Microsoft may have only just launched Windows 7, but Apple isn’t sitting back and letting Redmond enjoy its time in the spotlight. Instead, last night it revealed three new ads in the popular “Get a Mac” series featuring John Hodgman and Justin Long, all of which go after Windows 7 by name.

The three ads, “Broken Promises,” “Teeter Tottering,” and “PC News” all have a slightly different take on what’s wrong with Windows, but they all manage to find fault. And they all do so without actually citing anything concrete about Windows 7, which really hasn’t been around long enough to generate the kind of widespread complaints that plagued Vista.

PC News

It’s the Windows 7 release news coverage, except the excited masses aren’t on board with Microsoft. They’re taking advantage of the call to upgrade to Macs instead. The theory being, if MS is saying “All right everybody, ditch Vista!” they might as well switch to an OS they know for a fact actually is user-friendly. Not the best of the bunch, and the logic behind it is kind of a stretch.

Teeter Tottering

Sort of like a single case study of one PC user from the first ad, this one follows an XP user getting ready to switch. To Mac, not Windows 7, despite PC’s repeated overtures to try to get her to stay. What’s great about this commercial is that Justin Long as Mac never says a word, and instead the only debating that goes on occurs between the PC user and Hodgman, so the customer ends up convincing themselves. Hence, the real benefits of Mac are self-evident.

Broken Promises

Only the basic Mac/PC duo are featured in this third new ad, unless you count the inclusion of their former selves from years gone by. This is my personal favorite of the bunch. It uses fictional remembered exchanges between Mac and PC over the years as each iteration of Windows was released, all the way back to Windows 2. A nice visual touch on the part of Apple’s advertising team is the way Apple’s outfit changes only minimally from clip to clip, while PC seems to be a slave to the fashion trends of the time. It paints PC as dated and Mac as timeless.

PC users probably haven’t even had a chance to become disillusioned with Windows 7 yet, but Apple is doing the smart thing by not letting them get the chance. These ads say it all: If Microsoft’s laid the groundwork for an upgrade mentality, best to swoop in and grab a few switchers while the getting’s good.

Talk about biting someone else’s style. Not only is Microsoft trying to add some cool factor to its brand using celebrity influence, a game which Apple has long had in the bag, now it’s also opened its first official brick-and-mortar retail store, and it even just began offering PC hardware for sale via its online store. Next thing you know, Microsoft CEO Steve Ballmer will be wearing black turtlenecks.

A revamp of the web site is part of the Windows 7 launch campaign, and it includes a brand new store that stocks more than just software. You can now purchase a range of Windows 7-toting computers from HP, Acer, Dell, Lenovo and Sony, which are the real heavy-hitters in the PC arena. You can also pick up a single desktop, a Lenovo A600 all-in-one. Selection seems slim, but Microsoft is being a good copycat and not overwhelming consumers with an overabundance of choice.

All of the computers available on Microsoft’s web site come in stock configurations only, with no customization options beyond the ability to choose a color on select models. Users looking for more in the way of upgrades should still continue onto the manufacturer’s web site to order their machine, but Microsoft isn’t playing to that crowd. Instead, it’s aiming at first-time buyers or people with little to no computer expertise who just want the buying process to be as simple as possible.

And if you’re not too keen on the fancy new Internets, you can always take a trip down to Scottsdale, Ariz., where Microsoft today opened its first retail store. Here’s Microsoft’s own description of what it’s like, since I’m a little out of reach of the Scottsdale area:

As soon as you enter the store, there are laptops on large cedar tables, with seating so shoppers can sit and tinker. The walls are lined with giant LCD screens that envelop the space with landscapes and product images designed to create interest and spark curiosity. Below the images, stylish all-in-one PCs are set up with Zunes, Xboxes, headphones and widescreen displays, showing how all the items work together to create a multimedia experience.

Toward the back are laptop bags and an array of software titles before you turn the corner and reach a veritable mecca for Xbox enthusiasts — a gaming zone featuring a 94-inch widescreen, with immersive sound, seating and an array of controllers to play with.

Sounds like the whole premise is designed more around showing, rather than selling, as early speculation suggested. Microsoft is clearly pushing the experience, rather than trying to sell the component parts. I’d say something snarky about how this points to a lack of imagination on the part of your average PC customer, but being Mac users, I’m sure we can all come up with much more creative snark on our own.

All of this image and distribution re-imagining on Microsoft’s part is great news for one company: Apple. There’s no better sign that you have your main competitor on the ropes than when it resorts to parroting your moves. All Apple needs to do is continue to set the trend, and watch as Microsoft tries to follow it.

Apple did pretty much everything they could to steal some of Windows 7’s thunder by announcing some pretty major hardware changes earlier in the week, but Thursday is here nonetheless, and that means Microsoft’s latest OS is on store shelves now, ripe for the picking. Question is, will Mac users be helping with the harvest?

I’m getting a copy (might pick up a burger, too), but for me it’s a legitimate business expense, so the decision, even without an upgrade path (I’ve just been using the Windows 7 RC on my iMac, and don’t have an existing retail license), it makes financial sense for me to have access to a Windows machine. Maybe you’re in the same boat.

The question isn’t really whether Mac users are also Windows users, since recent research on the subject seems to indicate that yes, there is in fact plenty of crossover. I’m wondering whether it might be the case that Apple fans not only buy Windows, but that we might also represent a big chunk of the early adopter crowd for this new incarnation.

Everyone I know who is buying a copy of Windows 7, upgrade or otherwise, uses a Mac. It may not be their primary machine (yes, that does actually happen), but they have one nonetheless. Most of those people are planning on installing Windows 7 on a boot camp partition or a virtualized PC using Parallels or VMware Fusion.

I know you’re thinking that I probably surround myself with like-minded people, and as a result have a lot of Mac-using friends, but that isn’t the case. The majority of people I know are exclusively PC users, and not a single one that I’ve talked to plans on upgrading today, or even in the near future.

