I’m surprised the story isn’t getting a lot more coverage. The other day, it was reported that Microsoft is taking a $6.2 billion write down because their $6.3 billion purchase of an online ad service, aQuantive, in 2007, was a waste of money. Why aren’t Microsoft’s stockholders screaming?

Now the reason Microsoft bought aQuantive is the same reason Google bought DoubleClick for $3.1 billion that same year. Both are fighting hard for online ad dollars. Microsoft, having spent more twice as much to get in the game as Google, was the big loser.

It’s also reported that Microsoft continues to lose $500 million every quarter in their failing attempts to make Bing into a search colossus. All that’s happened is that Google’s share has edged a hair upward, while Bing has taken market share from Yahoo!. But as most of you know, Yahoo! uses the Bing search engine, so Microsoft’s efforts ended up being a game of musical default search engines. Pathetic!

This week, Microsoft announced upgrade pricing for Windows 8 for consumers, and it’s clear Apple has forced them to take a bath on pricing. With Mountain Lion going for $19.99 when it comes out later this month, Microsoft has decided that anyone using Windows XP or later can download the upgrade to Windows 8 Pro for twice that figure. The DVD version costs $20 more. Now maybe Microsoft does believe that Windows 8 is twice as good as Mountain Lion, but they are actually just bringing consumer pricing more in line with what OEMs, the PC makers themselves, pay for a Windows license.

So Microsoft is hoping, at a time when 40% of the Windows user base is still running XP, to persuade a larger number of consumers to get Windows 8 by charging a lot less. Since businesses buy special multiple seat upgrade packages, the pricing structure there is more complicated. But it’s not at all clear that businesses care one whit about Windows 8. Companies who are still using XP will probably move to Windows 7, assuming they are actually going to upgrade. Windows 8 is just going to cause too much of a disruption because of the uninvited interface changes, and the need for employee retraining.

But the most curious development at Microsoft in recent weeks is a certain clueless interview with co-founder Bill Gates. His grasp on reality was never as uncertain, as he imagines that Apple, who makes the best selling tablet on the planet, must somehow copy features from the Surface. He believes that the Surface will somehow “disrupt” Apple.

I’ll let you digest that statement before I comment, and please hold back the laughter. The delusional statements from Gates makes it clear why Microsoft has never grasped the tablet market, and why all of their attempts to boost PC tablet sales have failed. I cannot imagine how they’ve come to the conclusion that Apple should alter iOS, add a tiled interface, put a keyboard inside a removable cover, and add a pop-out stand that restricts you to a landscape position. Or maybe Apple should install two stands.

Microsoft continues to believe that a tablet is simply a traditional PC in a smaller, thinner form factor. To them, a touch-based virtual keyboard is an accommodation. You really want to use a regular PC keyboard, however thin, with a trackpad. Microsoft expects you to run the same OS and software on a PC and on a tablet. They are one and the same, and the only difference is size and, perhaps, the use of touch on the tablet, even though Windows 8 provides similar gestures on a PC.

Of course, the larger question is whether the Surface will actually see the light of day in any version. With HP reportedly ditching the idea of an ARM-based tablet, though, it may fall to Microsoft to prove that such a product has any potential. It appears that HP and other PC makers will probably concentrate more on the traditional Intel-based tablets; you know, the ones that have utterly failed in the marketplace.

There’s one question that should have been asked of Gates, but most members of the media are probably fearful of offending him. That question: If Windows 8 comes crashing down in flames, or only has modest success in the consumer market, what is Microsoft’s Plan B? Do they release a special update to let you kill the Metro interface, and rely on the Aero-free version of the traditional Windows desktop? What is their solution? Or will they keep scurrying through the same rabbit hole?

Certainly the fact that some usually pro-Microsoft pundits have criticized Windows 8 ought to be a wakeup call. Microsoft can hardly be ignorant of the fact that they are putting the final touches on an OS that isn’t getting the love from the people from whom they expect full support.

Of course, this isn’t the first time Microsoft has run into serious OS problems. Consider the issues with Windows Vista, a serious under-performer, but don’t forget the pathetic Bob interface add-on from 1995, where Microsoft hoped to give Windows a dose of the warm and fuzzies by replacing the Program Manager with a simpler cartoon-like look and feel. Or maybe few remember Bob’s failure, or even its existence.

Windows 8 comes across as yet another effort to fix something that isn’t exactly broken. After all, the standard Windows interface works. Hundreds of millions of people use it every single day with a reasonable level of success. While there is a lot that can be improved, such as the dreaded Windows Registry database, throwing out the core interface with something that’s not demonstrably better isn’t going to solve the problem. It’s just putting a fresh coat of paint on a structure that has a broken foundation.

