It was an astonishing private admission:
Microsoft had again been caught flat-footed, and it would again try to catch up by copying Apple.
But like Sony, Microsoft could never make it happen, even after Jobs showed the way.
Instead Apple continued to smoke Microsoft in the way that Cole had predicted:
It ported the iTunes software and store to Windows.
But that took some internal agonizing.
First, Jobs and his team had to decide whether they wanted the iPod to work with Windows computers.
Jobs was initially opposed.
"By keeping the iPod for Mac only, it was driving the sales of Macs even more than we expected," he recalled.
But lined up against him were all four of his top executives: Schiller, Rubinstein, Robbin, and Fadell.
It was an argument about what the future of Apple should be.
"We felt we should be in the music player business, not just in the Mac business," said Schiller.