Now that the key details about Mac OS X Lion, iOS 5, not to mention iCloud, are available, you have to start wondering about Apple’s competitors, and how they’ll react. Certainly the presence of Steve Jobs, at least for part of the keynote, seemed a plus, although some analysts couldn’t avoid reminding you that he seemed as thin and frail as before, and that his movements, while climbing stairs, appeared somewhat slow. It’s also important to note that Apple’s stock price, after staging a brief rally, dipped once again at the end of the first trading session after the WWDC keynote.

But I don’t think that’s necessarily an indictment against Apple’s announcements, or their impact. Sure, there were no hardware introductions, but Apple never promised their would be. There was enough on the plate, though, to make rival companies cringe, and Microsoft has to be at the head of the pack.

By demoting the venerable PC to an equal seat on the table next to smartphones and tablets, Microsoft’s core business is being summarily dispatched by Apple. The hub of your digital lifestyle has been relegated to the status of just another connected device; your iPhone or iPad can be activated, synced and updated online without the need to connect to a Mac or PC, so the cord is cut.

This is totally opposite of what you’d expect from Microsoft, who is still trying to make the PC the focal point, simply because they earn the largest share of their profits from the sale of Windows and Office licenses. Sure, Microsoft is hoping to provide a veneer of Windows Phone 7 integration with Windows 8, but it appears to be noting more than window dressing. Underneath the altered skin, it’s still Windows for better or worse. Although things might change between now and the official release date, it’s clear Apple has worked far harder to embed the best of the iOS — or at least the features that make sense — in Mac OS 10.7.

But the unkindest cut of all was Apple’s decision to sell what is clearly a major system upgrade for $29.99, a mere 99 cents higher than Snow Leopard, which was never advertised as a major feature release. I expect the number of changes in Snow Leopard were probably roughly compatible to the real changes between Windows Vista and Windows 7. Only Microsoft charged you full price for the retail upgrade, and I expect they will justify a similar price structure for a Windows 8 upgrade box for the very same reason. I also don’t expect that Microsoft has a clue how to make it a credible online-only release. Apple has perfected that technique with the Mac App Store, which now includes the Lion developer releases.

Sure, Microsoft could try to imitate Apple in the same fashion as they pay lip service to mobile OS integration in the next version of Windows. Windows 8 might be available in some new online app repository, but don’t expect Microsoft to seriously consider a retail price of under $30. If they did, they’d lose tons of money, considering all the cash they pour into (or squander on) Windows development. I once suggested on my tech radio show that Microsoft probably spends more than Apple has on every single version of Mac OS X for a single Windows reference release, though I admit I’m just shooting from the hip there. Yet efficiency is not in Microsoft’s DNA.

Worse, with Apple integrating everything into a powerful online ecosystem, iCloud, the best way to enjoy the user experience will be to go all Apple. Even though PC sales are relatively stagnant or dipping somewhat these days, Macs continue to move at a healthy clip. Making it painless for Mac users to upgrade to the latest and greatest OS — well, if you’re using Snow Leopard at any rate — is only going to smooth the migration path.

What’s more, a key feature of Lion is “Windows migration.” Says Apple: “With OS X Lion, you can migrate all the information from your old PC to your new Mac. Lion automatically transfers your documents, contacts, calendars, email accounts (Outlook and Windows Live Mail), and photos stored in Picasa, and puts them in the appropriate applications”

That’s no casual move. It means the irritating chore, for most users at any rate, of moving from a PC to a Mac is no more complicated when using Apple’s Migration Manager to grab the data from another Mac or hard drive when you set up a new machine. You start the process, go out to lunch and, when you return, your Mac is ready to run.

Sure, the migration procedure might be more complicated if you have a custom PC configuration, or you’re using documents created in apps for which there’s no Mac equivalent. But so long as a translation capability exists in the apps you are using, it may not matter that much.

