Thursday, June 28, 2007

What Apple could do to the worm...

I know it's more effort but this blog post from a couple weeks ago is well worth the read to jog thought about other countermanding strategeries that may be applied by Microsoft competitors (will we emerge from all this still a Microsoft competitor or a Microsoft partner?) who obviously won't sit still waiting to be mowed down by Microsoft in October.

If you're really in this to make money in the stock market, you can analyze the strategies with the current public thinking and then add the VCSy component into the equations. If you see who's winning and who's losing, you will be one step ahead of the skreet. At least with those stocks you don't have market makers trinking out the audience with their macho head games.

June 12th, 2007
Is Jobs planning a hostile takeover of the Windows desktop?
Posted by Ed Bott @ 3:06 pm

Let’s just get this out of the way right at the start: Steve Jobs is a genius and rarely makes stupid decisions. If you accept that statement as gospel, then you have to assume that Jobs has a brilliant master plan behind yesterday’s announcement that Apple’s Safari browser would be available for Windows. The full details didn’t come out in his remarks at the Apple developers conference yesterday, but it must be there.

Meanwhile, pundits are falling all over themselves to declare this the stupidest idea to come out of Cupertino since John Sculley fired Steve Jobs way back in 1985. My colleague Adrian Kingsley-Hughes yawned. Larry Dignan thinks it’s about monetizing the search box and scoffs at its financial potential, calling it a “rounding error.” Leander Kahney, who runs the Cult of Mac website, offers this critique from the other side of the aisle:

Safari sucks. A lot of Mac users won’t run the browser (I’m one of them), so why would anyone run it on Windows?

Why would anyone run it on Windows? Wrong question. The real question that we all should be asking is, “Why does Steve Jobs want Windows users to run Safari?”

For the answer, consider the fact that Apple is a hardware company with a tidy side business in services (music and TV shows). Yes, they write some pretty good software, but the real money comes from Macs and iPods and the iTunes store. Now, no one is going to pay for a browser in 2007, so why spend all that money on development and support? It makes no sense. Unless…

Unless Apple is planning to start selling its own hardware with Windows preloaded alongside OS X, and they’re planning to customize the Apple version of Windows by replacing as many Microsoft-branded middleware products as possible. There’s a hint of that strategy in the Safari press release, in which Apple boasts about the performance of Safari on Windows:

Safari has always been the fastest browser on the Mac and now it’s the fastest browser on Windows, loading and drawing web pages up to twice as fast as Microsoft Internet Explorer 7 and up to 1.6 times faster than Mozilla Firefox 2.*

That little asterisk at the end leads to this footnote:

*Performance will vary based on system configuration, network connection and other factors. Testing conducted on an iMac 2.16 GHz Intel Core 2 Duo system running Windows XP, with 1GB of RAM.

Hmmm. I’ve seen an awful lot of Macbooks running Windows lately. I personally know at least two senior Microsoft developers who happily run Windows Vista on Macbook Pros, and at a recent tech conference I noted that roughly 50% of the Macbooks I saw were running Windows XP or Vista using Boot Camp. In every one of those cases, the owner had to buy their own retail copy of Windows from Microsoft, install it themselves, and turn over half the system to an environment that Apple had not designed or approved. So what would happen if Apple began selling Windows as an option on new Macs?

1. The customer would save money. An OEM copy of Windows costs about half of what a retail copy costs, giving Apple room to pocket the difference.

2. The user experience would be better. The user wouldn’t have to go through the rigmarole of a side-by-side installation. Apple could tweak the installation, add custom drivers, and basically tune the system for maximum performance and reliability instead of allowing the Windows defaults to rule.

And here’s the part where Safari comes in:

3. Apple could replace virtually every bundled Microsoft application with its own equivalent. Windows Media Player? It’s out, in favor of iTunes. Internet Explorer? Buh-bye. Safari is the new default. Windows Movie Maker? iMovie. Windows Photo Gallery? iLife. The only missing piece is Microsoft’s e-mail client, Windows Mail (the successor to Outlook Express). And how hard would it be to port an Apple-branded e-mail client to Windows?

The best part, from a Jobsian perspective, is that Microsoft is legally prohibited from complaining about any such changes:

[T]he settlement prohibits Microsoft from retaliating against any OEM (original equipment manufacturer) because of an OEM’s participation in promoting or developing non-Microsoft middleware or a non-Microsoft operating system. This provision takes the “club” out of Microsoft’s hand and prevents the company from using anticompetitive means to discourage OEM’s from promoting or preventing rival software from being developed or installed on the Windows desktop.

Does any Windows user want Safari on their current system? Unlikely. Does Steve Jobs want as many Apple logos as possible on the Windows desktop when it’s running on Apple hardware? Absolutely. Think of it as a hostile takeover of the Windows environment by someone who is an acknowledged master at the art. Just ask the music industry.

So, my prediction: Come October, when Leopard ships, Apple will announce that anyone buying a new Mac can order an Apple-customized version of Windows Vista preinstalled on the same system. If I’m an Apple stockholder, do I care that those machines aren’t running OS X full time? Absolutely not. Windows can hang on to most of its market share, while Apple cuts a huge slice out of the hardware market currently owned by less nimble, less cutthroat competitors.

I’d consider buying an Apple-branded box if it came with Windows preinstalled. Would you?

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