As Mac users, we have a tendency to also be gadget addicts. I’ve found we’re more interested in all tech, not just our own, perhaps because we consider ourselves connoisseurs in the area thanks to our impeccable taste. For me, and for many others that I know, that interest translates into a pretty heady case of gadget-lust, one of the symptoms of which is early-adopterese. And also a willingness to acknowledge when a company besides our beloved Apple releases a smart, well-designed product.

Fact is, Windows 7 is a huge improvement on its predecessor. I say that as someone who’s been using preview versions since the first beta was released. It’s not Snow Leopard, don’t get me wrong, but that won’t stop me from being among the first to jump on board. Anyone else making that jump today? If you are, what are your reasons? Do you consider yourself an early adopter with tech in general?

From Computerworld, the ponderings of Broadpoint AmTech analyst Brian Marshall may state the obvious, but nonetheless bear repeating: Windows 7 is no threat to the Mac.

Having looked at the data on Windows release dates, Marshall “found no negative correlation between them and Mac sales.” Further, Marshall suggests that “new OS launches from MSFT may have even acted as a ‘delayed accelerant’ to AAPL’s computing sales.” However, he is also careful to add that “AAPL’s success (or failure) in the computing market is largely idiosyncratic (or company-specific) in nature and not dependent on others in the industry.” Just like a six-figure analyst to have it both ways, but he does have a point, at least about Apple.

While it’s true that the numbers don’t lie, they don’t tell the whole story in this case, either. Not shown on the chart is how the release of Windows 95 was an unmitigated disaster for then-Apple Computer. The company saw Mac market share effectively halved from 1995 to 1996, from around double digits to 5 percent in a year, and it only got worse.

That bump in sales in 1997 was due to the original iMac, as was a good deal of the spike that ran until 2001. And 2001, of course, brought the tech bust, not a worldwide embrace of Windows Millennium Edition at the expense of Apple. While Mac sales were stagnant over the next several years, even as PC sales grew, the basis of the Mac Renaissance we now enjoy can be traced to a few key events.

• Beginning in 2002, the continuous, incremental improvement in Mac OS X combined with the perceived security disaster of Windows XP changed attitudes about Microsoft and Apple.
• The iPod Halo Effect, the idea that the popularity of the iPod encouraged the Mac “curious” to switch, probably started in late 2003 with the iTunes Store and iTunes for Windows.
• The switch to Intel in 2006, along with the “safety net” of Apple’s Boot Camp or third-party virtualization, removed the last perceived obstacle to owning a Mac.

So, the iMac, the iPod and the iTunes Store, OS X, Intel Macs, and now the iPhone; all these “idiosyncratic” products are what have fueled Apple’s comeback, though it’s also fair to say Microsoft’s lack of innovation played a small part in that comeback, too. Looking forward to 2010, it appears that trend will continue. Windows 7 does nothing more than replace lackluster Vista, Microsoft’s mobile strategy is a disaster, and how about a tablet PC with a stylus in the age of multitouch?

Really, the game is Apple’s to lose.

Mary Jo Foley reports on her ZDnet blog that Microsoft is seriously considering making Zune services, such as the subscription-based Zune Pass, available to other platforms — and that includes Apple’s very own Mac OS X.

It’s early days though, as Foley admits, “There’s no guarantee that the Redmondians will end up doing this — or timetable as to when this could happen — but it’s one of many strategies under active consideration.”

She adds, “I’ve been thinking that there might be a number of Apple iPod/iPhone users who might prefer a music subscription service over a pay-per-song one. (And one that’s better than Rhapsody.)”

Jose Pinero, Director of Communications for Microsoft’s TV, Video and Music Business told Foley that:

“…with the addition of the ability to stream music from a browser that is part of the new Zune 4.0 experience, Mac and Linux users already can stream music to their systems if they have a Zune Pass subscription. The streaming capability isn’t limited to Internet Explorer; it works with any browser.”

So does this mean we may see a Mac OS version of Microsoft Zune Player software appearing one day soon? The latest version,  Zune 4.0, is described in a recent review by Paul Thurrott as “…vastly superior to its only real competition, Apple’s iTunes.” Ouch.  

But as Pinero explained, Zune Pass wielding Mac owners can already use their web browser to listen to their music. What they can’t do on the Mac OS is purchase and manage their music. And that’s where a native version of the Zune software comes in.

This raises the sticky-sweet issue of the Subscription Model, and whether Apple ought to adopt it. It’s a model proven supremely successful by the likes of Rhapsody in the U.S. and Spotify in Europe. Let’s take a quick look at those services.

Spotify

Spotify is, at its most basic level, completely free (through the unpredictable insertion of thankfully-occasional unskippable ads). An optional monthly fee of £9.99 (around USD$15) buys the user a Premium Account, banishing the ads and allowing the user to store streamed songs locally on their desktop computer (and now iPhone) for listening offline.

Rhapsody

Rhapsody doesn’t offer a free service, and at $12.99 its cheapest membership level is relatively expensive when compared to Spotify. For two dollars more, Rhapsody users can store music for offline listening.

Zune Pass

Zune Pass comes in at one price only — a hefty $14.99 — and offers both unlimited streamed music and a selection of 10 downloadable tracks each month that are yours to keep. That’s 120 songs per year. If you have a PC and a Zune player, you can store songs for offline playing.

Now consider how Apple could dominate this market. At its September 9 Press Event Steve Jobs said Apple manages over one hundred million active iTunes accounts with credit cards. That’s a staggeringly huge number, and even if we make some pretty conservative estimates, we still arrive at impressive results. Try this on for size; if Apple launched a monthly subscription service, priced at just $9.99 per month (cheaper than Zune Pass, Rhapsody and Spotify) and if only one percent of its credit-card-toting iTunes customers signed-up… that’s still almost a billion dollars in the bank, per year.

There’s more. While Rhapsody, Spotify and Zune Pass all cater to our (strictly) musical needs, a subscription service from Apple could potentially draw on the vast repository of content found throughout iTunes. So, to Music we can add TV shows, movies, maybe even custom-made “premium” podcasts from high profile celebrities and artists. And in a post-Tablet 2010, it’s conceivable subscription-based magazines, newspapers, journals and books could be added in to the mix.