Over the next few months, Microsoft will be struggling hard to understand what Apple has done with Lion, iOS 5, and, of course iCloud. You will hear loads of promises that Microsoft has better ideas, and that they will arrive real soon now. Some pundits will remind you that Apple probably cribbed a few ideas for iOS 5 from Windows Phone 7, and the Android OS. But it doesn’t matter one bit. It’s the entire user experience that counts, not whether Apple invented each and every feature from scratch.

All right, Steve Jobs did show up at this year’s WWDC keynote, but VP Phil Schiller and the rest of the crew did the heavy lifting — at least for the first two parts of the presentation.

But let’s get this little nugget out of the way first: Just last week, the Tech Night Owl predicted Apple will charge a mere $29 for Lion, same as Snow Leopard, even though it has an estimated 250 new features. Well, friends, I was mostly right. The retail price will be $29.99 when Lion goes on sale in July. I’ll take that as a correct guess, if you can overlook the 99 cents.

When it comes to the second part of the equation, distribution, well, I was only able to bat .500 on that one. I said it would be available online via the Mac App Store, one huge download (4GB), but there would be physical media for those who are bandwidth challenged. Well, that’s what I thought should have been done, but Apple, in its infinite wisdom, has decreed that physical software distribution is dead and buried. It must all be done online, with the Mac App Store serving as the focal point. So it’s download or nothing when it comes to Lion.

As far as the feature rollout is concerned, the WWDC presentation of Lion didn’t reveal much of anything new. What you’ve seen so far is pretty much what you’ll get, but I wonder what Microsoft is going to do with Windows 8 now that Apple has lowered the bar for good.

When it comes to iOS 5, first and foremost, that troublesome notifications feature will be fixed, with the entire interface being seriously revised. That has probably been the number one problem on the existing iOS.

With iOS 5, instead of interrupting you with a modal prompt (meaning you can’t do a thing until you dismiss it), there will be a Notification Center, available with a swipe, which will deliver the entire list of notifications. Each notification itself will be revealed with a display across the top of the screen when it arrives, one that won’t stop you from doing what you’re doing. You’ll be able to check it later, or swipe it then and to see what it’s all about.

The ability to handle subscription publications has been revamped with an app known as Newsstand, which makes it easier to manage those subscriptions. Your updates will also be downloaded in the background, an enhancement to the iOS’s carefully crafted, if limited, multitasking feature.

There will, as predicted by the rumor sites, be extensive Twitter integration, meaning that you can enter your login information in the iOS Settings screen, and it’ll be fully configured with apps, such as Apple’s, which support the new feature. I do wonder, in passing, how you’re supposed to handle situations where you have more than a single Twitter account, as I do for the two radio shows, since they reach different audiences. Oh well, maybe Apple will find a way to work that one into iOS 6.

The Camera app is also greatly enhanced with the ability to shoot a picture by clicking volume up on your iOS device. There will also be simple editing tools borrowed from iPhoto, such as one-click enhance, cropping, rotating and, of course, redeye reduction.

Mail gains rich text formatting, draggable addresses (it’s about time), all supported by a system-wide dictionary. But nothing was said about multiple signatures, support for rules, custom folders, and even junk mail filtering. Maybe they’re all there, but we have to wait for Apple to offer more information. For now, color me disappointed.

As you might imagine, some handy App Store utilities are going to fall by the wayside when iOS 5 comes out this fall. But many of the new features represent the things that Apple should have incorporated in the core OS in the first place. Now doubt they were influenced heavily by customer requests — not to mention the popularity of some of those third-party apps.

One of the most important developments, however, was the decision to make iOS gadgets PC free, cutting the cord between the iPhone, iPad, iPod touch, and your Mac or PC. To Apple, the post-PC world is now being ushered in, and Apple is taking advantage of the fact that customers are using the iPad as their one and only computing device, and the iPhone the only tool for Internet access. The comment that Apple is selling to customers who don’t have computers in their home was at the very least intriguing. And, oh yes, there will be Wi-Fi syncing with iTunes too, so it’s not a total separation. And I should mention that the Android OS has always been free of the PC, for better or worse.

