Microsoft Invested in Apple in 1997

August 30, 2010 at 5:00 am 5 comments

By Chad Upton | Editor

Microsoft and Apple are mortal enemies, at least, that’s what their TV commercials will have you believe.

They’ve always been competitors, originally trying to dominate our preference in computers, and now music players and mobile phones. Apple has a strong lead in music player and mobile phone segments, but Microsoft has a big lead as the dominant operating system. That said, Apple has become much more competitive in that space, especially in the past few years.

Their competition is most visible during commercial breaks, when they take jabs at each others potential flaws. Forget on court trash talk, when you’ve got as much money as these guys, you can trash talk in the form of multi-year, multi-million dollar ad campaigns — it’s so much more fun.

You see, Apple CEO Steve Jobs and Microsoft founder Bill Gates have a long history as friends. In the early days, they used to take their girlfriends on double dates with each other. They didn’t see a lot of each other after Bill moved to Washington State, but they’ve remained friends.

In fact, when Steve Jobs came back to Apple in 1996, the company needed help. To be a serious player, Apple also needed competitive office software.

Mac fans and developers were shocked on August 6th, 1997 when Bill Gates appeared via teleconference during Steve Job’s presentation at Macworld.

Steve and Bill announced that Microsoft would invest $150 million in Apple. Today, it sounds crazy, and at the time it sounded pretty crazy too. Jobs was booed when he announced the partnership and Bill was booed when he appeared on screen. But, it actually made a lot of sense for both companies. Steve said it best, “We have to let go of a few notions here. We have to let go of the notion that for Apple to win, Microsoft needs to lose.”

Microsoft got Internet Explorer installed as the default browser on Macs and Apple dropped their long standing lawsuit against Microsoft, alleging that Microsoft copied the look and feel of the Mac operating system with Windows.

Apple got the cash they needed and they also got a pledge that Microsoft would support MS Office on the Mac for another 5 years.

Microsoft still dominates Apple in computer operating system market share: 91.32% for Windows and 5.06% for Mac OS (as of July 2010).

But, Apple is way ahead of Microsoft in smartphone market share at 14% while Windows Mobile only has a 5%. However, Google is ahead of them both at 17% and RIM has a slight lead over Google at 18%, due to their longstanding BlackBerry products.

The next place the Microsoft/Apple rivalry will play out is right in your living room as both companies are stepping up their television and movie entertainment systems.

Stay tuned.

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Sources: The Guardian, Wired, CNET, Information Week, Hits Link, Wikipedia (Smartphone)

Photo: David Geller (cc)

Entry filed under: Computers and Internet. Tags: , , , , , , , .

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5 Comments Add your own

  • 1. Nikola Malesevic  |  August 30, 2010 at 5:07 am

    Now that’s a broken secret! :)

    Reply
  • 2. etc  |  August 30, 2010 at 9:02 am

    They didn’t really need a cash infusion in 1996. They had over a billion dollars in cash at the time:

    http://www.secinfo.com/d9XMe.84.htm#3rdPage

    Reply
  • 3. lostneedle  |  August 31, 2010 at 2:21 am

    Am I the only one who finds it difficult to believe they had girl friends when they were younger??

    Reply
  • 4. josh  |  August 31, 2010 at 7:49 pm

    you’d be suprised how many “computer types” get girlfriends, the geek stereotype is waay overrated.

    Reply
  • 5. bearfoot  |  September 4, 2010 at 5:12 pm

    This was genius for Gates as he could say “look I”m not a monopoly” by citing Apple as a competor.

    Can they say the same now?

    I’ll give you a clue, it’s just “Apple” now not “Apple computers” and if they were 100% honest I’d be called the “Icompany”

    Reply

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