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Microsoft: The "Bootleg Apple" Strategy and Why It Will Fail

February 18th, 2009 Comment Go to comments

The Bootleg Beatles

I think it was about 6 years ago that I went to “A Lark in the Park” in Hyde Park in London – a show that was an extension of the “Last Night of the Proms” via a huge screen, but also included a live performance in the park by none other than the Bootleg Beatles. The Bootleg Beatles, perhaps the best known of all tribute groups, provide a passable impersonation of the Beatles and their music. One of them looks like John, one looks like Paul, one looks like George and, let’s face it, nobody looks like Ringo. Their live performance sounds very close to the original Beatles sound and they are genuinely entertaining. They don’t come even close to the real thing, but that surprises nobody.

Blue Screens and Viruses

In the past decade Apple’s competitive strategy against Microsoft has been to remove the obstacles to using Apple computers. Apple did not go on an out-and-out orgy of innovation that humbled the PC and convinced people that they really should switch vendors. This is what happened:

  • After the acquisition of NeXT, Apple improved the NeXT OS (OS X) incorporating many of the features of the old Apple OS (Mac OS) and then switched the two. Mac OS was then gradually phased and OS X was gradually improved. OS X is really a GUI layer sitting on Free BSD Unix, with the Mach kernel underneath. Unix with the Mach kernel provides a very stable foundation for an OS.
  • Microsoft never saw the Apple Mac as a threat until a few years ago, even though Windows users were  becoming dissatisfied. That’s because the main Windows problems were (and to some extent still are) defined by the words: Blue Screens and Viruses. They were fixable.
  • Microsoft had many competitive advantages over the Mac: The Mac was niche, many computer users had never even seen a Mac, the Mac was relatively expensive, it didn’t use the x86 chip, a good deal of important applications didn’t run on the Mac, the Mac required you to learn a new user interface, very few people used Macs at work and that wasn’t about to change. Microsoft simply continued with its “drag along” monopoly strategy, dragging its users behind it.
  • In early 2001 Apple opened its first two Apple stores. Microsoft never took much notice. Many commentators declared it an initiative that was doomed to fail. But Apple understood that many people didn’t buy Macs because they never got to touch them or play with them. As Apple stores proliferated, Mac sales rose.
  • In late 2001, Apple’s iPod was released. As time past this unassuming device shifted the goalposts, but Microsoft never recognized the danger. Apple set up iTunes to sell music for the iPod and Microsoft still didn’t see it as competition. In time iTunes became the fastest growing software product on the PC. Millions of PC users were now running an Apple application. iPod user began to buy Macs
  • Apples OS incrementally improved with each release. Soon people were comparing the iMac “look and feel” favorably to the Windows look and feel. And this coincided with the time that Microsoft allowed the Longhorn project slip for years. These were lost years for Microsoft.
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