Battle between Google and Apple keeps getting more interesting, especially in the mobile arena. On the one hand several analysts liken the iOS vs. Android race to Mac vs. Windows in the 1980’s; claiming that when it comes to grabbing market share, iOS walled garden approach is no match to Android’s openness. On the other hand, Google’s acquisition of Motorola Mobility’s has led several to believe that tight coupling between smartphone hardware and operating system will help Google compete more effectively against Apple.
I will argue that neither vertical integration of hardware and software, nor openness will play a deciding role in determining the winner in the race between tech giants. Instead whoever can provide seamless coupling between devices and services will prove triumphant.
Innovator’s Solution
I base my analysis on one of the best business theories ever written by Clayton Christen and Michael Raynor in their book Innovator’s Solution.
The theory goes that when interfaces between components are not well defined, vertically integrated products do very well. This is why Mac did so well in the early years of personal computing. However, as components and interfaces between them mature, agility to launch becomes far more important than vertical integration. Citing personal computing again, when the interface between a PC hardware and operating system became relatively well understood, Apple’s integrated solution was no match to Microsoft’s ability to ship its operating system with external manufacturers such as Compaq and HP.
That interface between components in one part of the industry is mature does not mean, however, that interfaces in all parts of the industry are mature. For example, while interface between Windows and PC hardware was fairly mature, “interface” between PC’s and customer service wasn’t fine-tuned, and Dell was the first PC manufacturer that capitalized on this opportunity.
Next Winner
I argue that the industry has now entered a stage where tight coupling between mobile hardware and software, while beneficial, is not the key. The next industry leader will therefore be the one that can nicely integrate end to end experience spanning services across devices.
Let’s look at some examples (some real, and some hypothetical).
I often use Google Voice on the web to listen to my voicemails, and many times use it to add phone numbers to my contacts. When using an Android device or Gmail, those contacts become seamlessly available to me.
I install an application on my iPhone. It becomes (at the right price) available on all other devices (Apple TV, Mac, iPad) I use.
Just by signing in Android using my Google ID, all my contacts, calendars, and emails are seamlessly synced with the cloud, and therefore become readily accessible to me.
Watching a movie on iPad, but can’t finish it during my flight. I go back home, and watch it on my big screen by launching the movie from my Apple TV exactly where I left watching it.
My XBox Live identity, competitors, and score are carried over seamlessly from my XBox to my Windows Phone.
Much of the above is already possible, however note that not any single player offers all these benefits. For example, while Apple is really good at syncing media using iCloud, it is not great at syncing calendars or contacts.
(For a quick comparison between Apple’s iCloud and Google services, read what’s up with the iCloud?)
Let’s look at four major players vying for the crown of the new era of computing. Google and Apple are clearly dominant and growing; Microsoft, while an underdog and written off by many, is considered a wild card by others; and Amazon with its recently launched Kindle Fire will be a new force to contend with.
Apple
Apple has time and again shown the industry how an integrated product like iPhone or Mac can provide a much better experience than a disintegrated product such as Android. While Android comes in many flavors and with different App Stores, iPhone comes with a consistent user interface and a single App Store.
Yet, many wonder whether Apple’s early lead in the smartphone market is sustainable or the iPhone will also end up repeating history of the race between Mackintosh and PC in 1980’s (Microsoft’s DOS and later Windows OS while not integrated with hardware, overtook Macintosh as the best selling personal computing operating system and is still far ahead in the market share) If history were to repeat itself, Apple will surely be no match for Android’s growing prowess. Indeed Android already leads iOS in many respects.
(For more on how Apple might take the crown in personal computing again, read Is Apple readying for a rematch with Microsoft in personal computing?)
Surely, Apple has taken the next step in the right direction by launching iCloud, which works wonderfully well in keeping devices in sync irrespective of the need for cables, but is limited to Apple devices and software.
Also important to note is a major advantage that Apple has over Google and Microsoft: Its strong partnerships with the “old media” (as opposed to new media such as Youtube and over the top content), which allow Apple to offer superior content across devices more seamlessly. It’s no surprise then that most people have not even heard of Google Music.
A lot has been written about how Google’s acquisition of Motorola Mobility will help Android compete more effectively against Apple’s iPhone and would make more sense from financial perspective at least in the short term. At the same time, other have rightly noted that Google still risks alienating its largest partners such as Samsung and HTC by acquiring Motorola.
However, Android’s openness or lack thereof (via Motorola’s acquisition) is not what will determine the future of Google in the race between tech giants. It is Google’s ability to seamlessly integrate services across devices, and its web-centric portfolio that will decide where Google ends up in the next few years. Google certainly seems to have a strong lead in the arena.
Microsoft
I have extensively used Windows Phone, and despite some obvious feature gaps, find the user experience impressive. While lack of third party apps, slow time to market, and arguably weaker marketing all have played a role in Windows Phone’s slow uptake, and improving them will help Microsoft sell the phone better, Windows Phone will see little success unless it makes its services compelling and integrates them seamlessly with the phone.
(For my very early review of Windows Phone, read Will Microsoft come back strong with the Windows Phone?)
Microsoft has a long way to go in this area. Micorsoft’s Zune, its counterpart to iTunes, doesn’t even work for Mac yet! It’s web offerings are still disappointing. Its Hotmail despite several makeovers still turns out far more junk than Gmail does. It’s Office Live while a neat concept doesn’t work nearly as flawlessly as Google Docs do.
(For more on Microsoft’s web strategy, read Microsoft goes live-ish)
(For more on how Microsoft fares against competition in mobile, web, and entertainment, read Is Microsoft readying for a surprise comeback?)
Amazon
Five years ago, it wouldn’t even make sense for us to put Amazon in this list. As unlikely as Amazon might seem, it is now a leading contender in the race between the tech giants. Amazon before almost anyone else realized the importance of the cloud, and launched its Amazon Web Services. It now has leveraged its expertise in the cloud to launch devices that seamlessly keep content in sync and make it readily accessible.
(For an analysis of Amazon’s entry into the tablet market, read Will Amazon create a new tablet niche?)
Bottomline
The company that will crack and perfect the interfaces between devices, platforms, and services will dominate the next decade. This is yet another reason why the news of Google’s acquisition of Motorola while interesting, is nearly not as earth shaking as many near writers would have it. This is also why we will see more players entering the race in similar albeit very different ways: Facebook, Twitter, and even Netflix are potential candidates.
