“It’s the biggest, most intense battle in tech history,” said Ted Morgan, chief executive of Skyhook Wireless, a firm that provides location-based technology for mobile devices. “It’s so much bigger than even the Microsoft, Apple, IBM battles of the 1990s. I think all four of those guys get it. They get that it’s between us four. And we need to have something on every front.”
The latest example: Google’s announcement Monday that it will acquire cellphone maker Motorola Mobility Holdings, a move that will send the company even further into Apple’s smartphone turf.
During much of their histories, Google and Apple have looked like vastly different firms. Google, with its powerful search algorithm, has made money by selling ads that appear alongside its search results. Instead of manufacturing its own devices, the company offered its Android software to run on phones built by others, including Motorola, Samsung and HTC.
Apple, on the other hand, has built its success by selling computers, phones and tablets that work seamlessly with the company’s software programs. Think of the symbiosis between iTunes and iPods, or the way Apple’s mobile operating system, called iOS, works on both iPhones and iPads. By contrast, Apple has had a weaker presence on the Web, a domain ruled by Google.
Now, though, the Motorola deal makes Google look a lot more like Apple, because it will be responsible for not only the software on the phone but the manufacturing of the phone itself.
“Apple is basically an ecosystem with end-to-end delivery,” said Michael Gartenberg, an analyst at Gartner. “Google’s looking at that and saying, ‘Hey, maybe that works for us.’ ”
The two companies weren’t always such fierce rivals. Schmidt sat on Apple’s board from 2006 to 2009, when he was Google’s chief executive. He stepped down from the board when it became clear that Google was increasingly competing in Apple’s territory.
“Unfortunately, as Google enters more of Apple’s core businesses, with Android and now Chrome OS [Google’s Internet browser software], Eric’s effectiveness as an Apple board member will be significantly diminished since he will have to recuse himself from even larger portions of our meetings due to potential conflicts of interest,” Apple chief executive Steve Jobs said in a statement in August 2009 when Schmidt resigned.
The fact that two companies coming from vastly different business models have arrived at such a similar juncture demonstrates how quickly — and unexpectedly — these dominant tech firms can wind up competing against one another.
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