Apple may not be Microsoft's biggest retail challenge
Microsoft's retail and hardware partnerships may hinder its expansion into the retail space, as it seeks to compete with Apple's brick-and-mortar locations.
In a new report Wednesday, Nick Wingfield of The Wall Street Journal, wrote that Microsoft's retail venture is a more difficult proposition for the Windows maker than Apple faced when it opened its first stores. In addition to upsetting retail partners, Microsoft's hardware partners could also prove unhappy over which products are selected or neglected to be featured in the stores.
"While Apple had fewer potential business conflicts because it had such weak support from retailers when it opened its first store in 2001," the report said, "Microsoft depends on existing partners in the retail business that could be threatened by the company's expansion into their turf."
However, some believe that worries about retail and hardware conflicts are being overblown.
"Everybody is in everybody's space," Steven Baker, an analyst with NPD Group Inc., told the Journal.
Microsoft is pulling no punches in its quest to directly compete with Apple in the retail space, going so far as to poach Apple Store staff and managers and hiring former Apple retail executive George Blankenship who played an instrumental part in the growth and popularization of the Apple retail outlets.
Microsoft has made no attempt to hide the fact that they are gunning directly for Apple's market share. Company executive Kevin Turner reportedly said several months ago that Microsoft intends to open stores next door to Apple.
Microsoft plans to mirror many aspects of Apple's retail outlets, including using "Microsoft Gurus" for tech support and demos much like the Apple store "Geniuses."
These steps are all indications that Microsoft considers Apple to be a credible threat to its market share. Mac sales saw double-digit growth in the third quarter of 2009.
In a separate piece, Wingfield wrote that while poor initial reviews of Microsoft's retail plan have surfaced, Apple too had to deal with doubts and criticism during the rollout of their first retail stores.
So far, Apple's response to Microsoft's retail plans is simple: renew, remodel, and advertise. The Apple store located inside The Shops at Mission Viejo, Calif. - located in the same complex where one of Microsoft's first retail outlets will open has been boarded up with a sign reading "Coming soon. The all-new Apple Store." Apple also plans on running ads in response to the Windows 7 debut which will mock the upgrade process from Windows XP and highlight the benefits of switching to a Mac.
The first Microsoft store slated to open is located in Scottsdale, Arizona and is expected to open its doors "on or within days of the launch" of Windows 7, reported Wingfield.
In a new report Wednesday, Nick Wingfield of The Wall Street Journal, wrote that Microsoft's retail venture is a more difficult proposition for the Windows maker than Apple faced when it opened its first stores. In addition to upsetting retail partners, Microsoft's hardware partners could also prove unhappy over which products are selected or neglected to be featured in the stores.
"While Apple had fewer potential business conflicts because it had such weak support from retailers when it opened its first store in 2001," the report said, "Microsoft depends on existing partners in the retail business that could be threatened by the company's expansion into their turf."
However, some believe that worries about retail and hardware conflicts are being overblown.
"Everybody is in everybody's space," Steven Baker, an analyst with NPD Group Inc., told the Journal.
Microsoft is pulling no punches in its quest to directly compete with Apple in the retail space, going so far as to poach Apple Store staff and managers and hiring former Apple retail executive George Blankenship who played an instrumental part in the growth and popularization of the Apple retail outlets.
Microsoft has made no attempt to hide the fact that they are gunning directly for Apple's market share. Company executive Kevin Turner reportedly said several months ago that Microsoft intends to open stores next door to Apple.
Microsoft plans to mirror many aspects of Apple's retail outlets, including using "Microsoft Gurus" for tech support and demos much like the Apple store "Geniuses."
These steps are all indications that Microsoft considers Apple to be a credible threat to its market share. Mac sales saw double-digit growth in the third quarter of 2009.
In a separate piece, Wingfield wrote that while poor initial reviews of Microsoft's retail plan have surfaced, Apple too had to deal with doubts and criticism during the rollout of their first retail stores.
So far, Apple's response to Microsoft's retail plans is simple: renew, remodel, and advertise. The Apple store located inside The Shops at Mission Viejo, Calif. - located in the same complex where one of Microsoft's first retail outlets will open has been boarded up with a sign reading "Coming soon. The all-new Apple Store." Apple also plans on running ads in response to the Windows 7 debut which will mock the upgrade process from Windows XP and highlight the benefits of switching to a Mac.
The first Microsoft store slated to open is located in Scottsdale, Arizona and is expected to open its doors "on or within days of the launch" of Windows 7, reported Wingfield.
Comments
In addition to upsetting retail partners, Microsoft's hardware partners could also prove unhappy over which products are selected or neglected to be featured in the stores.
"While Apple had fewer potential business conflicts because it had such weak support from retailers when it opened its first store in 2001," the report said, "Microsoft depends on existing partners in the retail business that could be threatened by the company's expansion into their turf."
I wondered about this when they announced this idea. How do they decide how much
retail space goes to Dell running Windows and how much goes to HP, netbooks,
gaming machines, etc.? Will M$ use these stores to compete with Apple, or favor
and punish hardware makers? (Likely both.)
"Hmm. Dell recommends users downgrade to XP before taking the PC home. We'll
have our gurus recommend them less next month."
The whole thing could devolve into an ugly mess.
It will be interesting to see how the stores play out now that it appears they have a hit with Windows 7. Only time will tell.
Right, what a hit it is indeed. The only hit MS OS to have lower sales units than 1.
