In March 2017, Apple CEO Tim Cook and Google CEO Sundar Pichai had a dinner in a Vietnamese restaurant in Silicon Valley. The photos were published in the mainstream US media. Such meetings between top honchos of corporates are common. However, these two are competitors. There was speculation about what transpired between them. They were silent. However, after three years, certain things were revealed. It was a meeting that led to an agreement between them. It was about Apple allowing the Google search engine on its iPhone. Google would pay Apple per annum $15 billion to achieve this. The revelation came after an anti-trust suit was filed in an American court. Are they friends or foes?
The world has been vertically divided on the criteria of the use of smartphone by these two companies. Big Tech has affected the world — Microsoft, Facebook, Amazon etc. However, Apple and Google are in a different league. They are truly competitive.
Smartphone as a gadget has changed the world. It has affected social relations. It has led to analytics and artificial intelligence. It is a means of communication. It is a newspaper and TV. It also serves as a camera. It not only entertains, but also educates. It is just like a university. It facilitates transactions. It is the greatest instrument in the world. There is a competition between Apple and Google about the control of the smartphone.
Apple’s focus is on hardware. Google’s focus is on software Apple tries to launch exclusive products. Google’s attempt is to make the products which are extensively used. Apple wants to maximise sales. Google prefers to distribute the products free. Google wants to leverage the users’ data to benefit itself. These two companies do not have commonalities to be each other’s rivals. Apples iPhone is an excellent piece of hardware. Google’s Android Operating System is the best software produced. These two companies, instead of being competitors, could be complementary to each other.
About 15 years ago, iPhone was being developed. Jobs had realised that a PC could be accommodated in the pocket of a human being. Such miniaturization led to the concept of iPhone. In those days, the only operating system known for mobiles was Nokia’s Symbian. Microsoft could not adapt its Windows to mobiles even after trying. In those days, Apple and Google’s manpower was jointly working on a new mobile system. Apple team was led by Jobs and was working towards creating an iPhone. Larry Page and Sergey Brin , Google’s founders were following the development, and were interested in providing Google services. They were sure that Apple’s new product would overtake Microsoft. How Google Search, Google Mail and Google Maps would adapt to iPhone? A team from Google had been working on this at Apple’s California office. An American-Indian Vic Gundotra, formerly of MS, had realised that smartphone will be a gamechanger, However, his views were not taken seriously at MS. Google roped in Vic. The joint effort of Google and Apple was to adapt Google services to iPhone. Google’s CEO was given a Board seat in Apple. In 2007, Job launched the first iPhone. He invited at the press conference the CEO of Google on the stage.
Many were uncomfortable in Google about this joint striving. iPhone was going to be a gamechanger technologically. At the same time Apple would hold the apron strings of Google permanently.
Google too wanted the mobile to be a smartphone right from 2005. Google purchased the ownership of a company of Andy Rubin who was developing Android Operating System. Andy founded Anroid inc. In 2003. Google acquired Android Inc. in 2005 for $50 million. Rubin served as Google VP. He left Google in 2014. Rubin and his team continued work on Android in Google. Google wanted the handset making companies to use the Android software.
Apple launched the first iPhone in 2007, and the whole picture changed. There was no thought given to the concept of touch screen in Rubin’s team. Google realised that it had lagged behind. Google’s team girded loin, and revised Android. To do this, they were counselled by Jobs. Jobs too later realised that the new version of Android is akin to iPhone. He insisted on changing Android somewhat but that insistence was not successful. Jobs severed relations with Google saying that Google had copied Apple.
It was the beginning of the conflict between two seemingly complementary companies. They compete hard with each other and the fervour remains the same even after one and a half decade. iPhone has been established as the best product in the world. However, in terms of users Android phones leave Apple behind. Apple commands 25 per cent of smartphone sales. The rest is Google’s market.
Apple has concentrated on product excellence. It decides what the customer would expect from the phone. Google started in technology sector as a search engine company. It spotted an advertising opportunity in its search results. It came to know user’s choices and likings. This data could be leveraged to acquire advertisements. Google continued to collect data through its other apps — mail, maps and YouTube. Android Operating System’s foundation has been laid on this leverage.
The separation of these companies benefited the technology sector. They both want to command smartphone market. Their ways are different. Apple’s plus point is hardware. It always brings new versions of iPhone in the market. What features should be given to the consumers? Apple decided this. iPhone created a loyal customer base.
Google concentrated on consumer expectations. They changed Android quite often. Google itself created Pixel phone from 2016. Both the companies know each other’s strengths. Jobs severed relations, and was not availing of Google’s services. He created Apple Maps. However, they could not create an alternative search engine. They partnered with MS Binge. That did not work out. They again contacted Google. Google too wanted its search engine on iPhone. Google could get access to the data of iPhone users. And that was what they negotiated in the dinner meeting in 2017.