Apple Reignites the Browser Wars

The maker of the hotly anticipated iPhone is on the hunt for market share, with new versions of its Safari Web browser. Watch out, Microsoft

by Aaron Ricadela

In the Apple (AAPL) pantheon, hardware design usually stands at the altar, from the company's sleek, silver MacBook computers and its colorful iPod music players to its latest object of desire, the soon-to-be available touch-screen iPhone. But increasingly, software is what Apple relies on to broaden the market for its products—and, it hopes, take a chunk of business from Microsoft (MSFT).

On June 11, Apple Chief Executive Steve Jobs stepped up his assault on the software giant. In a speech before Apple developers, Jobs, clad in his traditional uniform of black turtleneck and jeans, announced new versions of Apple's Safari Web browser for the ubiquitous Windows operating system. That gives PC users a no-risk way to sample Apple software (Safari is free), and possibly an incentive to switch to a Mac computer or buy an iPhone. And to make sure there are enough programs for interested buyers, Jobs also offered Safari's underlying Web technologies to outside software developers so they could write programs for Apple products, including the iPhone, the company's latest potential blockbuster product that goes on sale June 29.

Surfing Safari

Taken together, the moves could sway more companies to enter Apple's orbit and potentially reignite a browser war that's been dormant for several years. Apple holds about 5% of the Web browser market, vs. 78% for Microsoft's Internet Explorer, which the company includes with Windows, and 15% for the open-source Firefox browser, according to Jobs. But Apple's anemic share of the browser market didn't deter Jobs. During his speech, he demonstrated Safari running twice as fast as Microsoft's browser on common tasks. "We've got the most innovative browser. We've also got the fastest browser for Windows," Jobs crowed to the audience. "Who knows, maybe we can grow our Safari share in the future. We're going to try."

The battle isn't just about browser market share. Windows users already have downloaded Apple's iTunes music software more than 500 million times, according to Jobs. A fast-running Windows version of Safari could give Windows users a better taste of the company's design aesthetic and technical chops, helping to reinvigorate sales of Apple computers, though the company still holds a small share of the overall PC market. "They have little to lose and some things to gain with the unified look on iPhone, if Safari is running on a Windows machine," says Charles Wolf, president of investment consulting company Wolf Insights. "The browser might be another Trojan horse like iTunes—maybe a few [users] go out and buy a Mac."

Apple may have another way to entice Windows users to switch to the Mac: Jobs disclosed that the next version of Mac OS X, code-named Leopard, will include Apple software called Boot Camp that lets users switch from a Mac to a Windows environment, without a performance penalty. The operating system is scheduled to be available in October. "We know how to reach these customers," says Jobs. Microsoft declined to comment on Apple's plans to woo developers, but in a statement said: "With hundreds of millions of Windows users, it's not a surprise that a company that makes Web browsers would want it to work with Windows."

Developing Interest

Jobs is trying to expand Apple's ecosystem of developers as it attempts to increase its 4.9% share of U.S. personal computer shipments, and push into new markets including mobile phones and set-top boxes.

Microsoft, whose Windows operating system runs on the vast majority of PCs, has historically been masterful at inducing independent software vendors to write programs that have helped sell more Microsoft products. Promoting Safari as the way for programmers to develop for the iPhone, and for Mac and Windows users to explore the Internet, could help Apple compete in a computer industry in which software is increasingly distributed online. "It's not the standalone apps world of the '80s and '90s," when users waited on big new releases of desktop software as the reason to buy new, more powerful machines, says Guy Kawasaki, managing director of investment fund Garage Technology Ventures, and Apple's former head of developer evangelism. "In that sense, it's a more neutral world."