Can Apple change its enterprise spots?

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Cath Everett ZDNet.co.uk

Published: 02 May 2007 13:56 BST

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Most Apple fans have nurtured the dream that one day everyone will see sense and abandon Windows for a platform that just looks and works so much better. While that dream seems to be coming partly true among consumers, Apple seems no closer to winning over big businesses with its innovative but costly hardware and software combo.

The launch of a new version of OS X, on the back of a lacklustre performance by Microsoft Vista to date, looked like an opportunity to finally attract some large companies to all things Mac but, unfortunately, it now seems that the operating system (OS), code-named Leopard, is unlikely to appear much before October 2007. By this time Apple could well have squandered any potential advantage offered by Vista's struggle to gain momentum.

The issue here is that Vista sales to enterprises and small- to medium-sized businesses (SMBs) are still relatively low and are not expected to take off until 2008 at the earliest — not least because of the significant hardware upgrades required to run the new OS.

Moreover, says Rob Enderle, principal analyst at the Enderle Group, "a lot of shops are very frustrated with Microsoft and looking to try something different", and so a timely release of Leopard might have provided Apple with a window to take market share.

"Vista is not doing well and is vulnerable right now," explains Enderle, adding: "But that vulnerability may largely evaporate by October, so much of Apple's advantage may evaporate as well."

This is because, by then, Microsoft is expected to have sorted out existing device driver problems, which are currently causing Vista to crash, and to have released a range of other bug fixes.

But the question is whether Apple has any real interest in the enterprise, particularly as it has spectacularly — and expensively — failed to make its mark there in the past.

Apple's history in corporate computing
Apple first ventured into this world in 1977 with the introduction of the hugely successful Apple II machine. Despite a higher price tag than its rivals, it quickly became market leader, not least because it ran the VisiCalc spreadsheet, which was the first business "killer app".

Within a few years, however, Apple was struggling to compete against IBM and Microsoft PCs, which were making inroads into the corporate computing space — a situation that was compounded by the disastrous release of the Apple III in 1980.

Apple III's designers complied with co-founder Steve Jobs' request to omit a cooling fan from the machine, but this led to thousands of units having to be recalled because of overheating. While an upgrade was released three years later, purchasers were wary of being bitten again.

To make matters worse, however, in 1986 Apple also released Lisa, which it pitched as an office computing system. The machine was named after Jobs' daughter, was the first PC to be operated by a mouse and had two user modes — the Lisa Office System and Workshop. The former provided the first commercial graphical user interface for end users, while the latter offered a mainly text-based development environment.

While innovative at the technical level, commercially Lisa was a disaster from which it took Apple some time to recover. The machine's high price tag, lack of applications and sluggish performance put business customers off, as they opted to run IBM PCs and later IBM clones, all of which meant that IBM and Microsoft, in particular, continued to gain market share at Apple's expense.

Despite the release of two subsequent models, the line was discontinued in 1986, although the experience gained from the work on Lisa was absorbed into the first Mac, which shipped in 1984.

Apple's continued growth during this difficult time, however, was due in part to its dominance of the education sector, which was, in turn, crucial to...

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