Pender's Blog

Blog archive

Apple Now Much Bigger than Microsoft -- and Google's Gaining

The world turned upside-down some months ago when Apple became bigger than Microsoft, thereby rendering obsolete -- or, at least, purely historical -- Bill Gates' declaration to Steve Jobs in the epic film Pirates of Silicon Valley that, "I got the loot!" It's about 7:40 here if you want to see it again.

Billions of dollars in sales of iPhones, iPads and just plain ol' Macs later, Apple isn't just bigger than Microsoft -- it's way bigger. In fact, it's $100 billion in market cap larger than any other company in the technology industry. (Yes, that's billion with a "b.") That's some pwnage, as we understand the kids call it these days, right there.

But look out, Microsoft. Your grip on the No. 2 spot is slipping. Rushing up behind you is Google, which is within striking distance of taking the runner-up spot. Apple and Google are growing explosively, and Microsoft is, well, not. So, what does all of this mean for the former king of the software hill?

We at RCPU actually interpret it as mostly good news. Microsoft's slow growth is bad news for partners, but its loss of the top spot in the technology industry (by a huge margin) shouldn't really matter that much. In fact, as we've said here before, it should encourage Microsoft to stop chasing Apple in the consumer market and focus instead on holding its enterprise ground -- which is where partners derive most of their revenues, anyway.

In the Pirates of Silicon Valley clip, somebody who works for Apple tries to convince Jobs that it's Microsoft, not IBM, that is the company's mortal enemy. Microsoft could take a similar lesson here: It's Google, not Apple, that Redmond should watch out for. Sure, the iPad is cutting into PC sales. But Google's cloud-based business offerings cut to the very core of Microsoft's most profitable and stable enterprise offerings.

And we're not talking about search here, either. Bing is actually making inroads against Google, but Microsoft has to focus on protecting its enterprise market. Azure and the cloud strategy will be key to that, and so will making sure physical servers stay relevant in an era of expanding cloud infrastructure. All of that means competing against Google, not Apple.

Bill Gates, to his immense credit, is busy giving his loot away these days. Back in the rat race, it's Steve Jobs, not Steve Ballmer, who has it now. Microsoft should just let that go, as difficult as that will be at a company that is used to ruling the roost. Better to hang on to second place than to slip behind another competitor that could do some serious damage.

What's your take on Microsoft's standing in the software industry? Send it to [email protected].

Posted by Lee Pender on February 16, 2011 at 11:57 AM


Featured

  • 2020 Microsoft Conference Calendar: For Partners, IT Pros and Developers

    Here's your guide to all the IT training sessions, partner meet-ups and annual Microsoft conferences you won't want to miss. (Now updated with COVID-19-related event changes.)

  • The 2020 Microsoft Product Roadmap

    From the next major update to Windows 10 to the next generations of .NET and PowerShell, here's what's on tap from Microsoft this year.

  • Microsoft Closing Most of Its Retail Stores

    Microsoft on Friday announced a major shift in its retail operations, with plans to close most of its physical Microsoft Store outlets in favor of online sales.

  • Matrix

    Microsoft, Harvard Describe Joint Privacy Initiative

    To facilitate data sharing while still preserving data privacy, Microsoft and Harvard have embarked on a set of open source tool called the "OpenDP Initiative."

RCP Update

Sign up for our newsletter.

Terms and Privacy Policy consent

I agree to this site's Privacy Policy.