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Mac Planet: Scratching the surface

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Microsoft CEO Steve Ballmer. Photo / AP
Microsoft CEO Steve Ballmer. Photo / AP

One of my favourite books of all time has this passage: "Presteign took out a silver-mounted slab of crystal and handed it to Olivia. She touched it with a fingertip; a black dot appeared. She moved her finger and the dot elongated into a line. With quick strokes she sketched the hideous swirls and blazons of a devil-mask."

I first read this book in 1972, so you might think of it as prescient. I was also impressed (apart from the great story and writing) by the fact the author mentioned Maori face tattoo (no slur intended with the 'devil-mask' thing, by the way, it's just a side-reference) in a US sci-fi book set way in the future. Even more impressive, though, is that author Alfred Bester predicted the iPad (or at least, touch-screen tablets) in 1955, which is when 'Tiger Tiger' was first published. I recently read it again, and enjoyed it every bit as much.

Myself, I don't like making tech predictions. I don't like being wrong. And I doubt I've written or said much worth quoting over the years.

Don't quote me on that - but on quotable quotes, feel free to quote the CEO of Microsoft.

If you also suspect Steve Ballmer's mouth is connected to something other than his brain, here's some more ammunition.

Ballmer recently went on record (in an interview with CNBC) saying "I don't think anybody has done a product that is the product that I see customers wanting. You can go through the products from all those guys ... and none of them has a product that you can really use. Not Apple. Not Google. Not Amazon."

At least, for a change, Ballmer isn't just tilting at Apple. He really is against the world, now. Ballmer reckons everyone wants the Surface, which he touts as a reimagining of the PC, of Windows and of Microsoft itself, which is now a "devices and services company."Albeit one that used to criticise Apple for 'not knowing what it was'. Microsoft is allegedly spending an estimated US$1.5 billion to launch the Surface and Windows 8 as a Microsoft version of the much criticised (by non users) Apple iCloud 'walled garden' which lets its devices sync painlessly.

Of course, Ballmer could be right about one thing, anyway. At the very least, many Windows PC users must be keen to have other devices that work well with their existing systems. They may have been casting covetous eyes at what Mac users experience with their iDevices, or at least wishing that iPads etc worked better with their Windows boxes. Despite some effort, Macs and iDevices still don't talk flawlessly with Microsoft exchange all the time. My first impulse might be 'so what?' but the reality is that many businesses justifiably rely on this technology to achieve their commercial aims.

I sometimes get put in the situation where irate new Mac owners demand of me "Why isn't this more like my Windows PC?" They obviously haven't done the research. Any research. But that's the risk Apple took, building fashionable devices everyone wants, even if people can be misdirected enough to simply buy a product for its looks, mystique or for other real or imagined charms (rather than Apple's very real and actual charms).
Another Microsoft exec, Steven Sinofsky, rather more realistically (than Ballmer) pointed out that the new Windows 8 PCs deliver better value than Apple's products.

Sinofsky said there are "full-featured Windows 8 laptops that sell for $279. These are fantastic machines. At that price, you can get a computer good enough to last a student through college."

Yes you can. But this is kinda missing the boat, because despite logic, the recession, natural disasters and all sorts of other negative factors, price somehow isn't the reigning factor for all consumers when it probably should be. Maybe in straitened times, people would rather buy something good? At least when the investment is beyond minor. I mean, Walmart's profits are still good, as are NZ's retail equivalents, so there's still a correspondingly active market for risible junk. But Apple's recent 2012 fourth-quarter sales of the Mac line showed sales one per cent higher than last year's. For the same period, the (non-Apple) PC market saw a sales drop of 8 per cent.

Apple's figures are salutary. It has increased its number of employees to almost 73,000 full-timers when unemployment is an issue for pretty much every country. The 2011 employee count was 60,400. [Please do note, I am not an Apple employee. I have never been an Apple employee.]

Just under half of these employees work in Apple Retail. The square footage of Apple's retail building space has meanwhile increased from 4.02 million square metres last year to 5.27 million square metres this year. That's growth of almost 32 per cent.

Thirty-three new Apple Retail stores opened during 2012. Twenty-eight of those were outside the US, although not as far outside the US as New Zealand is. This brings Apple's total retail store count to 390 - and there are plans for more Apple Stores in 2013.

Revenue per store is also up: a 19 per cent increase to US$51.5 million this year, compared to US$43.3 million in 2011.

Net sales in Asia jumped 47 per cent during the past year, mostly thanks to iPhone sales in the region. Net sales in Japan alone increased 94% to US$5.1 billion. Pretty good figures for devices that people 'can't really use'. Apple sold three million of its new iPads in the three days from launch.

While older (or should I say 'experienced') users might fret about Apple's future and distinctions between consumer and professional devices, as I do, Apple certainly has no plans to stop innovating, or at least (as more cynical readers will no doubt point out) buying and rebranding the companies and software that innovate. Apple has increased its research and development costs by US$1B in the last year. The 2012 costs were reported as $3.4 billion, an increase of $1 billion over last year's numbers. The cost was 'just' $1.8 billion in 2010, the year iPad was introduced. In NZ dollars, this comes out to about $4.11 billion dollars just on R&D. That's significantly more than New Zealand - the entire country - spends on R&D (about $2.44 billion).

But erring on the side of fairness, as I like to do just occasionally: it's not just Microsoft that can act in an unseemly fashion. Forced, in the UK, to publish ads apologising to Samsung for transgressions against its reputation, Apple's original apology was deemed inaccurate. So a link to a new statement has been made available ... but Apple modified its website to ensure the message is never displayed without visitors having to scroll down to the bottom first.
So there.

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