Bet you didn’t know this, but Microsoft invested $100 million to keep Apple afloat in 1997.
It’s pretty douche-bag of Apple to make their commercials that portray Microsoft users as ‘dullards or klutzes’.
But you have to admit that they indeed do make pretty hilarious commercials.
But all’s well ends well. =)
“Bet you didn’t know this, but Microsoft invested $100 million to keep Apple afloat in 1997.”
The reason we don’t know that is because it didn’t happen the way you tell it.
First, it was $150 million.
Second, $150 million was not the right amount to “keep Apple afloat” at that point. Why? Because at that point in time, Apple was said to be worth around $4 billion (more details below) with 10x more cash on hand than Microsoft invested. Microsoft’s investment was a drop in a bucket of that size.
So what was Microsoft doing? They were making an investment, not a bailout. Microsoft sold those Apple shares a few years later, and made about $4.5 billion. Today, Microsoft has no real stake in Apple as far as stocks go.
P.S. I just found this on the Web and am pasting it below for additional info.
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On August 6, 1997 Steve Jobs announced that Microsoft would be investing $150 million in Apple and was committing to producing Microsoft Office for the Macintosh for at least five more years.
Q: The deal included a technology sharing agreement between the companies. What was that all about?
A: The driving force in this deal was the resolution of a long-standing dispute over patents.
Q: The investment was in non-voting stock, which Microsoft was committed to holding for a minimum of three years. If the investment was a “gift” on Microsoft’s part, why the three year minimum term?
A: Because it wasn’t a gift — this is how the companies worked out their legal differences. Additional cash was quietly exchanged behind the scenes. How much was not disclosed.
Q: Microsoft committed to Office for the Mac for five years. If this commitment was completely voluntary, how can the five year term be explained?
A: It can’t be explained that way, because it wasn’t voluntary. These were the agreed-upon terms.
A few of most common myths about the Microsoft-Apple deal debunked:
Myth 1: Without Microsoft’s investment, Apple was doomed.
Reality: Apple had lost over $1 billion in the 18 months before the investment, but in August 1997, they still had $1.2 million in cash on-hand and annual sales of around $7 billion. The $150 million investment did not “save” Apple, though arguably the positive publicity did.
Myth 2: Microsoft was acting to preserve their market for Mac Office.
Reality 2: A nonsensical argument. Was the Mac’s 5% market-share worth $150 million to Microsoft? If Apple went out of business, would Apple’s former customers revert to yellow legal tablets and pocket calculators before they’d buy a Windows computer and Office for Windows?
Myth 3: Microsoft invested in Apple to give them “cover” in the on-going federal antitrust investigation.
Reality 3: This assumes Microsoft’s commitments were essential to Apple’s survival. If this is so, does Microsoft’s ability to issue a life or death sentence over their only competitor make them look MORE or LESS like a monopoly? In fact, within weeks of the announcement, the deal was investigated by the Department of Justice. If this move was intended to give Microsoft breathing room in the antitrust case, then it certainly didn’t work. It didn’t, because it wasn’t.
Myth 4: This deal was a “big win” for Bill Gates.
Reality 4: Apple gained at least $150 million, Microsoft’s public endorsement, and a lot of positive press. What did Microsoft gain? Bill Gates appeared on a big screen at MacWorld, where he was roundly booed by the audience. They also got Apple to call MSIE the Mac’s “default” browser, even though Apple would still be distributing Netscape. This fabulous deal only cost Microsoft $150 million, and then some.
Myth 5: Microsoft owns a big part of Apple.
Reality 5: At the time it occurred in 1997, the $150 million investment amounted to roughly 5% of Apple’s market capitalization, but was held in a special class of nonvoting shares. According to the terms of the deal, Microsoft was allowed to liquidate these shares in three years, which they’ve almost certainly done by now.
Many thanks for the eye-opener,Bill G. Jobs. Even though I have a feeling that’s just a pseudonym, lol.
But i’m pretty sure that $100 or $150 million went a long way for Microsoft.
But all-in-all, I think at this current day and age – if Apple insists on coming up with adverts to condemn the PC, Microsoft should not be taking the back seat in advertising.
But we all know that Apple designs better-looking machines.
I just am comfortable with my PC tablet and its Vista OS; even though I drool at the thought of the MacBook Air built with a lack of functions.
That said…I wonder why Microsoft ain’t producing their own laptop and desktop designs to penetrate the commercial market; instead leaving that job to mass PC producers like HP, Dell, Acer, etc.
With their ability to come up with great peripherals like their notebook wireless presenter mouse which has incredible ergonomics (I own two and I seriously think they are the best presenter mouse around), I don’t see why they aren’t investing in designing their own laptops and desktops.
Then maybe it’ll put Dell, HP and the likes out of business.
BUT, it might not be possible as we have already seen their design in their Zune – which can’t be compared to the iPod and the Zune comes with restricted functionality. (You will have to read up on it on Google)
We can only judge the day they come up with proprietary designs for their certainly-not-dumb OS.