Microsoft’s Bill Gates is once again playing catch-up to Apple’s Steve Jobs

“The battle for supremacy in the digital entertainment world is about much more than who makes the sleekest, coolest device… The battle is really about who controls the next generation of home entertainment; how content is received, stored, viewed, manipulated and distributed. In essence, it is a platform war like the one in the late 1980s and early 1990s that firmly established Microsoft as the rainmaker of the PC world, and made company co-founder and chairman Bill Gates the world’s top techie and richest man in the process. Smart investors might be asking themselves whether they really want to bet against this man,” Simon Avery reports for The Globe and Mail.

“Once again, Mr. Gates is playing catch-up to Steve Jobs, his counterpart at Apple Computer and one of the greatest innovators of the digital age. Apple’s early success with the iPod and its accompanying music ecosystem has given the company a solid head start,” Avery reports. “This week, the Cupertino, Calif.-based company reported soaring revenue and profit for the second quarter, with iPod sales generating $1-billion, or almost one-third of Apple’s total revenue. The iPod is converting long-time Windows users to the Apple platform, Peter Oppenheimer, Apple’s chief financial officer, told analysts on a conference call. The ripple effect from the portable music player included a 43-per-cent increase in the number of Apple Macintosh computers sold in the quarter, a 70-per-cent increase in traffic to Apple’s 102 stores and a doubling of in-store sales from a year earlier.”

Avery reports, “It would be a mistake to think, however, that Mr. Gates and his team have been caught flat-footed, as they were 10 years ago by the Internet. ‘Our story is harder to tell,’ says Greg Barber, vice-president of the home and entertainment division at Microsoft Canada Co. and a member of the consumer strategy team in Redmond. ‘It’s not just music, it’s video, TV and photos, and even communication in terms of smart phones. Our story is a little harder to tell because it is broader and because it is done jointly through partners.'”

Avery reports, “The winner in the race is likely to be the company that can take the elements of home entertainment and combine them into a single neat fashion that is easy for the consumer to embrace, Puneet Jain, a senior marketing manager for Sony of Canada Ltd., says. Today, Apple Computer claims bragging rights as the company that has most closely achieved that. It is expanding the iPod’s capabilities to carry photos, and many are hoping Apple will eventually find a way to popularize mobile video content.”

Full article here.

MacDailyNews Take: Only one company makes computer hardware, consumer electronics, operating systems, and software under one roof: Apple Computer, Inc. That is why their solutions work so well for the users of the products. Apple controls the entire widget to create seamless, solid, elegant solutions vs. the disjointed “too many cooks in the kitchen” approach of the Wintel hegemony.

38 Comments

  1. Apple produces all of the widget because they can. Imagine if Microsoft attempted to produce the entire widget – it would never see the light of day due to numerous delays. They must partner just to get things done.

  2. Yes, but the problem is with marketing and sales. In this arena, Apple is alone, and totally outmatched by all those Microsoft partners. How long has it been since you saw a TV ad for Macs or OSX? Apple has 200 stores, and PCs are sold everywhere. And those stores advertise, as well.

    Apple, your innovation is great. But, your marketing and advertising sucks. And everyone knows it but you.

  3. Don’t underestimate Apple. 10 Years ago, Steve Jobs was at NeXT and Apple was in a steady decline and getting steamrolled by Windows 95.
    The 32-bit OS wars were won by Micro$oftopoly, but the next era is dawning with 64-bit, networked computers with powerful media applications. The race is on and Apple is well ahead with it’s technologies, OS and apps.

  4. Patience Alvin, Patience….. The vacuum of space that was once Apple’s Advertising & Marketing efforts is about to breath it’s first breath of fresh air…

  5. NoPCZone, I think you missed Alvin’s point. As far as technology is concerned, Apple is in the lead. No question. But, this war will not be won by technology alone. I have to agree that Apple needs to promote more than the iPod. Unless they have already given up, which may well be the case.

  6. In order for Apple to be the standard in music, etc. it has to allow others onto its platform – or does it intend to dominate the market by being the only vendor in it? M$ ultimately got where it did due to licensing. Producing the whole widget is all very nice, but as Sony found out when its music interests competed with its hardware interests, hardware and software require different treatment.

  7. There is plenty more coming. Apple already is showing signs of acting differently than they had in the past. The iPod is mainstream. Since when was Apple ever really mainstream? This in and of itself speaks of a new direction.

