
Steve Ballmer calls Apple's Mac growth a "rounding error" - terpua
http://www.appleinsider.com/articles/09/07/31/steve_ballmer_calls_apples_mac_growth_a_rounding_error.html
======
mdasen
This wasn't a smart thing to say. Apple's growth is real. While it may not be
a threat to Microsoft's profits, calling it a rounding error just seems out of
touch with reality.

If anything, Microsoft should play up two things. First, that they believe
their products offer a superior value, choice, and flexibility when compared
with Apple's as their "laptop hunters" commercials portray. That counts for a
lot. Second, that Apple's health shows that competition is alive and well in
the computing market which will drive all parties to produce the best products
they can.

Saying that Apple's growth isn't real simply comes off as out of touch with
reality. It makes it seem like you don't know the market well enough to see
the obvious and, if that's true, how can you steer your company to success?
Similarly, if Apple were to simply dismiss Microsoft's "laptop hunter"
commercials as not connecting with people, they'd similarly be out of touch.

Both offerings have strengths and weaknesses. Pretending that isn't true might
win you points with fanboys, but makes you seem out of touch to the 90% who
aren't die-hards on either side and try to buy what's best for them.

The key is getting across the point that your product has continued value, not
that someone else's product doesn't have value. Windows is powering more
computers than ever today as the market expands. Windows provides a low-cost
(compared to Apple) operating system that maintains a high level of
compatibility that businesses demand. Similarly Apple should stress that they
offer an elegant, integrated experience with greater interoperability than
ever.

Fanning flame wars as an executive just seems immature.

~~~
grellas
Ultimate in hubris: IBM regarding Wintel [Edit: PC] offering as a "toy" circa
1984. This seems to be in that same spirit.

Apple's Standard Oil model of business (fanatical control of every aspect of
its products) has given it certain major engineering advantages but has
limited its desktop share to that of a strong high-end niche - great for
connoisseurs and for those on the cutting edge, less appealing to those who
need to solve immediate business problems with cost-effective solutions.

It was a seismic shift ala first-time-ever mass computing that blind-sided IBM
and caused it to lose hegemony in the enterprise market. That could happen
today as well (though not from the Mac itself, which will remain a high-end
niche product), and I would suspect that Microsoft is not nearly as sanguine
in the back room about the threats to its dominance as it lets on. Agreed it
is not wise to put on an arrogant face about it.

~~~
scythe
Hm? Windows was first released in November of '85, and the first release that
achieved significant popularity was released in '87. Do you mean to say IBM
regarded the Apple Macintosh as a toy?

~~~
grellas
I really messed that one up.

IBM senior management regarded the desktop PC manufactured by its own Boca
Raton division as a toy.

What IBM missed (with all its big-systems hubris) was the competitive threat
that arose when it gave Intel and Microsoft a vehicle by which to seize the
future of mass computing when they got to supply the key inner parts for the
PC.

"Wintel" was intended as a shorthand reference to the Intel/Microsoft teaming
but it was obviously a poorly chosen term to refer to the early 1980s era,
when Windows didn't even exist.

------
socratees
Is it really about market share? The cool one is the one who innovates, the
one who changes market landscapes. Apple does that. Microsoft doesn't.
Microsoft shouldn't worry about gaining the rest 10% of the OS share. They
should worry about why they aren't innovative.

~~~
zaidf
_Is it really about market share?_

Yes. Getting market share means you've a product that lots of people want
_and_ you've figured out a way to get it to them.

Just because Microsoft does not fit in your narrow definition of innovation
does not mean that they are not innovative.

 _The cool one is the one who innovates_

Yes, but the cool one is not usually the most successful business. If
anything, Apple's learned that over its history. For the longest time it
innovated great cool things that Microsoft would copy and sell it better while
after the innovation phase, Apple would crumble. Since the iPod things have
been looking up but geez, Apple has a longtime to go before it can compare
itself to Microsoft.

