Yesterday, May 26, 2010 was a historic day as Apple’s market value exceeded that of Microsoft for the first time in history. Who could have imagined that ten years back? As these values go, they swing back and forth based on market conditions shaping the stock value. Back in late 1990s, CISCO had that honor for a day right in the middle of the dot-com boom.
But this event is significant. Ten years back just when Steve Jobs came back to the company he founded, Apple was in bad shape. The joke was they were in the business of “painting the PC in various colors” as colorful Macs were the game then. Its market share had dipped to historic lows, its innovation streak was waning. Everyone, almost everyone, wrote it off as a “has been” company of the past. Its glory days were long over.
Then Steve comes back and reshaped the company in more than one way. Out of the box thinking was back, so was innovation in design, and breakthrough in user interface. Fortune magazine recently called Steve Jobs the “CEO of the Decade” for leading three major businesses that had a big impact on the market – the music business via iPod, the mobile phone business via iPhone, and the animation business via Pixar which got sold to Disney. He may even lead in another new market – tablet PC via iPad.
Such leadership is rare as CEO’s rarely become such a force to shape an entire industry through their creative imagination and drive. Imagination is plenty, but execution and market success are rare. Steve sets very high goals and marches towards perfection in design, marketing, distribution, consumer experience, and re-invention.
Whether Apple stays as the most valued company is irrelevant. There is no doubt that it has surpassed Microsoft in so many ways! Microsoft is not showing much leadership in innovation, never has. It’s “lots of little” model and dominance in the PC market is almost like a curse. No matter how hard it tries to embrace the “cloud”, it has to balance that with its existing revenue-model of “mouse-led, individual computing”, a model that seems so antiquated in the era of the Internet.
If the new “touch screen interface” pioneered by Apple becomes the defacto standard of UI in future, Microsoft has a ton of work to do to catch up.