January 9, 2003
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Reading Apple

Since nobody else seems to be talking about it, let me suggest that this year's new Apple announcements are misunderstood. Why is Apple (a) launching a PowerPoint competitor, (b) launching a new Web browser, and (c) relaunching the iApps as a separate product? What does this mean?

I suggest that these launches are strategic, and they are about Microsoft Office, the dagger that Microsoft holds at Apple's throat. For the last five years, Apple has lived with the threat that Microsoft, by killing Office, it could eliminate that Macintosh completely. Without Office, nobody -- not even the Apple faithful -- could depend on using anything but Windows for work.

The Clinton administration wouldn't permit Microsoft to obliterate Apple this completely -- they were moderate Republicans, and Apple provides the appearance of a free market. Protected from assassination, Apple invested in infrastructure: iMac, iApps, Airport. This era ended in 2002, when the Bush DOJ conceded its case against Microsoft, thereby indicating that they might not be willing or able to protect anyone any longer.

What Keynote and Safari mean is that Apple is prepared to deliver a capable office suite if it must. Note the skillful way these two products are positioned. Keynote competes on features by leveraging Apple's new graphic technology: it's better than PowerPoint. Safari, the new Web browser, can't beat Internet Explorer everywhere; instead, it's smaller, faster, and good enough. They demonstrate two ways to attack Office.

Apple is telling everyone that, if they have to, they'll build a word processor that will replace Word and a spreadsheet that will replace Excel. They don't want to do this; if they did, they'd just launch the products. Keynote and Safari don't gore Microsoft's ox; they attack dead markets where there's no money to be made. They demonstrate capability without starting a war.

Apple is also making sure they can pull it off. If they can't -- if this is Cyberdog all over again -- it's just a footnote like the Cube. Management wants to be sure that, if total war breaks out, their weapons go boom. If they do, fine: Apple has deterrence. If they don't -- if Keynote and Safari turn out badly -- then management knows to avoid war at any cost.