Yesterday, October 22, Apple held a special event to announce significant updates in their lineup of software, hardware and services, and unveil what they have lined up for the holiday season.
They have been busy.
Practically everything was upgraded, and some new products were introduced as well. Each announcement deserves praise in its own right, but it’s only by looking at the whole picture that the tremendous scope of yesterday’s event becomes obvious.
I’m sure the new MacBook Pros, the completely redesigned Mac Pro, the new iPad Air and the iPad mini with a Retina Display will all be incredibly popular. This coming holiday quarter is probably going to be the best ever for the company, and that’s saying a lot. But I think these new products distract attention from something else that happened yesterday with the potential to be huge for the company.
Yesterday, Apple decided to kill Microsoft.
I know, it seems strange to think of Microsoft in this context. When Apple ended the famous “I’m a Mac, I’m a PC” ad campaign, they shifted their focus and moved on, and they practically stopped referencing Microsoft altogether. Instead of promoting Apple products as being better than Microsoft’s, they decided to simply promote them as something else entirely. The original iPad perfectly embodied this change of attitude. It was the beginning of the “Post-PC era” and Microsoft was no longer relevant.
What was different then, during yesterday’s keynote? Well, for all their talk, for the past few years Apple has avoided a direct confrontation with Microsoft. The thing about Microsoft is, they may not be a credible threat in the Post-PC era, but they remain the dominant player in the traditional PC industry. Until now, Apple’s strategy was to end this dominance with their Post-PC devices: the iPhone, and specially the iPad, have become mature enough to serve as a primary computer for many, many people. Apple has been playing to their strengths, trying to cannibalize the PC industry, and the results have been remarkable.
On the other hand, Microsoft is struggling to gain momentum in the Post-PC world. They are still holding on to their two main businesses to maintain profitability: Windows and Office. Even though they’re not growing anymore, the enterprise market and the traditional consumer PC market are still huge. This is where Microsoft rules as undisputed king (at least in terms of market share). Yesterday, Apple decided to attack them on their home turf.
Think about it for a moment: iLife and iWork are now free with every new Mac and iOS device. OS X is now free, not only for every new Mac, but also retroactively for every Mac that supports it, going back as far as 2007. Apple just commoditized Microsoft’s two main businesses, and they’re not even breaking a sweat.
At a consumer level, this move gives people another great reason to buy a Mac instead of a PC. If you factor in the cost of the Windows and Office licenses (including future versions), the price difference between similarly specced Macs and PCs is going to be significantly reduced. Not to mention all of the great features that are Mac-only, like the Retina Display or the great battery life under OS X. The Mac has been a better computer for years, but now, it may even be cheaper in some cases.
For the enterprise and for small businesses, the implications are equally huge. Free OS updates across the board means everyone gets to be on the latest version, which should make life a lot easier for IT departments, and the ease of use and installation should greatly reduce support needs. This is going to be a big factor whenever a company plans to invest in new computers for its employees, because the potential for saving money down the road is huge. Free productivity software that works across all devices (desktop, laptop and mobile) with 100% compatibility is the holy grail in the enterprise world. Soon, people could be sending Pages documents instead of Word files, simply because it will be the file format that you are 100% sure you can read and edit on all your devices.
Of course, this has been years in the making for Apple. Like a great chess player, they have been laying the groundwork for a long time, they’re now simply revealing their big move to the enemy. By building an impressive ecosystem and tying everything together in a way that only Apple can, they have put themselves in a great position to take down the Windows empire once and for all. The fact that they make their profit from selling hardware means they can afford to give the software away for free, which leaves Microsoft with no possible answer. Well, other than to start making their own PC hardware on a massive scale, of course. Good luck with that.
It’s obviously too soon to tell if this means checkmate in the long run, but Apple certainly shot to kill yesterday: If I were working at Microsoft, I would be scared shitless right now.