Microsoft and Apple were once the yin and yang of the tech world. Microsoft was dull and plodding, milking buggy, barely-good-enough-for-prime-time Windows for tremendous profits, thanks to a worldwide operating system monopoly. The company was incapable of creating new, innovative products, and relied on sharp-elbowed (and potentially illegal) business practices to stay atop the tech world.Apple was its polar opposite. Under Steve Jobs out-of-the-box thinking and obsessive attention to the smallest details, it released what seemed an unending stream of beautifully designed products that changed the way the world uses technology: the Mac, iPhone, iPod and iPad.That was then.These days, the two companies have reversed roles. If youre looking for innovation, look to Microsoft. Meanwhile, Apple stagnates, milking old products for new money.For evidence, you need only look at a single day Feb. 19, 2025. On that day, Microsoft announced a breakthrough in quantum computing, based on a branch of physics known as quantum physics. (Its beyond the scope of this article to detail exactly how quantum computing works, but you canget some details in Microsofts announcement.)The technology will eventually be able to solve technological, mathematical and scientific problems that cant be cracked right now. When its ready for prime time, it will likely be able to supercharge AI development and usage. Microsoft has been working on quantum computing since the early 2000s and will continue spend money on it. And while it will take years to come to fruition, its one of the few technologies that has the potential to change the world.On the same day Apple announceddrumroll, please!a cheaper version of the iPhone, the iPhone 16e, a successor to the iPhone SE. Theres no new technology in it, aside from the first modem built by Apple. On second thought, hold the drumroll.How did we get here? Why is the tech world looking to Microsoft for the newest technologies like AI and quantum computing, and looking to Apple for a cheaper iPhone? To understand the present and predict the future, you need to know the past. So, well start out by looking at both companies earlier days.A look at technologys pastIts said that to a man with a hammer, everything in the world looks like a nail. In the old days of Microsoft, Windows was its hammer. Its competitors were the nails. One by one Microsoft used Windows to pound them into submission. Lotus, the maker of Lotus 1-2-3 the worlds most popular spreadsheet gone. Harvard Graphics, maker of the Harvard Graphics the worlds most popular presentation software gone. WordPerfect, maker of the worlds most popular word processor WordPerfect, barely even a shell of its former self. Many other competitors were crushed by Microsoft as well.The strategy worked for years, until it didnt. The world changed, and Microsoft didnt change along with it. Its attempt to build a mobile operating system bearing the Windows name cost the company billions of dollars before CEO Satya Nadella killed it. Its other attempts at getting into new markets, like the laughably bad Zune music player to compete with the iPod, went off the rails. The Internet came along, and Microsoft didnt pivot quickly enough to it because it was still focused on Windows, allowing the rise of Google, Meta and myriad other companies.As for Apple, under Steve Jobs it seemingly did everything right. It focused on new technologies, each new product beautifully designed and built and released before people even knew they wanted them, creating entirely new markets. Jobs was an impatient innovator, and he refused to rest on his laurels or repeat the past. Something new was always in the works.So, what happened?At Microsoft, Bill Gates and Steve Ballmer, architects of Microsofts rise to power, left the company in Nadellas hands. He wasnt wed to the companys past and didnt believe Windows was the solution to every tech problem.Hes been a quiet innovator. Under his leadership, cloud computing, not Windows, became the focus. Then Nadella turned to AI. And all along, he continued to spend money on quantum computing. The company now lives on the cutting edge.After Jobs died in 2011, Apple was never the same. Tim Cook took over as CEO. Hes been a brilliant manager, growing the company to the point itsnow valued at $3.7 trillion, the largest in the world. But is he an innovator? No. The Apple Watch and AirPods launched under his watch might bring in nice amounts of revenue. But theyre far from being breakthroughs.A look to the futureWhats next for both companies when it comes to innovation?At Microsoft its clear. The company has become an AI company and its not looking back. Its going to continue to pour money into quantum computing. I dont know what else its cooking up in its labs, but Im sure its something.As for Apple, its having a hard time catching up with Microsoft and the rest of the industry when it comes to innovation. And its doing a particularly bad job in AI. Apple Intelligence, the companys answer to Microsofts and other companies generative AI (genAI) efforts,has floundered badly.OpenAIs ChatGPT was released more than two years ago, and Microsoft Copilot, based on ChatGPT, was released more than a year ago. Apple Intelligence still isnt here, and its falling behind schedule. It may not be released until the WWDC (Apples annual developer conference), and possibly not even then, a full year after it was first announced.When its released, it will still lag badly behind its genAI competitors.Bloomberg reportsthat an upgrade to make Siri more conversational and a closer match for ChatGPT has been postponed to 2026. Thats about a century in AI time. By then, the competitors will be several generations ahead of Apple.The upshot? Apple is doing a great job of milking existing products, but a terrible job of innovation, while Microsoft continues to innovate. And theres no sign of that changing anytime soon.