Hot on the heels of the Dick Brass fiasco just recently, a series of emails between executives of Microsoft in 2003, revealing their reaction to the iTunes launch and just what they planned to do to counter it. Jim Allchin, former Microsoft executive, believed at the time that Microsoft was "smoked," and wasn't sure how Apple managed to get all the music companies to go along.
The chain of letters, found over at Groklaw, show the executives somewhat confused and slightly worried, with Bill Gates (CEO at the time) stating that Microsoft, "even though Jobs has us a bit flat footed again," aimed to bring out a product that was even better. Chris Jones, another member of Microsoft, stated that both teams on both sides (Apple and Microsoft) wanted to have the client and services solution come together, but that it took Apple to make the move in order for Microsoft to break through communication issues in order to get the job done.
Most of the letters contain information regarding Microsoft's plans and what they should do from here on in, etc., though it's certainly very interesting to get an insight into what they were thinking during the iTunes launch in 2003. David Cole of Microsoft believed that when Apple was to bring iTunes to Windows (as not doing so would be a "mistake"), the company really would be smoked, though he noted that they shouldn't have been so surprised; he said this had happened before with the .Mac service, in terms of communications and storage. If you'd like to read the letters yourself (which are marked as highly confidential), have a look at the .PDF file here.