Others might have been first to the Subscription Model party, but it’s easy to imagine the Apple pitch: “Today, Apple reinvents the Subscription model…” only, y’know, they’d say something way more funky than that.

I can’t believe I’m excited at the prospect of yet another reason to give Apple my money. But I do believe this is a service Apple would do well to consider. The Rhapsody’s and Spotify’s of this world prove there’s a growing, lucrative market demand for streaming content. That Microsoft is seriously considering expanding its Zune Pass service to other platforms tells me, beyond a shadow of doubt, there’s gold in them thar hills. I wonder if Apple has noticed?

It took the designer-store concept from Apple. It took the Genius Bar concept from Apple. What’s left for Microsoft to take from Apple as it gears-up to the launch of its first brick-and-mortar retail stores?

Well, the staff, of course.

According to The Loop, Microsoft is poaching Apple’s retail store managers with the promise of “significant” salary increases and, in some cases, offering to cover all moving expenses. The Loop doesn’t say who its source is, only that it spoke on condition of anonymity. The Loop’s Jim Dalrymple writes;

Once hired, the ex-Apple employees are then contacting some of the top sales people in the Apple retail organization offering them positions at Microsoft retail. They have also been offered more money than what they made at Apple.

Dalrymple says this poaching is a smart move, though I’m not so sure of that. Apple’s staff are trained, shaped and brainwashed inspired by the Cupertino Mother Ship. The Apple Retail Store philosophy runs through their veins. Apple Stores are successful not only because they offer ‘insanely great’ products, but because the staff are carefully versed in the Apple way of life.

Truly, they are Mapple People.

That little slogan on their t-shirts and badges that reads, “I could talk about this stuff for hours”? They mean it, and it’s easy to see why. Forgive me for drinking the Kool-Aid here, but consider how seamlessly software and hardware works in the Apple ecosystem. For the most part things “just work,” right? And when things work well, the experience is a happy one.

Now imagine those same enthusiastic technology-loving Mapple People going to work at a Microsoft Retail Store where Windows 7 doesn’t work the same way on every PC, where OEM crapware and errant drivers cause slowdowns and DLL headaches on a daily basis and it’s near impossible to easily demonstrate even the most basic of digital media management without being forced to sign-in to Windows Bloody Live just to get anything done…

I doubt things will “just work” quite as seamlessly. Not as happy an experience, I imagine. And I’m not speaking as a fanboy either — I’m speaking as a power-user of every iteration of Windows since 3.1.

If Microsoft thinks poaching Apple’s employees will bring a little of the Jobsian Magic to its retail venture, good luck to them, but I reckon they’re in for a nasty shock.

On August 6th, 1997, Steve Jobs stood on a stage in Boston and announced that Microsoft had purchased $150 million in non-voting stock and promised to continue to develop Office for five years. While the crowd reacted as if had he announced his love of Pabst Blue Ribbon, it’s one of the moves that’s widely regarded as having helped Apple recover as a company.

Microsoft recently announced its plans for Office 2010 — although the scant details make me think this was really just a “No, no, don’t go use the Exchange features in Snow Leopard; we’ve got you covered” move. Which begs the question: Does Apple still need Office for the Mac, like they did 12 years ago?

No, of course not. They have iWork and online services like Google Docs and Zoho. But I need it.

I can imagine myself staying in Apple’s Romper Room, only using iWork and iLife, only as long as I never, ever need to exchange files or collaborate with another person. Like it or not, Office and especially the .doc file structure has become the industry standard. The better I can adhere to that standard, without jumping through a ton of hoops, the easier my life is. Sure, I can print to PDF, but that’s hard to collaborate from.

That’s not to say I’m a slave to Microsoft. For simple layout I use Pages; Numbers is an acceptable spreadsheet; and Keynote is a totally kicking presentation program. When I write fiction, I use Scrivener. For my work at TheAppleBlog, I can use any sort of text editor I want. However, when I need to exchange files with other people — especially if I want them to make in-line comments or changes — I will default to the Office suite for the sake of simplicity, even for complicated files transfer without any noticeable issues between the PC and Mac versions of Word.

As much as I love hearing about Apple’s plans, and its commitment to OS X at keynotes, as a frequent user of Microsoft Office, in many ways I look forward to the affirmation that Office for the Mac’s development isn’t lagging too far behind its PC counterpart.

So far we’ve had to sit back and watch while Office 2010 news for PC users rolled in, but the MacBU over at Microsoft has finally come through with details of when and what Mac users can expect regarding the industry-dominating productivity suite, announced at a press conference this morning. They also detailed some changes to the existing Office 2008, or at least to the way it’s sold, to tide us over.

First, the changes to 2008 will include a reduction in retail SKUs from three to two, a Home/Student Edition and a Business Edition. The new Business Edition will include Entourage Web Services Edition, MS Document Connection, additional templates and clip art, and some Lynda.com training sessions. This new pack will cost $399 and be available September 15, while the Home/Student Edition will continue to retail for $149.

Not much was revealed about the next version of Office, which has a target launch date of 2010’s holiday season, but the MacBU did drop one major bomb on Apple users. Entourage, the email application currently bundled with Mac Office, will be replaced by Outlook, a move which probably has IT departments everywhere who support a Mac/PC hybrid work environment jumping for joy. It still wont’ be exactly the same as Outlook for the PC, but it will support a greater range of Exchange features, including public calendars.

The new Outlook will also be a native Cocoa application, which should bode well for Mac integration, and sport a brand new database that includes support for Spotlight indexing and Time Machine backup. Outlook for Mac will also sport Information Rights Management, which should make sure that only recipients who have permission to access rights-managed content actually get to see or use it. Finally, it’ll also be able to sync tasks and notes.

Developers and advanced Office users will also be pleased to learn that Visual Basic for Applications, which wasn’t included in Office 2008. Microsoft received harsh criticism for the omission of VBA, which makes it relatively easy to add customization options such as menus and dialogs, and create macros to simplify tasks. MacBU group product manager Kurt Schmucker explained that user response factored heavily in their decision to re-introduce VBA support, saying “we know [VBA] is important to a section of our user base who needs cross platform compatibility, and we’re bringing that back.” VBA was left out of Office 2008 because of the difficulty in upgrading the software for Intel-based machines.