You’ll be able to download software updates for your iOS gadget over the air, and Apple will incorporate Delta updates, a feature also debuting in the Lion version of the Mac App Store, which only downloads the changes in an app. In other words, it’s a patching mechanism, something that’s been part and parcel of the personal computers for a number of years. Only Apple can pretend it’s all new.

There will also be enhancements to Game Center, which Apple boasts has a user base much larger than Xbox Live, a new messaging service called iMessage that supports photos, videos, contacts, group messaging, secure encryption, and lots more. It appears to be iChat on steroids, although Apple’s executives didn’t say whether iMessage will support other messaging services, such as AOL and Yahoo! Perhaps third parties can use a system hook to enable such support; time will tell.

In all, there are loads of new developer APIs, and 200 new features, and get this, the iPhone 3GS will still be supported. But don’t expect that support to last when iOS 6 arrives next year.

Closing the session was Steve Jobs, who introduced iCloud. He began the presentation announcing that he said the PC would be the hub of you digital life long, long ago. But this model has broken down over the years with the introduction of such devices as the iPhone and the iPad.

Simply speaking, iCloud is designed to be integrated with your apps, storing content in the cloud so all your Mac OS X and iOS devices can send and receive that content wirelessly. And unlike the competition, there will be no ads. Furthermore, most services are free. There will no longer be a $99 per year MobileMe service; subscriptions were extended until mid-2012, to give you time to make the transition to iCloud.

In addition to contacts, email, calendaring and so forth, iCloud will support your App Store and iBook purchases, meaning apps and books are downloaded and/or patched to all your devices. The third piece of the pie is Backup. Your iOS stuff will be backed up to Apple’s servers via iCloud each day, up to 5GB. To answer the Google Apps and Microsoft efforts to build an office-based cloud document management system, you’ll be able to also store documents in the cloud. iCloud support has already been added with the latest versions of the iWork apps, which include Pages, Numbers, and Keynote. Other features include Photo Stream, to sync your photo library.

The basic focus, according to Jobs, is that the file system can present a “staggering” problem for many Mac users, and this new scheme supposedly allows Apple to move past such constraints. iCloud Storage APIs are now available for developers to join in the fun. Jobs also stated that iCloud will work on all iOS devices, plus Macs and PCs. His summary about all these goodies is the usual, “it just works.”

The final page of the equation is full integration of your iTunes music, along with the ability to sync all of your purchases on up to ten devices. iCloud ships with iOS 5 this fall, and music, apps, books, and photos won’t count towards your 5GB limit. Beta support is now available courtesy iTunes 10.3, released within hours of the end of the keynote.

There were no new hardware announcements, but iTunes in the Cloud was the subject of “one more thing.” The most intruiging feature, iTunes Match, scans all your tunes, whether from iTunes or elsewhere, and matches it up with the same songs in the iTunes library, assuming they’re offered. You won’t need to upload that material. Matched songs will be upgraded to 256K versions, AAC, DRM-free, at a flat subscription rate of just $24.99 per year, no doubt the result of those recent agreements with the music companies. This is a technology that Apple acquired when it bought Lala.com, a music streaming service, a couple of years ago. But it’s taken this long to nail down agreements with the music companies.

If you an forgive the lack of new hardware, this was quite a meaty keynote, and I expect to be ready to download Lion the day it appears in the Mac App Store, particularly since my guesses were at least partly correct.

So a report is published this week indicating that the companies that are trying to beat the iPad with their own tablets are cutting back on production. At a time when Apple still can’t keep up with demand for the iPad 2, this clearly means that those other gadgets from the likes of Motorola, RIM, Samsung and other companies, aren’t doing very well in the market.

We still have Best Buy proclaiming their intention to set up a special tablet section, but why bother if most customers are only after one product? Besides, most Best Buy stores already have a dedicated Apple section, with iPads, or the small numbers that are available, are under lock and key. The rest of the products might as well be in the storage room, ready for the few people who request them, since there’s no sense taking up expensive shelf space for gear that isn’t moving.

