Microsoft Vs. Apple: Analysis About Their Business Model

Microsoft and Apple are the two largest companies in the world. The business model of Apple is based on customer-centric devices and innovation. Microsoft’s business spanned across Windows, Office products, Gaming (Xbox), Hardware, Web search engine (Bing), Cloud, LinkedIn, etc.

Microsoft Vs. Apple: Analysis About Their Business Model

Microsoft Corporation and Apple, Inc. are leading companies in consumer access and technology. They are competing each other in so many sub-industries, such as operating systems, mobile devices, hardware, advertising, software, Web browsing, applications, etc. Microsoft and Apple have a different business model.

They are the two largest companies in the world.  The business model of Apple is based on customer-centric devices and innovation. Microsoft’s business spanned across Windows, Office products, Gaming (Xbox), Hardware, Web search engine (Bing), Cloud, LinkedIn, etc. They have a diversified business model. They changed their business model by starting to release their own devices.

These 2 companies made a revolution in the technology industry. Both companies have chosen a different way for the adoption of enterprise. These tech giants succeeded in the enterprise, using different strategies. Both companies have a different approach from the philosophical and organizational perspective The analysis about the business models of these 2 companies are given below.

Business model of Apple

Apple, Inc. was founded by Steve Jobs, Ronald Wayne, and Steve Wozniak on 1976. It is one of the most successful companies in the world. The company offers software services and technology products. The headquarters of the company is situated in California, USA. Currently, Tim Cook is the CEO of the company.

Steve Jobs

Apple 1 computer is the first product of the company. After that, Apple provided so many services and products. iPhone is one of the most successful products from Apple. iPhone had a sale was  $142 Billion in 2019. It represents the 54% of Apple’s total revenue. Its total revenue was $260.174 Billion in 2019.

Strengths

Apple is one of the most valuable brands. It has a brand value of $140 billion in 2020. Apple is a reliable company in the industry of smart technology devices and advanced computers. The loyal customers, who number in millions is one of their major strengths. And also, they have top technology.


Evolution of Apple and Its Business Model
With a market [https://startuptalky.com/tag/market/] capitalisation of over atrillion dollar at the time of this writing, Apple is among, if not the mostvaluable brand in the world. In recent years, it has become increasingly rareto not use an Apple product at some point in your day. In fact, as…

Apple introduced some innovative products such as iPads and iPhones. They are still determined to manufacture the best technology devices. Apple Company provides a specific business page to its customers. According to customer's needs, It gives technology solutions of top quality.

Apple gives more dedication into designing of their products. According to customer needs, they are doing more researches. Apple introduced an iPhone recycling robot named "Liam". It is used to disassemble of iPhones. The reusable parts are safely stored. Those parts are used for new manufacturing.


Apple And Google To Launch A Joint COVID-19 Tracing Tool for iOS And Android
Tech giants Apple and Google [/tag/google/] announced that they are buildingtogether a Bluetooth based COVID-19 contact tracing tool. It will helpindividuals determine whether they have been in contact with a COVID-19[/tag/covid-19/] infected person. The collaboration will assist health officials…

The company is expanding their services portfolio. The 16% of their total annual revenue (2019) comes from its services. It is the second largest contributor to its total revenue. iPhone (54% in 2019) is the biggest source of company's total revenue. In 2019, Apple Company introduced so many new services. It includes Apple Arcade, Apple TV+, Apple Card, and Apple news+.

Annual revenue of Apple from 2016 to 2019

Weaknesses

The products from Apple considered as a luxury item due to the high prices. Apple’s products are not affordable for low Income consumers. Most of their customers are middle or high class individuals. Apple has only limited advertising resources. Company’s marketing mainly depends on their flagship and iconic retail stores.

Apple released their mapping service named "Apple Maps" in September 2012. It was a failure. They are swiftly entering into new services (game streaming, video content streaming, and credit card) and competing with the major players such as Disney, Netflix, City, Paypal, Chase etc. The products of Apple do not support other technologies or softwares. So Apple’s products are incompatible with other devices.


