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How, and Why, Apple Overtook Microsoft

HughPickens.com writes James B. Stewart writes in the NYT that in 1998 Bill Gates said in an interview that he "couldn't imagine a situation in which Apple would ever be bigger and more profitable than Microsoft" but less than two decades later, Apple, with a market capitalization more than double Microsoft's, has won. The most successful companies need a vision, and both Apple and Microsoft have one. But according to Stewart, Apple's vision was more radical and, as it turns out, more farsighted. Where Microsoft foresaw a computer on every person's desk, Apple went a big step further: Its vision was a computer in every pocket. "Apple has been very visionary in creating and expanding significant new consumer electronics categories," says Toni Sacconaghi. "Unique, disruptive innovation is really hard to do. Doing it multiple times, as Apple has, is extremely difficult." According to Jobs' biographer Walter Isaacson, Microsoft seemed to have the better business for a long time. "But in the end, it didn't create products of ethereal beauty. Steve believed you had to control every brush stroke from beginning to end. Not because he was a control freak, but because he had a passion for perfection." Can Apple continue to live by Jobs's disruptive creed now that the company is as successful as Microsoft once was? According to Robert Cihra it was one thing for Apple to cannibalize its iPod or Mac businesses, but quite another to risk its iPhone juggernaut. "The question investors have is, what's the next iPhone? There's no obvious answer. It's almost impossible to think of anything that will create a $140 billion business out of nothing."

8 of 458 comments (clear)

  1. They always [conveniently] miss facts... by bogaboga · · Score: 5, Informative

    "Unique, disruptive innovation is really hard to do. Doing it multiple times, as Apple has, is extremely difficult."

    "Unique, disruptive innovation is really hard to do. Doing it multiple times, as Apple has, is extremely difficult." That's why Apple has had its share of failures..."

    Additions mine. This is one fact that a simple google search would have shown. One may ask, are the authors of these pieces paid?

  2. Re:Create a $140 billion business out of nothing? by Tridus · · Score: 1, Informative

    That's not creating a new business out of nothing, nor is it being particularly visionary. It's a natural improvement on an existing market segment.

    This piece reads like someone has been smoking the good stuff at Apple HQ.

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    -- "So they told me that using the download page to download something was not something they anticipated." - Bill Gates
  3. Re:Japan: and the $0.02 market analysis. by ClaraBow · · Score: 4, Informative

    Apple's market share is dwarfed by Android's, but Apple's profitability makes the Android people look like peasants.

    One major reason for this is that the Android market is inundated with very low-end Android phones. These phones are often underpowered and have very little storage. I work at a large public school corporation and have kids come to me asking for help on installing apps on their phones or asking why they can't load music or download games. The hardware just doesn't support it, which limits the app and content Android market.

  4. Re:Different markets... by BarbaraHudson · · Score: 5, Informative

    No, Microsoft are making Windows 95 with a few tweaks and Office 97 with a terrible icon bar added they call a ribbon, minor tweaks to two decade old products. Apple make popular well designed products. You might want to dismiss them as mere trinkets, but users with money know better.

    From the one-button mouse to the hockey puck mouse, the "style over functionality" of the toaster mac to the gooseneck mac, the oh-so-greatly engineered antennagate phone to the latest bendable phone ... so let's look at the software side. From updates that crash the computer to phone updates that didn't check to see if there was enough free space before attempting to install ... and lets not forget the holes in their cloud storage ...

    Every player in the industry has had products that are poorly designed and/or poorly implemented. And that includes the free / open source ones. The price you pay is not a direct correlation with the quality of what you get in the end.

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    "Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
  5. Re:Japan: and the $0.02 market analysis. by Anonymous Coward · · Score: 1, Informative

    Those low-cost phones are the visionaries today seeing what Apple doesn't want to see now: the days of people buying expensive phones are numbered.

  6. Two potential markets. by 140Mandak262Jamuna · · Score: 1, Informative
    1. Automobile sharing like, iUber. 95% of the cars bought remain unused 95% of the time. [*FN1] Cars are the second most expensive thing a typical American buys. The most expensive for renters. The first expensive thing for all too. This level of over investment in something that lies idle for so long, depreciates in value.. It is ready for a huge disruption. Uber and its clones are the first movers. A company with better image would do a lot better.

    2. More than 70% of credit transactions are not loans, the balance gets paid every month. Credit card companies are raking in 2% commission on these sales without taking the risk of advancing an unsecured loan. Most retailers are not giving 2% discount to non-credit cards because of contract with credit card companies. Only when the non-credit card usage reaches a critical mass, they will flip and customers and retailers will split that 2% off the credit card companies and banks. Waiting for a company with credibility for mass market adoption.

    [*FN1] 100 *( 1 - (15000 miles/year) / (55 miles/hour) / ((365 days/year) *(24 hours/day)) )

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    sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
  7. Re: Japan: and the $0.02 market analysis. by symbolset · · Score: 2, Informative

    iPhone 4s was a $600 phone. Now you can get a much better device for under $50. This is the future.

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    Help stamp out iliturcy.
  8. Re: Create a $140 billion business out of nothing? by Karlt1 · · Score: 3, Informative

    The iPhone, and none of Apple's other products, are an improvement. They're veblen goods, people just pay more for them despite less features, walled gardens, forced obsolescence, lack of expandability, NO FREAKING SD CARD SLOT and other anti-consumer practices because they're stupid. Same reason people pay $5 for $0.30 of coffee at Starbucks, they want to feel like a princess by spending more when the reality is they're just getting ripped off.

    I can't seem to find the SD card slot in any Nexus Phone....

    And as far as forced obsolescence, a 2011 iPhone 4s can still run the latest OS. How many Android phones that were sold during thst time period are still officially supported? Apple provided a security patch for the 3GS released 6/2009 on 2/2014. Android manufacturers and Google left security problems on Android phones less than 2 years old.