Following the Google I/0 2013 key notes I asked myself who will (can) “stop” Google? And more importantly “stop from what”? Apple’s focus on exceptional customer experience and eco system dominance has given them their unique stronghold. It is fair to say that they have singlehandedly invented Mobile IT (smartphone/tables/applications). I believe however that as the mobile application world is moving from native apps to mobile web, there is a high chance that Google will be able to achieve big relevant innovations leveraging Google’s core asset of analytics, Data Warehousing and integration in the web on Desktop, Mobile and more and more the internet of things. This will lead to much broader innovations than just smartphone centric innovation especially when these assets will be leveraged in new non-digitalized industries such as Transport, Health, Education. Only time will tell 😉 Let me know what you think ?
Who will (can) stop Google? More importantly Stop from what?
Apple has single handedly defined and invented mass personal Mobility when they launched the Iphone in 2008. It has taken Android (the Google and Hardware ecosystem) quite some time to jump in the race and just recently to catch up with Apple.
After the recent 2013 Google O/I developers keynote speaker event I ask myself who will win the race and probably more importantly, what race are we/they actually in.
Apple invented the Race ! But how is Google catching up ?
Apple’s success is based on many drivers. I was involved as CMO of Mobistar (Mobile operator) as an active (exclusive) partner to launch the Iphone on the Belgian market and I have have seen the rocket lift off. From that angle I see three fundamental drivers of success for Apple and I compare Google position versus these drivers:
First Driver – Customer centricity in design and interface. Apple’s NPS score’s of +70% is one of the highest of any product category in the world and it is amongst many things the results of a unique company DNA, their focus on design, on user interface (UI) but more importantly their inherent closed business model with very high level of “controlling” on the whole eco system.
Here, Google has a challenge: It‘s open platform approach has given much more “liberty” to its partners to adapt the UI with often impacts on customer experience. This explains Google obsession on securing the success of their own Nexus handset brand running on the original Android version. On the other hand Samsung is emerging as the largest hardware player in the Anroid ecosystem and getting positive customer feedback on their Android version adoptions. All of this does not help the “one front” of course of the initial Android philosophy
Second Driver – Leveraging the brand to secure strong go to market and very strong pricing/profitability. Apple brand has allowed them to maximize topline with very high pricing of devices, while Apple was able to change the cost of doing business by having the Mobile Operators carry the subsidy and advertising & go-to -market costs. In the applications space it has allowed them to impose very high transaction terms. For reminder, today Apple is sitting on 170Billion of cash.
Here Google has an advantage because their business model is much further away from hardware and mobile operator support. With the introduction of the bestselling laptop Chromebook below $200, Google is clearly leading the way to democratize hardware. Larry Page’s point of smartphone’s raw material being $1 so why do the smartphones sell at $500plus ? This is not neutral nor for Apple, nor for Samsung….
Third Driver – Apple did not launch “design” hardware but was the first to launched “a central eco system platform” (Itunes). The single central “platform” is able for the consumer to secure an incredible integrated customer experience. For the consumer, at first the benefits were the ease of “docking on” evolving today to its ability to provide seamless multi-screen/central content experience. For Apple the platform is able to secure its ability to take a big part of the value chain by billing and have a balance of control in their ecosystem (see last point).
Here Google has a structural advantage. Google’s mobile platform initially was Android. However, it becomes very clear (also in the keynote speeches last week) that Google wants to build its future on three platforms Android, Chrome and Maps. The demo shown at the Google I/0 conferece of the Google Now application inventing a real personal butler that you can talk to help you solve your personal problem taking into account the your full context is amazing. Google Now best captures the power of the synergies of these platforms. It also shows that Search is moving from basic search to conversation and anticipation. This is going much further than the Sirius (Iphone) solution. The recent debacle of Apple to launch IMaps also shows that this is not their core business.
This raises the fundamental question of what the core business is of Google versus Apple and fundamentally, what RACE are they in.
What RACE are they/we in ?
I believe we are in the last couple of years where we will have a smart phone centric definition of Mobility. The increased focus of Google on Chrome based Mobile web is preparing the step to go away from an app centric/native app world to a world where all goes back in the web.
If this happens, Google’s’ web analytics based innovation combined with a mastery of cloud and integration with the Web will result in more relevant innovation. The big difference will come with the scope of innovation of Google. Larry Page referred in the Keynotes to Google’s drive to reinvent/re-digitalize whole new markets (education, transport, health). His view is that the digital/mobility challenges faced in these markets are addressed by the same fundamental assets enabled by Chrome/Android/Maps. The real impact will be really shown once we will move to the Web 3.0 with the internet of things (machine to machine connectivity)
Who Will Win the Race ?
It is obviously worthless to predict anything. It does raise the question on what is happening with the barriers of entry to the digitalization of our society. On one hand we are having total industries that will be challenged by “Over The TOP” players (example Viber application that has in 3 years achieved 200million customers and is fundamentally undermining the whole telco industry. At the same time these greenfield innovations are made possible by the Google/Apple eco system who are securing integration in a customer base.
Let me know what you think ?