No word yet on any prospective pricing, naming or specific release dates for the next version of Office for Mac. I imagine some kind of upgrade pricing will be available, and it’s probably safe to assume that the pricing structure will closely resemble that of the 2008 suites. That is, if they’re allowed to sell it at all.

As more and more households have multiple PCs, the idea of a “family pack” (i.e., a piece of software with multiple licenses for use) makes a lot of sense. Since Apple and Microsoft are set to release new versions of their respective operating systems this fall (Apple’s Snow Leopard in September, Microsoft’s Windows 7 in October), let’s look at the family pack available for each.

Microsoft

Microsoft finally ended all rumors of a Windows 7 Family Pack, announcing that there would indeed be such a product:

The Windows 7 Family Pack will be available starting on October 22 until supplies last here in the U.S. and other select markets. In the U.S., the price for the Windows 7 Family Pack will be $149.99 for three Windows 7 Home Premium licenses.

It’s not that paying $150 for three licenses is a bad deal, it’s just that the paragraph above pretty much constitutes the entire announcement, which is bad because…

• Where is the Family Pack for Professional? What about Ultimate? Sadly, there is no such thing. Why isn’t Microsoft making its other OS editions available in similar “family friendly” offerings?
• It’s only for a limited time (“until supplies last”). This is a software product on disc that comes with a three-user license, there are no “supplies.” The only thing that can run out is Microsoft’s willingness to provide this value to the consumer.

So Microsoft will thwart consumers who desire Professional or Ultimate by requiring full licenses even if they want to run it on all the PCs in their home. This is practically an engraved invitation to pirate the software.

Further, after some as-yet-unnamed amount of time, the Home Premium deal will be withdrawn. Perhaps this is just a maneuver to juice up early interest and sales for PR purposes, and once they can report large numbers of licenses sold they’ll just end the deal.

Apple

Apple’s upcoming Snow Leopard will be sold in family packs of five licenses for $49. This is a better deal than Microsoft’s in many ways:

• Obviously, $50 for five license is much better than $150 for three.
• Unlike Microsoft, Apple doesn’t offer “crippled” editions. Their family pack will consist of the full (“Ultimate”, to use Microsoft’s term) version of Snow Leopard.
• There is no expiration date on availability.

Aside from its OS, Apple also offers family packs for their iLife and iWork suites that are incredible values.

Conclusion

While I’m not suggesting upgrade pricing alone would be a reason to switch to a Mac, I do believe Apple’s family packs (which are not new) are an impressive, and important, value. I consider them part of the Apple value equation; a computer is a combination of hardware and software, not just one or the other.

I think Apple’s philosophy on family packs is clear. Put simply, they take the sting out of wanting to run multiple licenses for multiple machines. They provide such an excellent value, the consumer has little issue with legitimizing multiple software copies in their home.

For Microsoft, this is new territory. I’m glad to see there was some truth to the earlier rumors, but it all falls short. While the family pack for Windows 7 is a smart move, Microsoft is misguided to limit it to just the “cheap” edition and to make the offer short-term. Indeed, why not encourage people to legitimize multiple copies, and up-sell Professional, by offering a family pack at the high-end? If the goal was to limit piracy, I believe it will have only a minimal impact there.

Nonetheless, if your decision to use Windows 7 is already made, and Home Premium is what you desire, then I’d certainly recommend snapping up the family pack before Microsoft changes its mind.

Microsoft’s Steve Ballmer has an unimpressive track record at predictions, which is why his latest comments should be of concern to Apple and, especially, MacBook Air fans:

Those new ultra-thin PCs, the first of which will be coming later this year and, presumably running Windows 7, won’t be as cheap as $299 or $399 netbooks, Ballmer admitted, but they will combine netbooks’ portability, with some unnamed but higher-sounding prices.

Though the MacBook Air won’t be running Windows 7 any time soon, the rest of the quote is a pretty good description of it. Ballmer had earlier defined this “new” class of PC when speaking at the kick-off presentation for Microsoft’s Financial Analyst Meeting:

Ballmer told analysts there would be a new class of “ultra-thin” PCs” — or high-end netbooks –coming this year that would combine the light weight of netbooks with high-power and high-performance of traditional PCs.

Yep, that’s the MacBook Air alright.

When the Air was introduced, Steve Jobs first outlined these three problems (compromises) with netbooks:

• Small screens
• Tiny keyboard
• Low processing power

The MacBook Air went on to address them all. And it did so as a “high-end” model for a “higher-sounding” price, exactly as Ballmer is predicting will not appear until “later this year.”

Will Ballmer’s bad track record seal the MacBook Air’s fate? Or will this particular “prediction,” which is of the past, and tantamount to predicting yesterday’s sunrise, be an isolated case of him being correct?

I guess only time will tell if the MacBook Air is truly finished.

The locations of the first Microsoft Retail Stores have been announced. Microsoft’s foray into brick-and-mortar retail will begin in Scottsdale, Ariz., and Viejo, Calif., CNET News‘ Ina Fried reported in an article yesterday.

Microsoft confirmed it has signed leases for both locations, where it expects to open its retail stores in the fall. Microsoft spokeswoman Kim Stocks said:

“Over a billion people use our products every day yet we don’t have a way to directly connect with them. We see the physical stores, as well as a consistent online experience, helping that.

“Our customers have told us three things — they want a more simplified buying option for PCs and devices, great technology, and competitive prices and knowledgeable staff.”

Umm, isn’t that four things, Kim?

I’m not surprised she seems confused. If she read the 124-page Retail Store Proposal I reported on this week, she’s probably still a little dazed. I know I was.

I have only two questions: Will the first store be introduced to us by Steve Ballmer, will Microsoft forge ahead with its blatantly Apple-inspired “Guru Bar,” and will you be standing in line hours before the grand opening?

A few weeks back, Steve Jobs returned to his duties at Apple. During his absence, Apple appears to have operated effectively and efficiently. Few people asked the question, “What will Apple do without Steve?” because the question was getting a dress rehearsal. But now that Steve is back (meaning, one day, he will “leave” again), I believe that the investors, financial analyst and the media will once again begin to ask about Apple’s succession planning.

