embertin
11-13-2009, 02:32 AM
Something occurred to me today as I was reading a piece about Bing, Microsoft’s search engine. Sometimes it seems like Microsoft acts like the bitter older brother or sister who can’t stand its siblings having anything that it doesn’t have. When someone makes something successful, Microsoft has to have it. Then I began thinking about how this contrasts with the way Apple does things. If you look at the way both companies develop new products, or bring new technologies to the market you see a stark difference in approach.
Apple identifies technologies that are in their infancy or are relatively unexploited and finds away to give them mass market appeal. Examples: iPod, iPhone, The GUI, iTunes, Multitouch
Microsoft on the other hand identifies technologies that are established and successful, then decides that it want’s part (or all) of that success and uses its size and power to chip away at the competition until it gains market share. Examples: Xbox, Bing, MSN, Windows, Windows Mobile, Zune.
I’m speaking on general terms here of course, obviously there are exceptions.
Another interesting point is that Apple almost always seems to approach new products with the goal of making a profit from whatever that product may be, whereas Microsoft seems to approach a product line with the goal of dominating that market regardless of profitability.
The curious thing about this is that from a purely business point of view, Apple’s way of doing things should make more sense. Bring out something people want and make a profit from it. It’s business 101, and yet over the years the technology media has become blinkered into accepting Microsoft’s approach of “dominate at all costs” as being the only acceptable way for a technology company to operate. Time and time again we hear from pundits about how Apple is doomed unless it focuses on market share over profits, and yet the company has been operating very successfully for the past 10 years or so and we’re still waiting for that inevitable doom.
It’s funny how Apple is one of the few (if not only) very successful businesses that pundits continue to argue that the companies business model is entirely wrong and that it should be doing things completely differently. According to some, Apple should open up the iPhone to other handset makers, licence its operating system, let other products work with iTunes and so on. Even after all the years of iPod and iTunes success, even with the recent rise of the Mac and the dominance of the iPhone, many pundits still think Apple should be operating more like Microsoft. Yet Microsoft has become stagnated in an endless round of trying to one up others. It tried to reposition its successful xbox 360 to go after the wii market despite being a successful product in its own right. It opened a series of its own retail stores almost identical to Apple’s despite having hundreds of thousands of existing channels to sell its products. It’s desperately trying to wrestle control of the search engine market from Google even though its core business is computer operating systems.
I’m not trying to say Microsoft copies and Apple is original. It’s just that Microsoft has become obsessed with having what others have at the expense of what it used to do best: making money. Obviously they’re still a profitable company, but as they continue to make decisions based on what appears to be jealousy rather than basic business you have to wonder for how long. Perhaps it’s time technology pundits start accepting that maybe Apple’s solid business model of profitability before market share isn’t that bad after all, and maybe Microsoft could learn a thing or two by taking that approach for a change.
Apple identifies technologies that are in their infancy or are relatively unexploited and finds away to give them mass market appeal. Examples: iPod, iPhone, The GUI, iTunes, Multitouch
Microsoft on the other hand identifies technologies that are established and successful, then decides that it want’s part (or all) of that success and uses its size and power to chip away at the competition until it gains market share. Examples: Xbox, Bing, MSN, Windows, Windows Mobile, Zune.
I’m speaking on general terms here of course, obviously there are exceptions.
Another interesting point is that Apple almost always seems to approach new products with the goal of making a profit from whatever that product may be, whereas Microsoft seems to approach a product line with the goal of dominating that market regardless of profitability.
The curious thing about this is that from a purely business point of view, Apple’s way of doing things should make more sense. Bring out something people want and make a profit from it. It’s business 101, and yet over the years the technology media has become blinkered into accepting Microsoft’s approach of “dominate at all costs” as being the only acceptable way for a technology company to operate. Time and time again we hear from pundits about how Apple is doomed unless it focuses on market share over profits, and yet the company has been operating very successfully for the past 10 years or so and we’re still waiting for that inevitable doom.
It’s funny how Apple is one of the few (if not only) very successful businesses that pundits continue to argue that the companies business model is entirely wrong and that it should be doing things completely differently. According to some, Apple should open up the iPhone to other handset makers, licence its operating system, let other products work with iTunes and so on. Even after all the years of iPod and iTunes success, even with the recent rise of the Mac and the dominance of the iPhone, many pundits still think Apple should be operating more like Microsoft. Yet Microsoft has become stagnated in an endless round of trying to one up others. It tried to reposition its successful xbox 360 to go after the wii market despite being a successful product in its own right. It opened a series of its own retail stores almost identical to Apple’s despite having hundreds of thousands of existing channels to sell its products. It’s desperately trying to wrestle control of the search engine market from Google even though its core business is computer operating systems.
I’m not trying to say Microsoft copies and Apple is original. It’s just that Microsoft has become obsessed with having what others have at the expense of what it used to do best: making money. Obviously they’re still a profitable company, but as they continue to make decisions based on what appears to be jealousy rather than basic business you have to wonder for how long. Perhaps it’s time technology pundits start accepting that maybe Apple’s solid business model of profitability before market share isn’t that bad after all, and maybe Microsoft could learn a thing or two by taking that approach for a change.