The big question for Microsoft: Does it go after Apple through a strategy of "vertical integration," creating its own hardware and software as it's doing with the Surface tablet?
Or does it fall back to its classic business model of selling software to PC makers?
Microsoft CFO Peter Klein, speaking at the Goldman Sachs Technology and Internet Conference Wednesday morning in San Francisco, basically punted on that question.
He talked about the need for more (and lower) price points on Windows 8 devices. And he said that making its own tablet had given Microsoft a lot of "learning."
And then he kept talking about the "ecosystem"—that is, the large number of Windows PC manufacturers Microsoft has built up over the years, like HP, Dell, Lenovo, Asus, and Acer.
This is the dilemma Microsoft is facing: Klein and other executives cannot strongly praise the Surface, lest they scare the PC makers who pay lots of money to license Windows.
And investors—Klein's primary audience at the conference—worry about Microsoft moving from the high-margin software business to the lower-margin hardware business.
But it also cannot walk away from the bet it made on Surface.
Hence Microsoft's inconsistency in messaging. To consumers, Microsoft delivers singing-and-dancing TV commercials and glossy, Apple-like stores, telling them how great the Surface is.
Contrast that to Apple CEO Tim Cook, who—predictably—bubbled over with enthusiasm when talking about his company's products yesterday at the Goldman conference.
Microsoft is learning, all right. It's just a hard lesson.
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