Why Windows Beat Apple and Google in PC Operating Systems

TL;DR

Windows held almost 83% of PC market share by unit shipments in 2020, versus 10% for Chrome OS and 7% for Mac OS. Its dominance came from running on many hardware makers' machines, pulling along Office and other products, and embedding itself deeply in corporate ecosystems that companies grew reluctant to leave.

Transcript

Microsoft Windows debuted in 1985. And for the past two decades, it has been the dominant PC operating system worldwide. In 2020, Windows had almost 83% market share by unit shipments. While Google Chrome OS had 10%. And Apple's Mac OS had 7%. Bill Gates, his vision was to put a PC on every desk, in every home. We've struck a chord with Windows whe... Read More

Key Insights

• Windows commanded almost 83% of PC market share by unit shipments in 2020, while Google Chrome OS held 10% and Apple's Mac OS held 7%, cementing two decades of PC operating system dominance.
• Windows was strategically critical not just for selling PCs but because it sold Office. The graphical programs Word, Excel and PowerPoint drove revenue, so Windows pulled a lot of other Microsoft products along with it.
• Windows began as a graphical user interface running on top of MS-DOS rather than a standalone operating system, aiming to remove the barriers that made 1980s computing complex and lines-of-code intensive.
• Windows faced a challenge Apple did not: it had to run on all the different MS-DOS machines in the market from many hardware makers, whereas Apple only had to make its software run on its own hardware.
• Windows 3.0 turned the product serious, introducing Solitaire to teach drag-and-drop with a mouse. It shipped 1 million copies in three months and reached 25 million licensed users by 1993, with 60% of PCs pre-installed.
• Windows 95 solidified Microsoft's dominance, generating $30 million in revenue on its first day, running on 80% of all PCs with over 100 million users, and shipping simultaneously in eight languages worldwide.
• Corporate lock-in is a core reason for Windows' endurance. Once big companies deploy thousands of PCs and build internal Windows applications, employees grow accustomed to them, creating a base companies are reluctant to leave.
• Microsoft stumbled with several releases: Vista ran applications slower and had graphics and hardware issues, while Windows 8 removed the familiar Start menu with a touch-friendly smartphone-style design users could not cope with.

Questions & Answers

Q: What was Windows' PC market share compared to Apple and Google in 2020?

In 2020, Windows had almost 83% market share by unit shipments, making it the dominant PC operating system worldwide. Google Chrome OS held 10% and Apple's Mac OS held 7%. This dominance reflected two decades as the leading PC operating system. According to the description, these figures come from Gartner, underscoring how far ahead Windows remained against its two main platform rivals at the time.

Q: Why was Windows so critical to Microsoft's business?

Windows was critical not just because it sold PCs but because it sold Office. The graphical user interface programs Word, Excel and PowerPoint depended on Windows, which is why it has been central to Microsoft's business and remains so. Windows also sold developer tools and pulled a lot of other products along with it. Failing to make needed operating system changes would have hampered the development and sales of those other products.

Q: How did Windows begin, and how was it different from an operating system?

Windows was not the first OS Microsoft made; the company first developed MS-DOS 1.0 for IBM. In its early days, Windows was thought of not as an operating system but as a graphical user interface, or GUI, that would run on top of MS-DOS. The motivation was to remove the barriers that made 1980s computing complex, so users could get the most out of available technology as effortlessly as possible without entering lines of code.

Q: Why did Apple sue Microsoft, and what was the outcome?

Apple and Microsoft made a confidential agreement in 1985 that allowed Microsoft to use any of Apple's interface elements in its software. After Windows 2.0 was released, Apple sued Microsoft for copyright infringement. However, the court said Apple's copyrights were covered by the existing agreement. Apple appealed several times, but the court denied their petitions. Earlier, Microsoft had also created software for new Macs, including the first version of Microsoft Word.

Q: What made Windows 95 such a landmark release?

Windows 95 solidified Windows as a dominant operating system. Its marketing was legendary: Microsoft paid the Rolling Stones for rights to 'Start Me Up' to roll out the Start button, and people lined up for hours at stores. Microsoft generated $30 million in revenue on the first day, and Windows was used on 80% of all PCs with more than 100 million users. It shipped simultaneously in eight languages and added faxing, messaging and networking.

Q: Why do corporations tend to stay with Windows?

Many, if not most, Windows deployments are within corporations, where it becomes part of a corporate ecosystem that companies manage and secure as their own. Microsoft paid attention to what business users asked for, especially big companies deploying thousands of PCs. Once those companies are on Windows and start building internal applications for it, many employees get used to those programs. That creates a formidable base that companies are reluctant to leave, contributing to Windows' enduring success.

Q: What happened with the Microsoft antitrust case in the 1990s?

In the 1990s, Microsoft faced legal scrutiny for using its dominant position, holding above 90% of Intel-compatible PC operating systems for much of the decade. In 1998, the US government accused it of using its software dominance to drive competitors out. The suit debated whether Microsoft forced computer makers to exclude Netscape's browser. A judge ruled Internet Explorer was unlawfully tied to Windows and the company should split, but a 2002 appeals court threw out the ruling and Microsoft settled via a consent decree.

Q: Which Windows versions struggled, and why?

Windows went through good and bad cycles. Vista interacted differently with programs, causing applications to run at slower speeds along with graphics and hardware connection issues; its management team was replaced after the disaster, with the Office team put in charge of Windows. Windows 7 fixed those problems. Windows 8 was called Microsoft's 'new coke moment' because it removed the familiar Start menu with a touch-friendly, smartphone-style design that many people and companies could not cope with.

Summary & Key Takeaways

• Windows debuted in 1985 and dominated PC operating systems for two decades, holding almost 83% market share by unit shipments in 2020 against Chrome OS's 10% and Mac OS's 7%. Bill Gates envisioned a PC on every desk and in every home, and Windows changed how people use computers.

• Windows started as a GUI on top of MS-DOS. Windows 1.0 launched in November 1985; after Windows 2.0, Apple sued for copyright infringement but lost because a 1985 agreement let Microsoft use Apple's interface elements. Windows 3.0 and the legendary Windows 95 marketing campaign propelled Microsoft to PC dominance.

• Facing 1998 US antitrust action for tying Internet Explorer to Windows, Microsoft settled via a consent decree after an appeals court threw out the split ruling. Later versions varied in quality, from the Vista disaster to Windows 8's unfamiliar removal of the Start menu, while its mobile OS failed to win leadership.