Oh, we love this Apple-Microsoft and PC World marketing competition.
The first computers we bought for our business were expensive IBM “5100” minis — at $8,000 (then) or more per processor with a whopping 64-k RAM. Two processors and four printers set us back $90,000 in 2007 dollars. But miracle machines they were and we anxiously awaited what was to come in the 1980s.
Then when we began buying personal computers to replace IBM Selectric typewriters we made the decision to go with both IBM Personal Computers (green phosporous screened-PC’s) and Apple MacIntosh (with its annoyingly tiny screen). From 1984 on there were Macs and PCs in the office, some for word processing and numbers crunching and others for graphics and publishing. There are still some Macs here…but.
Think about “unintended consequences” here — as IBM was pursued over a 15 year period by the federal Department of Justice, and ATT was being dismembered by Federal Judge Harold Green’s court in the 1970s / early 1980s. Both companies pursued for allegiations of anti-trust, anti-competitive business practices, and at IBM new approaches to marketing were evolving. IBM was working on a secret project in South Florida (far from the operating base in New York’s Hudson Valley) to bring a “personal computer” to market. A wonder-worker named Philip Donald Estridge and his tiny engineering team created the PC under budget and ahead of schedule — and the little desktops IBM-PC were launched. (Don Estridge unfortunately died in a plane crash on a business trip in Dallas in 1985.) Read about him and early PC days at:
On the other coast, entrepreneurs Steven Jobs and Steven Wozniak were working away day and night in that fabled Silicon Valley garage creating the miraculous Apples. Toys, some computer pros called them. Educators snapped them up for school use; so did creative organizations welcoming their ease of use and publishing platforms. And the marketing and product positioning races were on. For a while.
Because of those federal lawsuits against Big Business, and especially Big Blue, IBM is said to have grown cautious and management made a fateful decision to outsource many key components of the PC, including the operating software. And so “DOS” became a wealth-producing machine. (It was a diskette-based “Diskette Operating System” using BASIC language.) A small team at a tiny company called “Microsoft” got the contract for the PC operating system — the rest is tech history.
It helped that generic manufacturers quickly began copying and marketing “PCs” — using Microsoft operating systems. DOS was everywhere (and Apple’s operating system was not.) Since many of these components were sourced in the Far East, that region emerged quickly as a supply-center.
And then the product marketing race seemed to be over — and MSFT was king of the hill. Until now. The history written over two decades, of course, is that of MSFT’s almost-absolute global dominance of the small computing (personal and small business) environment. Thanks to brilliant marketing and savvy intellectual property protection, plus the comparative opening of the kimono for business partnering (vs. Apple’s closed kimono), Bill Gates became the wealthiest American.
But savvy investors didn’t count Apple down and out. From a low teens pricing, the stock is approaching $200 per and the products are being whisked off shelves. “I-pod (R)” is almost a generic phrase, like “Kleenex(R).” Apple just opened a huge store in New York City in December — a symbol of its expanding marketing power.
And so – Stay Tuned here — to the tale of the hare and the tortoise. The little hard-shelled crittur with an multi-colored Apple on its back may be sprinting at last…
And isn’t this a wonderful demonstration all around of American business ingenuity and what our Capitalistic Democracy excels at!
Editor & Publisher
Disclosure: The author holds APPL in retirement portfolio…bought low a long time ago. And GA&I continues to be an Apple user in the editorial offices. MSFT is also in there somewhere in the IRA, a lagging stock over the past few years. – HB