Apple Overtakes Microsoft As World's Most Valuable Tech Firm

At the close of Wednesday trading, Apple's market cap stood at $222.1 billion, compared to Microsoft $219.2 billion. Apple can now legitimately crow that it, and not Microsoft, is the most valuable tech company in the world. Apple is also now second only to Exxon ($282 billion) among U.S. companies.

The role reversal taking place right now couldn't be more dramatic. Microsoft in 1997 saved a foundering Apple with a $150 million investment, and when CEO Steve Ballmer took over as CEO in 2000, Apple's market cap was $15.6 billion and Microsoft's was $556 billion, as reported by The Wall Street Journal.

Since then, however, things have changed a bit. Apple shares have doubled in the past year on the strength of booming iPhone and Mac sales. Microsoft shares are up about 20 percent compared to a year ago, much of that due to strong Windows 7 adoption. But unlike Apple, mobile isn't driving this growth.

What's ironic is that mobile, the main impetus behind Apple's business, is precisely the area where Microsoft is weakest. Windows Mobile's market share is dwindling, and the cavalry -- Windows Phone 7 -- is several months away. Microsoft earlier this week shook up management of its Entertainment and Devices division, which guides its mobile and gaming businesses, parting ways with longtime vets Robbie Bach and J Allard.

From a product standpoint, Apple is hitting home runs in every at-bat. The iPad is selling even faster than the iPhone did at its launch, and Apple is getting ready to launch a fourth generation iPhone at next month's Worldwide Developer Conference, although the veil of secrecy around this particular product launch was blown away by the Gizmodo iPhone scandal.

In a recent purported e-mail exchange with a customer, Apple CEO Steve Jobs reportedly said "you won't be disappointed" with what Apple has on tap for WWDC.

Apple may be peaking right now, but what has to be concerning for Microsoft is that it's in the midst of the largest product launch wave in its history. Microsoft appears to be recovering financially from a disastrous 2009, but investors frustrated with a stock price that has been largely flat for the past decade may be wondering if this is as good as it gets.