Apple’s Mac Could Finally Win the War Against Microsoft’s Windows

Half a decade ago, the war between Apple's (NASDAQ: AAPL  ) Mac and PCs running Microsoft's (NASDAQ: MSFT  ) Windows was all the rage. Apple's commercials poked fun at Microsoft's operating system, while discussion boards across the Internet were filled with endless topics dissecting the merits of the two competing PCs.

That era seems to have come to a close. With the market for traditional PCs shrinking, and mobile devices growing ever more popular, the debate has shifted -- now its Apple's iOS against Google's (NASDAQ: GOOGL  ) Android. Windows against Mac is a thing of the past.

Or is it? Although the traditional PC is fading, it is unlikely to ever truly die. Now, Apple appears to be taking the PC market more seriously than ever before, and in the end, perhaps the Mac will ultimately prevail over Microsoft's Windows.

Apple's iPad event wasn't really about the iPad
The press largely characterized Apple's event on Tuesday as its "iPad event." To some extent, that's fair -- Apple announced two new iPads. Yet, it would've been far more accurate to call it Apple's "Mac event" -- Apple spent almost twice as much time discussing the Mac as it did the iPad. In fact, for an event that lasted only 90 minutes, the iPad received decisively little attention. Apple might've saved the best for last, but it didn't discuss the iPad until the final 30 minutes.

Apple spent the entire first hour on the Mac -- the Mac Pro, the MacBook Pro, and its new operating system, OS X Mavericks. The new version of OS X includes a number of improvements and additions, but most notable may have been the price -- Apple is giving Mavericks away for free. That's not that significant (the last update only cost $20), but it does lessen the cost of owning a Mac over time.

Updates to Microsoft's Windows are notably more expensive, usually costing $100-200. No one is forced to upgrade to the new version of Microsoft's operating system, but a user could easily spend several hundred dollars on Windows updates over the life of their PC.

Apple cutting Mac prices
Free OS X makes a Mac less expensive over time, but Apple could cut the upfront cost of Mac ownership as well. On Tuesday, it lowered the price of the MacBook Pro by $200, and more price cuts could be coming.

According to Ming-Chi Kuo, an analyst at KGI Securities with a solid track-record, Apple is preparing to cut the price of the iMac next year. Kuo also expects Apple to unveil a new member of the MacBook family -- a 12-inch laptop -- that could be cheaper than Apple's current laptops. 

Apple has also decided to include iWork -- its competitor to Microsoft's Office -- for free on all new Macs. In addition to buying Microsoft's Windows, many PC users also buy Office. By including its own Office competitor for free, Apple is further driving down the cost of Mac ownership.

Microsoft is confused
Of course, even if Apple cuts the price of its Macs, they'll still be relatively expensive. The average PC generally sells for around $400-600, and PCs running Microsoft's Windows that retail for less than $300 are still popular. Yet, Windows may be in danger -- Microsoft seems to be alienating both its users and its hardware partners.

Apple's CEO Tim Cook took a shot at Microsoft on Tuesday, saying that its competitors were "confused." By that, Cook meant Microsoft's strategic decision to create a hybrid operating system. Windows 8 is made for both traditional PCs and tablets, and with its two separate interfaces, works well on either type of device.

Yet, Microsoft's Metro interface, optimized for touch-screens, seems out of place on a traditional PC. It can still be controlled with a mouse and keyboard, but it isn't ideal. Some users have been upset with the revisions, and Microsoft's customer satisfaction rating has fallen to its lowest levels since 2007.

Microsoft's hardware partners, too, are upset with Microsoft's decisions. Hewlett-Packard's CEO Meg Whitman called Microsoft a "competitor." Microsoft's flagship Windows 8 devices -- the Surface and Surface Pro -- compete directly with Windows devices sold by HP.

Google's Chrome OS is slowly growing
HP isn't abandoning Microsoft's Windows entirely, but it is focusing more on Google's competing operating system, Chrome OS. By the end of the year, HP will have released three Chromebooks, and more could be on the way.

Google's Chrome OS isn't much of an operating system -- it's mostly just Google's Chrome browser, a gateway to the web. Still, as cloud-based web applications become ever more powerful, Chromebooks are becoming more capable, and in time, they could capture a sizable chunk of the PC market -- in fact, Google's Chromebooks are the fastest growing segment of the PC market.

Also, partly because Google gives Chrome OS away for free, and Chromebooks don't run any local software, Chromebooks are incredibly cheap -- HP's new Chromebook 11 is just $279, and Google sells Chromebooks on Google Play for as little as $199. They also include deep integration with Google's Apps, Google's free alternative to Microsoft Office.

The PC market is Microsoft's to lose
Although its iDevices may continue to grab the headlines, Apple is slowly positioning its Macs to capture a larger segment of the PC market. Now cheaper, and with free software, Apple's Macs could appeal to a segment of PC buyers turned off by Microsoft's revisions to its operating system. Meanwhile, Google is going after the bottom -- cheap Chromebooks are becoming ever more potent alternatives for buyers on a budget.

The PC market isn't the behemoth it once was, but it remains crucial to Microsoft's Windows. Unfortunately for Microsoft, it appears to be a market it's in danger of losing.

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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 24, 2013, at 11:35 AM, techy46 wrote:

    Fools- The average PC generally sells for around $400-600, and PCs running Microsoft's Windows that retail for less than $300 are still popular. Yet, Windows may be in danger -- Microsoft seems to be alienating both its users and its hardware partners.

