Delusional Mac Users Need Microsoft

by Chris Seibold Feb 17, 2005

Spend any amount of time in the Deep South and sooner or later you’ll hear a Jack Daniels fueled cry of “the South shall rise again!” Usually the drunkard’s yell is followed by the sound of screeching tires and a not completely unfortunate meeting of a large tree (or other immovable object) with a domestic pickup truck. This behavior seems laughable when viewed by people who are not congenitally stupid (and most people in the south aren’t) but, surprisingly, the Mac has plenty fans that are just as delusional.

In the Mac universe the cry that is analogous to the drunken whoop is: “It’s finally happening.” The “It’s” the Apple fans are referring to is the market share nirvana that will suddenly happen when the average Joe starts thinking of a Mac as his first option instead of that cheap Wintel from Best Buy and IT managers all across the globe realize the Mac’s T.C.O. (total cost of ownership) is much less than that of a Windows Machine. Why are the Mac fans suddenly all atwitter about the Macs imminent dominance? Because lately every single thing seems to be breaking Apple’s way.

What has Apple been getting right? The sensible place to start is the outstanding success of the iPod. A halo effect was supposedly going to envelop the people who used the iPod and push them to the nearest Apple store to extend the experience with a Mac. It was slow in coming but the fourth quarter of 2004 did see a slight boost in market share. That minute bump (the Mac sales grew some 25% while PC sales grew a mere 14%) coupled with the introduction of the Mac Mini caused great excitement. The thought being that with market share already growing and with the introduction of decidedly inexpensive Mac all the stars were aligned for the Macs forthcoming domination. These are good signs but not the market busting home runs some people suppose they are. Sure the Mac Mini may sell in iPod quantities (doubtful, I note wait times on the Mini have dropped to “2-3 weeks”). Also when assessing the rise in market share it is important to realize that supplies of the G5 chip had been constrained for quite sometime. Hence the upward tick could be little more than the fulfillment of pent up demand.

So the numbers, at this point, certainly do not bear out a huge Macintosh revolution. Of course numbers offer a portrait of the past, not a window to the future. The faithful remain resolute, maintaining that there are other reasons to think that Apple may be headed down the Microsoft slaying path. The best indicator of the Macs newfound strength can be found in a recent interview conducted by Fortune Magazine with Steve Jobs. In the interview the Apple CEO reveals that he has been approached by three major PC makers to license OS X. Corporate hyperbole being what it is the value of such a statement is questionable but if only half true it could be a serious blow to Microsoft and an indicator of just how frustrated people have become with Windows.

And now we come to heart of the matter: Apple can’t beat or even take serious market share from Microsoft unless Microsoft makes huge blunders. People won’t turn to Macs in droves because they hear how great it is, they’ll come in droves when Windows becomes unusable. So all the “Mac will take over the world” folks shouldn’t be looking at Apple’s latest and greatest they should be watching for the missteps of the Redmond giant. And surely Microsoft would never make errors of such a scope as to allow Apple back into the game, would they?

Microsoft would not intentionally drive the company into the ground, no company would ever purposefully make bad choices. Be that as it may history is littered with once dominant corporations who found became marginalized. One prominent example is Apple computer. While there are a plethora of ways for powerful industry leaders to become marginalized the most apropos example is that of a powerful brewery reduced to a niche player. In this case study the board of a powerful brewery became overloaded with marketers. These people felt the beer would continue to sell even if quality was somewhat sacrificed for greater profits. To get a little more cash per keg they changed an ingredient with the unfortunate side effect that the beer now had flakes. Generally you don’t want flakes in your beer and the brewer’s market share went into a steep slide from which they never recovered. Could Microsoft make an equally large mistake, essentially ceding the market to Apple and Linux?

Not likely. While missteps seem to be the norm at Redmond lately they’ve got too much market presence to go down quickly. Sure Longhorn has been largely denuded of new features (when are they going to rename the thing XP Service Pack 3?) and Windows XP is nothing more than a gaping security according to common wisdom (for the record I like XP, I just like OS X a whole lot more) but neither of these problems are Microsoft killers. Too many people have too much invested in both dollars and time for Microsoft to be felled by a few largish mistakes. In short Microsoft could commit corporate suicide but they’re not there yet. None of this means that the best days aren’t still ahead for Apple. Could Apple treble the number of Macs sold this year? It would not surprise me. Could Apple continue to pull in record profits for the next five years? I think it is likely. Could Apple ever be more than a footnote when compared to Microsoft? That’s up to Microsoft.

