An interesting little theory for the New Year from Forbes: Apple is being eaten away inside by Google.
The Google Worm
Call it “the worm strategy”—because Google is attacking Apple from the inside out.Over the past six months, Google has begun to systematically replace core, Apple-made iOS apps with Google-made iOS apps.
And this leads to a world where? Well there’s Android users, surrounded by Google search, and there are iPhone users, downloading Google apps—all of which make Google search a prominent feature. Interesting Yes?
However Google faces exactly the same problem that everyone else does: how do you monetize mobile? This is something that no one has managed to worked out as yet:
The key driver is that mobile CPMs are only 15 percent of desktop CPMs. As traffic migrates, seven ads on mobile bring the same revenue as one on the desktop, not good, because the lower CPMs coincide with lower click-through rates. With me so far?
The problem is traffic is flooding from desktop to mobile and no one has yet really worked out how to make good money from mobile traffic. And there’s no certainty at all, although a good bet would be that if there is a solution to be found, that it will be Google that finds it, in the same way they did with AdWords for Web 1.0. ( I knew that would come back to haunt me one day) did they find it? or was it nicked from Overture, that’s another story.
Anyways gaining great chunks of iOS traffic through apps is just great, but that traffic still has to be monetised, so get working on ideas my friends, there’s money to be made here.
This is not a tribute to Steve Jobs directly. Although in the end it may be one of his greatest legacies.
I have been in the technology field for over 30 years. I have seen a number of radical changes that became metaphors for how things were supposed to be done. Many, but certainly not all, of these metaphors were created at the hands of Steve Jobs.
QWERTY defined the keyboard. The Apple II defined a generation of PCs. Sony defined what the home video recorder should be. The Mac defined what a Window and Window based programs should behave like. The iPhone defined how touch functions on a smartphone and what a smartphone is.
These defining products and the companies that produce them don’t always win the battle in the market place for various reasons but the idea sticks. The technology becomes iconic and lays the path for others to follow. Sometimes the followers overtake the creators, sometimes the creators win. The market is a brutal overseer.
Siri, the natural language interface for the new iPhone 4s, is one such product. It may not be the product that wins the battle in the market place, it may not be the specific product feature that everybody has to have in their pockets in 2015 but if it isn’t, whatever is there will be like Siri.
Imagine a world where you say to your phone: Find me the best Asian restaurant within 25 miles. Or: Text my wife to meet me at 21. Or: Schedule an appointment for me with Joe the PR Guy and send him a text. Or: Tell my friends on Facebook that our team won!
All of the sudden the only thing that matters is the answer. Nothing else. You won’t be looking at a search box, you won’t be landing on someone’s home page, you won’t be looking at an ad…In fact you won’t be looking at anything.
You won’t need to. Not all of your interaction will be voice driven but depending on your mobile needs a large portion of it could be. You no longer need to look at your phone to enter a query in a search box. You just ask for the answer and it will just give it to you.
The answer can come from a single source or a range of sources. The brand of search engine is no longer important, the brand of phone that you are asking the question on is. Your only relationship is with the phone. Either it works or it doesn’t. Search engines and web brands could potentially fade in importance.
The winner in this next interface battle gets to pick where and who it gets the answer from. If it needs three data sources, it uses three data sources. If it needs four, it looks at four. That complexity is all hidden and the user not only doesn’t need to visit multiple websites, the user doesn’t even need a special app. Siri, or something like it, becomes the great equalizer for data sources. An OS for voice as it were. It handles the complexities. You just need to ask it.
Will it do what Apple says it will? There was a time when you couldn’t trust what Apple or any technology firm said. You had to have it proven to you. Even though this is a new Apple, one molded by the demanding perfectionism of Steve Jobs, this is one of those times when you will need to know that the natural language interface works and it works seamlessly.
If it does, it becomes THE WAY that you want to interact with the device. The new QWERTY as it were. Maybe not all all the time but certainly with mobile search and more frequently than not with mobile local search.
It also become the great disintermediator in mobile. It may be the greatest disintermediator of all time. If it works.
This past Monday, Google finally has tipped it’s hand to the world. To the tune of over $12 billion, the search giant bought up Motorola Mobility, best known for their quality cellular phones.
It’s common knowledge at this point in the industry, that the Google Android operating system has been devouring market share on handheld devices. By adding the Motorola feather into their cap now, Google includes both them and Android, Google voice and fibre optic service plans, as well as their internet voip phone services which are still growing and booming in usage. Providing that all of the industry watchdogs say yes to the deal, Google has bought itself a powerful arm to add to their arsenal with more than 17,000 patents in the Motorola company.
With Android being so popular on so many different handsets, they’re still all going on the record and saying the Motorola purchase doesn’t worry them in the slightest. In fact, they’ve reportedly endorsed the deal as a patent protection measure. That sounds all well and good, but paying $12 billion+ for patent protection is a stretch even for the search giant. Android is a powerful, moldable operating system which many handheld device makers have adopted, but the longer the lifetime of Android has been stretched, so do the problem tickets and the wait of a solution. By having Motorola in their stable, Google will be able to solve some hardware misunderstandings which have dogged their Android OS.
“With Motorola, Google will get a better understanding of how hardware works,” said Ramon Llamas, mobile device analyst at IDC. “They can then offer better help to guide their partners about how to develop hardware for future Android products.”
No one thought 6 months ago that Google would want to buy up a handset manufacturer — or launch a head-to-head assault on Facebook, as it did with Google+. Four months into Larry Page’s tenure as CEO, he’s already proven he’s not afraid to make high-stakes bets. Forget “don’t be evil.” Google’s new motto seems to be “expect the unexpected.”
While the possibility that Android, a beloved smartphone institution, could be sued out of existence by Apple, Microsoft, it is alarming to many, this incident in many ways serves most of all to illustrate much broader problems with the U.S. intellectual property system.
Companies in the U.S. are laying claim to increasingly generic intellectual property and using that IP as instrument not to innovate, but to litigate. The street runs two ways in most cases — often times IP lawsuits are followed by IP counter suits. But often one player in the market is using IP as the general bully, while the other is trying to defend itself.
Many argue the U.S. desperately needs intellectual property reform. But the federal government under both former President George W. Bush (R) and under President Barack Obama (D) has been slow to act.
The Nortel sale should offer a key signal to the market. If the federal government blocks it, it may be a sign that the era of using IP as an offensive weapon is coming to an end. On the other hand, if it’s approved without restriction, it will offer a virtual blueprint of how to defeat your competitor. If the latter scenario plays out consumers may find themselves in an odd market where it’s not the competitor with the best products that wins, but the company with the best lawyers and patent portfolio.
Personally, knowing Google as I do, I think they may well have something up their cuff, watch the space.