Dawn of the Google era
The recent history of corporate computing leadership over the last 30 years is pretty simple: first it was IBM. Then Microsoft. More and more, it appears that the next undisputed champion of the business of computing is Google. In the beginning, Google offered the clean and simple search interface that proved a stark usability contrast to the more complex offerings of the competition. Their products slowly expanded into complementary areas like maps, news, and shopping while generally retaining their elegance and quality. They went public and become the stock market story of 2004, thrilling investors with enormous gains, all the more remarkable thanks to their seemingly altruistic “Do no harm” edict. They were one of – if not the – most beloved dot.com brands and a bona fide media darling. With apologies to the Yahoo! monolith, they are unequivocally the most powerful dot.com company today. And it is just the beginning.
Apple is peaking
Apple is in a really interesting position right now. They are borrowing on innovation and first mover advantage in their iPod family of hardware products and related digital music sales. But the market is already catching up, and they have made some very consumer-unfriendly choices, such as forcing people to buy and own content instead of renting it (yes, the Napster model really is dramatically better). In fact, their iTunes strategy is so archaic that, if you buy a song and your hard drive crashes, even though they have record you purchased the song already, they will not allow you to download it again! This sort of customer service policy will ultimately catch up to them. Now, at the same time, looming out there on the 2006 horizon is Microsoft Vista, the new supercharged operating system from our good friends in Redmond. At a minimum, it is expected to equal, if not exceed the functionality of the current OS X, which has contributed to Apple’s establishment as a legitimate lifestyle brand. This is happening at the same time that the Microsoft mobile OS is showing up on Palm devices and gaining real market momentum in the emerging ubicomp market segment. Translation? Apple’s many early advantages in convergent computing environments are likely terminal, and there’s enough alternate market momentum to reasonably project that the high Apple is enjoying right now might be followed by a relative low in late 2006 and beyond. That vulnerability could provide a need to pair up with another power player, creating the opportunity for a blockbuster opportunity.
Opportunity, meet destiny
Google seems Hell-bent to grow as large and diversified as possible. They’ve been attached to many diverse wide-ranging initiatives: from a ubiquitous WiFi network that stretches across the United States to the development of a next generation operating system that erases the distinction between a desktop and browser environment. Google appears driven to achieve total online – if not computing – dominance in the decade ahead. But there are some areas we haven’t heard much about from Google yet, such as hardware. Apple’s products are to hardware what Google’s ambitions are to computing: smart and sexy. And what about content? Apple is making impressive legal inroads into the most coveted multimedia content in the world. As Google’s search-based approach to providing access to content they do not have rights to transitions into one of capturing content for themselves, they may ultimately need to pay to provide access to the content everyone wants. Apple is opening up an impressive beachhead in that regard, particularly with the key major content providers. Apple’s strengths fit naturally into the areas where Google is deficient. From the standpoint of brand alignment and product opportunity, it is a perfect match.
Arrogance attracts arrogance
I’ve never seen a brand shift so quickly in the heart and mind of intelligentsia as Google. Almost immediately after their volcanic IPO, green began to show around Google’s edges: well-publicized gluttony by their nouveau riche leadership. Irreverence and callousness bordering on the bizarre by suddenly power-drunk founders. An overly ambitious project to digitally capture everything ever written that is running afoul of media companies and national governments alike. The hallmark simplicity of product, irreverence of marketing, and altruism of leadership are being replaced by a sweetly sickening smell that perhaps things aren’t as fresh and pure as Google would have us think. Indeed, Google seems evermore ripe to eventually take over Microsoft’s role as the Evil Empire of the computing world. For Apple’s part, their corporate arrogance borders on the legendary, stretching even to a percentage of the user base that reflects a distinct better-than-thou attitude. Particularly as this arrogance reflects a shared ambitious, innovative, and risk-taking executive approach to market leadership, it is a signifier of why these companies fit together. I can see it now: Sergey and Larry fade into the background, pinching themselves in disbelief as Google CEO Steve Jobs applies his unique vision to taking their Stanford dreams far beyond their wildest imagination.
Sound far-fetched? Perhaps. But lets talk again in 18 months. And remember where you heard it first.