Today in Apple history: Bill Gates predicts doom for Apple’s biggest product

Today, nevertheless, we understand that Jobs agreed with Gates. The year prior to, at a time when sales of the iPod made up roughly 45 percent of Apples income, he struck an offer with Motorola to produce a cellphone that might play tunes from iTunes.
That phone ended up ending up being the tremendously disappointing ROKR E1, the grandpa of the iPhone and the very first Apple-sanctioned cellular phone to run iTunes. It was a bust, however it pushed Apple to go into the smartphone market– which it did 2 years later with the iPhone.

May 12, 2005: Longtime Apple frenemy Bill Gates tells a German newspaper that Apple may have struck it huge with the iPod, but that its success isnt going to last permanently.
The bad news for Microsoft is that Apple cannibalized itself by making the iPhone. And Apples mobile phone became even more successful than the iPod.
” As great as Apple might be, I dont believe the success of the iPod is sustainable in the long run,” Gates told the Frankfurter Allgemeine Zeitung. “You can make parallels with computer systems: Apple was very strong in this field in the past, with its Macintosh and its graphics user interface– like the iPod today– and then lost its position.”
Gates went on to predict how things would play out. Cellular phones, efficient in doing much of what an iPod could do, would ruin the marketplace for MP3 players, he said.

At the time, the Apple press saw Gates dismissive comments about the iPod as sour grapes from a male who– having stepped down as Microsoft CEO in 2000– was no longer relevant in the tech world in the method Steve Jobs was.
Sony sold 340 million Walkmans over 25 years, experts noted. Because Cupertino had actually sold just 15 million iPods at the time, the majority of observers remained confident that Apples portable music player would delight in a long, successful future.
Mobile phones are the brand-new MP3 gamers

In spite of Gates prophetic words, Microsoft didnt take the iPhone too seriously, either. Seeing this classic Steve Ballmer clip makes clear how severely Microsoft misjudged Apples phone:

Mobile phones are going to take the iPods market share. The great news for Gates is that he was right on the money. The bad news for Microsoft is that Apple cannibalized itself by making the iPhone. And Apples mobile phone became even more successful than the iPod.

Yeah. Who would ever desire a mobile phone without a physical keyboard?

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