The Road Ahead

I acknowledge that I am copying the title of Bill Gates' book from about ten years ago. I'm halfway through my degree, and considering my own road ahead. Since it's the start of a new calendar year, I'm going to make some wild guesses about the future of two firms I work with quite a bit, Apple and Microsoft.

Both are hardware companies. Microsoft may not manufacture computers, but they do make the Xbox and Zune, as well as a handful of peripherals. Both companies make operating systems, and both companies make application software.

Apple is run like a startup. Steve Jobs is entrepreneurial; after he was ousted from Apple in the 80s, he went on to start NeXT and run Pixar. Microsoft is turning into a growth company; they have their hands in many pies, and have a stable of goods and services that, for the forseeable future, provide steady revenue and growth.

Apple has a reputation as a warm and fuzzy company, while Microsoft has a reputation as an 'evil' company, based largely on their business practices in the 90s. Apple is not your friend; I say this having interacted with the company over many years in my career. They do not share information, they provide limited options to the enterprise space (and education, as well, educators just don't realize that). The company has had its share of failures, and they take their time to acknowledge and resolve them. This doesn't make them worse than Microsoft, or any other company, for that matter.It just means that they are a large corporation, and the notion that they are somehow nicer or cooler or better than other firms is laughable. They are very good at what they do; that is as far as it goes.

Microsoft has made some missteps. They had a huge manufacturing error with the Xbox, resulting in a $1BN charge to pay for defective units. That alone should knock out any profit they might have obtained from the Xbox, yet it is worthwhile to them to stay in the game console space - a space Apple has avoided. Their ties to Netflix, Facebook, LastFM, and licensed products sold via Xbox Live represent a multi-threaded approach to generating revenue from services. The Xbox is the razor; Xbox Live and various games are the blades. I would argue that the Xbox and Xbox Live are Microsoft's iPod and iTunes Store.

So where are these two firms headed in the near future? Everyone is certain Apple will be coming out with a tablet or netbook soon. Apple is known as a media company, and with the iTunes Store, they are establishing a strong presence as an e-tailer. Microsoft seems to be repairing its image and trying to stay warm and fuzzy in the consumer space; this is a departure from their previous attempts to become integrated with new services, ala operating systems for cable boxes. I'm not sure this is the best bet, unless they really have got all of the market they are going to get in their original markets, or are willing to cede it to other operating systems.