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A 'state of the union' memo from Microsoft CEO Steve Ballmer to all his employees makes it clear that the company still sees Apple and Google as threats, but for very different reasons. The defensive tone of the memo which mentions Microsoft's competitors by name is an unmistakable sign that the company is feeling the heat.

The memo, as published by All Things Digital, was intended to inform Microsoft employees of Ballmer's strategy and priorities for the current financial year. Microsoft's competition with Apple and Google was raised in the opening paragraph.

Later in the memo, he wrote "In the competition between PCs and Macs, we outsell Apple 30-to-1" but admitted Microsoft's position vis-a-vis Google is not as strong as it is on the desktop: "We continue to compete with Google on two fronts - in the enterprise, where we lead; and in search, where we trail."

It would probably be more accurate to frame that as "PCs preloaded with Windows outsell Macintoshes by 30-to-1" - as far as I know, Microsoft doesn't sell PCs apart from those Surface tabletop jobs.

Both Gartner and IDC give Apple around 8 percent of US PC shipments, which means the ratio is at worst (from Apple's perspective) 11.5-to-1 in the companys' home markets.

It's probably about right globally, though. IDC says Apple has 3.3 percent of the worldwide market, which is roughly 30-to-1 if you assume that every PC shipped with either Windows or Mac OS X. Linux has got to be in there somewhere, especially with the apparently growing interest in UMPCs such as Asus's Eee range.

Ballmer clearly doesn't underestimate Apple - read on to see how he plans to compete with Cupertino.

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Stephen Withers

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Stephen Withers is one of Australia¹s most experienced IT journalists, having begun his career in the days of 8-bit 'microcomputers'. He covers the gamut from gadgets to enterprise systems. In previous lives he has been an academic, a systems programmer, an IT support manager, and an online services manager. Stephen holds an honours degree in Management Sciences, a PhD in Industrial and Business Studies, and is a senior member of the Australian Computer Society.

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