like AutoCAD work on a Mac is to rewrite the entire program. Autodesk has no desire to spend that kind of money. They, like MS, would rather spend their money buying all their competitors so no competition exists.

Autodesk needs its monopoly broken up just like MS. If you are an architect or engineer do whatever you can to use something other than AutoCAD and use something compatible with the Mac. I personally find Goggle's Sketchup a great tool for conceptual 3D drawings.

Jul 24, 08 - 04:07 pm Comment from: Brau

"denial ain't a river in Egypt",as they say, and these poor saps STILL don't get it. Apple leads because they create and innovate, then have control over the whole execution of the product. No amount of statistical analyzing or copying will ever bring MS the success they desire. They quite simply lack their own vision at the most fundamental level.

This report at least shows that Ballmer isn't the only deluded monkey on the team. It's systemic to MS. Long live the MS CEO's!!

Jul 24, 08 - 04:11 pm Comment from: menolikemsft

Here's a nice read from 2yrs ago that hits the nail on the head about Apple, innovation, and user experience

http://switchtoamac.com/site/apples-endtoend-model-leads-to-innovation-and-user-experience.html

Jul 24, 08 - 04:12 pm Comment from: Harvey

@@Harvey

This is totally off topic. Sorry, but I should answer the question.

My use of the term "feminist software" is poking fun at people who abbreviate Microsoft as MS, which is also Ms, which has its origins in the feminist movement. MS Word = Ms Word, get it?

People who Capitalize Seemingly at Random just Because it Looks Pretty and Make Unnecessary Acronyms (UA) drive Me Bats. I do a lot of editing, and things like this take a lot of time--and are annoying--to correct. At least when I'm done, they appear to have the communications skills they claim.

Then of course there are people who use MACs. How they get work done on a media access control address, I don't know. My Mac has a MAC, but I prefer to use the Mac, and let the Mac worry about the MAC.

Jul 24, 08 - 04:12 pm Comment from: bizlaw

@ t

Microsoft won't drop Office for Mac because they make too much money selling it. That will only happen when Apple builds it's office suite to be comparable enough that people no longer need MS Office. However, so long as MS controls its formats and won't let other companies have access to the formats, MS will be in control of office suites. This may be changing with the new Office formats, but it will take time to be fully adopted (5+ years).

Just enough time for Apple to fully build up it's iWork suite. It's good, but not a threat to MS yet.

Jul 24, 08 - 04:13 pm Comment from: The Other Steve

Microsoft does make nice computer mice. I bought one for one of my Mac's and I do like it.
I'm just not going to use their OS.

As for Ballmer, I don't think he's the one to make this work for Microsoft. He's a sales guy for god sake! Why the shareholders let a sales guy run (or make that ruin) the company is beyond me.

Jul 24, 08 - 04:16 pm Comment from: HolyMackerel

MS always says that Google and IBM are their biggest competitors. I find this odd since MS has no meaningful Web advertising, Web apps, mainframe or services business.

While MS don't sell PC hardware, their biggest competitor and threat to their core business and current monopoly has always been Apple.

Maybe MS are finally admitting Apple as a competitor.

Jul 24, 08 - 04:19 pm Comment from: AutoCAD Alternative

My brother is in Architecture school right now and he has a new iMac, but is forced to run windows so he can use AutoCAD. He then stumbled upon a program like AutoCAD but made for the Mac. Its called ArchiCAD. I am not sure how it works or anything, but at least its a start. Does anybody else have any experience with ArchiCAD? I would really be interested in how it compares to AutoCAD.

Jul 24, 08 - 04:25 pm Comment from: since1985

Reading the end of Ballmer's memo:

“As I said at the June 27th Town Hall for Bill,”

Oh my god, the "Town Hall for Bill"...

“we are the best in the world at doing software and nobody should be confused about this.”

Delirium.

“It doesn’t mean that we can’t improve, but nobody is better than we are.”

Egotistical bastards. Conversely, Apple’s drive is to excel at making the best products that people will want to buy. And this is how it expresses it publicly; it never communicates in terms of being better than everyone else.

