Photo: Natt Garun / Business Insider
In the past year or so, there has been a remarkable sea-change in the global mobile landscape.
A year ago, Google’s Android platform was taking over the world, and it looked as it it might only be a matter of time before Apple was surrounded and marginalized the way it was in the PC market during the 1990s.
But in the past year, Apple has focused on making certain that it did not repeat the mistakes it made in the 1990s–namely, pricing its products too high.
And, just as important, Google has blown it.
How has Google blown it?
First, it has failed to fix Android’s glaring weaknesses: 1) the fragmentation that makes Android more of a collection of different operating systems with the same name than a single development platform like Apple’s, and 2) the ability for developers to make as much money as they make building apps for Apple’s iOS. As a result, Google has failed to capitalise on Android’s global market-share lead: Developers still build apps for Apple first and Android second (witness Instagram).
(Android’s “fragmentation” problem, by the way, is not just about app compatibility. That’s critical, and most Android apps work on most Android phones. But Android’s fragmentation by version and carrier hurts it in other ways, even when all the versions run the same apps. It makes app development more complicated, for example, and it makes the user experience different on each carrier and phone. And there’s also the hardware fragmentation problem: Some Android apps simply don’t run on some phones. Apple’s phones, meanwhile, all work exactly the same way–and they can all be put on the same version of iOS with a simple sync.)
Second, Google got so jealous of Apple’s amazing success that it decided to go into the phone-manufacturing business itself. First, it tried this by building and distributing its own phone (the Nexus One) with a partner. And then it jumped in with both feet and bought a massive, dying mobile phone manufacturer called Motorola. The latter move, which could end up being one of the most disastrous M&A decisions of all time, infuriated Google’s Android partners. It will also likely create a huge distraction for Google’s management in the years to come.
Third, Google failed to mount a significant challenge in the tablet market. The only Android-based tablet that appears to have been very successful is the Kindle Fire, and that’s an Android tablet in name only (Amazon controls the platform and the app distribution). So Apple and Amazon are running away with the tablet market, leaving Google and Android in the dust.Meanwhile, of all the global hardware makers that are chasing Apple, Samsung is the one that has the best shot of challenging Apple across the whole spectrum of connected devices. Nokia, RIM, and Motorola are cratering, and HTC and LG are either smaller or primarily dumbphones. Samsung builds great products, and it sells a lot of them. And it also has some swagger and pizzazz that the rest of the field lacks. And it makes the full suite of connected products, from smartphones to tablets to TVs, which puts it in a great position to build a cloud-based ecosystem that’s competitive with Apple’s.
Just as important, Samsung makes money.
In Q1, Samsung made more than $5 billion in profit. That’s more than Google made. It’s also almost half of what Apple made (few companies on earth can say that). That means Samsung is on a pace to generate more than $20 billion of profit this year–an extraordinary amount.
What all this means is that, as Business Insider’s Jay Yarow observes, Samsung doesn’t need Google anymore (if it ever did).
Now that Google has stabbed Samsung in the back by buying a handset maker and becoming a direct competitor, Samsung should respond by “forking” Android and building its own Android platform.
” source=”” alt=”Google Music android metal horns” align=”left” size=”xlarge” nocrop=”true” clear=”true”]Without Samsung, Android and Google are pretty much toast–an even more fragmented group of smaller players all trying to catch up to the big dogs. So it’s unlikely that Google will be able to force Samsung to adhere to usage rules that can unify the Android platform and restore Google’s dominance.Rather, Samsung can take the one big benefit of Android–app compatibility–and then customise everything else, the way Amazon has. And it can take its already strong position in the TV market and use that to compete with Apple’s TV efforts. And it can finally build a viable competitor to the iPad.
The bottom line: In the past year, as Google has moved closer to finally closing its Motorola deal, most analysts have focused on the coming war between Apple and Google as Google becomes a direct competitor to the iPhone.
There will almost certainly be a war between Apple and another hardware maker, but based on recent market share trends, that hardware maker is not going to be Google–it’s going to be Samsung.
And Samsung should seize the moment, forget helping Google, and focus on building an amazing end-to-end competitor to Apple.
Appearances are deceiving… Click chart for THE FUTURE OF MOBILE: