With Steve Jobs back and clearly motivated to show that he is running the company again, Apple appears to be executing at an incredibly high level at the moment. It appears he is personally managing the creation of a new class of product for Apple, the iPad, a product that falls into the MID (Mobil Internet Device) category. The PC vs. Mac ads have improved sharply as well.
We are seeing Apple at the top of its game and Snow Leopard is the first product since the Apple Lisa that appears to be heavily targeted by Steve Jobs at business users. He just head faked Microsoft with a tactical ploy that hasn't been seen in the market for decades: He basically got Microsoft prepared for a September launch and then launched in August. Since I think this will likely be thought of in the future as a turning point for both Apple and Microsoft, let's talk about what just happened.
Business users aren't Jobs' strength, but Snow Leopard does appear to be one of the firm's better business efforts. However, I want to chat about why what Apple did is so amazing and why Microsoft will have trouble responding in a timely fashion.
Microsoft Was Positioned to Win
Microsoft has put together a launch engine that is in line with its massive Windows 95 launch. Some of my peers are sort of disagreeing on whether the Brad Silverberg/Brad Chase team that did Windows 95 was better than the Kathleen Hall team that is currently doing Windows 7. My argument is that Hall is the better marketing talent. Silverberg and Chase had more of the company -- and Bill Gates-- behind them and had more time to build momentum. (Hall is a recent external hire and Gates is gone.) But we all agree this is some of the best work the company has ever done.
With a launch like this, the shear amount of partner and Microsoft resources easily exceeded Apple's by several magnitudes, and if Microsoft executed and Apple did nothing -- which is close to what happened in 1995 -- Apple would bleed a massive amount of market share. However, Jobs wasn't at Apple in 1995 and "nothing" isn't an option for him.
Apple's Head Fake
I'm borrowing a term from one of the industry's top analysts, Michael Gartenberg, who first coined the term for Apple's recent move. Jobs plays pro ball when it comes to marketing and advertising. While Microsoft actually got its new OS finished before Apple, it has to feed a very archaic structure of partners and leave enough time so they can all have products in their various sales channels. As a result, Microsoft missed the ideal window for an annual launch, which begins and ends in August. It's clear that it has been a long time since Microsoft faced competition in this segment.
Jobs initially announced he would miss the August window as well, but would still beat Microsoft to market by a month. Normal practice for a team like Microsoft's would be to begin its hard product marketing ramp at the same time Apple launched. This would effectively stall the market so it wouldn't lose too much share.
But this week Steve announced Apple would ship in the perfect August window, catching Microsoft unprepared for Apple's early launch. This had to have been a major "holy crap" moment in Redmond, and it means Apple is playing hard ball.
Can Microsoft Play Hard Ball?
I met with Kathleen Hall, the GM of Windows 7 marketing, a few weeks ago and I believe she and her team are capable of playing at Jobs' level. But I question whether Microsoft, as a company, is willing to back her to the level (as Brad Silverberg and Brad Chaser were backed) needed to win the game. Jobs is the captain/coach/owner of his team; Kathleen Hall is simply the GM of Windows 7 marketing. In terms of resources, Jobs has a small army, and Kathleen has a large platoon.
There is no doubt in my mind that we will see, and recently have seen, some of the best marketing work out of Microsoft ever. But we are already seeing some of the best work out of Apple, and when Apple is at its best in marketing, historically, the company has known no peers. This latest ad is classic in that it makes a point, both directly against Microsoft's campaign and subtly against its earlier use of Seinfeld. (Read the comments under the Apple Ad; they do suggest this campaign may be weakening.)
A lot is at risk here for both companies. Apple needs to continue to show growth and the easy target of Windows Vista will soon be over. Microsoft remains both more powerful and better connected to existing users than Apple. Microsoft, on the other hand, has found growth elusive; the market largely rejected Windows Vista and Microsoft desperately needs to get back in the game. Were it to lose a large amount of share over a short period of time, I doubt any executive would be safe, regardless of his or her connections. It goes without saying that getting that share back will be difficult.
This is likely Jobs' last big personal push and he clearly knows it. It is unlikely Microsoft will ever again give him a Vista-level advantage, and his health is still not that great. As a result, he is not only working his folks at extremely high pace (I doubt you'd want to work anywhere near him at the moment), but executing at a near legendary high level as well. He knows he has a window to take more share from Microsoft over the holidays than has ever been attempted, let alone done, in the past.
For Microsoft, this is an epic moment. Will it step up to the challenge and fight at Apple's level by giving Hall the resources she needs or begin crafting excuses as to why the company failed. The first excuse is likely "Apple cheats," but I'm of the belief that, in business, if you aren't cheating, you aren't playing hard enough.
Watch this fight over the next few months. This will be a legendary battle, and both companies have more to lose than either can afford.