Windows 7 'I'm a PC. A $999 MacBook still doesn't

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Apple didn;t wind up fielding an $800 MacBook this week,Microsoft Office Pro Plus 2007, as several had been expecting. However the organization did reduce the cost of its entry-level MacBook to just beneath $1,000 at its October 14 notebook rollout.
Will Microsoft;s Computer partners, already providing several lower-priced Vista laptops, nonetheless feel the reverberations, now that Apple has crossed the “beneath $1,000″ threshold?
Microsoft seems to think so. Members of the Windows marketing team seeded the notion of an “Apple tax” with varied bloggers and reporters the night before the Apple launch. From an email I received from a corporation spokesman:
“The bottom line is that (Apple) price minimize or no price cut, Microsoft is confident that Windows still offers a far better value. The reason is the hidden costs that make a Mac far more expensive than just in the up-front purchase cost of the machine.
“The economy is impacting consumer choices,Office 2010 Key, but Macs, due to their high upfront, won’t sell in a more conservative market. On Sept. 29th, Morgan Stanley noted: “PC unit growth is decelerating and the remaining source of growth is increasingly the sub-$1,000 market where Apple does not play.” Even if Apple were to drop pricing, the Apple Tax still prices Macs well outside of the sub-$1000 range.“You can get a Computer laptop with a bigger hard drive, more RAM, a media-card reader, more USB ports,Office 2007 Pro Key, and a bigger screen, for much less than a Mac. See the comparison chart below for just a couple of examples of what you can get today…we’ll send out an updated comparison chart after Apple’s announcement tomorrow.“You can upgrade just about any Windows desktop Computer, but the only significantly upgradeable Mac is the Mac Pro listed at $2799.00.“Repurchasing software to make your Mac do all the things your Computer does will cost you hundreds of dollars. Buying a Mac means scrapping your software and buying new applications (for up to $1,100) that run on Mac, just to do what you can nevertheless easily do on a new Pc with the applications you currently have. We’ve listed a set of common applications below.“HDMI, Blu-Ray,Office 2007 Pro Plus, eSATA, MediaCard Readers, built-in 3G, Fingerprint readers, TV Tuners, all have been shipping as built-in features on PCs for years, but none are available on a Mac. Not only does this mean you get to use the latest and greatest now, but since it’s so easy to upgrade PCs, it also means that your personal pc is more future-ready…you can get today’s technology now, and tomorrow’s technology the minute its available.”
(For Microsoft;s full-blown “Apple tax” pitch, see the interview News.com;s Ina Fried had with Brad Brooks,Office 2007 Key, Microsoft Vice President of Windows Consumer Product Marketing.)
When it comes to competing with Apple at retail, Microsoft is in a “damned if it does/damned if it doesn;t” position. If Microsoft refuses to talk about Apple when discussing Windows; competition in the retail, education and SOHO spaces, the corporation is accused of burying its head in the sand. But if it does talk turkey about its only operating-system rival in the retail arena, Microsoft is seen as desperate and defensive.
In my opinion, Apple isn;t Microsoft;s biggest problem in the retail market at the moment. Microsoft is heading into a tough holiday buying season with a big challenge on its hands: It needs to convince consumers that they should buy Vista PCs when Windows 7 is looming substantial on the near-term horizon.
In two weeks, Microsoft is going to be showing off and touting Windows 7, the version of Windows that, for all practical purposes, is fully formed at this point. Unless Microsoft makes a conscious decision to push back Windows 7;s delivery date, all signs I;m seeing/hearing nevertheless are pointing to Microsoft releasing Windows 7 to manufacturing in the second half of 2009.
What do you think? Is Apple in reality the biggest competitor facing Microsoft and its Pc partners with Vista? Or is Windows 7 — or good old Windows XP — still the biggest challenge Vista needs to overcome?