Everybody steals from Apple Computer Inc.

Or so the thinking goes in the Mac community.

Ever since Microsoft Corp. introduced Windows 1.0 in 1985, there has been a ceaseless chorus from Mac users accusing the software giant, based in Redmond, Wash., of pilfering Apple's best ideas and poorly implementing them for mass consumption in successive versions of its operating systems.

Mac users had their dander up again last week after Microsoft Chairman Bill Gates introduced a prototype called Athens, built by Microsoft and Hewlett-Packard Co., at the WinHEC (Windows Hardware Engineering Conference) event in New Orleans.

Two aspects of Athens got under Mac users' skin:

  • The appearance of the machine, which -- with its translucent plastics, the cinema-like dimensions of its display and its curved edges -- led many reviewers to compare it with Apple products.

  • Gates' explanation for co-developing a PC with a hardware vendor.

    Hardware and software development had at times been "a little out of sync," Gates said.

    "The best way to advance the state of the art is to work even more closely, always starting from the customer's perspective and focusing on the combination of hardware and software that works best to create an innovative and compelling PC," he said.

    The notion of designing computer hardware and software in tandem is, indeed, a terrific idea, but Microsoft and HP are late in embracing it.

    Apple, based in Cupertino, Calif., has been designing personal computers that way for 25 years and isn't alone. Several companies that build sophisticated business computers -- IBM Corp. and Sun Microsystems Inc., among them -- also have done it that way for a long time.

    Veteran Mac devotees can reel off a lengthy list of similar incidents, from Microsoft's legendary quest to duplicate the Macintosh operating system's look and feel to knockoffs of such Apple software as iMovie with Windows Movie Maker.

    Though Apple fans may seethe, the truth is that "borrowing" ideas from competitors is an accepted and common business practice. Genuine inventions can be patented, but clever ideas will always be ripped off -- especially when there is money to be made.

    For that matter, many of Apple's storied innovations actually have been improvements -- though often vast improvements -- on existing ideas: the graphic user interface pioneered by Xerox Corp.'s Palo Alto Research Center that Apple reworked into the Macintosh interface, introduced as early as 1983, and 2001's acclaimed iPod, which grew from Apple's desire to make a better MP3 player.

    "Success always has a thousand fathers," said Tim O'Reilly, founder and president of O'Reilly & Associates, the computer book publisher based in Sebastopol, Calif.

    "But what Apple does so well," O'Reilly added, "is to realize the potential in a technology and to frame it in such a way that people discover that they need it."

    Josh Bernoff, an analyst for Forrester Research Inc. in Cambridge, Mass., agreed, saying Apple is good at figuring out when technologies are ripe and at how best to popularize them.

    But, inevitably, the companies of the PC world -- be it Microsoft, Gateway or anyone else -- recognize the value in an Apple idea and copy it.

    "There's enormous pressure on Apple to continue to innovate," Bernoff said. "Everything they do gets commoditized by somebody else and all the profit driven out of it."

    Adding to the challenge is that Apple must maintain its parade of innovations with far fewer resources than its Windows rivals.

    Although Apple, for instance, invests 8 percent of its gross sales in research and development -- a higher percentage than most other computer companies -- its total R&D budget is dwarfed by that of its competitors.

    For its 2002 fiscal year ended Sept. 30, Apple invested $446 million in R&D. Such spending at Microsoft totaled $4.3 billion in its last fiscal year -- nearly 10 times Apple's. Microsoft's Athens partner, HP, meanwhile, spent $3.3 billion on R&D in fiscal 2002.

    Luckily for Apple, the diversity of companies involved in PC technology makes major changes more difficult to implement. Since Apple completely controls the hardware and software for the Mac, its only significant impediment to wholesale changes is resistance from users who have a hard time keeping up.

    Yet Apple has little choice but to keep the innovations coming, because one of the Mac's critical selling points is that it's a step ahead of the PC in many areas. If Apple loses that advantage, it could lose customers -- a scenario a company with only 3 percent of the market can ill afford.

    But there's another side, too: if Apple is an acknowledged leader in the computer universe, why isn't its market share growing? Shouldn't there be more people lining up to buy products from the industry's chief innovator?

    Edward J. Black, president and chief executive of the Computer and Communications Industry Association, a Washington technology industry lobbying group, credits Apple for having "great vision" and being more creative than its competitors, but sees several barriers obstructing Apple's progress even though Apple has an impressive set of products.

  • Black said Microsoft's habit of "abusing its monopoly by continuing to engage in truly anti-competitive behavior" works against any rival getting market traction.

  • Apple faces corporate acceptance of Windows-based PCs as the "entrenched standard," which inevitably trickles into the consumer consciousness as well. "That restrains Apple's ability to grow," Black said.

  • Black cited several mistakes Apple made in the late 1980s and early 1990s, which discouraged other software developers from writing more programs for the Mac and failing to allow Mac clone makers until it was too late to make a difference.

    Black said many of the customers who deserted Apple in the mid-90s, fearing the company was about to go out of business, haven't returned despite the company's steady stream of snazzy products and much-improved management since Steve Jobs returned in 1997.

    Forrester's Bernoff said Apple probably could capture more customers by making Windows versions of its products, as it has done with the iPod. But the more products Apple makes available for Windows, the less unique -- and, by extension, the less compelling -- the Mac platform becomes.

    "Every decision is a tightrope act," Bernoff said, citing the recent successful launch of the iTunes Music Store. Recognizing its huge market potential, Apple said that a Windows version of the service would be available later this year, but by putting it off preserves the principle that Mac users get the goodies first.

    Apple has sought to leverage its innovative reputation in its advertising, and its retail stores are an excellent vehicle for demonstrating the Mac's advantages. Still, it appears not enough Windows users are getting the message, or they're simply not dissatisfied enough to switch.

    "Windows is 'good enough' for most people," Bernoff said.

    O'Reilly blames Apple's inability to convert its technical prowess into greater market share on its business model.

    "It's clear that a commodity hardware business model with standard parts and multiple players works better than a proprietary business model," O'Reilly said, comparing Apple's plight to that of Betamax and VHS, where the former's superior technology lost out to the widely adopted standard.

    "What's remarkable is that Apple has survived and prospered despite being incompatible with an industry standard and overwhelming market share," O'Reilly said.

    For more than two decades, innovation has helped Apple endure. But as surely as Apple will keep cooking up better ways of doing things, the PC world will keep borrowing them -- and vice versa.

    But Apple can't change that, so Mac users will just have to accept it. The consolation is that, more often than not, Mac users will have bragging rights, however temporary, over a lot of new technologies.

  • Advertisement