Apples, Kids, & Attitude
Wait and See…
In August, Steve Jobs stepped onto the stage at MacWorld Expo and declared an end to the
Apple-Microsoft feud. After signing a few agreements, Apple will be collecting royalty checks from
Microsoft for its use of Apple technology. Microsoft's highly publicized stock investment in Apple
helped create a burst of enthusiasm for Apple and its products. This coincided with the back-to-school
buying season and the release of Mac OS 8.
I'm glad the feud with Microsoft is officially over. For the past several years Apple Computer has been
the "incredible shrinking computer company." There has been much debate about why the Macintosh
market is shrinking, but I think much of it stems from misinformed reporting about Apple's plight and
a general misunderstanding about the Microsoft-Apple OS rivalry. If every story printed about Apple
were true, the company would represent the most successful business failure ever (at the time of this
writing, the company has more than $1 billion in cash). In my view, Apple's resources are best used
developing new products and technologies, not paying legal bills. The company needs to use its assets to
improve products and increase sales. The Microsoft deal will allow to Apple to allocate its resources
more effectively and better focus its efforts.
There are millions of Mac advocates. Each of us has personal reasons why we prefer to use a Mac and the
Mac OS. I believe the creators of the Mac OS were motivated in part by respect for their fellow human
beings and an appreciation for each individual's inherent strengths, weaknesses, talents and skills. The
Mac OS has provided a better opportunity for human expression. The Macintosh opened the world of
computing to millions of non-computer users. It was a breakthrough product for its time.
In keeping with the tradition of innovation and ease-of-use, Mac OS 8 is a nice progression from
System 7.x. I'm looking forward to Allegro, the next major upgrade to the Mac OS. Allegro will further
enhance functionality. The more I use Mac OS 8 and read about Allegro, the more enthusiastic I become
about the Mac OS and its future.
The official end of the Apple-Microsoft feud will have direct and indirect effects. One is that the
licensing payments from Microsoft will improve Apple's financials. This has received far less attention
than the $150 million investment by Microsoft in its former arch-rival. Many press reports have
referred to Microsoft's investment as a "bail out," which indicates a lack of understanding of Apple's
circumstances, its balance sheet, and its product strategy.
Apple doesn't need the $150 million as much as it need positive press. Microsoft's investment has
helped to significantly raise the value of Apple's stock. In my view, this is because the public
perception of Apple Computer's financial standing increased dramatically when the deal was announced.
Ironically, because of the increase in Apple's share price, Microsoft's investment in Apple has also increased significantly in value.
Another benefit to the official end of the Apple-Microsoft feud is a more realistic discussion of Apple's
position in the personal computer industry. Microsoft Windows, in all its variations, is the
predominant operation system today. It is unlikely that the Mac OS or a combination of the Mac OS and
Apple's Rhapsody will supplant Windows in today's personal computers. It's my view that Apple can
dramatically increase its sales and market position but only if a new personal computing paradigm or
model is established.
Over the past several weeks, Apple Computer acquired the core assets of clone maker Power Computing
and much of the Apple-IBM-Motorola partnership was unraveled. These events will reshape the
manner in which Apple approaches the marketplace. Apple has chosen to virtually eliminate the
Macintosh clone market (at least temporarily) and the Power Computing deal will help Apple develop a
direct sales approach in key markets.
There has been much talk about Apple's plans to produce network computers (NCs). Apple's decision to
"unspin-off" its Newton unit has only added to the NC speculation. Last year's acquisition of NeXT and
the company's continuing development of the Rhapsody OS fits quite snugly with the development of
network computers. Apple may have more than just a dual OS strategy. It may also be developing a dual
computer strategy (network and non-network computers). Can you imagine Apple Computer providing
products that allow users a choice between computing options based upon their personal computer
needs? Better yet, can you imagine Apple Computer providing virtually seamless integration of diverse
products (desktop computers, Message Pads and eMate-like units) to allow users access to a myriad of
products, services and technologies? The possibilities are endless.
Apple Computer has seen significant change since Steve Jobs' return first as an advisor and now as
interim CEO and the company's guiding force. However, the company is less forthcoming about its plans
than about its changes. During the next several months, change will continue at Apple Computer and in
its approach to the personal computer market. For me, it's a matter of wait and see...
I think the array of new products being developed by Apple will be impressive. I also think there is
tremendous opportunity for Apple to design unique solutions to corporate and personal computing needs.
Apple may embrace different microprocessors (RISC and non-RISC) for use in its different products.
In the end, Apple will remain unique, but perhaps in ways few of us expected.
I'm glad the Apple-Microsoft feud is officially over because I think a new revolution is about to begin.
What do you do if you don't like the rules of the game? If you're Steve Jobs and Apple, you change the
game. Like I said, "For me, it's a game of wait and see." I hope you wait with me. Things are about to
change in ways few of us might have imagined!
"Apples, Kids and Attitude[TM]" is © 1997 Robert Paul Leitao, <rleitao@atpm.com>.
Also in This Series
- Good Morning America, How Are You? · October 2003
- Martians in the Manholes · February 2001
- The Golden Touch · May 2000
- Three Kids and an iMac · February 2000
- How? · November 1999
- Apples, Kids, & Attitude · August 1999
- Play Ball! · May 1999
- A Time For Change · February 1999
- New Year, New Times · January 1999
- Complete Archive
Reader Comments (0)
Add A Comment