Comments

  • In my humble opinion, having a much smaller market share has actually been a positive thing for Apple; it has forced them to be competitive.  Would they have gone to an open source Unix based platform had they had a 95% market share?  I doubt it.  It took lots of pressure from an ever decreasing market share for them to take back Steve Jobs and start really innovating again.

    And I totally agree that Microsoft will not fade into oblivion any time soon.  Let us not forget that they will release a new OS, and when backed into a corner they have a lot of weight behind them (ie cash) to be competitive.  They could copy Apple’s design again (in some form), and even if late in the game, that would keep them on top.

    However, Microsoft may have deeper problems then we are aware of.  I refer readers to the article by veteran analyst Michael Malone, Silicon Insider: R.I.P. Microsoft?
    http://abcnews.go.com/Business/print?id=88655

    Regardless, let’s just hope for more competition from all fronts, as a single dominant OS is no good for users.  I repeat, even Apple would turn sour if it were dominant, which should be evident from past decisions (eg the attitude that the superior platform would dominate, regardless of price).

    arbuckle had this to say on Feb 17, 2005 Posts: 7
  • I concur, a lot of the innovation at Apple was made possible by the small size and loyal user base. Competing from such a small position forced Apple to not just be better but to be much better.

    chrisseibold had this to say on Feb 17, 2005 Posts: 48
  • Yaahaaaaaaaaaa,
    JAjAajajjdada,

    My Mac rules the *hip* worljd!!! *burph*

    PSSSSSSSSSSSSSSSSSS (unloading some Jack Daniels)

    Iai’Ll tell you *snort* that Windowes suhucks, itsss gonnaaahh die. Yeph, Microoosof is gone. Fiiinished…. lost…..oh daamnn…..

    “Drops to the floor and starts snoring real loud”

    Michel had this to say on Feb 17, 2005 Posts: 5
  • I wish I hadn’t grown up in the South so that I was smart enough to read your column. Of course, I had to get someone to type this for me. I do, however, appreciate the efforts of anyone who seeks to perpetuate a rather tired stereotype.

    Joe S had this to say on Feb 17, 2005 Posts: 1
  • The day Microshit dies is a day when the heavens smile down upon the world smile

    Can’t believe a dork like Bill Gates was able to sell SHIT to America and the rest of the world. Are the majority of the population THAT STUPID??? Statiscally, it sure as hell looks like it!

    Jay had this to say on Feb 17, 2005 Posts: 2
  • So tell me, wouldn’t the behavior of continuing to use the virus platform (Windows) be considered to be congenitally stupid even if you don’t live in the south?

    For those who think this behavior isn’t congenitally stupid, who is to say your not simply delusional?

    What level of stupid or brilliance qualifies you to move off the virus platform to a safe haven?

    ClueGiver had this to say on Feb 17, 2005 Posts: 2
  • Anyone with a 1% sense of logic would never TOUCH anything made by MicroSHIT. Bullshit company specializing in ripping people off and taking ignorant people for a very costly ride!!

    Jay had this to say on Feb 17, 2005 Posts: 2
  • Joe S,
    As a long time resident of the South I would generally agree with your take. But, as I was searching for a topic the other evening, someone sped down the road behind my house. While flying down Dixon Lane they did, in fact, yell “The South will rise again.” A few hundred yards later they drove their S10 into the drainage ditch. I was mildly amused but also saddened. By the way, that event took place in Knoxville Tennessee.

    chrisseibold had this to say on Feb 17, 2005 Posts: 48
  • A good read despite the alleged insult to people of the south wink

    One only has to look at the graphics card market too see how the once mighty can fall and, as this particular market has such a quick product refresh cycle it’s fairly simple for anyone over the age of 18 to remember it (a bit like using fruit flies for genetic experiments)

    Remember 3dfx? If not 3dfx was the company that just about created the 3d graphic revolution.  I personally have owned a Voodoo1, Voodoo2, Voodoo3 2000, Voodoo3 3000, and Voodoo3 3500 card for my PC at one time or another.  At the time 3dfx were raking it in nVidia was a bit player who basically couldn’t get anything right. Then 3dfx fumbled.

