Google, apple, and microsoft struggle for your internet experience

6,054 views

Published on

Google, apple, and microsoft struggle for your internet experience
Case Study of Chapter 7 from "Management Information Systems: Managing the Digital Firm" 12e by Laudon & Laudon

Published in: Education, Technology, Business
2 Comments
2 Likes
Statistics
Notes
No Downloads
Views
Total views
6,054
On SlideShare
0
From Embeds
0
Number of Embeds
14
Actions
Shares
0
Downloads
155
Comments
2
Likes
2
Embeds 0
No embeds

No notes for slide
  • The phrase the enemy of my enemy is my friend (sometimes shortened to enemy mine) is a proverb that advances the concept that because two parties have a common enemy, they can work with each other to advance their common goals. Often described as an Arabicproverb
  • In this triangular fight, at one point or another, each firm has befriended one of the other firms to combat the other firmTwo of the firms—Google and Apple—are determined to prevent Microsoft from expanding its dominance beyond the PC desktop. So Google and Apple are friends.
  • Apple and Microsoft are determined to prevent Google from extending beyond its dominance in search and advertising. So Apple and Microsoft are friends.
  • But when it comes to the mobile marketplace for devices and apps, Apple and Microsoft are enemies.
  • But when it comes to mobile phones and apps, Goggle and Apple are enemies: each want to dominate the mobile market.
  • Google and Microsoft are just plain enemies in a variety of battles.
  • Blog.moovweb.comGoogle estimates 2013 more peoplein 2016, they are expected to account for 23.5% of searches.
  • American technology news and media network verge posted July 23, 2013All three companies disappointed in some areas, but nonetheless remain extremely profitable. Google's wealth grew significantly this quarter, but even with revenue and profit growth pegged at around 15.5 percent year-over-year, Wall Street were left cold; revenues and profits fell short of expectations.
  • Microsoft, (os90.81%)on the other hand, was always unlikely to see profits drop year-over-year: last year's calendar Q2 saw a huge $6.19 billion "goodwill impairment charge" related to its disastrous acquisition of aQuantive. That said, relatively static Windows revenue, despite the launch and continued push of its Windows 8 and Windows RT operating systems, and a $900 million write-off on its Surface RT tablet, gave investors cause for concern.
  • Apple also had a troubling quarter, with flat revenues and significantly lower profits than this time last year. The company is making far less revenue per device than it has done in the past, and that's impacting it's bottom line significantly.Q2 may have been a difficult quarter, but It's fair to say that none of the three are really struggling. Net profit margins — a tricky figure to use comparatively — are healthy, revenues are high, and profits remain astronomical.
  • For both Apple and Google, the most critical battleground is mobile computing. Apple has several advantages that will serve it well in the battle for mobile supremacy. It’s no coincidence that since the Internet exploded in size andPopularityIphone 30% of apple revenueGoogle is aggressively following the eyeballs. Google is as strong as the size of its advertising network.
  • Apple has a loyal user base that has steadily grown and is very likely to buy future product offerings. Apple is hopeful that the iPad will be as successfulas the iPhone, which already accounts for over 30Percent of Apple’s revenue. Part of the reason for the popularity of the AppleiPhone, and for the optimism surrounding Internet-equipped smartphones in general, has been the success of the App Store. A vibrant selection ofapplications (apps) distinguishes Apple’s offerings from its competitors’, and gives the company a measurable head start in this marketplace
  • Google’s efforts to take on Apple began when it acquired Android, Inc., the developer of the mobile operating system of the same name. Google’s original goal was to counter Microsoft’s attempts to enter the mobile device market, butMicrosoft was largely unsuccessful.. Google continued to develop Android, adding features that Apple’s offerin Instead, Apple and Research In Motion, makers of the popular BlackBerry series of smartphones, filled the voidgs lacked, such as the ability to run multiple apps at once. After an initial series of blocky, unappealing prototypes, there are now Android-equipped phones that are functionally and aesthetically competitive with the iPhone. For example, the Motorola Droid was heavily advertised, using the slogan “EverythingiDon’t…Droid Does.”
  • Verizon explicitly promoted the Droid as an Apple iPhone alternative. Launched on October 17, 2009
  • Apple’s preference for ‘closed’, proprietary standards on its phones. It would like smartphones to have open nonproprietary platforms where users can freely roam the Web and pull in apps that work on many different devices. Apple believes devices such as smartphones and tablets should have proprietary standards and be tightly controlled, with customers using applicationson these devices that have been downloaded from the its App Store. Thus Apple retains the final say over whether or not its mobile users can accessvarious services on the Web, and that includes services provided by Google. Google doesn’t want Apple to be able to block it from providing itsservices on iPhones, or any other smartphone. A high- profile example of Apple’s desire to fend off Google occurred after Google attempted to place itsvoice mail management program, Google Voice, onto the iPhone. Apple cited privacy concerns inpreventing Google’s effort.
  • Winrtsource.com 28 August, 2013Originally stardust-spm.com
  • Winrtsource.com 28 August, 2013Originally stardust-spm.com
  • The comic above is a bit harsh, but if generalizations were to be made about each group of users, it's unfortunately accurate. Android users are less willing to buy apps, even high quality or low priced apps. They're also far more likely to pirate apps. Flurry Analytics found some alarming trends about app pricing, and if things don't change, developers may need to adopt some unpopular pricing schemes. iOS users pay on average 19¢ per app, while Android users pay only 6¢. Android users could be dragging the industry down a path users won't be happy about.
