Steve Ballmer, the former CEO of Microsoft and the current owner of the Los Angeles Clippers, recently appeared on an interview on Bloomberg TV. One of the topics that were discussed in the interview is the investment that Microsoft made in Apple almost two decades ago, and how it could probably be "the craziest thing" that Microsoft has ever done.
Back in 1997, Apple was on the brink of bankruptcy. However, Microsoft agreed to make an investment into the company, giving Apple its much-needed lifeline to be able to innovate. And, as history goes, it was this investment by Microsoft that helped in setting up Apple to become one of the most inspiring stories of resurgence in the tech world.
In the agreement, Microsoft agreed to an investment worth $150 million in Apple in exchange for non-voting stock shares. Microsoft and Apple also agreed to a broad cross-licensing of patents. In addition, Microsoft promised that it will provide continuous support for the Microsoft Office software on Mac computers over a time of 5 years, with Apple likewise promising to use Internet Explorer as the default Internet browser on Mac computers over the same time.
Ballmer was asked about the investment in the interview with Bloomberg TV, and his response is memorable.
"They've done a great job. They're a company that's done a great job," Ballmer said regarding Apple's resurgence, as back in 1997, the company was nearing bankruptcy upon the return of Steve Jobs to the fold. Microsoft, however, made the investment into Apple as a part of a lawsuit settlement involving Windows 95 and stolen Quicktime code.
"In a way, you could say it might have been the craziest thing we ever did," Ballmer noted, but praised Apple for taking the foundations of great innovations and investments and using them transform itself into the world's most valuable company.
While the deal was met with worries at first among fans of Apple, it can be regarded as one of the greatest achievements ever made by the late Jobs. The investment deal with Microsoft ended what would have been a destructive patent-related lawsuit, but more important gave an influx of cash into the company that gave it enough time to gather itself and shift its focus on creating and pushing out new products.
As Jobs famously said at that time, "we have to let go of this notion that for Apple to win, Microsoft has to lose."