Microsoft's decision to invest $150 million in its arch but ailing competitor, Apple Computer, has surprised many in the technology sector. But the fine print of the deal shows that Mr Bill Gates is, as usual, getting good value for his company's money, while at the same time, giving Apple's struggle to survive a timely boost. The decision will be particularly welcomed in Cork where Apple employs 1,500 people. They will be cheered also by the new board appointments which see industry heavyweights, such as Larry Ellison of Oracle, adding their undoubted talents to Apple's cause.
The announcements could mark the turning point for Apple which has been on a downward slide for a number of years. In the last seven quarters, the company has lost a total of $1.7 billion as the so-called Wintel combination of Microsoft Windows software and Intel computer chips made inroads into Apple's share of the personal computer market. The beleaguered company's attempts to fight back have been hindered by technology lapses and management indecision. Earlier this year, the company's crisis reached a new stage when chief executive Mr Gil Amelio was forced to bow out as Mr Steve Jobs returned in the role of super-adviser to the company he co-founded 23 years ago.
It is Jobs who has put this latest lifeline together. He kick-started the previously stalled talks with Microsoft and his influence appears to be giving Apple the sense of purpose and vision it has lacked. The Microsoft investment, small though it is in relative terms for a company valued at $3 billion plus, signals to the market - and Apple's hard-pressed customers - that even its darkest foe believes it has a future. At least Apple hopes this is the message that comes across. Others will see this development as a further nail in the Apple coffin. Supping with the enemy will be hard for Apple Macintosh loyalists to digest, especially as many believe that Gates will not be happy until he has taken over all the company.
For Microsoft, the investment has many advantages. It makes it more difficult for its many critics, particularly in the US, to accuse it of monopolistic tendencies and should ease fears of it being broken up under US anti-trust legislation. Apple's decision to adopt Microsoft's Explorer technology as its default Internet browser will increase its penetration of this key market and put pressure on a more healthy rival, the Internet software company, Netscape. The deal also safeguards Microsoft's substantial revenues from software written specially for the Macintosh. If Apple were to die, so would a considerable slice of Microsoft profits.
Even with this vote of confidence, the future for Apple is not secure. The company faces a critical series of challenges if it is not to shrink into a minor computer power or disappear altogether. To stem the haemorrhage of Macintosh users, it must provide a credible alternative to Wintel's dominance. Achieving this rebirth of vision and ingenuity will not be easy. And it will be even more difficult to convince a sceptical market that it has been achieved. But Steve Jobs has given hope where previously despair reigned. For the sake of 1,500 jobs in Cork, and many more worldwide, plus the maintenance of a competitive market, it is to be hoped that he succeeds.