Can Google buy consumer competitiveness? Can Apple be an ad giant?

Daniel Eran Dilger in fine form after Apple became the world’s largest technology company by market capitalization.

These days, Apple’s primary competitors have all fallen down on their knees while clutching their gutted bellies…

Who is left? Google, the paid search giant that backers hope will beat Apple in hardware and software platforms… despite Google being neither a hardware vendor (nor marketer nor retailer nor support provider) nor having any real experience in managing a software platform for consumers. Fans of Google suggest that the company will take on Apple by acquiring a competing version of everything Apple has built over the last decade: iTunes, a mobile platform, hardware expertise, user interface design savvy, development tools, and a user base.

The problem is, they don’t also foresee that Apple could compete against Google in its own home territory of ads.

via How Apple could slay Google at WWDC 2010 — RoughlyDrafted Magazine.

The key assumption in the “Google can buy anything Apple already has” is that of the three things that make up a company (resources, processes and priorities) the only thing cash can buy is resources, and, in the tech world, even those are fragile things with legs that can walk out the front door.

Google’s “copy-paste” competitive approach vis-a-vis Apple falls down when you realize that Apple has been successful mostly because of its processes and priorities. It’s well known that all of its vanquished competitors could (and did) recruit legions of Apple employees, elevating them to positions of responsibility, with naught to show for it. Grafting engineers and IP onto Google (or Nokia or Microsoft) cannot make it into an Apple.

Conversely, through a risky, long and arduous path, Apple could become a Google. Success with ad-based search requires resources (mostly CapEx), algorithms and distribution. With the $42 billion (soon to be $100 billion) in the bank and eye-watering free cash flow, there are few no resources that Apple cannot buy.

With iAd the world will witness an Apple that can make loads of money in Google’s home turf, while Google burns cash and bridges with Android trying to defend its soft platform underbelly.  The irony is that Apple can knee-cap Google without even trying to do search. After all, Jobs said plainly enough: On a mobile device Search hasn’t happened.

Judging by the stock prices of the two companies, I suspect investors know this already.

If Apple did not exist, Google would need to invent it

Google’s innovation pipeline:

  • new mobile OS
  • updated mobile browser
  • rich mobile ads
  • Google TV

It used to be that Microsoft’s agenda was written in Cupertino, now they are no longer the only ones in line at the copy machine.

Google gives up on Nexus One online store

Google gives up on Nexus One online store, moves to retail | Electronista.

So much for Google the Shopkeeper.

UPDATE:  This also puts the idea of Android generating any revenue for Google at a logical dead end.  As it stands tactically and strategically, Android is a financial black hole in perpetuity.

Android remains, in my opinion, Google’s biggest failure.

New in iPhone OS 4: No more Google promotion

“Google” has been replaced next to the keyboard’s space bar with the word “Search.” Ouch.

via New in iPhone OS 4: The Full App-by-App Breakdown | iLounge Article.

Apple: When Will They Build Their Own Mobile Search Engine?

Apple: When Will They Build Their Own Mobile Search Engine? – Tech Trader Daily – Barrons.com.

The opportunity here is not to do web search better than Google, but to find a way to index the information that lives on the iPhone ecosystem.  With potential for millions of apps and hundreds of millions of iPhones generating usage patterns a separate mountain of information is emerging independent of the current cloud.  The mobile cloud has different hooks and different relevance measures.

Mobile search will be as much about new algorithms as about getting a new way to spider the data.

It seems Apple is better positioned to leverage this emerging space than Google.

Why Google is headed for trouble

Never mind the gossip and tales of intrigue. Ignore the stories of betrayal and affairs. Forget the animosity and ego tripping.

No, the real reason you should be nervous if you are betting on Google long term is that Schmidt gave his first iPhone away.

By August of 2007 it’s reported that “Schmidt had long ago given up on the Apple handset because he couldn’t stand the on-screen keyboard. His wife had tested a prototype, but didn’t care to keep it. Schmidt, we’re told, ended up giving his iPhone to [his mistress] as a gift”

Here is a guy who has in his hands one of the first iPhones and he treats it with contempt.

He did not get it.

Nor, it seems, does he get the iPad.

Google does not understand where computing is going.

I don’t mean this in a small way. I mean this in a big way.


Why HTC (Part II)

Starting in January, Apple launched a series of C-Level discussions with tier-1 handset makers to underscore its growing displeasure at seeing its iPhone-related IP infringed. The lawsuit filed against HTC thus appears to be Apple’s way of putting a public, lawyered-up exclamation point on a series of blunt conversations that have been occurring behind closed doors.

link: Apple talks tough to handset makers – Apple 2.0 – Fortune Brainstorm Tech

Top-tier handset makers continued to avoid implementing multi-touch, but Apple could safely assume that they were hanging back to gauge Apple’s response to Motorola and HTC. If there wasn’t one, the OEMs would likely read the silence as a green light, especially after Google also moved to enable multi-touch on its Nexus One phone.

Even before the lawsuit, handset makers were having second thoughts about Google, which with the Nexus One had become a direct competitor. Now their faith in Android as the easiest and cheapest way to counter the iPhone has been shaken, says Reiner.

Seems pretty close to what I wrote here:

Why HTC?

Therefore it’s entirely likely that HTC was singled out to disrupt the business logic of modular mobile software. HTC is the pioneer and the hub as the largest licensee for both WinMo/WinP and Android and the inspiration for hundreds of OEM/ODMs to make modular products.

… Other vendors looking at this licensing model might think harder about participating, and that may be the whole point.