Tim Cook: The man who made Apple a mega-brand!
The startup circuit has witnessed the rise of many big brands that haverevolutionized the technology. The credit for making technologies accessiblegoes to Apple. The team has worked restlessly and continues to be the brand thatstates a person’s economical status. The 21st century will be characte…

Customers have to buy Apple accessories or apps to continue the using of products from Apple. They received payments to make search engine of Google company as the default search engine for their Safari web browser. Because of this, the company is under investigation. They have been accused of using tracking apps in phones to find the location of users. But in their latest version of phones provides the right for users to decline the tracking.

Business model of Microsoft

The Microsoft is an American multinational technology company. It was founded by Bill Gates and Paul Allen on 1975. The company offers office software suites, devices, apps, cloud computing, operating systems, hardware and software products. They are one of the leading companies in software market. The headquarters of the company is situated in Washington, USA. Currently, Satya Nadella is the CEO of the company. They are forefront of the technology industry for more than 40 years.

Bill Gates

Strengths

Microsoft is considered as the market leader in the industry of software technology, especially in cloud computing. They are the developers of Windows operating system. Azure is a public cloud made by Microsoft. Company's total revenue was $126 billion in 2019. Microsoft is one of the top 5 cloud service providers in the world.

The Microsoft has a brand value of $117 billion in 2020. The company operates their business in more than 190 countries. They launched a promoted version of Windows 10. It got more than 700 million installs. Microsoft added new stock keeping units to its portfolio. It includes Microsoft 365. The company has larger loyal customer base. It is one of their main strength.


Evolution of Microsoft and its Business Model
History of MicrosoftRevenue Streams of MicrosoftConclusion It all started with two computer geeks who were fascinated by the world ofcomputers. Microsoft [https://startuptalky.com/tag/microsoft/] Corporation is anAmerican multinational technology [https://startuptalky.com/tag/technology/…

They have an efficient adverting platform. The company influenced consumers through their effective and stronger marketing strategies. Their advertisement with the title "The future starts now" has touched so many peoples. Microsoft has a 4th rank in world’s most valuable brand list prepared by Interbrand. The company offers user friendly and quality products such as Office software products and Windows OS.

They are implementing a freemium business model. Microsoft realized that paid software is a more difficult sell in an age of low-cost alternatives. Tablets and phones are replacing PCs. A newer Microsoft business model has been made by CEO Satya Nadella, who emphasizes product integration, a "freemium" software package, and a concentration on its cloud computing business.

Annual revenue of Microsoft from 2016 to 2019

Weaknesses

The cyber-crime cases are increasing. It made Microsoft in a weakened state. Cyber-security of the Windows OS have faced attacks from hackers for several times. Their hardware product sales are failing to grow. It includes phones and surface pro computers. Also, PC shipments of the company have frequent falls, because of currency fluctuations and rising to vendors’ rising prices.


Microsoft launches Back2Business Solution Boxes for SMBs & Startups
During the ongoing coronavirus crisis, Indian SMBs (small and medium businesses)are facing various challenges in running their operations smoothly. Thesechallenges include access to remote working solutions with secure and scalableenvironment, disaster recovery and advanced security with device m…

They are lagging in advanced technology and innovation. At this time, Google, Apple and Amazon are rapidly growing.  Safari, Google, and Firefox are the leaders in the internet browser market. But Microsoft is lagging in the Internet browser sector. The acquisitions of the company such as LinkExchange, WebTV, Danger, and Massive were failures. Those unprofitable investments are the major weakness of the Microsoft.

In terms of enterprise value to free cash flow and price to earnings ratio, the market value of Apple is currently higher than Microsoft. Apple has a market capitalization of $1.904 trillion in August 2020. But Microsoft has only $1.607 trillion in this time.


List of the Most Famous Entrepreneurs You Must Know About | 2020 Updated
Famous and popular entrepreneurs [https://startuptalky.com/tag/entrepreneurs/] are the one who changed the way the world think about stuff. These popular andfamous inspirational business [https://startuptalky.com/tag/business-2/…

The analysts said that there will be a 15% compound annual earnings growth for Microsoft and 11.5% compound annual earnings growth for Apple in the next 5 years. The both companies have crossed the market capitalization value of $1.5 trillion. Now their next target is to reach the market capitalization value of $2 trillion.

Must have tools for startups - Recommended by StartupTalky

Read more