But that’s a message that Microsoft will simply not grasp, even if the latest ventures fail.

There’s renewed speculation this week that Apple is getting ready to release a new iMac in the near future. Some suggest this month, in time for the release of Mountain Lion, while others expect it to happen this fall, or perhaps in August.

Regardless of when the next iMac appears, the larger question is whether Apple might consider using a Retina display on at least one of the configurations. Maybe, but I’m going to just say no. Here’s why:

As you probably know, the Macbook Pro with Retina display costs a lot to build. Not just the high cost of solid state drives, but the magnificent flat panel with a native resolution of 2880×1800 pixels. According to published reports, particularly some gaming-related tests where they max out the display settings, the hardware is pushing pixels at the limits of current technology. That’s for 2880×1800 pixels.

Today’s 27-inch iMac has a native resolution of 2460×1440 pixels, which isn’t too shabby, and only slightly less that the fancy MacBook Pro with Retina display, though distributed on a much larger screen. Regardless, putting a Retina display on an iMac would mean a resolution of 4920×2880. Are flat panels of that pixel density even available in quantity? What about the graphics hardware sufficient to deliver smooth performance for your apps, videos, and particularly games?

But even if the graphics chips are available — and I don’t know that they are — what about the cost of the display itself? Apple is said to be paying more than $100 higher for those higher resolution displays in 15.4-inch trim. The costs of flat panels don’t scale up precisely, but even if it cost $250 to $300 extra to build one into an iMac, and I expect that’s low-balling the price, would it deliver enough value to drive sales? Obviously, Apple would have to charge more for such a model — and again there is the question about the capability of graphics hardware.

My theory, such as it is, goes this way: If Apple can affordably deliver a 27-inch iMac with Retina display, it will be strictly an optional configuration. In a sense, it would be a technological experiment to see if it can become as popular as the high-resolution display on a MacBook Pro. It would also give Apple another foot in the door towards convincing display suppliers to build out their production lines.

In the end, I do believe Apple wants to convert all remaining MacBooks and the iMac to a Retina display. But technology has to play catch up, and it may take a year or two for the costs of parts to come down sufficiently to make it feasible. And let’s not forget production yields. But that’s all about supply chain minutiae that you’ll only read rumors about. It’s not as if Apple is going to be terribly forthcoming on such matters, except, perhaps, to explain the possible late delivery of a new product.

My other expectations for a 2012 iMac are relatively modest. Apple will use Intel’s Ivy Bridge chips, probably sticking with quad-core across the entire model lineup. There will be enhanced graphics, perhaps from NVIDIA, since Apple is using their parts for MacBook Pros. I would also expect that the new iMac will have an optical drive, since there’s no compelling reason to remove it from a desktop computer where size considerations aren’t quite as severe.

At the same time, it’s possible the iMac’s form factor will be thinned somewhat, with a smarter cooling system that perhaps takes a few cues from the one in the MacBook Pro with Retina display. That means it’ll run cooler under heavy load.

Drive configurations may be similar to the current lineup, with the  SSD offered as an optional configuration, along with a traditional hard drive as a second storage device. But it would be nice if Apple made it easier for end users to take apart the thing and install any drives they want. Being restricted to special orders, or sending it off to a third-party assembler, doesn’t really make sense. Here Apple could do the right thing and make the iMac a more credible replacement for a Mac Pro at the low end. That, and Thunderbolt, will continue to reduce the need for a full-sized workstation except for specialty houses that do such things as mathematics or movie special effects work.

I suppose Apple could also take the easy way out, and simply update the current form factor with new drives, processors and graphics chips. As with the standard MacBook Pro, a 2012 iMac of this sort would be a worthy upgrade. But you’d think Apple would have done that by now. That the next iMac is still in the rumor stage may mean there are mere serious changes afoot.

Regardless, as the owner of a late 2009 iMac that is beginning to get a bit long in the tooth, I will be very curious to see what changes Apple delivers to the next model. Looking at the product’s 14-year development path, I also remember the very first 1998 Bondi Blue iMac, which was strictly an entry-level computer. How times have changed. And, by the way, amid reports that supplies of existing iMacs are drying up at various dealers, it may well be that the refresh is coming sooner rather than later.

On the heels of some notable wins against Samsung and other companies that allegedly infringed on Apple’s intellectual property, I suppose it’s natural to suggest that Apple wants to compete in the courts, rather than in the open marketplace. But suggestions of that sort are just not realistic.

First and foremost, people are buying iPhones and iPads, and Macs for that matter, not because Apple is suing tech companies in various courts around the world. It is because they already have positive experiences with Apple gear, or are persuaded that these products meet their needs.

