While CEO Larry Page is a bit more reluctant to openly talk about Google’s competition with Apple, chairman Eric Schmidt wasn’t shy about voicing his thoughts in a recent Bloomberg interview. In comparing the current mobile landscape to the home computer market of the 1990s, Schmidt said that Google is “winning that war pretty clearly now.”
As was the case with Microsoft so many years ago, Google is relying on hardware partners, advertisers, and developers to create an expansive ecosystem that is attractive to more and more users. The model is working, with a recent Gartner report revealing that Android’s stranglehold on the market grew to 72 percent in the third quarter of 2012. It’s a dominance that is expected to extend for several years.
Schmidt said, “the core strategy is to make a bigger pie,” but admitted, “we will end up with a not perfectly controlled and not perfectly managed bigger pie by virtue of open systems.” Apple’s strategy, on the other hand, has always been to offer software and hardware as a packaged deal, seeing one as the natural extension of the other. In the early days of home computing this model prevented the company from overtaking Microsoft, but a successful string of relatively cheaper products like the iPod, iPhone, and iPad have helped to grow their business as a whole.
Many argue that Android will ultimately be doomed by its size, scope, and fragmentation, with the entire ecosystem eventually buckling under its own weight. While that could be a reality someday down the road, Schmidt and company will be riding their wave of success for the foreseeable future. But Google shouldn’t rest now. They may think the war is over, but we’re sure Apple sees things a little bit differently.
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TAGS: Eric Schmidt