Google android OS is a competitor to Apple in the mobile OS segment. Very curious to know the difference in business model of Google vs Apple. Since each is a multi sided platform, but one is open and other is closed. Alex, please also through some light on Google TV business model. Here are some interesting tweets on this topic.
@glynmoody Google Now Activating 100,000 Android Devices A Day — 50,000 Android Apps - http://tcrn.ch/a9dSAu not *if* it overtakes iPhone, but *when*
@googleio Android report card: over 60 devices, 100K+ new device activations, 50K apps #io2010
I'll spend some more time on the question in the near future. Here some first thoughts:
It's not quite clear who of the two actors has the better cards. To a certain extent the business models of Apple and Google are starting to resemble each other, although coming from very different roots. Google's economic engine was and remains advertising. Apple's economic engine was hardware/software, which is increasingly interwoven with a content ecosystem (apps, music, books, etc). However, they are now also adding "in app" advertising.
One of the key differences obviously remains the open/partner approach (Google) vs. closed approach (Apple). To my knowledge Google doesn't engineer much of its own hardware, but relies on OEMs for its Google phones and counts on the adoption of device manufacturers using its Android operating system (OS). The latter will definitely allow the Android platform to continue to grow impressively and become the platform market leader. Apple on the other hand is involved in the engineering, though it buys the components from OEMs. This allows it to control the hardware/ software integration, which should lead to a better hardware/software integration. Ultimately, this should lead to a better user experience. However, it also limits the growth of its platform. That said, it's pretty impressive to watch the Android demos highlighted in the FT blogpost above, showing the performance of Android-based software. Finally, Apple doesn't license its OS and focuses on a limited range of products, while the Android product space can be pretty confusing at times.
The above really increasingly makes me think of the Microsoft vs. Apple (OS) platform battle of the 80s. Former collaborated with hardware manufacturers to scale their OS adoption, while the latter bet on integration... and lost, despite flaws in the MS Windows software. Microsoft finally won because of network effects. As it turns out, the 80s OS platform game was a "winner takes all" battle that marginalized Apple.
Of course the context and the business models are totally different today. Google will never make money by licensing/selling its Android OS (like MS in the 80s until today), they just want to keep the (mobile) Web open to continue selling advertising. As such they need to foster the adoption of Android on the widest scale possible. Apple on the other hand seems to be planning to extend its impressive scope of revenue streams towards advertising - attacking Google on its home turf, albeit with a relatively "closed" platform. The main questions are: a) how many OS platforms can survive in parallel and does it really matter? For the time being the OS battle does seem to matter.
I haven't yet really made up my mind on which business model I would bet. It looks like the components of their business models will increasingly resemble each other. However, the strategic weight will be very different from one business model to another...
Give me some more time to think this through... and particularly sketch out the Canvases in more detail after some research. Maybe other Hub members can help with comments on this, so we can develop a nice case study!!!!
One of the problems with Google's approach is that the value proposition of its advertising model fails to add authentic value for users of its devices. Apple is able to offer value to users in a number of different ways because, as you mention, Apple controls the seamless integration of hardware and software - that is the fundamental element of its value proposition and it does so better than any other hardware or software company.
The Microsoft Mobile Strategy could also be added this case study. Since Loosing the HP account for Mobile OS, Executives being let off. Microsoft might have reached the sell by date of it Mobile Business Model or its just left behind buy a better platform (Google or Apple) ?
Big tech companies (Microsoft) hit an inflection point long before the damage is visible to all. http://goo.gl/kPzE
I think Google Android has the long term advantage. Fundamentally, it's for the same reasons that Microsoft Windows beat Apple Mac in the late 1980s/1990s for PC OS dominance. Trying to take market share by both being a hardware and software supplier is usually only successful in the long run in certain market niches and customer segments. Google will take the bulk of the emerging smartphone markets in emerging and developing economies simply due to cost and the ability for third-parties to tailor the device platform. I think Apple will remain successful for many years to come, but Google has many advantages.