Hacker News Reader

Comment by zekevermillion | Hacker News Reader

Even if I generally agree with disappointment at the apparent "maintenance mode" of Apple's product line, I am not sure Ballmer is the best analogy. My understanding is that Tim Cook actually is responsible for many of the supply chain innovations behind Apple's dominant product lines. This is an incredibly hard technical feat, not just blustery MBA crap. I suppose it remains to be seen whether Apple can put its enormous cash hoard to work in R&D and new product development. It could be possible for Apple to go the way of RIM but I think it would be very hard to kill them given their unique supply chain efficiencies (not to mention brand and balance sheet).

View on HN

If you take a look back, Steve Ballmer was responsible for a lot of the success of Microsoft. He mostly got hate because people hated Microsoft. I'm don't think Ballmer's list of accomplishments at Microsoft is fully appreciated particularly compared to the good press Tim Cook as enjoyed.

My impression is that he got less hate and more ridicule.

Sure, Gates looked like the archetype nerd any time he presented something. But not was lightyears better than the whole "developers developers developers" dance Ballmer managed to pull.

Sadly the tech media have over the years blended over into lifestyle media. No longer is the computer or phone something to get a job done and that's it, now its a indicator of how you see yourself and how you want others to see you. And that image goes all the way back to the company making them, and the people that are the faces of said company.

Whilst I agree tech has blended with lifestyle, I don't see it as "sad", its perception being more akin to other aspects of personal identity isn't to be seen as derogatory but celebrated as it's expanded the market and the media interest in reporting on it.

I don't have anything personal against Ballmer. Would be interested to know more about his role in building MS.

>He mostly got hate because people hated Microsoft.

I believe that the hypothesis of the article is that people hated Microsoft because of Ballmer.

Mr. Gates was in charge when Microsoft did quite a bit of their hated activities. It was Gates as CEO who rigged it so all of us buying a PC to run a different OS had to pay for Windows.

Apple also did a fair share of evil things, but it managed to be viewed as cool rather than evil.

However, it is obvious that we are talking about subjective things here, and establishing causality is certainly not easy.

Interesting - do you have a cite?

> He mostly got hate because people hated Microsoft.

He was the face of "bad" Microsoft, the unashamedly anti-competitive win-at-all-costs bully. Gates could win some people back with his nerd-cred and things like the mid-'00s "security push". Ballmer was first and foremost a suit, or rather a suit trying to pretend he's down with the nerds just enough to screw them as soon as they turn around, and his "fuck you" attitude wasn't exactly friendly.

> I'm don't think Ballmer's list of accomplishments at Microsoft is fully appreciated

Probably because they were accomplishments for Microsoft rather than for the industry as a whole. Apple gets a lot of leeway because the iPhone really made a difference for the industry, not just winning but drawing a path. Microsoft has not really done anything like that since the Win 95 / Office / IE 5 progression.

Microsoft publishes research, Apple does not. I love Apple via NeXT, but let's be real, Apple is in it for Apple and they don't even treat their partners of any kind very well.

But Tim Cook had tons of bad press. Back when the stock was falling in late 2012-2013, there was a cottage industry of people calling for him to resign.

I wonder if Ballmer really got bad press outside of geeky circles until relatively late in his career, when hindsight showed that Microsoft was missing out on a lot of new products.

He got plenty of bad press, but you're right in that it was countered by (valid) good press about his success in strengthening Microsoft's enterprise business.

No, Ballmer got hate because Microsoft's consumer products consistently flopped. The stuff that those of us who flipped to Apple while he was in charge used (Zune, Windows Vista, original Surface, Windows Phone) were consistently underwhelming. However, Ballmer was simply inarguably an effective CEO from the perspective of investors. He grew the enterprise business consistently (which has a huge amount of value for legacy purposes), and some of the stuff he launched to support that (Azure, notably) positioned the company to grow in new ways that Nadella has really leveraged. He wasn't a visionary at all, but Ballmer was one of the best executor CEOs out there.

For the kids out there: “original Surface” isn’t what you think. It was a “smart table” and its most compelling use case was to present a menu right underneath your place setting: https://www.youtube.com/watch?v=Zxk_WywMTzc

Heh, thanks for reminding me of that.

For me its most compelling use case was as a gaming table. At Origins I got to see it used for D&D. Quite fun, but too expensive an option for the average gamer (who isn't already buying Geek Chic furniture).

Don't forget this classic parody video:

https://www.youtube.com/watch?v=CZrr7AZ9nCY

There’s a distinct trend of YouTube commenters who believe that the Surface (tablet) is somehow a descendent of the Surface table, just because their names are the same. Interesting.

Funny video — thanks for sharing.

> No, Ballmer got hate because Microsoft's consumer products consistently flopped.

Doesn't that ignore the XBox and the dominance of Windows in the consumer market?

Let us know what consumer market products you think MS will have by 2018.

Satya Nadella is in charge of Microsoft, not Ballmer, so I don't see the relevance of 2018 for the article.

> Ballmer was simply inarguably an effective CEO from the perspective of investors.

I'm not so sure. Imagine Microsoft had a lazy/disciplined CEO who said, "Windows and Office development only. No Bing, no XBox, no Azure, no Windows Phone, no Nokia". Would the shareholders be richer now?

Especially with declining PC sales.

