Things could not be going better for Apple right? It just announced earnings that have once again beat earning estimates thanks to very strong sales of both Iphones and Mac computers. In after market trading, Apple’s stock gained about 4,5% as its highest margin product, the Iphone, pushed earnings higher. But all if not perfect in Apple world. In fact, it looks like it is not appreciative of Microsoft’s recent tv ads, that attack the higher price of Mac computers.
In fact, Microsoft’s COO Kevin Turner has even been asked to stop running the ads by Apple’s legal team according to a recent interview in PC World. Quite a request don’t you think? They demanded the ads stop saying that Apple’s computers were now priced 100$ lower making the ads non-justified. His reaction? “It was the greatest single phone call in the history that I’ve ever taken in business.” And he is absolutely right. If these ads are indeed getting the attention of consumers and pointing them to the fact that they can get as good of a computer for a lower price, then Microsoft should be buying a lot more airtime.
Personally, I am surprised to see Apple on the defensive about this. Apple consumers are generally known to go towards the brand for all kinds of reasons, but price is rarely if ever one of those. And because of that, I would not have expected these ads to have much of an impact but if Apple even went as far as asking Microsoft, there is clearly something going on with the campaign.
Should competitors ever ask themselves to stop attacking each other? Certainly does not sound like something a company would even consider in a capitalist world but that seems to be exactly what happened. I truly wonder if others such as Coca-Cola and Pepsi for example have ever had such discussions. I can’t imagine Microsoft ever deciding to stop a campaign for that reason, could you? Apple’s response is that Microsoft is giving false information quoting prices that are no longer accurate. Should such ads be allowed to go on? From the ads that I have seen, I don’t think there is any issue because Microsoft is simply saying that the Mac products are more expensive, which is…true.