So, what is succession planning and why is it important to Apple?

Succession planning is a talent management process. For key employees, those whose positions within Apple are too critical to be left vacant or staffed by someone who doesn’t have a clue about the task at hand, the board of directors is responsible for identifying and developing a talent pool. These leaders-in-waiting will be used to ensure effective continuity and growth of the company.

Succession planning is a primary concern for Apple’s shareholders. Many institutional and individual investors have chosen to hold Apple’s stock for the long haul. They want to know that the company is planning predictably over that time frame as well.

So why is this important to Apple?

Over the last year, the state of Steve Job’s health has raised a chorus of questions about Apple’s succession planning. What would happen to Apple if Steve was no longer able to do his job as CEO? Is Tim Cook the next “Steve?” Why isn’t the board making a clearer statement about this issue? These question create uncertainty, and investors don’t like uncertainty (as can be seen by the January lows in Apple’s stock price).

The question of succession planning goes beyond just figuring out who will be the next CEO. Transitions in leadership can be disruptive. Selecting a candidate from within the company may provide continuity. However, internal candidates who are not selected may choose to take their chances elsewhere. Selecting a candidate from the outside usually results in the new person bringing in his/her “people” — who possibly displace existing staff. The board’s challenge is to find a leader that works well within the existing corporate culture and, at the same time, brings something exciting and new to the table so he/she is not seen as “Steve 2.0.”

Apple may be able to learn a lot about leadership continuity from companies like Intel and Microsoft.

Over the last 40 years, Intel has maintained a high level of growth and innovation as it has transitioned through five chief executives. Paul Otellini, Intel’s current CEO, worked at the company for more than 30 years before taking the reins, and his top executives have spent their entire careers at Intel. Grooming and predictability are the hallmarks of the Intel approach. For those analysts that think Apple currently has a “deep bench” of capable executives, the Intel approach may be the best option.

On the other hand, the transition of Bill Gates at Microsoft was a planned affair that took more than eight years to complete. A phased, long-term approach would give Apple an opportunity to bring new executives into the spotlight and provide the kind of certainty that both customers and investors are looking for.

Over the next several months, as Steve gets back into a more normal work schedule, I suspect that we will have greater visibility into Apple’s succession planning. My hope is that the company combines the best of the Intel and Microsoft approaches.

Last week Gizmodo published a leaked proposal (32MB PDF) from marketing agency Lippincott detailing plans for Microsoft’s upcoming brick-and-morter retail stores. It makes for mind-numbing reading, running at a mammoth 124 pages of (mostly) brain-freezing execu-speak.

I’m glad I don’t work in Marketing. It’s a troubled, stressful world where there’s no such thing as a “lie” and the customer is considered little more than an uninformed, paranoid bag of walking money. Marketing execs rabbit incessantly about “managing expectations” or “steering brand awareness” and other essentially meaningless buzz-phrases. Either it’s subtle genius, or howling bum-gravy.

Here are a few of the “highlights:”

• Customer experience seems to be high on the agenda, though geared toward Emily, a hypothetical customer broadly categorized as one of three types: Basic Communicator, Productive Connector and Escapist.
• “Reconsideration of the Microsoft brand by consumers” — speaks for itself.
• NikeTown, AT&T, Sony, Nokia and Apple are acknowledged as providing retail/customer service benchmarks that Microsoft could learn from or aspire to.
• A Digital Media Wall is planned that will span the length of the store wall. There are lots of design mockups of what might appear on it. Check out the proposal for details.
• Windows 7, PCTV and Windows Mobile will also get their own dedicated stages.
• The stages will get their own dedicated Microsoft Surface Tables.

There’s a lot more in there besides these few points. Here are a few of the visualizations. No prizes for spotting similarities with the Apple Store. (But, to be fair, how many ways are there to design a retail store that sells computers and software?)

Proposed Windows 7 Stage

Here it's called the Guru Bar. In the proposal it's called the Answer Bar.

If you squint, this looks like an Apple store. What are the odds?!

I found this one odd. Buried in the proposal is a chart that explains which sort of customers use Microsoft’s various services. Bing is said to be for “Search Explorers” and “Search Productives.” MSN is for “Information Seekers” and “Functional Organizers.” Frankly, I’m failing to see how these are truly distinct, different things?

Microsoft was quick to post a comment on the Gizmondo website, saying:

“As a part of our process in briefing creative agencies, we shared some early prototypes and concepts of our retail store plans. No final decisions have been made. As we previously announced, we are on track to open retail stores this Fall.”

I wish Microsoft every success in their Retail stores. I’ll happily visit them to see what techy goodness is on offer. But for what is supposed to be a proposal that should make me want to run out and start building the first Microsoft Store with my own two hands, the language in this document leaves me cold.

“The brand vision: realizing potential. The value proposition for the retail offering and experience is: inclusive exuberance.”

Inclusive Exuberance? Seriously?

OK, I know I’ll be flamed for my criticism. But look — if you think this sort of language is not a screaming insult to human intelligence and dignity… well, then, you’re probably already in Marketing.

For the rest of us looking forward to seeing what these new stores have to offer, we can only hope they’re not as cynical, “corporate” and soulless as this document manages to be!

A lot of stories like this one are circulating about how NPD is saying Apple has a 91 percent market share of all PCs sold over $1,000. They give that impression by claiming something like “a 91 percent share”, or “91 percent of the market”.

Truth be told, if NPD really stated this as market share, I’d say they were wrong. It’s hard to believe 9.1 out of 10 PCs over $1K are Apple’s. Come on, people, there are many non-Mac users who spend money, too. Whether for quality, style, or higher-end components, not everyone who gets a PC is a Laptop Hunter. I’ve never bought a Windows machine for under $1K in my life, and I’ve had many.

It doesn’t take much to refute the market share angle. I don’t agree with the article using just Best Buy as a point of comparison, but it’s still not hard to believe there’s no such ratio of Macs to PCs at the high-end.

