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TheStreet Open House

Microsoft Paying for Apple's Next Product Cycle

But back to my main point: Microsoft is going to drive post-iPad customers willing to try something new, right back into Apple's arms.

By offering the trade-in credit, some open-minded individuals will likely give the Surface a shot, acknowledging that their iPad is feeling a little dated. Trying a non-iOS product and attempting to integrate it into their iOS lives will not likely be a pleasant experience.

I'm not saying this as an Apple "fan boy" or whatever some will call it -- I'm sure I'll hear it in the comments section. Surely, some who make the switch will ultimately stay with Microsoft. That's inevitable. But the obvious fact remains: Microsoft had to write down nearly $1 billion worth of its old tablets because they couldn't sell them!

Now, they're paying people to give it shot, an act that will likely end as bad as its first attempt with the Surface. Perhaps even worse. People want premium. People want the best. Apple continues to let the rest of tech slug it out for the low-cost marketshare, while many consumers continue to crave the iPad.

Now that it's offering iWork and iLife for free, it gives consumers an even bigger reason to crave the ecosystem. Everything ties together so easily. Those open-minded enough to give the idea of switching a chance, will find themselves dumping their Microsoft tablets just in time to start buying the new iPads.

Microsoft got it wrong the first time, what could have changed? It will be interesting to see how much it writes down next year on the Surface 2.

At the time of publication the author was long shares of AAPL.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.
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