Why Apple and Microsoft are suddenly playing nice

Tense history aside, Apple and Microsoft now share considerable opportunities in the business world. Both IT administrators and users stand to benefit if friendly relations between the two technology leaders continue to develop, according to analysts and industry watchers.

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Credit: REUTERS/ Suzanne Plunkett

Apple and Microsoft were founded less than a year apart in the mid-1970s. In the following years the companies went through multiple cycles of partnership and discord. Microsoft's surprise on-stage presence at an Apple media event last week demonstrated just how cordial things have again become as the two tech giants are seemingly pleased to be in each other's good graces.

The companies' shared future in the enterprise market in large part fuels this renewed spirit of compromise. And the software, services and devices both companies sell will be increasingly complementary. 

Apple hardware, Microsoft software

Microsoft's future in the business world will relate to OS and productivity software and cloud services, while Apple maintains a significant lead when it comes to software, according to Jan Dawson, chief analyst and founder of tech research firm Jackdaw

[Related Feature: CIOs say Apple still doesn't care about enterprise]

Microsoft "makes many of the tools employees actually need … to get their jobs done," Dawson says. "Apple obviously does make alternatives for some of those tools, but in the vast majority of cases they're either inferior or simply not supported by IT departments."

MacBooks and other Apple devices will be more compelling to enterprises if Microsoft starts treating that hardware as a "first-class citizen" for new Office apps and other software, according to Dawson. However, Apple also needs to continue to make it easier for businesses to deploy those devices at scale along with the Microsoft software they need.

"Except for Windows, Microsoft's elements will increasingly need to run on Apple hardware, so the companies will definitely be working together more," Dawson says. "The good thing is that Microsoft has stopped resisting this inevitable outcome, and is instead embracing a future that's as much about third-party devices as its own devices and operating systems." 

History of ebbs and flows between Apple and Microsoft 

The companies may be friendly today for revenue's sake, and for future opportunities in enterprise, but the relationship hasn't been this way for long.

Just two years ago, Apple's CEO Tim Cook painted Microsoft as a confused competitor. "They chased after netbooks," Cook said during a press event in October 2013. "Now they're trying to make PCs into tablets and tablets into PCs. Who knows what they will do next?" 

During the dawn of the smartphone revolution in 2007, Microsoft's former CEO Steve Ballmer told USA Today: "There's no chance that the iPhone is going to get any significant market share. No chance." 

And when the late Steve Jobs, cofounder and CEO of Apple, was asked what it was like using iTunes on a Windows PC at the 2007 D Conference, he said: "It's like giving a glass of ice water to someone in hell."

These aren't exact the sentiments of friendly corporations, but that was then, and today is a different story … for now.

[Related Feature: CIOs say AppleCare for enterprise is lacking]

"Who to know better about productivity than Microsoft?" Phil Schiller, Apple's vice president of marketing, asked a notably quiet crowd at the company's event last week before inviting Microsoft on stage to demonstrate new Office 365 features for the iPad Pro.

"Though the companies absolutely still compete, the increased degree of rationality at Microsoft has opened the door to partnerships and other forms of working together," says Dawson.

microsoftapple REUTERS/ Beck Diefenbach

 

Kirk Koenigsbauer (L), Corporate Vice President, Office 365 Client Apps and Services Team, is greeted by Phil Schiller as he takes the stage to discuss Microsoft Office for the iPad Pro during an Apple media event in San Francisco, California, September 9, 2015

'Real magic happens' when Apple, Microsoft cooperate

Chip Pearson, the former CEO of JAMF Software, a mobile device management vendor for Apple products, who's now focused on strategic partnerships, says the "real magic happens" when Apple and Microsoft work together on products for enterprise. "I believe that in a perfect world, an organization or user has Microsoft applications and backend services running on Apple endpoints." 

IT administrators and users both benefit from having their technology needs met through the cooperation and coexistence of both companies, according to Pearson. "It's hard to look at any human endeavor where two groups of very capable and skilled people weren't able to do more when working together."

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Of course, there's no telling how long relations between the two competitive companies will continue to be friendly. "Many things change on a cyclical pattern, and there does seem to be a historical precedent for the warming trend to continue," says Pearson. "However, history isn't destiny, and humans working together for their common goals is good as long as both parties are getting their needs met."

Dawson has an equally positive outlook for the companies' alliance in enterprise, but he sees more subtle signs of compromise instead of more formal partnerships like the ones Apple struck with IBM and Cisco. "As long as Microsoft stays on this more rational, open course with regard to developing software for third party devices and platforms, I can only see the relationship continuing to warm up."

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