    Says who? You can get a PC running Windows starting at under $300 going to over $3000. That put the average price at $1600 unless you're talking about weighted average price. MS is not alienating it's users. We've been waiting for version 8.n and Intel's new chips to offer faster performance, longer battery life and more economical prices. I've got a $1000 15" W7 notebook and I'm going to buy a $700 all-in-1 W8.1 15" notebook and a $300 8" 2-in-1 W8 tablet. I'll upgrade my Lumia 900 to a 925 next Spring. There's over 1 billion Windows users that have been happily using their productive W7 and WXP devices musing over all the applesauce for the last 3-5 years. They'll be joined by 1 billion Nokia phone users shortly.

  • Report this Comment On October 24, 2013, at 11:52 AM, skyledavis wrote:

    This reads more like someone who reads tech articles than someone who truly gets the tech industry from any personal experience. Mr. Mattera's bio didn't give any indication of his history, so I could definitely be wrong about that.

    Here are some facts to consider:

    -a "computer" business (PC, Tablet, Phone, whatever) has never, in the history of the industry, held long with only devices from one manufacturer. The technology business, like any business, abhors a monopoly. People like choice, and competitors with a lower price inevitibly come in with a just-as-good or better product and undercut the platform. Examples include IBM, Mac, iPhone, and iPad.

    -Mac sales are falling, not increasing. Last quarter's numbers were bad for Mac. Let's not kid ourselves.

    -Apple is losing much of it's elite mojo. Power users are more and more moving to Windows. Reasons for shelling out for Apple are less, especially with Mac software losing the power tools and the best products being cross-platform offerings from the likes of Adobe, etc. I speak from personal experience from a large number of friends, as well as reports and studies.

    -The enterprise, which remains the PC stronghold, still hates mac. They are hard to manage and costly to deploy. From a pricing and a development perspective, Mac is a consumer product that only plays at being enterprise-friendly. Mac is enterprise only in the sense that they are BYOD. They aren't meant for enterprise deployment, which is where the bulk of the PC sales are these days.

    None of this is to say that Windows can't be beat, but it won't be by Mac or by a cloud-only solution (at least not any time soon). If anyone hopes to bring down Windows, it will be a Linux-based solution that finds a way to exploit the popularity of Android. This may be an evolution of ChromeOS or it may be Ubuntu or someone else. But it won't be Mac.

  • Report this Comment On October 24, 2013, at 11:54 AM, skyledavis wrote:

    For the record, PC sales may still fall and the amount of true "PCs" may be small compared to "post-PC" devices like the iPad, but there will still be a market for such devices, and right now Microsoft is the best-performing game in town.

  • Report this Comment On October 24, 2013, at 4:22 PM, Snoopy2012 wrote:

    Looks like all the iHaters are moved to the fools site.

  • Report this Comment On October 24, 2013, at 4:23 PM, fwe43 wrote:

    Sorry but Microsoft isn't confused. People who think that all devices are unique and that they shouldn't be integrated are confused. You luddites are still whining about touchscreen when Win 8.1 is already moving into the world of gesturing to control the interface. In 20 years Minority Report will be reality and Apple will still be selling iPads that can't run real applications ... just 99 cent app store lite versions.

    There is absolutely no chance the enterprise world will shell out the money necessary to go to OSX. It would quadruple their hardware costs. Beyond that I look at all the user reviews for the Surface Pro or the Lenovo Yoga or the Dell XPS 18 - and 95% of the people that own those devices love them.

    Yes we know, PC sales have been declining. I'm part of the problem. Last Winter I bought a Win 8 Asus tablet that has prolonged my timeline for buying a new laptop. And when I do, I certainly won't be buying a Meg Whitman chromebook paper weight.

  • Report this Comment On October 24, 2013, at 5:20 PM, j186 wrote:

    Tune in next week when Motley Fool states that Microsoft is beating out Apple. Motley Fool - you change your story every other week. Your advice is worthless.

  • Report this Comment On October 24, 2013, at 5:27 PM, d42chad wrote:

    Mac will never win the war because the "war" is actually between Windows and Ubuntu. The biggest buyer of the Windows pc is every company in the world. I'm sorry to hurt your mac's feelings but no professional will take them seriously. It is the operating system that is easiest to hack....The security is garbage. The hardware is outrageous and can't be customized.Also the hardware is fairly brittle. Try dropping a macbook vs dropping a thinkpad. The mac doesn't stand a chance. Heck on that note....swap out a keyboard on a mac vs thinkpad or hdd or screen. Business pc's are made to be tanks that are easily fixable. Theres a very slight chance that Mac will compete with personal home pc's IF the IF Windows doesn't make significant change to the awful Windows 8 but the price point on Apple makes it unrealistic.

  • Report this Comment On October 24, 2013, at 5:29 PM, auggybendoggy wrote:

    "Sorry but Microsoft isn't confused. People who think that all devices are unique and that they shouldn't be integrated are confused. You luddites are still whining about touchscreen when Win 8.1 is already moving into the world of gesturing to control the interface."

    Man isn't that the truth. MS is ahead of everyone else. The reason they're not doing it is because they'll look stupid if they copy MS. And they will copy them once they see that everything will be touch. Yes the mouse will always have it's place, but that doesn't mean a desktop can't be touch. That's Apple thinking INSIDE the box.

  • Report this Comment On October 25, 2013, at 12:45 AM, pwkrp wrote:

    Look at how many different computer companies it took to beat Apple. So Apple didn't do bad.

  • Report this Comment On January 08, 2014, at 10:54 AM, Grendel wrote:

    The "war" for desktop marketshare isn't relevant anymore.

    I guess it doesn't surprise me that Motely Fool doesn't understand technology companies.

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