> However, Ballmer was simply inarguably an effective CEO from the perspective of investors.

Reasonably effective, but not inarguably, since investor basically care only about one thing only: RoI. Under Ballmer's reign, the stock generally remained flat. Microsoft paid dividends, so investors still got some RoI, but not even close to what they could get on Apple in the same era. Under Nadella the share prices went up by 50% (100% really if you count from when Ballmer announced he'd be leaving), so Nadella is inarguably a more effective CEO for short term investors by several orders of magnitude. Nadella's strategy may be slightly more risky, so Ballmer might be an arguably better CEO for risk-averse long-term investors.

> He mostly got hate because people hated Microsoft

There are developers that actually do enjoy using Microsoft stacks, even though we also have experience using other systems.

Generally speaking a product company can't thrive off supply chain innovations. The market will move to commodification at some point.

If this were true Apple shouldn't be able to sell computers for a premium, and yet they do. 40 years should have been enough for commodification to take effect.

Apple in the PC market is a single digit percentage point(7.2) participant. Premium niche is a functional business model, but broad market speaking, commodification has taken place, in that 25% of the PC market is Other in most reports. That number is important because it implies that 25% of the entire market is "small" actors that have been able to leverage commodification. If you also consider Dell as a commodity vendor then that group jumps to 40%.

The parent implies that it will eventually drive the margins down. If you're saying that commodification has already taken place then it's even more impressive that Apple's line of computers can still command a premium and indicates that they have some kind of durable competitive advantage.

I agree. Premium niche is a very effective business model, and Apple does apply that strategy very well. I was only suggesting that supply chain optimization is more a function of profitability for Apple and less of a market advantage due to total market commodification.

It's almost like Apple has uncovered a new kind of product microeconomics -- luxury commodity, a commodity product where luxury pricing increases demand. It's a cheap way for consumers to signal upscale fashion.

(This is me appreciating the enemy's skill from afar. I do not personally like Apple products. Just as I prefer wearing paint-stained sweatpants and 10-year-old extra-large t-shirts, as well as running linux on 8-year-old workstation. My favorite "smart"phone is a blackberry classic.)

I'm not sure if you were being sarcastic, but that's called a Veblen Good (https://en.m.wikipedia.org/wiki/Veblen_good) and many luxury items follow the same pattern.

Nitpick, luxury goods and veblen goods are distinct concepts. Veblen goods are generally considered theoretical (with the possible exception of things like stocks). For Apple laptops to be Veblen goods, you would have to believe that they would sell fewer laptops if they were cheaper, not just makes less money. You could make the case that it's all brand fetishism and Apple would sell fewer MacBooks than they do now if they cost $500 rather than $1000, but i find that fairly implausible.

What if they are merely still selling computers at a premium because they merely used to be better and are slowly falling behind?

For me, I want the OS. I grew tired of maintaining my Linux install (and the various hardware issues), and grew tired of Windows (especially as a non-gamer). I wanted a unix-environment, OS X was the easiest way to get that in a reliable, portable system.

And then, through the network effect, my family followed suit because I'm their IT guy (actually, one of the reasons I quit Windows too, but they just keep dragging me back).

But the premium isn't too bad, IMO. I've had my current laptop (MBP, retina display) since 2012 and it's still going strong, even the original battery. I recognize that this is partially because we seem to have plateaued a bit on desktop/laptop capabilities, but I have no major issue running anything I want to run on it (modulo games, whicH I don't play so is a non-issue for me). I've also been able to reliably sell their laptops for a decent amount (could probably get more, but always sell to friends) and end up with a discounted new laptop as a result.

EDIT: Further, my experience with non-tech owners of Apple laptops versus PC laptops has been interesting. I don't know if the PC laptops are just more fragile, or if the Apple owners are more conscientious. But Apple laptops seem to last much longer and end up in much better shape (less the power cords) with "average" users. But this is purely anecdotal. A large part of that difference is probably just that a $1000-2000 PC laptop would last just as well as the same price Apple, but more PC laptop owners get the $300-500 sale price machines from Best Buy.

So who's making better mobile chips than their A series of processors? Or even chips as good?

Their mobile chips aren't in their computers (i.e. laptops or desktops) ... yet.

I was going to say something along these lines (tho more of a "cautionary tale" than absolute "no company can") Having worked for Nokia when they absolutely dominated the supply chain for their phones, this indeed gets you to the position of "top 10 brand in the world" but it isn't enough to keep you there.

That said, I think Apple it much better positioned than Nokia and much more focused on continual disrupting their own position (ipad to phone to tablet to watch is an interesting morph away from single product). So long as they can keep innovating and dominate the supply chain, I believe they will have some long legs.

> Generally speaking a product company can't thrive off supply chain innovations. The market will move to commodification at some point

To stave off commodification, the said company can pivot into a fashion company where the value is derived from the brand itself. Instead of differentiating by feature, it can differentiate by 'brand value' and encourage repeat-sales by ecnouraging seasonal fashion cycles. "Rose Go^w^wTeal is the color of the season this year. If you don't have a teal device, you're so last year"

It seems to me that Apple wouldn't have recruited Angela Ahrendts if it wasn't serious about following this strategy.

This is why they have invested so heavily in silicon fab and machining.

Reply on news.ycombinator.com