But if not market share, what is NPD talking about? Let’s look at this as reported by Joe Wilcox (with a headline as misleading as the others):

According to NPD, in June, nine out of 10 dollars spent on computers costing $1,000 or more went to Apple.

Nine out of 10 dollars went to Apple? That’s a different beast than market share. It’s revenue share, and a lot more believable.

Consider the example where two people go to a Best Buy. One buys a PC for $1,045, the other a Mac for $1,455. At this point the Mac and PC market share is equal (one each, 50 percent). But now let’s look at the “dollars spent on computers costing $1,000 or more”, which total $500. PC got $45 (9 percent), while Mac got $455 (91 percent).

Is it believable that Macs, with an Average Selling Price of $1,400 in June, could hold that kind of ratio against PCs with an ASP of $515 the same month? I believe so.

Honestly, though, this is one of those statistics that sounds cool, but doesn’t really tell us much. By picking an arbitrary cutoff ($1K) it’s statistical juggling. What if the Mac cost $1,200 to make, and the PC $800? Apple would have that flashy 91 percent number, but only net 10 more bucks than the PC from the deal.

Which brings me to what matters. Ultimately, it’s about profits. Units sold, share of this category or that, supposed web usage figures by tracking browsers, etc., all make for interesting headlines. But where is the money? Microsoft and PC vendors have made plenty in the past despite their lower ASPs. They simply sell a lot more boxes (Apple is still under 4 percent globally). That’s why, to me, the real story this week is Apple’s stellar earnings report from Wednesday compared to Microsoft’s dismal results from Thursday. That’s more revealing than a 91 percent share of anything.

After so brazenly bragging about Apple’s legal department’s request that one of Microsoft’s ads be pulled last week, Redmond has quietly made changes to the ad in question to make sure that it accurately reflects reality, which is what Apple wanted in the first place. Kind of puts a damper on Microsoft COO Kevin Turner’s bubbly enthusiasm, I’d imagine.

Last week, he basically did a little dance for joy when he received the call from Apple legal, and trumpeted the news to the masses to make sure everyone knew that Microsoft had indeed scored a direct hit, even going so far as to call it “the greatest single phone call” he’s ever taken. The ads in question are the Laptop Hunter series, in which Microsoft gives random people a sum of money and challenges them to find their perfect laptop, at which point they get it for free. The ads were created by Crispin Porter & Bogusky.

The specific ad Apple took issue with is the “Lauren” ad (not that “Lauren” ad, the other one), in which Lauren and her mother are shopping for a computer under $1,700. At one point, they comment on the MacBook Pro’s $2,000 price tag, asking “Why would you pay twice the price?” As of the latest notebook lineup refresh, Apple’s top-of-the-line MacBook Pro no longer costs $2,000, coming in instead at a much easier to swallow $1,700. Which, coincidentally, is actually within Lauren and mom’s budget.

Microsoft, for its part, is saying the minor change doesn’t change “the focus of the campaign,” according to AdAge.com, so it’s clearly still counting this as a win. I’m willing to bet Microsoft’s legal department has been in contact with Apple on quite a few occasions, yet COO Tim Cook doesn’t break out the noisemakers and party hat every time that goes down.

Allow me to set the scene. It’s January 2007. The iPhone has just been announced and the tech world is going crazy. CNBC interviews Microsoft CEO Steve Ballmer.

CNBC: “Let me ask you about the iPhone [...] What was your first reaction when you saw that?”

Ballmer (laughs): “Five hundred dollars?!! Fully subsidized?!! With a plan?!! I said if that isn’t the most expensive phone in the world… and it doesn’t appeal to business customers because it doesn’t have a keyboard, which makes it not a very good email machine. Now, it may sell very well…”

And sell very well it did — the estimated total is now 37 million and counting. OK, so Ballmer was never going to clap his hands and rave about the iPhone, but while laughing dismissively might have irked Apple enthusiasts, it likely reassured Microsoft’s shareholders. Ballmer, after all, must answer to them.

Culture

In another interview, this time with USA Today in April 2007, Ballmer said, of becoming CEO of Microsoft:

“…the CEO in a lot of ways becomes the icon for many things in the business. The CEO establishes culture.”

This from the man who heaved himself, sweating and scarlet-faced, across a stage screaming with unbridled joy over Microsoft. Well, you can’t fault him for being passionate. Sadly, it’s a passion he doesn’t seem to want to celebrate or promote amongst Microsoft’s customers.

“USA Today: People get passionate when Apple comes out with something new[...]. Is that something that you’d want them to feel about Microsoft?

Ballmer: It’s sort of a funny question. Would I trade 96 percent of the market for 4 percent of the market? (Laughter.) [...] There’s no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I’d prefer to have our software in 60 percent or 70 percent or 80 percent of them, than I would to have 2 percent or 3 percent, which is what Apple might get.”

Let me take off my Apple Hat for a moment and consider his answer more carefully.

“It’s sort of a funny question.” Steve, how is it a funny question? It’s a very simple question. Would you like your customers to be as passionate, loyal and fanatical about your products as Apple’s customer base is to its?

If I were a Microsoft shareholder, sure, I want to hear you reinforce the fact that 80 percent market share is more attractive than 3 percent. But I also want to hear you acknowledge that customer enthusiasm — particularly of the Apple Fanboy variety — is at least desirable. I want to know that you’re pushing the boundaries everywhere, not just in the corporate world. You don’t seem to mind whooping and skipping when you want to share your passion for Microsoft. So why is it a “funny” question to ask if you want to engender that same passion in your customers?

Furthermore, according to Gartner, this is how worldwide Smartphone Sales by Operating System looked, first in 2007, the same year Ballmer dismissed the iPhone, and then again 12 months later.

When a Bad Economy is a Good Thing

In March, at the McGraw-Hill Companies’ 2009 Media Summit, Ballmer said of a slight downturn in Apple sales:

“The economy is helpful. Paying an extra $500 for a computer in this environment — same piece of hardware — paying $500 more to get a logo on it? I think that’s a more challenging proposition for the average person than it used to be.”

