Apple vs google soft ai

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Apple vs google soft ai

  1. 1. Apple vs. GoogleWho will win the soft AI war?Ismael Soto Cantero
  2. 2. Executive Summary:1. Apple in creating a stack in the search engines business with Siri2. Google + Samsung seem to be the main competitors that Apple should defeat in this battle; correspondingly, they dominate the customers data and the mobile phones industry3. Apple has the right technology and the right products to captivate the customers but starting from scratch is difficult and will take longer than analyst though4. Soft AI technologies open a new business horizon for mobile devices and the interaction of the customers with them devices
  3. 3. Siri is something new and it is here to stay with us for a longtime, so be aware about what it really means On October 4th, 2011 Apple announced that Siri would be included with the iPhone 4S Siri represents the first soft AI and virtual personal assistant that is launched to any device; it interacts with us through our questions and it is not limited to recognize our voice and transform it into actions "We are at a turning point in history where people can talk to a computer and be understood. It’s a watershed moment where people won’t go back" Gary Morgenthaler (first VC investor in Siri)
  4. 4. Apple has made his iPhone its main line of business and Siri isthere to take advantage of all the information of its customers • Apple revenues and profits are driven by the iPhone & iPad products; around 72% of Apple´s revenues • Apple is taking less than 5% of market share in the smart phones market but nearly 75% of its profitsCharts from Business Insider
  5. 5. The Siri´s back business model is to learn about customer´spreferences and get money from them, just as Google does 1. Siri will learn from the customers their preferences 2. Apple will put the customers´ information over an open map data base using other search engines in the back as a Wolfram Alpha and Yelp 3. Apple could use Siri as a crowder to become a preferences-based data base 4. Apple can monetize the information via 2 complementary ways: a) Selling devices with the best VPA among other characteristics b) Using the information that Siri is taking from the customers; - Traditional way: getting money from advertisement - New way: price discrimination and getting a haircutCharts from Harrison Research
  6. 6. iPhone customers have received well Siri; however its non-fullydeveloped capabilities could entail a menace to Apple´s plans iPhone customers like Siri and they are satisfied with its capabilities; however, due to the fact that it is a unfinished product, they cannot use the add as frequently as they should (for Apple´s interests)Charts from Business Insider
  7. 7. Google is the main competitor in this new soft AI business dueto its data bases and to its presence in the mobile industry (1/3) • Google is the leader in both, the core search services as well as the overall number of searches by surfers • Besides that, its mobile operating system, Android is the most popular by number of phones sold around the world with around 47% of market share and Samsung as the big fish in the market by number of sold phonesCharts from Business Insider
  8. 8. Google is the main competitor in this new soft AI business dueto its data bases and to its presence in the mobile industry (2/3) • Google has historical data of us and a powerful tools called Gmail, Google, Google Maps and Google+ that mimics Siri´s preferences learning process since years • Google included in its Android system tools that act as a VPA since before Siri appeared • Google is also embedded into iPhone as predefined search engine. Something that seems to change in the following weeksCharts from Business Insider
  9. 9. Google is the main competitor in this new soft AI business dueto its data bases and to its presence in the mobile industry (3/3) • Samsung is an intensive R&D company with more than 45.000 US patents (4.800 Apple) that can face Siri technology soon or later • Samsung leads the market and has launched the new Samsung Galaxy III that includes a self build VPA. It is true that is not as advanced as Siri is • Samsung works over Android and would use this to create powerful collaboration between Google and them whenever they get and maintain enough market shareCharts from Business Insider
  10. 10. However, Google also has problems to retain its core businessand iPhone is at the end a massive business by itself; a $100Bbusiness only surpassed by 53 other companies in the world…Charts from Business Insider
  11. 11. …and a technological war have started through the firms viaacquisition processes in aim to adquire a massive amount ofpatents, increasing lawsuits among them
  12. 12. The end of this war depends on whether Apple is able to makeSiri work better and if Google can make attractive the value ofits current and potential capabilities Apple Samsung + Google • Cutting the edge soft AI technology • Massive data and customers • Starting from • Cutting the edge scratch is always • Android and knowledge Google do not mobile phone difficult, specially product and • Android is the when Apple has offer products as business model leader mobile OS launched Siri attractive as Apple in absolute terms unfinished does • Apple starts from and Samsung is the scratch with the first cell maker in • Apple product • Soft AI current customers learning the world users are high portfolio is process value ones but few atomized and not • Potential synergies in relative terms to • Wide portfolio of among Google cutting the edge products and its the market size products complementarity • New developments in • Users are more soft AI VPA from and more search- • Entering into a Samsung and • Being the leader is driven by new business; big other developers always questions and data management challenging, will answers and not and its • Fully integration of Apple keep on the just by links. Also, implications each of the track? they use Google´s tools and alternative ways of the Android searching systems
  13. 13. ismael-soto.com

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