A row is brewing between the two tech titans, initiated by Apple's' comments about "confusion" among its rivals during the recent iPad unveiling. Microsoft shot back, claiming "standardization" and "productivity" are on its side. Who do you think is right — or should both companies shut up and just let consumers decide?
Everyone Loves A Fight
If you watched the Apple iPad and Mac unveiling live (or caught the replay), you probably noticed Tim Cook's dig at the company's unnamed competition. You know, the company he describes as being "confused, turning tablets into PCs and PCs into tablets," among other things.
Microsoft execs took the attack personally, issuing a blunt blog post response from Frank Shaw, vice president of communications, that bites back at Apple and touts Microsoft's traditional strengths: the Office suite and greater productivity through Surface's range of keyboard options. Shaw is right on track with the Office claim, because MS Office remains king in enterprises, according to recent research.
By the numbers, however, Apple sold 15 million first generation iPads, generating around $7,485 million in revenue, Microsoft reportedly generated $853 million in revenue (updated to $1.23 billion now Microsoft's latest numbers are out) from its first generation of Surface tablet sales, but had to write off around $900 million due to over-estimated demand and major price cuts. In terms of Office, Apple is the one playing catch-up, but the conversation started around hardware.
A Sale Is a Sale
Way back when, Apple had the nascent tablet market all to itself. Now, there is massive competition from a plethora of Android devices. In addition, Microsoft has a number of tablet partners, most recently Nokia with the new Lumia 2520 and Samsung's ATIV Tab 3. Those and the new range of Surface 2 devices should mean Microsoft will rapidly increase sales and gain market share on Apple. Right?
Maybe not. With iPad sales at 170 million and likely to shoot up after recent quarterly declines, Microsoft and its partners will be hard-pressed to put up anything like a comparable quarterly or annual number (Apple sold 86 million iPads between September 2012 and October 2013) and shouldn't even think about comparing themselves to the content-consumption heavy Android market.
So, Microsoft's VP of communications chose to talk about the benefits of the Microsoft experience but he doesn't have the sales numbers to really back up those claims. If users are so enamored with the Surface and Office experience, why isn't he bragging about tens of millions of sales? It looks like a disconnect between Microsoft's beliefs and those of tablet users.
What They're Both Not Saying
Apple might boast about a new opportunity as the iWork apps become free with new Mac and iOS device purchases. But in reality the vast majority of users still have a Windows PC for "work" and a tablet for light usage, something even Apple likely admits will only change fractionally over time. The benefits of a big screen and proper keyboard still rate rather highly on users' wish lists.
And while Apple keeps making newer and faster devices, fewer users really need those features, leading to the potential for a continued decline in sales, once everyone has a tablet of choice. That's why Apple is probably now boosting the productivity side, getting people to use its tablets for work rather than just for cute apps and content consumption.
We're only the fourth year of the world of tablets. PCs have evolved over four decades, so there is plenty of time to see who is right, wrong or just has the biggest mouth. Microsoft Windows-powered PCs could easily dominate OS-X driven Mac sales and iPad sales could always trump those of Surface. Perhaps that's just the way of things — and all the verbal sparring won't change that. Apple can fire the next shots during its upcoming quarterly earnings call on Monday.
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