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Technology Stocks : Apple Inc.

AAPL 270.25

-0.4%

Oct 31 3:59 PM EDT

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To: Lizzie Tudor who wrote (54969)	7/22/2006 1:47:38 PM
From: NAG1	Read Replies (1) of 213172

<<In the case of Zune, I think it is partly ego on the part of Ballmer that just can't accept msft dominance is waning.>>Lizzie That may be part of it. I think the real reason why MSFT is doing this now is that they don't want to lose the battle for the entertainment center and the iPod and iTunes is a powerful entryway for Apple to gain dominance here. For MSFT, it is not only an issue for the music business, but maybe they are thinking this is a way for them to compete against SONY in the battle of the game station platforms. So I think this is important to MSFT and could prove harmful, if they lose, in their other businesses. One of the interesting side effects of MSFT entering this business, especially if Apple can get some traction into the entertainment center/hub business, is that one of the other game playing companies might decide to join up with Apple to fight against MSFT. Lots of different scenarios could be played out depending on how things take place. It is always interesting. That is why I think this is real serious business for MSFT and not their trying to throw at the dartboard and see if they can come up with a successful business. Neal

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