Now I know stores that do not carry the iPad are busily touting the rivals. The nearby Staples business supply outlet has huge signs proclaiming the availability of the Motorola Xoom and the RIM BlackBerry PlayBook. At the same time, I don’t see near as many TV ads for either. Maybe the makers of those failed products are cutting back on the campaigns, since they’re a waste of money.

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So there’s a report this week about Microsoft’s first demonstration of the next great version of Windows, known at least for now as Windows 8. This comes on the heels of a curious action from Microsoft’s PR department, where they walked back a statement from CEO Steve Ballmer about Windows 8, and its possible arrival next year. Part of it “correction” was the statement that the name hadn’t been established yet.

But that didn’t stop a Windows executive from calling it Windows 8 and demonstrating it anyway, and it is expected some time in 2012, assuming nothing changes.

Of course, Ballmer’s behavior has always been strange, and not just because his prognostications are almost universally wrong, and his put-downs of competing products, such as Apple’s iPhone, fail to damage their targets. It’s almost as if Ballmer lives in what the comic book fans would call “Bizarro Land,” where everything is the opposite of our reality.

But Ballmer isn’t the only Microsoft executive who is mixed up about future technologies and, in fact, their vision of “innovation.” When the U.S. Department of Justice first went after Microsoft for various alleged antitrust violations, then-CEO Bill Gates said the company simply wanted the freedom to innovate. That word is regularly misused in the PC universe, not just by Microsoft, but by industry pundits who speak of new products and services.

However, it’s hard to look at most of what Microsoft does and not find another company who got there first. Past even Windows, originally a very clumsy DOS shell that copied the Mac OS, Microsoft has almost invariably been behind the curve.

So Apple is busy putting the final touches on Mac OS 10.7, code-named Lion, which will sport features adapted from the iOS. Microsoft, seeing the threat, decides to stage a demonstration of a competing OS a week before Apple’s WWDC, where the final wraps will be lifted from Lion. Maybe they hoped for a leg up, but the interface seems a curious blend of the admittedly neat iconic display of Windows Phone 7, with the traditional Windows OS. Microsoft is also adapting Windows to run on ARM processors, the chips used in most of today’s mobile computers. Remember that even Apple’s A4 and A5 are basically ARM processors customized by the company’s in-house processor development team.

You can easily imagine Ballmer watching the first Apple demonstration of Lion, with a six-pack at his desk, screaming at the top of his lungs how Microsoft has to match that concept. That is not to say that the look and feel of Windows Phone 7 is necessarily a poor copy of the iOS or Android, but I can’t forget the passing resemblance to Apple’s original Mac OS Launcher utility, from the 1990s, which sported square icons that, with a single click, would launch the app you selected.

Of course, if Windows Phone 7 was a huge success, it would make sense for Microsoft to want to graft some of its features, even if it’s a rush job, onto the next Windows upgrade. But the uptake of their mobile OS has been very poor. Few care, other than, apparently, Nokia, which licensed Windows Phone 7 months after a former Microsoft executive became its CEO. Curious that few tech analysts attempt to probe the significance.

At any rate, Microsoft sees a huge advantage in throwing billions of dollars at Nokia, which is still the world’s largest mobile handset maker, although sales are heavily dominated by cheaper gear. But when the first smartphones stemming from this alignment of convenience appear next year, you have to wonder about Microsoft’s other Windows Phone 7 partners, who have to pay license fees, rather than receive huge spiffs for their efforts. You have to think that, despite the claims of some that they still support Microsoft, they will jump ship fast when the first round of Nokia handsets featuring the OS come to market.

I’m also still wondering how the Bing remake of Microsoft’s search engine will fare on the long haul. It appears the only market growth results from the fact that Yahoo! uses the Bing engine. Google’s share is relatively unchanged, and that’s the unkindest cut of all. Besides, just what advantage is Microsoft offering, other than a flashier and more cluttered interface? Are search results any better? The jury may be out on that one, but I fail to see any improvement, at least for the searching I do. Your mileage may vary.

While all this occurs, and some people urge Ballmer to step down, Microsoft also needs to learn that the word innovation is not a synonym for running a copying machine.