Talking about innovation, don't even get me going about Apple's treatment of
developers versus Microsoft's. Hint: innovation is a lot more than building
cool technology in your secret lab.

~~~
jimbokun
"but geez, Apple has a longtime to go before it can compare itself to
Microsoft."

According to Google Finance, in the last available quarterly results for each
company Microsoft had about $13B revenue with $3B net income, Apple had about
$8.3B revenue with $1.3B net income. And Apple has been growing faster
(Microsoft's income went down year over year last quarter, for the first time
in their history I believe). So, yes, I think you can compare them. Microsoft
is still bigger with more profits, but with Apple growing faster you can make
a case it is the better stock to own.

------
sriramk
[Disclaimer: I work at Microsoft but on cloud stuff not on anything Mac vs
Windows related. This is not officially endorsed by Microsoft, just my
personal opinion, etc, etc]

One small clarification.The 'rounding error' he was talking about was the
_change_ in share. I know this since I was a few feet away doing manning a
booth for my team :)

[http://www.microsoft.com/msft/speech/FY09/BallmerFAM2009.msp...](http://www.microsoft.com/msft/speech/FY09/BallmerFAM2009.mspx)
has the entire speech. Grep the page for the quote - it appears deep in and is
just a couple of lines.

~~~
rawr
This is not a "small" clarification. The headline is completely misleading -
thank you for calling this out.

------
jcw
Yet again, Ballmer is either mad about something or saying something
inflammatory. Why not just save yourself the frustration of arguing and ignore
him altogether?

~~~
vijayr
For some reason, Ballmer's statements remind me of Sarah Palin's statements

~~~
blasdel
To be fair, he speaks in english sentences ((with the occasional chant), not
Palin's constant _word salad_

~~~
jimbokun
Not word salad, but brilliant free verse poetry.

<http://mashable.com/2009/07/29/shatner-palin-conan/>

------
JeremyChase
I think it is easy to think this way if you don't operate in many circles.
Around MS and with Ballmer's associates, I am sure that there are very few
Apple products around. But go into any Starbucks in NYC and you'll probably
see more Mac's than PC's.

~~~
jbronn
Exactly. Ballmer obviously hasn't been on a college campus in the past few
years. I personally saw the percentage of Mac laptops go from ~5% to ~40% from
2005 to 2008 in my classes. The ratio goes even higher if you go to any
scientific/technical conference.

~~~
slackerIII
You say that like it is his job to speak the truth and accurately describe the
world.

------
halo
Microsoft paint Apple as expensive, elitist and irrelevant. Apple paint
Microsoft as unfashionable, unoriginal, and unreliable.

This has been going on for years, this isn't news. Who cares?

------
joezydeco
Microsoft missed revenue estimates by a billion dollars in the fourth quarter.
I guess that's a rounding error for them too.

~~~
zaidf
Anyone know how historically significant that billion dollar figure is?
Meaning, how is that relative to other tech companies missing their estimates
in the recession?

~~~
mikeryan
Significant in regards to what?

At this point the recession is a fairly known quantity and should be factored
in to estimates - its not a very solid excuse any more.

Google and Apple topped estimates for the quarter I believe

~~~
zaidf
_Google and Apple topped estimates for the quarter I believe_

Cool. That's exactly what I wanted to know.

------
Alex3917
Summary: The infidels are falling at the gates of our operating system.

------
yread
Microsoft needs a strong Apple so that they don't get buggered by those pesky
anti-monopoly fees

------
TweedHeads
Since January 2000 when he became CEO of M$, the stock went from $60 to $20
the first year, then flatlined for the next decade.

Ballmer is the only problem in M$, the worst CEO ever, and I will be very
happy the day he steps down.

~~~
TweedHeads
Btw, AAPL went from $80 to $160 in just a quarter.

I guess Ballmer is banging his head against a monitor showing a Win7
screensaver for missing that opportunity to double his wealth.