Superficially, this sounds like common sense. I mean, a laptop is a laptop, right? Whether it’s wrapped in plastic or aluminum, you’re talking a chip (probably Intel), a few gigs of RAM, a keyboard and a screen. To the blissfully unaware, to the Lauren’s of this world…the difference is little more than a glowing fruit on the lid.

What Ballmer is really saying here is distasteful, not just in what it implies but also because he didn’t even try to make the point subtly. He’s suggesting Apple’s sales dipped because customers are struggling financially, not due to any special marketing strategy or other efforts on Microsoft’s part. To hang a lantern on it and tacitly state “The economy is helpful” is crass and insensitive. I wonder how the marketing team in Redmond felt when they heard their boss say that?

The Numbers Don’t Lie

Fast forward to this week. Apple announced its latest quarterly earnings. In Apple’s own words, its “best non-holiday quarter ever.” So much for Ballmer’s ‘helpful’ recession. Also, the Wall Street Journal reported that despite accounting for less than 3 percent of the global smartphone market, Apple’s iPhone has taken 20 percent of that market’s operating profits. Predictions from Deutsche Bank for year’s end point to Apple and RIM sharing 5 percent of the smartphone market and taking almost 60 percent of its profit.

Ballmer’s assertion that it’s better to have massive market share suddenly deserves scrutiny. Apple and RIM don’t command 60 percent of the market (yet) but they’re soon going to command 60 percent of its profits.

The iTunes store continues to perform superbly (8 billion songs downloaded as of June 2009), while the App Store is a smash hit. Mac sales have remained strong despite the crippling economy Ballmer relies upon to keep the competition in check.

I’m Not Taking Shots

This article isn’t about taking an easy shot at Microsoft, or gloating about Apple’s recent successes. I know, so far it reads that way, and I won’t deny there’s a certain satisfaction to be had basking in Apple’s glow. I’ve brought you on this journey to make a serious point that’s more about leadership and vision than smartphones, laptops or market share. (But those facts are crucial to placing these final thoughts in the right context.)

At the Media Summit Ballmer was asked if he used any Apple products. “No, none. I don’t, my sons don’t, my wife doesn’t.”

Imagine you are a Microsoft shareholder with a vested financial interest in Microsoft’s success. Certainly you don’t want the CEO to promote the competition, but you do want him to demonstrate he’s in touch with the real world.

Surely the right answer should have been, “Yes, I have an iPod. I also have a Zune, of course, and a Zen. I have them all. It’s important to see how they work — see what choices our customers have. I want to experience first-hand where these products succeed, and where they fail. So, sure, I have an iPod. I have all the other music players, too!”

But, no. Instead we got Ballmer’s typical, speaks-before-he-thinks derision.

Ballmer said a CEO “establishes culture.” If Microsoft is looking to him for its creative and business leadership, no wonder Windows Mobile 7 is practically vaporware and the company’s next operating system is referred to by many not as an incredible new OS but instead as Vista “done right.”

Ballmer appears less relevant with each passing year. He’s not a man to respect or fear, despite chair-tossing antics. Rather, he’s becoming a sad and lonely figure, out of touch with the tech industry outside of Microsoft’s dusty old-boy network.

But why should it matter if Microsoft has crummy leadership? We don’t care, right? Good riddance to ‘em?

It matters because, if Microsoft does a lousy job it will ship lousy products. Apple will therefore face less vigorous competition. In any market, when competition is weak or lackluster, the dominant player becomes complacent. It’s hard to justify the R&D costs of constant, breathtaking innovation when the competition isn’t doing the same.

We need a creative, innovative Microsoft that today behaves with the same hunger for success it had in the 70’s. As long as we have that, we’ll have an Apple that stays one step ahead, delivering products Microsoft can only aspire to produce. We can’t get there with Ballmer in the driving seat. He’s out of his depth, and it doesn’t matter how much he sweats as he screams “Developers! Developers! Developers!”; he simply fails to inspire creativity or confidence — just as he fails to recognize opportunities in new/developing markets, such as mobile media or the rapidly-changing smartphone space.

We need a Microsoft as imaginative and exciting as Apple. If that could happen, just imagine what Apple would do to raise the bar ever-higher. I’ll leave you with one more excerpt from that 2007 USA Today interview.

“USA Today: You don’t find you’ve got a problem with people saying, “Sorry, but I really think you’re wrong here”?

Ballmer: That happens all the time. From 10 this morning until I came over here, I got more “Steve, that’s wrongs” than I got “Steve, that’s rights” today. It was two to one, “Steve, that’s wrongs.”

He’s just not getting it, is he? Maybe someone’s trying to tell him something…

Microsoft is counting on a turncoat to help jump-start its recently-announced efforts to compete with Apple on the retail store front. Former VP of Apple’s Real Estate department, George Blankenship, has been confirmed as a consultant attached to Microsoft’s retail efforts, which should bear fruit beginning this fall.

Blankenship is responsible for shaping the way Apple chose to place its inaugural retail locations, along high traffic routes in places with extremely high property values. The gamble was that being in upscale shopping centers would offset the high lease price of the store locations because it would attract bigger fish, or shoppers with more money to spend and more inclination to spend it.

That’s apparently the approach Microsoft wants to copy when setting up its own brick-and-mortar chain, which will obviously carry hardware from a variety of manufacturers, since it doesn’t make any computers. Those third-party partners might be interested to know that Microsoft’s apparent goal with its shiny, new, expensively placed stores won’t actually be to move product, but to showcase it.

AppleInsider cites an earlier leak as suggesting that Microsoft will be using the storefronts more as an environment for hands-on demos and product showcasing than as a place to aggressively sell product. I think it realizes that it will have a hard time staying competitive with the wide range of online and traditional retailers who sell its products, many of whom have much more leeway with regard to pricing than Apple generally allows its authorized resellers.

In a world in which ignoring advertising is becoming easier to do (TiVo, ad blockers, consumer resistance through overexposure), Microsoft might be on to something with a brick-and-mortar retail approach to raising brand awareness. The Apple Store, after all, is an iconic monolith in the mind of the American consumer, owing to the unity and uniqueness of its design. Let’s see if Redmond can come up with something equally evocative.