    Advertising will likely come, but it likel;y won’t be traditional. There’s going to be a leveraaging of the already in-place iPod/iTunes structure.

    This is really an exciting time. There is a noticeable level of sophistication with this company. They don’t do things like the others– essentially beg for your business. They expect us to be able to discern the difference. In that way, they actually elevate, not belittle their customers. Once a customer catches on to that, they like being appealed to as savvy.

  8. My dear “Alvin” (and the others of your ilk):

    Your analysis of Apple’s marketing tactics would be worthy of praise from a Business Marketing 101, C-level, student, but you have no clue on the workings of the real world. Rather than a detailed explanation (which would most likely fly at Mach 7 over your head), think about why Porsche, Jackson Hole (Wyoming) and Nikon are all very well known without advertising.

    If you’d notice, the items that get advertised the most (or loudest) are the crappiest products. You can determine their crappiness level by noticing how much they talk about the user’s feeling and sensations rather than on the product itself; “let’s talk about a fictional ‘cool factor’ because in reality the product sucks.”

    Apple is very well aware that they cannot even scratch the surface of Mac’s best qualities within a commercial. Regardless how cool the Mac really is, stating so in a 30 second ad makes it appear as cheap as the other crap being hawked. What would Porsche gain by advertising?

    Apple DOES advertise in Mac-oriented magazines, because they know that it is much easier to sell a new model Mac to an existing user. But no ad is going to make someone with an existing Hellish experience with computers (thanks to Microsoft) want to change. The vast majority of people stay with the Hell they know rather than the possible Hell they don’t know. If most people get thrown and hurt while riding horses, how easy is it to get someone to ride your horse?

    And, please, don’t start on the iPod-to-Mac advertising comparisons. They are vastly different products and markets. I fully entrust the people that made the excellent decision to design and advertise the iPod to make the equally excellent decision not to advertise the Mac until the time and place are right.

    In the mean time, continue to use your Mac with all of its ease, stability and security, and help Apple advertise Macs the way they are meant to be; invite a Windows-using friend over for a drink and pizza… and a one-on-one computer show.

  9. “If you’d notice, the items that get advertised the most (or loudest) are the crappiest products. You can determine their crappiness level by noticing how much they talk about the user’s feeling and sensations rather than on the product itself; ‘let’s talk about a fictional ‘cool factor’ because in reality the product sucks.’ “

    What about Apple’s iPod advertisements? There are a lot of iPod ads and the iPod doesn’t suck.

    Or are iPod ads an exception to the rule?

  10. “If you’d notice, the items that get advertised the most (or loudest) are the crappiest products.”

    Though I see your point, and in many cases you are right, the product isn’t what the advertising if for, all of the time; it is mind share.

    There is a local PC shop where I live that has the most annoying commercials ever. They are cheap, cheesy and don’t even mention a product. Yet the commercial is successful. It is successful because everyone knows those awful commercials from that one company.

    And when someone needs to buy a computer the only name that comes to mind is that one company because it is so loud in memory it drowns out everything else. Crappy commercial, crappy product, successful advertising.

    Apple needs to advertise for mind share. They need to let the world know they still make computers, and they rock.

  11. The Wintel crowd may have the majority. Remember Ford and the model T? They were bested by car companies looking to produce more than a cheap, non personal car. Customers wanted quality and differentiality, and this is seen by those who are switching to Apple now. This trend will only continue.

    Customers will choose Apple over Microsoft because there is a higher intrinsic value to the product. The quality of the customer experience is far better on a mac then on a wintel machine.

  12. Of course, people do choose Apple over Microsoft because of higher intrinisc value, etc.

    But not if they don’t know about Apple. Just get an ad agency who can show that tastelfully, not one who produces ads just to get awards from ad agency peers.

    Porsche does advertise in many ways. The most effective way that Porsche uses to get name recognition is racing, which they have used for 50 years.

    Apples seems to take the viewpoint that: If I hide what I am capable of doing effectively enough, people will come looking for me. UH… not it they don’t know you exist!!!!!!!!

    In the social/dating world, those who play hard to get don’t get any. Advertising is not that different, unfortunately.

  13. As much as I want Apple to have 99% market share and to be less expensive, I also know that the best products are never cheap and mass produced. This is what happened to Microshaft. I wan’t Apple to slowly grow over time and maintain it’s quality.

    Word of mouth advertising beats TV ads etc anyday. So much more people are interested in my 12″ iBook than my last PC notebook. This was not because of advertising…

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