“Nobody works harder than we do.”

Arrogant bastards.

“Nobody is more tenacious than we are. We’re investing more broadly and more seriously than anybody else.”

Okay, now we're getting a little closer to the truth. M$ is tenacious like a dog whose jaws have gotten hold of your pants leg and won't let go. "We’re investing more broadly and more seriously than anybody else" is a euphemism for ‘we are committed to spending our wealth on buying out the competition so there is no competition to compete against’.

“Our opportunities to change the world have never been greater.”

Read: Our competitors are changing the world with their innovations. We have the enormous capital and the monopolistic swagger necessary to buyout our competitors or outright steal their technology to make these new markets our own.

Jul 24, 08 - 04:35 pm Comment from: TexasAg03

For example, if Autodesk came out with a good, sound working Mac version of AutoCAD today, Apple would own the architecture market by next week.

I'm hoping for an OS X compatible version of SolidWorks (rumors say it is in the works). I don't know if that will happen at my company, but at least I could install it at home and work from there more often.

I agree with 84 Mac Guy. AutoCAD is a POS; all our old drawings are in that format and I cheer every time we convert one to SolidWorks...

Jul 24, 08 - 04:45 pm Comment from: Peter

Actually, there was a version of AutoCAD for Macintosh, back in the mid-late 80s. It ran explicitly on the Macintosh II. It's actually a funny story on how not to do a software release.

AutoCAD for Macintosh looked just like AutoCAD for DOS--it was a straight port. AutoDesk basically told everybody, "We'll release AutoCAD for Macintosh. If it sells and makes money, we'll do a 'hybrid' version that's sort of Mac-like. If that sells and makes money, we'll do a real Mac version."

What happened? Nobody bought the DOS look-a-like because they wanted a real Mac version and they figured it wouldn't hurt to wait for it. So AutoDesk never made the money that they thought they would to do the 'hybrid' version. After a couple of years, they dropped support and claimed that there wasn't enough of a market for CAD on the Mac.

Of course, there was plenty of interest. The customers didn't want a straight DOS port, though. They wanted a real Macintosh version.

By the way, check out Architosh for information on Mac-based CAD programs.

Jul 24, 08 - 04:53 pm Comment from: The Muffin Man

30 to 1 is about right.

Microsoft and Apple sell their products world wide, and Apple certainly has no more than 3% of the world market, probably less.

Jul 24, 08 - 04:55 pm Comment from: grh

Rats, sinking ship

Jul 24, 08 - 04:58 pm Comment from: Whatever

Microsoft will never stop selling Office for the Mac as it makes a lot of money for them and they are a Software company so they want to sell software - also it helps solidify all of those Exchange servers.

Jul 24, 08 - 05:09 pm Comment from: John

MDN gets it right!

Jul 24, 08 - 05:16 pm Comment from: Maginary

Again, why can't Microsoft look at their name and say, oh yeah, we're supposed to make software!

Apples and oranges, apples and oranges....

Jul 24, 08 - 05:26 pm Comment from: DH

If Ballmer believes that MS makes the best software in the world, he's delusional and should seek professional help. Perhaps a few trips for some shock treatment get him back to reality.

Should MS ever acquire Yahoo, they'd run it into the ground. I've heard that some key staff at Yahoo have already bailed out. No
doubt, in anticipation of MS seizing control.

There is NO EXCUSE for Vista's poor performance. They had 5 YEARS to get it right and they weren't even close !

Jul 24, 08 - 06:08 pm Comment from: Sir Gill Bates

I agree that AutoDesk software sucks. Our engineering department uses AutoCad, and accessing a print takes an eternity. I can almost make an 'E' size print in the time it takes to come on the screen.

Anyway, I had a thought. I wonder what it would be like if Steve Jobs was given complete control of MicroSoft? I wonder what he would do first - I mean other than shitcan Ballmer.
Do you think that even he could turn MS around? I don't mean from a profit standpoint.

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