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Lessons learned from the Apple-Google privacy fight

Rob Enderle | June 8, 2015
In the battle between Apple and Google, columnist Rob Enderle writes that the real issue worth noting --and one we all should be backing Apple on -- is privacy.

One of the fascinating things about the last decade was the iPhone. We had a market dominated by companies like Palm, RIM, Nokia and Samsung. Each was incredibly powerful in its segment and two were massive multinationals. But, despite all that, Apple walked in and cut through them like a knife through butter.  

It reminds me of the World of Warcraft Ballad of the Noob, which tells of the story of how a Level 1 beat a Level 60 because the 60 didn't fight back. That is precisely what happened here — everyone was so sure Apple would fail they didn't take the company seriously and by the time they did Apple was above critical mass and Palm was gone and most everyone else was on life support.

There was no ballad written about Apple's achievement and one of the sad things about this industry of information is companies rarely learn from their own mistakes let alone the mistakes of others. But Apple apparently isn't in that group and their recent challenge against Google showcases they get that they are in a fight and aren't planning to go quietly into the night. The thing is, for us professionals, the privacy angle should be a much bigger differentiator than it is and I think we should back Apple in this fight.

Revisiting why Apple won

When Apple took out the other players it basically leveraged its iPod dominance to catch everyone else sleeping. The market had concluded that smartphones were for business, which they were and should have largely remained, but Apple's success with the iPod showed them that users wanted something that was more fun.

Meanwhile, there was a research group in Microsoft looking at this and it concluded that to beat Apple on the iPod Microsoft needed something like an iPhone, and in Palm they had a similar effort. However, both efforts were killed because the executives that knew better in Microsoft's case said no, we need a Zune; and in Palm's case they just laughed and said such a thing was stupid.

Ironically, the iPod was vulnerable to a phone attack and Jobs saw the vulnerability. I suspect he thought he would just prevent iPod erosion, not that the entire market would basically abandon the other players to jump on the iPhone.  

Apple's new weakness

Now Apple is a high-margin company. It does have the best customer satisfaction, but it is a premium class vendor and like any vendor in its space it is vulnerable to companies and countries that can make a similar product at a lower price.

Google basically did what Microsoft had done earlier and created a clone of Apple's offering for others. However, unlike Microsoft, it didn't charge for it, it gave it away for free.   Apple did sue them for infringement with a bit more success than they had with Microsoft, and Eric Schmidt (Google's then CEO) got booted off Apple's board and Jobs stopped mentoring the Google founders.


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