"When it comes, the landscape listens,
Shadows hold their breath;
When it goes, ’t is like the distance
On the look of death."
-- From "There's A Certain Slant of Light," by Emily Dickinson, circa 1861

Microsoft (Nasdaq: MSFT) could have written those lines today as a longtime underdog rolls over a software giant much like Dickinson's dreaded winter.

I'm talking about Apple (Nasdaq: AAPL), which, depending on how you look at it, just passed Microsoft in terms of market cap following a stellar Apple performance and lackluster Microsoft numbers. That's all perfectly true if you look at the numbers in a certain slant of light.

  • Counting by the total value of all available shares, Microsoft is still bigger. Do the math using each company's full share count multiplied by today's prices and Microsoft adds up to a value of $271.4 billion, comfortably ahead of Apple's $245.4 billion.
  • But the S&P 500 index by Standard & Poor's reports things differently. By the S&P's measure, insider holdings and such don't count toward the reported market cap. In that light, Apple stays close to the fully diluted cap at $243.6 billion while Microsoft shrinks to $238 billion. Sayonara, bragging rights.

Whatever measure you use, Apple's rise to prominence is astounding. Four years ago, Apple was worth a piddly $72 billion and on par with Dell's market cap instead of Microsoft's. That was before the iPad, before the iPhone, and right at the start of the Intel era for Macintosh computers. A lot of water has run under the bridges since. Dell is now worth a fraction of Apple's cap no matter how you slice it, and only ExxonMobil (NYSE: XOM) is ahead of Apple on the S&P 500 list sorted by float-adjusted market cap. Exxon’s place looks safe for now, but then again, so did Microsoft’s just a few months ago.

Of all the companies near the top of the U.S. market cap list, Apple continues to hold the most upside, but also a fair bit of risk. In the near term, the company will go as far as the iPhone will take it, and that could be pretty far considering a potential tie-up with Verizon (NYSE: VZ) in the U.S. and expanded partnerships in key overseas growth areas.

In the long run, the company will need to find ways to keep the enormous, $600 iPhone selling price (the cost carriers pay) well above its cheaper rivals. Recent reports from Qualcomm (Nasdaq: QCOM) and Nokia (NYSE: NOK) show that prices on smartphones are already facing significant downward pressure. In the not-too-distant future, the iPhone will have to compete with a sea of Google (Nasdaq: GOOG) Android phones being offered at the enticing price of zero dollars and zero cents.  

Still, I'd tip my turtleneck to Steve Jobs if I had one, and could figure out how to tip it. I've been critical of Apple before (and I still think the stock is getting ahead of itself), but in a certain slant of light even this skeptic has to bow to the master.