Why does Ballmer think that a pure software player (when it comes to computers) has to imitate a vertically integrated competitor? Why is Ballmer trying to be a better Apple than Apple? Is he going to ban the MS guru's from saying "that's a hardware issue, you need to get in touch with the manufacturer"? How about "your copy of windows is OEM, you need to talk to the PC manufacturer"? Nobody has yet talked about how MS will handle these crucial issues. If they turn away people because of these reasons, they'll put a black eye on their brand. If they take on all comers then the gurus will be swamped.
It will be interesting to see how the stores play out now that it appears they have a hit with Windows 7. Only time will tell.
I don't think being well reviewed by tech pundits as being what Vista should have been necessarily equals being "a hit."
Being a hit would require broad and rapid adoption, and that remains to be seen. I would guess all those low cost Walmart computers that drive Windows market share also act as a boat anchor when it comes to getting people to upgrade, since I would further guess that many of those users really don't give a shit about their OS, as long as it works OK-- that is to say, XP will continue to serve. That goes for a lot of business users, as well.
Now, it's unlikely that 7 is going to inspire the clamor for downgrades on new hardware that Vista did, so through the inevitable process of computer replacement 7 will make its way onto the desktops of America. But that's not really the same as being "a hit."
"My computer is reeeeeaaaalllly slow"..."I keep getting all these windows popping up"..."I can't install a networked printer"..... and on and on and on.......
My post was somewhat tongue-in-cheek, but only somewhat.
I don't think being well reviewed by tech pundits as being what Vista should have been necessarily equals being "a hit."
I was assuming that techstud was in "Sarcasm Mode". I don't think he really
meant that W7 is already a hit.
Then again, maybe I'm putting words into his mouth . . .
In two years every corporation will stop using Windows and Office and instead play with iChat and iPhones all day long!
These steps are all indications that Microsoft considers Apple to be a credible threat to its market share. Mac sales saw double-digit growth in the third quarter of 2009.
Yeh, keep telling yourself this. As much as you Apple Fan Boys would like it, Apple is really nothing more than a small prick in the side to Microsoft. Remember, they make a lot of money off you guys when you buy MS Office or Vista for dual boot.
They have seen Apple do good with these retail stores and Microsoft are copying it (as usual, it's the whole way their incredibly successful business model has worked from the start). That doesn't mean in any way that Microsoft is scared of Apple. I can tell you that Microsoft's biggest rival right now is Google.
Keep trying to tell yourself you're in the big league, but you're still a super small player compared to Windows.
In two years every corporation will stop using Windows and Office and instead play with iChat and iPhones all day long!
Close.
Within two years, every corporate office serf will have dumped Solitaire and Mine Sweeper for iPhone games.
Microsoft's retail and hardware partnerships may hinder its expansion into the retail space, as it seeks to compete with Apple's brick-and-mortar locations.
NO KIDDING. Only Ballmer could have dense enough not to see this.
One question is whether the PC makers are going to risk "losing favor" with the high-volume retail outlets over an unproven and initially low-volume venture.
And will the likes of Best Buy give Windows 7 etc. any kind of prominent showing when MS starts direct competition with them? Or better yet: will Best Buy refer Windows/Office support questions to the MS stores? (i.e. "That's a Windows problem, you need to see MS")
Things are certainly going to be interesting!
Yeh, keep telling yourself this. As much as you Apple Fan Boys would like it, Apple is really nothing more than a small prick in the side to Microsoft. Remember, they make a lot of money off you guys when you buy MS Office or Vista for dual boot.
They have seen Apple do good with these retail stores and Microsoft are copying it (as usual, it's the whole way their incredibly successful business model has worked from the start). That doesn't mean in any way that Microsoft is scared of Apple. I can tell you that Microsoft's biggest rival right now is Google.
Keep trying to tell yourself you're in the big league, but you're still a super small player compared to Windows.
Classic short term outlook on your part. Microsoft is scared sh*tless about apple and so are Microsoft's hardware oem's.
Why are they scared? cause apple has almost locked up the mid to premium tier of the marketplace and makes a bundle in profits. Microsoft's OEM's are working non stop to make pennies.
Anyway, back on topic:
NO KIDDING. Only Ballmer could have dense enough not to see this.
One question is whether the PC makers are going to risk "losing favor" with the high-volume retail outlets over an unproven and initially low-volume venture.
And will the likes of Best Buy give Windows 7 etc. any kind of prominent showing when MS starts direct competition with them? Or better yet: will Best Buy simply refer Windows/Office support questions to the MS stores? (i.e. "That's a Windows problem, you need to see MS")
Things are certainly going to be interesting!
Microsoft cares nothing for it's partners. They were a means to an end.
OMG Microsoft is doomed and will die in two years. Apple's worldwide marketshare will grow and they will dominate the world and all the humans will think different!
In two years every corporation will stop using Windows and Office and instead play with iChat and iPhones all day long!
feeding the trolls is sooooo not helping...
I guess not even *he* believes his own stuff any more
It will be interesting to see how the stores play out now that it appears they have a hit with Windows 7. Only time will tell.
They don't have a "hit". Pre-sales were ok, but not gargantuan.
It's not even available yet.
Articles have been saying that sales of 7 will be fairly modest, and even Ballmer has stated that it won't help PC sales much.
Upgrading from XP which is what is in almost 80% of all PC's, will be a real bear. few will upgrade to it because of that.
Why do you say these silly things?