In my article Macs in the Enterprise: A Firsthand Tale, I mentioned the hardship I was having dealing with editing documents directly from a SharePoint site.

As a result, I can only perform the most basic of tasks. I can upload and approve documents, but I can’t edit a document directly on the server as I can if I’m accessing the library on Internet Explorer and a Microsoft SharePoint-compatible application. It’s kind of a pain downloading and re-uploading documents when the changes are relatively minor. Later this year, Microsoft is planning on adding the ability for Office 2008 to interact directly with SharePoint, so that might help.

That functionality was part of the recently-released Service Pack 2 for Office 2008. Specifically, you can now check out, edit, and check in documents directly on a SharePoint site. I had a few moments today to test it out and here’s my report from an hour or so of testing.

Before I get too far into the SharePoint tools, I wanted to talk about the speed increases. I have a 2006 MacBook with 2GB of RAM. Even running the latest version of Office 2008, my load times were fairly long. I’ve noticed a significant improvement with SP2. I didn’t do any time tests, but they feel about half what they were. They certainly patched in more snappy.

Without getting into the PC/Mac debate too much, I’ll just say how Microsoft has integrated SharePoint within Office 2007 for the PC is amazing — I can even launch workflows on documents. The Document Connection Tool, however, earns an enthusiastic “Eh, well, it’s not bad.” Granted, I can finally edit a document on the site without jumping through a lot of hoops, I still can’t manage workflows and approve documents for publication. It’s not a big omission; I can do those just fine from the browser.

While the Document Connection Tool is a standalone program, you can access it from the File menu in Word and PowerPoint (oddly, I did not see the option in Excel).

The Open From Document Connection Screen

The first time you launch the program, you’ll be greated with a blank window. Choose “Connect to a SharePoint Site…”

A blank Document Connection Screen

Enter in your SharePoint info.

Entering in your SharePoint information

You can also connect to an Office Live Workspace (an online collaboration tool similar to, but not exactly like, Google Docs). Regardless of which you connect to, you’ll manage your documents in this screen (for Corporate Security reasons, I’m showing the connection to my personal Office Live Workspace, not my company’s SharePoint site).

Managing Documents

You manage documents in either location similarly. The biggest difference is in SharePoint you click “Check Out” to edit a document; in Office Live you click “Edit.” In terms of working with existing workspaces in Office Live, the Document Connection Tool is adequate. When it comes to managing those workspaces, it’s not that great. While I can upload a new document to an Office Live workspace (its version of folders), it doesn’t appear I can create new workspaces or delete documents (the “discard” button is grayed out).

Also, these tools seem to assume you have an Internet connection. There doesn’t appear to be any sort of offline syncing similar to Google Gears — while the press release claims offline document caching, I haven’t seen where the cache files are kept, and the only way I’ve been able to open a cached file is from the Recents menu. However, that’s from testing with Office Live, I didn’t test with my production documents on my SharePoint site.

While the Document Connection Tool is a good first step, there are a few things I’d like to see added: the ability to approve documents and manage workflows on a SharePoint site, and the ability to check out a document from both SharePoint and Office Live for offline editing — or make it clearer where I can find them.

Speed, stability, compatibility — that’s the mantra from the Mac Business Unit for SP2, which will be released today at 10:00 a.m. PDT.

Besides bug fixes, general improvements include faster launching of applications, as well as better performance within, like scrolling in Word and calculation speed in Excel. PowerPoint users will now be able to create motion-path animations, as well as define their default theme.

A new tool, Document Connection, provides Mac Office users improved access to documents through Microsoft SharePoint and Office Live Workspace. Safari 4 is now supported for accessing the browser-based services. According to Microsoft, file-sharing and document fidelity are the most important features for Mac Office users.

“There’s never been a better time to try Office 2008 for Mac — with SP2 we are not only delivering on top customer requests mid-cycle, but also taking a first step in bringing Microsoft software plus services to Mac users,” said Mike Tedesco, senior product manager for MacBU at Microsoft.

Unfortunately, those waiting for the return of Visual Basic for Applications will be disappointed. While the MacBU is planning on restoring VBA, that won’t be happening until the next release of Mac Office, for which no date has been announced.

The free update, around 300MB, will be available at Mactopia, as well as through Microsoft’s software autoupdate.

Sometimes I feel like Microsoft keeps the Mac BU around just so it can mock and ridicule it. The unit never seems to get to join in the fun when it comes time to release a new iteration of Office. Not, at least, until well after its PC counterparts. The official line is that the development cycle for both products is always around two to three years, so the schedule dictates when new releases become available — which explains why we won’t be seeing Office 2010 until 2011. Regardless of cycles, Office for Mac is badly in need of an upgrade — right now.

I have Office 2008, but I can count the number of times I use it in one month on one finger. Whenever possible, I use Google Docs or Bean (an excellent freeware multiformat text editor for Mac) for any Word doc editing I may need to do, which is almost none now that I’ve left school and the corporate world behind. Even though a lot of people still depend on the format, as the number of Mac users grows, I suspect Office will continue to lose ground, especially if Microsoft continues to offer such seriously unpleasant Mac-specific software.

Sometimes I swear Office 2008 was just a ploy to get me to install Windows on a Boot Camp partition and run Office 2007. I find command and menu placement to be completely unintuitive and just plain awkward on the Mac version. Google Docs in an SSB seems like a natively designed OS X app by comparison.

Of course, a big part of the announcement of Office 2010 was the revelation of a suite of online apps, which theoretically should be accessible from any browser on any platform (unless MS pulls a classic IE-only block, which I don’t think it would for fear of inciting riots). So, Mac users will be able to join in on the fun, right? Not quite. The web portion of Office 2010, from what I gather from Microsoft’s press releases about the software, will complement and work together with the old-fashioned installed media portion. I think it’ll end up looking much more like iWork.com and iWork than Zoho Writer or Google Docs.

Microsoft, if you want to be a software company, be one. Clearly you think it makes business sense to develop for Mac, or the Mac BU wouldn’t exist (unless my conspiracy theories above are correct). If that’s the case, treat it as you would any other software, and build excitement by launching cross-platform products of consistent quality, all at once.