Microsoft chief Steve Ballmer had the unenviable timing of his appearance taking place on the Friday between two bookend Steve Jobs presentations, one at The Wall Street Journal’s D8 conference and the following Monday where Jobs showed a new iPhone. On Tuesday Jobs said traditional PCs would lose substantial market share to tablets just as trucks have to cars as a percentage of the vehicle market.
Ballmer’s responses were, ‘I think people are going to be using PCs in greater and greater numbers for many years to come. There may be a reason why they call them ‘Mack Trucks,’ but Windows machines are not going to be trucks.”
He said most consumers can’t afford a different device for every location: an iPad, an iPhone and a PC. “I think there will exist a general purpose device that does everything you want, because I don’t think the whole world’s going to be able to afford five devices per person,” he said.
The iPad and other tablets, he said, are just another form of a PC. “The real question is ‘what’s a PC?'” he said.
The majority of Microsoft’s revenues and profits come from Windows versions and its Office software. Its Xbox 360 has sold well but profits in that division, mobile and entertainment, have lagged. The top two executives in that division recently resigned and Ballmer now has both sections reporting directly to him.
Ballmer said he was disappointed that the mobile phone version of Windows has dropped to fifth place in market share. “We were ahead of this game,” Ballmer said. “Now we find ourselves number five in the market.”
Apple will start shipping its newest iPhone this month but it’ll be towards year end before phones with Microsoft’s new Windows Mobile 7 start shipping. And Apple will have a new OS for its iPhone this summer.
Also, none of the tablets with Windows 7 that have been previewed come anywhere close to the iPad in performance and function, especially in life between battery charges and third-party applications. In fact, the tablet that Ballmer helped HP demonstrate at CES in January has disappeared into a black hole. Since then, HP has spent $1.2 billion to buy Palm for its Web OS mobile phone operating system, a loud vote by HP of no confidence in Windows 7 on tablets.
Looming for both Microsoft and Apple is Google’s Android operating system. Some surveys have Android-based handsets already outselling the mighty iPhone.