Apple Is a Low-Volume Player on Every Market, Except Tablets, Says Chief Exec of Microsoft

Steve Ballmer Criticizes Apple, But Follows Its Business Approach

by Anton Shilov
10/30/2012 | 06:48 PM

Although Microsoft Corp. recently decided to embrace some of the business practices from its long-time rival Apple and intends to offer its own-brand hardware to take advantage of all the benefits its software can provide, its chief executive still does not really like Apple’s approach and claims it has too many limitations, which do not let Apple to grow.

 

It is not a secret that Microsoft Windows operating system is the dominating OS for personal computers on the planet and that is not going to change any time soon. However, Microsoft is not so lucky with its platforms for smartphones and tablets, mostly because both categories are evolving quicker than Microsoft can update its OS and hardware makers produce decent hardware with proper user experience to take advantage of that software.

To tackle poor user experience and bring it towards that of the Apple iPhone or Nokia, Microsoft imposes severe restrictions on what kind of system-on-chips and other components to use with its Windows Phone operating system-based devices. Furthermore, it has launched its own Surface tablets to set up a standard for all Windows RT-powered slates and promised to make more hardware when it makes sense.

Still, Microsoft prefers its own business model, under which it makes software and others create market share for that software through endless differentiation of their devices. By contrast, the head of Microsoft believes, Apple remains a minor player because it cannot serve everyone on the planet with limited amount of products.

“We like our model, as we are evolving it. In every category Apple competes, it is the low-volume player, except in tablets. In the PC market, obviously the advantage of diversity has mattered since 90-something percent of PCs that get sold are Windows PCs. We will see what winds up mattering in tablets,” said Steve Ballmer, chief executive of Microsoft, in an interview with the Wall Street Journal.

While Apple is barely too successful with its Macintosh PCs, set-top-boxes and some other products, the company is indeed the world’s No. 1 supplier of media tablets, is the world’s second largest maker of smartphones and is still the biggest seller of personal digital media players. Most importantly, Apple is a key player on the two rapidly evolving markets – smartphones and media tablets, where Microsoft has yet to establish its presence at all since so far Windows Phone and Windows 7 have not penetrated these markets any significantly.

The software giant itself believes that today it finally has what it takes to win in the new world of mobile and non-mobile devices: it has operating systems for PCs and tablets, it has Windows Phone 8 platform for smartphones, it has popular Skype communication program and it has ultimate entertainment platform called Xbox.

“You really do see all of Microsoft well integrated into Windows 8 and Windows Phone. This is really quite remarkable. You buy a Surface, it is all of Microsoft. You've got Office, Skype, it is all right there. We are focused on devices, with their integrated services, and we have got three of them primarily: [Windows] Phone, Xbox and Windows. Those are the vessels in which we should pour our value,” stressed Mr. Ballmer.