  • Soon after, Google CEO Eric Schmidt stepped down from his post on Apple’s board of directors. Since Schmidt’s departure from Apple’s board, the two companies have been in an all-out war. They’ve battled over high-profile acquisitions, including mobile advertising firm AdMob, which was highly sought after by both companies. AdMob sells banner ads that appear inside mobileapplications, and the company is on the cutting edge of developing new methods of mobile advertising. Apple was close to a deal with the start-up when Google swooped in and bought AdMob for $750 million in stock. Google doesn’t expect to earn anything close to that in returns from the deal, but it was willing to pay a premium to disrupt Apple’s mobile advertising effort. Apple has been more than willing to use similarly combative tactics to slow its competition down. Apple sued HTC, the Taiwanese mobile phone manufacturer of Android-equipped phones, citing patent infringement. Apple CEO Steve Jobshas consistently bashed Google in the press, characterizing the company as a bully and questioning its ethics.
  • Google in the meantime is moving aggressively to support manufacturers of handsets that run its Android operating system and can access its services online. Apple relies on sales of its devices to remain profitable. It has had no problems with this so far, but Google only needs to spread its advertising networks onto these devices to make a profit. In fact, some analysts speculate that Google envisions a future where mobile phones cost a fraction of what they do today, or are even free, requiring only the advertising revenue generated by the devices to turn a profit. Apple would struggle toremain competitive in this environment. Jobs has kept the Apple garden closed for a simple reason: you need an Apple device to play there.
  • This case demonstrates the fundamental paradigm shift from primarily desktop PC computing to mobile computing devices accessing services through the Internet that is currently taking place. This environment is projected to be a $400 billion e-commerce marketplace where the major access device will be a mobile smartphone or tablet computer. Each company is vying for the lead in a world of ubiquitous computing based on Internet access. The leader stands to make untold profits from advertising but in order to do that, the leader needs to claim the largest user base. Apps greatly enrich the experience of using a mobile device. Whoever creates the most appealing set of devices and applications will derive a significant competitive advantage over rival companies. Apple: by far the current leader in the number of apps users can download – over 250,000. Apple takes a 30% cut of every app purchased. Uses a closed proprietary system and apps that only provide “one way in.” Google: aggressively following the eyeballs. It has introduced the Android mobile operating system for a host of non-Apple devices. The Droid system adds features that Apple devices don’t have – the ability to run multiple apps at the same time. Uses an open non-proprietary system that allows users to grab apps from any source.Microsoft: trying to partner with Apple and make Bing the default search engine on both the iPhone and Apple’s Web browser. That would provide Microsoft with a much needed boost to its fledgling search service. Otherwise, Microsoft doesn’t bring much to the table in mobile computing.
  • Apps greatly enrich the experience of using mobile device, and without them, the predictions for the future of mobile Internet would not be nearly as bright. Whoever creates the most appealing set of devices and applications will derive a significant competitive advantage over rival companies. Apple makes money on each app sold through its App store. That’s worth billions of dollars to the company. Even if an app is free, Apple still has an advantage because users must visit Apple’s App Store and the company is betting consumers will buy something else, other apps or entertainment services, while visiting the store. However, app developers have complained that making money is too difficult. Apple has blocked some apps from its mobile devices, namely Google’s voice mail management program, Google Voice. Apple claimed it violated user privacy. Apps for the Android system used on non-Apple devices are available from many different sources. Google has worked very hard to increase the number of apps available for Droid-based mobile devices by encouraging developers to increase the number of apps. Google also makes money by embedding advertising in some of the apps used on Droid-based devices.
  • The size, complexity, and bureaucracy of organizations affect the ability of any company to continue to innovate, grow, and expand its reach. (see Chapter 3) As all three companies try to expand into mobile computing, their ability to “turn on a dime” in the face of other competitors may be in serious jeopardy.Google currently has the major share of the Web-based advertising market, however Microsoft and other market entrants will be a major threat to them. The Microsoft corporation have very “deep pockets” and will stop at nothing to overturn and destroy Google’s competitive advantage. Apple has had a significant lead in mobile computing for several years. However, as more companies, Google, Microsoft, and others, continue to expand into the arena, it’s lead will be threatened. Legal and regulatory compliance will be a major issue as this market grows and more concerns are expressed from external environments.History is not on anyone’s side. Every major company that’s been a force in technology in one era has lost its lead in the next era. For example, IBM was king of mainframe computing in the 1940s and 1950s. DEC was king in the mini-computer era during the 1970s. Microsoft was king in the 1980s and 1990s during the reign of desktop computers. Google reigns in the 2000s with its Web-based services. Apple began as king of mobile computing devices. Will it remain on top as technology continues to evolve?
  • Google, apple, and microsoft struggle for your internet experience

