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Thursday, April 6, 2006 - Page updated at 01:12 AM

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Run Windows XP on a Mac?

Bloomberg News

Apple Computer unveiled software Wednesday that lets its newest personal computers run Microsoft's Windows XP, bridging a historic gap between the companies.

The program gives Apple Chief Executive Steve Jobs a chance to bolster sales of his Macintosh computers by wooing consumers who are more familiar with Windows, which runs more than 90 percent of the world's PCs.

"If you can run Windows on the Macintosh, maybe the Macintosh will be more marketable," said James Fisher, who helps manage $1 billion at Pennsylvania-based Unives, including about 300,000 shares of Apple.

The software, called Boot Camp, will work on Apple computers with Intel chips, Apple said. The program can be downloaded from the Web and will be added to Apple's next operating system. Jobs in January began shifting to Intel chips to boost performance.

Apple's move will "drastically reduce" the costs of switching to Apple PCs, J.P. Morgan Securities analyst Bill Shope said in a note. Boot Camp allows Macs to run the Microsoft operating system, an improvement from so-called emulation programs that let Mac users run some Windows applications.

Any program that runs on Windows XP will now be able to run on Mac hardware, so consumers won't have to buy new ones if they want to switch to Apple.

In an interview, Apple executive Philip Schiller said the move could interest people who have one or two special Windows applications that don't run on the Mac. "They've got a lot of Windows stuff and want to be able to have both," he said.

Goldman Sachs analyst Rick Sherlund was more skeptical of the impact of the move, saying in a research note that he doesn't expect any meaningful increase in Mac sales in the short term. And while Microsoft will make money selling Windows to Apple users, Sherlund said, that group is still only a small percentage of the market.

Mark Stahlman, a Caris & Co. analyst in New York, also doesn't expect Boot Camp to help boost Apple's market share. Microsoft is readying the next version of Windows, called Vista, and this Apple software only works with the older Windows XP.

"It's actually likely to lead to a decline in market share" because customers will pick Vista when it becomes available, Stahlman said.

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The stock market was bullish on the news, however. Apple's stock posted its biggest gain in 16 months, climbing $6.04 to $67.21.

Microsoft did not give media interviews on the issue Wednesday and released a statement saying only that it is "pleased" that Apple is responding to customer demand for Windows.

Relations between Microsoft and Apple have been thawing since August 1997, when Microsoft invested $150 million in Apple and agreed to continue its Office programs for the Mac. The deal was announced to a chorus of boos at the MacWorld trade show with Jobs on stage and Microsoft Chairman Bill Gates' head appearing above on a gigantic video screen.

The companies continue to compete in operating systems and digital-music software, where Apple's combination of the iTunes music store, software and iPod devices dominate the market. Apple's software chief also testified against Microsoft in the U.S. antitrust case.

Jobs often takes shots at Microsoft, saying many features in Windows were "copied" from Apple. "For many years, they've followed our taillights," Jobs said at Apple's annual meeting in April 2005.

Users with a Microsoft Windows XP installation disc can now download Boot Camp, allowing Macs to run on either Apple's Mac OS X operating system or Windows XP. Boot Camp also will be a feature in Leopard, Apple's next major release of Mac OS X, which will be previewed at Apple's developer conference in August.

Apple now sells three computers that use processors from Intel, the world's biggest chipmaker. Jobs started with the iMac desktop PC and has said he plans to move all Macs to chips from Intel by the end of this year.

The PC maker in February began selling its first Intel-based notebook, the MacBook Pro, and has switched the company's lowest-priced desktop, the $599 Mac mini. They previously had used processors made by IBM.

Apple's U.S. market share was 4 percent in 2005, up from 3.3 percent in 2004, according to Massachusetts researcher IDC. Dell, the world's biggest PC maker, had 34 percent.

Apple adds $2 billion in revenue and more than 30 cents a share in earnings for every point of market share the company gains from bigger competitors, analyst Shope said.

Information from Seattle Times technology reporter Kim Peterson is included in this report, which also contains information from Bloomberg News reporters Jason Kelly, Dina Bass, Dune Lawrence, Suzy Assaad and Jennifer Geller.

Copyright © 2006 The Seattle Times Company

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