At the same time, I don’t think too many people choose not to buy mobile gear from Samsung, HTC, Motorola or any other company targeted by Apple’s legal teams because of the possibility that they might be buying something that will someday be banned from sale. None of the injunctions Apple has requested would make any difference for products you already own. It won’t change the level of support you get from your wireless carrier or the tech company. The sale is the sale.

But that leaves the matters that Apple continues to litigate and, of course, the matters that Apple’s competitors are, in turn, using to fight back. In some cases, Apple’s competitors are complaining about industry-standard patents, which supposedly ought to be available for license under FRAND, which otherwise stands for “fair, reasonable, and non-discriminitory terms.” Now FRAND means that the company who owns the patent should seek fair license payments, whatever they are supposed to be, and give all comers the same terms. That means Apple shouldn’t pay a higher price per unit sold than other companies licensing the same patent.

Apple has already made deals with lots of companies on such terms, including Nokia, the beleaguered wireless handset company. Apple isn’t objecting to fair terms, although it appears the courts might have to decide what’s fair in many cases.

But the core of these ongoing lawsuits is all about whether other companies are building products that infringe on Apple’s patents. If they are, Apple has the perfect right to claim injury and demand they stop, or pay the appropriate license fee for using that intellectual property. Those who felt that Apple under Tim Cook would be more lenient in dealing with intellectual property issues than Steve Jobs are clearly wrong. Apple hasn’t stopped filing lawsuits.

It’s also clear that the prime offender is really Google, since most of the legal actions have been against mobile products that use the Android OS. In that sense, Samsung, HTC, and even Motorola, which is now owned by Google, have served as proxies. But Apple is coming closer and closer to their main target, particularly when they got that recent injunction against the Samsung Galaxy Nexus smartphone. Google uses the Nexus brand name for flagship gear that is meant to deliver an unfettered Android experience. So it will be relatively free of handset maker or carrier interface changes and/or junkware. And, supposedly, a Nexus product will be eligible to receive Android OS updates, which doesn’t happen with most other products using Google’s platform.

So it comes as no surprise to see reports that Google is working with Samsung to take a united front against such lawsuits.

At the same time, Google still  earns a fair amount of cash from having a presence on the iOS and OS X platforms. Google search is still first among equals on both. It would be a trivial matter for Apple to update the OS to make Microsoft Bing or Yahoo! (powered by Bing) the defaults on new Safari, OS or hardware installations. Since most people don’t change such settings, that move would clearly hurt Google’s bottom line, at least to some extent. Apple is already moving away from Google by building their own mapping system for the iOS.

Sure, Google can state that Android consists strictly of their own inventions, and any possible imitation of iOS features is purely accidental, and is based on the fact that the patents are too general to be enforceable. But does anyone believe Android would sport a look and feel similar to the iOS if the iPhone never existed? More than likely, the Android OS would power devices with physical keyboards meant to compete with the BlackBerry, Windows Mobile and Windows Phone gear.

Yes, I suppose there are things that Android does better than the iOS. Yes, I realize that some of you prefer Android for various reasons, either because you feel it’s a better platform, or you don’t cotton to Apple’s walled garden.

At the same time, Apple has the perfect right to defend their intellectual property. If they don’t defend, they lose protection through inaction. That would allow anyone and everyone to mimic iOS and OS X products without fear of consequences.

Sure, I grant that the patent puzzle is a confusing mess. No doubt patents are granted far too casually on inventions that are heavily based on previous patents, or are just too general. I find the whole patent brouhaha annoying, and, other than the occasional victory, not really worth much concern. I just wish there was another way for companies to protect their inventions, assuming those inventions are legitimately theirs.

When Google acquired a certain startup known as Android in 2005, it was clearly meant to compete with Microsoft in reaching the mobile space. Certainly both companies saw the potential, but you had to expect that any smartphone running Android would probably have been designed with a physical keyboard to compete with the BlackBerry.

Yes, as RIM teeters towards ruin, it’s hard to believe that, not too many years ago, the BlackBerry was the fashionable tech toy for business power users. That was true even for a first-term Illinois Senator named Barack Obama. To this day, it appears the President still uses a BlackBerry — and an iPad for that matter. In any case, few expected a certain company in Cupertino, CA to upend the industry.

When Steve Jobs first unveiled the iPhone in early 2007, I suppose it was hard for more skeptical media pundits to take him seriously. After all, the “real” smartphone was a BlackBerry. Real smartphones had physical keyboards, not virtual keyboards on a touch screen. How could Apple possibly get away with that?

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