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318 Part Two Information Technology Infrastructure

Apple, Google, and Microsoft Battle for your Internet Experience

CASE STUDY

T he three Internet titans—Google, Microsoft, when you can listen to music and watch videos any-

and Apple—are in an epic struggle to
time, anywhere on mobile devices? It’s no surprise,
then, that today’s tech titans are so aggressively bat-
dominate your Internet experience. They
are competing on several fronts: digital con- tling for control of this brave new mobile world.
tent, from music to videos and books for sale in their Apple, Google, and Microsoft already compete
online stores; physical devices, from Apple’s iPhone in an assortment of fields. Google has a huge edge
to Google’s Android phones, to Microsoft’s Windows in advertising, thanks to its dominance in Internet
8 phones. And let’s not forget they all offer tablets as search. Microsoft’s offering, Bing, has about 5 percent
well. The prize is a projected $400 billion e-commerce of the search market, and about 80 percent belongs
marketplace by 2015 where the major access device to Google. Apple is the leader in mobile software
will be a smartphone or tablet computer. Each firm applications, thanks to the popularity of the App
generates extraordinary amounts of cash based on Store for its iPhones. Google and Microsoft have less
different business models and is using that cash in popular app offerings on the Web. Microsoft is still
hopes of being the top dog on the Internet. the leader in PC operating systems, but has struggled
In this triangular fight, at one point or another, with many of its other efforts, including smart-
each firm has allied with one of their two major phone hardware and software, mobile computing,
foes to team up on the third. Two of the firms— cloud-based software apps, and its Internet portal.
Google and Apple—are determined to prevent Even though Microsoft’s Xbox consoles and games
Microsoft from expanding its dominance beyond are popular, they contribute less than 5 percent of
the PC desktop and onto the new mobile plat- Microsoft’s revenue (the rest of its revenue comes
form. So Google and Apple are friends. But when from Windows, Office, and network software). While
it comes to mobile phones and apps, Google and Windows XP, Windows 7, and Windows Vista are still
Apple are enemies: both want to dominate the the operating systems for approximately 90 percent
mobile market. Apple and Microsoft are deter- of the world’s PCs, Google’s Android OS and Apple’s
mined to prevent Google from extending beyond iOS are the dominant players in the mobile comput-
its dominance in search and advertising. So Apple ing market, and all three of these companies now
and Microsoft are friends. But when it comes to the realize that this market will only increase in size and
mobile marketplace for devices and apps, Apple scope going forward.
and Microsoft are enemies. Google and Microsoft Apple has several advantages that will serve it
are just plain enemies in a variety of battles. Google well in the battle for mobile supremacy. It’s no
is trying to weaken Microsoft’s PC software domi- coincidence that since the Internet exploded in
nance, and Microsoft is trying to break into the size and popularity, so too did Apple’s revenue,
search advertising market with Bing. which totaled well over $108 billion in 2011, up
The Internet, along with hardware devices and from $65 billion the previous year despite an
software applications, is going through a major ongoing economic downturn. The iMac, iPod,
expansion. Mobile devices with advanced functional- and iPhone have all contributed to the company’s
ity and ubiquitous Internet access are rapidly gaining enormous success in the Internet era, and the iPad
on traditional desktop computing as the most popu- has followed the trend of profitability set by these
lar form of computing, changing the basis for compe- previous products. Apple has a loyal user base that
tition throughout the industry. Some analysts predict has steadily grown and is very likely to buy future
that by 2015, mobile devices will account for the product and offerings.
majority of Internet traffic. Today, mobile devices Part of the reason for the popularity of the iPhone,
account for approximately 30 percent of the traffic and for the optimism surrounding Internet-equipped
on the Web. These mobile Internet devices are made smartphones in general, has been the success of
possible by a growing cloud of computing capacity the App Store. A vibrant selection of applications
available to anyone with a smartphone and Internet d istinguishes Apple’s offerings from its competi-
connectivity. Who needs a desktop PC anymore tors’, and gives Apple a measurable head start in this

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