Mega-Irony: Microsoft Digs Up Apple's 25 Year Old Mistakes

"Those who cannot remember the past, are condemned to repeat it."

The X360 is a cancer.  No, not because it has had a negative effect on PC gaming and I'm a PC fanboy, although all of that is true.  It's because it's a product and a business that leeches revenue, mindshare, and resources away from Microsoft's core businesses.  The XBox was supposed to be Microsoft's key into the living room -- a way for them to capitalize on the "digital convergence" that would occur there.  But it ends up that XBox business unit is really just a fortress in the living room that even the greater Microsoft will never be able to add further value to, and digital convergence may never actually occur... So it's a big ole rotten egg that has stolen from Windows its only remaining "killer app": GAMING.

In the end, the X-Box is going to kill Windows (or drive it to go open source?!) for that very reason.

Bill let this wolf into his flock against his better judgement, if Dean Takahashi's book "Opening the X-Box" is to believed.  According to it, the team who developed the product pulled a bait-and-switch on him when they got him excited about a lower-end version of a PC that could play games, but slowly morphed it into an appliance that wasn't Windows-compatible at all.  At that point, it seemed like a complicated situation that he decided to defer to his lieutenants. 

But I know Bill is kicking himself now, because he wrote the book on how to build an industry around the PC.  In fact, he spelled it out in detail to his friends over at Apple all the way back in June 1985.  John Sculley was at that point firmly at the helm of the company, and Bill, as the biggest developer of software for Apple at that time, wrote him a memo outlining what he thought should be Apple's go-forward plan: licensing the Mac's technology.

Apple's stated position in personal computers is innovative technology leader. This position implies that Apple must create a standard on new, advanced technology.

Apple must make Macintosh a standard. But no personal computer company, not even IBM, can create a standard without independent support. Even though Apple realized this, they have not been able to gain the independent support required to be perceived as a standard.

The significant investment (especially independent support) in a "standard personal computer" results in an incredible momentum for its architecture. Specifically, the IBM PC architecture continues to receive huge investment and gains additional momentum. (Though clearly the independent investment in the Apple II, and the resulting momentum, is another great example.) The investment in the IBM architecture includes development of differentiated compatibles, software and peripherals; user and sales channel education; and most importantly, attitudes and perceptions that are not easily changed.

Any deficiencies in the IBM architecture are quickly eliminated by independent support. Hardware deficiencies are remedied in two ways: expansion cards made possible because of access to the bus (e.g. the high resolution Hercules graphics card for monochrome monitors), [and the] manufacture of differentiated compatibles (e.g. the Compaq portable, or the faster DeskPro).

The closed architecture prevents similar independent investment in the Macintosh. The IBM architecture, when compared to the Macintosh, probably has more than 100 times the engineering resources applied to it when investment of compatible manufacturers is included. The ratio becomes even greater when the manufacturers of expansion cards are included.

The companies that license Mac technology would add credibility to the Macintosh architecture.  These companies would broaden the available product offerings through their "Mac-compatible" product lines. 

They would each innovate and add features to the basic system (various memory configurations, video display and keyboard alternatives, etc.) Apple would leverage the key partners' abilities to produce a wide variety of peripherals, much faster than Apple could develop the peripherals themselves. 

Customers would see competition and would have real price/performance choices. Apple will benefit from the distribution channels of these companies.

The perception of a significantly increased potential installed base will bring the independent hardware, software, and marketing support that the Macintosh needs.

Apple will gain significant, additional marketing support. Everytime a Mac compatible manufacturer advertises, it is an advertisement for the Apple architecture.

Can you fathom this?  It's the business plan for what the XBox should have been!  Licensing, a rich ecosystem of hardware, partners, partners, and more partners!  All the rationale for not building a closed platform is right there.  He wrote this to a company (Apple) that thought that having a lock on the most advanced and best designed product was all one needed to succeed. But we know better, judging from Apple's history into the late 90's as a story of innovation and invention with botched execution over and over again.  And Bill knew better, too.

Ideas, products are nothing without the right execution. Microsoft should never have strayed from their Windows-centric business model.

Doh!