    1. 1. Google, Apple, and Microsoft Struggle for Your Internet Experience CASE STUDY BUS 602
    2. 2. Presented By Anirudhya Robi (BSSE 0333) IIT, University of Dhaka 10/8/2013 IIT, University of Dhaka 2
    3. 3. Guided By Dr. Md. Mahbubul Alam Joardar Director & Professor IIT, University of Dhaka 10/8/2013 IIT, University of Dhaka 3
    4. 4. 10/8/2013 IIT, University of Dhaka 4 The Enemy of My Enemy is My Friend
    5. 5. 10/8/2013 IIT, University of Dhaka 5
    6. 6. 10/8/2013 IIT, University of Dhaka 6
    7. 7. 10/8/2013 IIT, University of Dhaka 7
    8. 8. 10/8/2013 IIT, University of Dhaka 8
    9. 9. 10/8/2013 IIT, University of Dhaka 9
    10. 10. Expansion of Mobile Internet 10/8/2013 IIT, University of Dhaka 10
    11. 11. 10/8/2013 IIT, University of Dhaka 11
    12. 12. 10/8/2013 IIT, University of Dhaka 12
    13. 13. 10/8/2013 IIT, University of Dhaka 13
    14. 14. 10/8/2013 IIT, University of Dhaka 14
    15. 15. Apple and Google in Mobile Computing 10/8/2013 IIT, University of Dhaka 15
    16. 16. Apple iPhone Apple has a loyal user base that has steadily grown iPhone already accounts for over 30% of Apple’s revenue Success of the App Store Active 900,000+ apps (as of June 2013), 50 billion apps downloaded (as of May 2013) 10/8/2013 IIT, University of Dhaka 16
    17. 17. Google Android Acquired Android back in 2005 Original goal was to counter Microsoft’s attempts to enter the mobile device market Adding features that (run multiple apps) Apple’s offerings lacked Active 1,000,000+ apps, 50 billion apps downloaded (as of July 2013) 10/8/2013 IIT, University of Dhaka 17
    18. 18. 10/8/2013 IIT, University of Dhaka 18
    19. 19. Flexibility Issues Closed proprietary standards of smartphones Tightly controlled, available exclusively or selectively Google doesn’t want Apple to be able to block it from providing its services on iPhones, or any other smartphone Can’t surf web freely 10/8/2013 IIT, University of Dhaka 19
    20. 20. 10/8/2013 IIT, University of Dhaka 20
    21. 21. 10/8/2013 IIT, University of Dhaka 21
    22. 22. 10/8/2013 IIT, University of Dhaka 22
    23. 23. 10/8/2013 IIT, University of Dhaka 23
    24. 24. Google Envisions •Google only needs to spread its advertising networks onto the devices to make a profit •Mobile phones would be free! 10/8/2013 IIT, University of Dhaka 24
    25. 25. Case Study Questions Why is mobile computing so important to these three firms? Evaluate the mobile platform offerings of each firm. 10/8/2013 IIT, University of Dhaka 25
    26. 26. Answer Fundamental paradigm shift This environment is projected to be a $400 billion e- commerce marketplace Apps greatly enrich the experience of using a mobile device 10/8/2013 IIT, University of Dhaka 26
    27. 27. Case Study Questions What is the significance of applications and app stores to the success or failure of mobile computing? 10/8/2013 IIT, University of Dhaka 27
    28. 28. Answer Whoever creates the most appealing set of devices and applications will derive a significant competitive advantage over rival companies Apple makes money on each app sold through its App store. That’s worth billions of dollars to the company Apps for the Android system used on non-Apple devices are available from many different sources 10/8/2013 IIT, University of Dhaka 28
    29. 29. Case Study Questions Which company and business model do you believe will prevail in this epic struggle? Explain your answer. 10/8/2013 IIT, University of Dhaka 29
    30. 30. Answer As all three companies try to expand into mobile computing, their ability to “turn on a dime” in the face of other competitors may be in serious jeopardy The Microsoft corporation have very “deep pockets” and will stop at nothing to overturn and destroy Google’s competitive advantage Every major company that’s been a force in technology in one era has lost its lead in the next era 10/8/2013 IIT, University of Dhaka 30
    31. 31. Q & A 10/8/2013 IIT, University of Dhaka 31

    ×