    They missed the whole “T&L” boat whilst nVidia embraced it.  Before you know it 3dfx has zero market share and is being bought by nvidia.

    Today nVidia is being challenged by ATi because they (nvidia) were the biggest and became a trifle complacent.

    This kind of thing happens all the time.  large companies get cocky and forget who they serve, who pays for their lunch.  Small companies innovate and provide what the public want.

    nVidia started to penetrate the average persons mindset with the TNT2, Apple is on that “TNT2” road right now. 

    If things continue the way they are I think Apple has a rosy future and Microsoft had better realise they are set to become the next 3dfx if they’re not careful. 

    Alistair Hutchinson had this to say on Feb 18, 2005 Posts: 1
  • True. In any business or corporation that grows from small to big, has this problem.  entrepenuers who become very successful have this problem.  They make an inovative product or service, they build from the ground up and market it themselves, sell it themselves.  Then they get successful and they stop dealing with the customer.  Now they no longer know what the customer wants or needs.  They no longer know the environment thier business creates.  Thus they make marketing decisions based on thier inaccurate perception of reality.  They deliver not what the people want or need, but what they believe the people want or need.
    The administration in any company goes through a cycle.  Innovation, success, growth, then disconnection with the customer. 

    Apple has overcome this cycle, they have steve jobs back, they’re fresh and creative, and they’re competitive.

    Microsoft is overcoming this cycle, they set forth the .net architecture, they are releasing security updates and service packs at alarming rates, they have doubled they’re development time because of quality and security. 

    these companies are maturing and finally understanding the industry again.  Things are going to get very competetive soon. 

    The upside?
    Whoever loses… We win.

    Karl Oscar Weber had this to say on Feb 19, 2005 Posts: 18
  • The real issue in a free market is competition. Microsoft needs Apple, and vice versa. In fact they could both do well with another competitive OS (Linux is still years away from being desktop competitive).

    But has to be fair competition - which requires standards. The virtual world will get no better if nothing interoperates. Apple is makes good on this - supporting standards with iCal, Safari, iSync, Rendevzous, etc.

    As for MS dropping the ball - they are at such an installed base that they are not IBM - they are McDonalds. McDonalds will never go out of business because it is twofold: 1. They own prime real estate - so whatever they sell good or bad, will always sell. 2. They sell an essential aspect of our lives: food.

    MS is also twofold - 1. They own nearly everyone’s desktop, virtual real estate. Whatever they put on the desktop, someone will use. 2. They also sell an essential aspect of our lives: an operating system. If we did not have MS Windows - all of the first world countries would not be able to function.

    Nathan had this to say on Feb 21, 2005 Posts: 219
  • As for the 3DFX correlation - methinks that is a weak connection.

    3DFX was a tiny corporation, with tiny margins (when taking into account its R&D expeditures) when compared to Apple, even moreso when compared to MS.

    Graphics card’s fast update cycle was the result of being new technology in a developing market: pc games before Doom did not need 3D horsepower (3DFX did not “create the 3d revolution). That’s where SGI ruled the day - and also a better company to make a history lesson of.

    Today, graphics cards have settled into the mold of yearly updates, evolutionary features, and slipping deadlines just like all mature hardware markets. They may become complacent - but they are more likely to be commoditized. Which is a real danger for the operating system. If file formats become truly standardized - boom, the OS becomes a commodity and MS/Apple start seeing single digit growth.

    “nVidia started to penetrate the average persons mindset with the TNT2, Apple is on that ‘TNT2’ road right now. ”

    I’m sorry, but Apple just won the most influential brand of 2004. Bypassing Google, IKEA, and notably, Coca Cola. How is that “on the road?”

    Nathan had this to say on Feb 21, 2005 Posts: 219
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