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Tech's tectonic plates begin to change

By deleting the car's automotive logistics, companies with the slower cars driven by advertising revenue (Google and Facebook) are no longer able to hide in traffic. Instead, they are becoming increasingly vulnerable, being hit from multiple directions by faster, more scary cars powered by non-advertising revenue (Amazon, Apple, and Microsoft). In addition, the faster cars have become much more strategic when deciding when and how to go after the slower cars.


A number of interesting battles have evolved in the technology landscape:

  1. Google is being attacked by Amazon, Apple and Facebook across multiple segments and industries ranging from AI and digital speech assistants to digital mapping and hardware.

  2. Facebook is attacked by Apple in content delivery and private communications.

  3. Apple continues to face modest skirmishes with Amazon, Microsoft, Facebook and Google in terms of hardware.

  4. Amazon and Microsoft have their own unique battle formation to offer business tools.

While these battles have been around for some time, Amazon and Apple are beginning to land some serious blows. For example, Apple shocked everyone about finding success in writing content distribution with Apple News. At the same time, iMessage and FaceTime continue to create momentum and now represent legal competition for traditional social networks. Amazon is increasingly becoming a Google thorn in terms of user data collection through subsidized services.

Especially three three games:

Apple vs. Google

Google is a service company that focuses on providing free, data collection tools to as many people as possible. The necessity found with such a mission has access to as many users as possible. This is where Google finds itself in growing problems. Apple gets power as a gatekeeper between Google and the most valuable customers Google needs for its services: Apple users.

Apple is a design company dedicated to providing tools that can change people's lives. These tools include a portfolio of hardware, software, and services. Apple is showing increased interest in entering Google's turf and launching its own services where it feels it has something else to bring to the table. Such unique attributes can range from having an attractive layer of design (ie, a focus on the user experience) that Google struggles to add to its services, privacy and security.

Five years ago, Apple discussed that the risk was for Google to turn off its services to Apple users. Today, the reverse is true. Apple is now in a position of power. Google would find itself in deep trouble if the default search for iPhones and iPads was threatened.

What changed?

Apple has harnessed its hardware and software expertise to create a stronger ecosystem for products. This has allowed Apple to strengthen its customer relationships while still attracting new customers. Another way, the Apple ecosystem is gaining strength, and that its strength is now beginning to strive for the adoption of Apple services.

Seen in this changing dynamics, this year's Google I / O keynote left me completely undervalued. Aside from a few flashy but unmemorable demos, Google found itself relying on what is best known: data acquisition and user experience enhancement technology ̵

1; none of them is a winning strategy on its own.

The figures speak for themselves. According to Apple, the installed base in the iPhone grew by nearly 75 million people in 2018. According to my estimates, about 40 million of these users switched from Android. Google continues to lose grip on the premium segment of the mobile market.

Apple vs. Facebook

Apple versus Facebook match has been the most surprising given how few people saw Apple having any overlap with Facebook. While some were concerned that Apple had to get into social networking with a flashy acquisition, Apple was putting together the foundation of another kind of social network. iMessage and FaceTime include Apple's identity network. As Facebook evolved to offer a cured version of the web via News Feed, Apple is investing in conditions that actually matter to people: family and close friends.

Given Facebook's recently announced pivot to a privacy-focused social platform built around messages, there is no doubt that Apple had the right strategy while Facebook went down the wrong path. Messenger and WhatsApp will now be increasingly positioned against iMessage and FaceTime.

Apple was able to spread content distribution in a way that Facebook failed in bad. The secret ended up being human cure instead of machine learning. Apple continues to expand Apple News to other countries, with Canada being the latest addition. Apple News can only be one of the best new services Apple launched from scratch in recent years.

Facebook vs. Google vs. Amazon

In the struggle for trade, Google, Facebook and Amazon are increasingly becoming competitors, and the battle for ad revenue is just the tip of the iceberg. At a basic level, Amazon is trying to systematically remove Google and Facebook from the customer's memory when it comes to buying products online.

Given Facebook's renewed push to position Instagram and Facebook as trading platforms, it is safe to say that things are going to be dicey during the user's attention. In fact, all three companies targeting the home with hardware devices (speakers, monitors, and other smart home devices) are given how the home has become an e-commerce engine. In addition, our home is the delivery point for all these items.

We are moving to the point where the consumer will have the opportunity to go all-in on an "Amazon home" where echo sounders, microphones, locks, a security system, a Wi-Fi router and a number of third-party parties smart Appliances with Alexa built in are all connected to Amazon.

What about data?

A potential area of ​​pushback to my comments will come from tech advocates who claim that Google builds an insurmountable advantage against peers with their data collection services. Such a view could best be described as "the data is all" thinking.

For example, voice first and autonomous car drivers will probably have a problem with the requirement that Google lose power in mobile. The basic problem that advocates for specialized tech verticals do not think enough about the user experience.

More people switch from Android to IOS, rather than vice versa. It does not support the fact that consumers are clamoring to use Google services given the company's data superiority. Meanwhile, other clues such as Pixel Smartphone sales such as flawed and smart speakers are used primarily for music consumption and not much more, talk to the wider disconnect that has evolved between "data is all" advocates and how people actually use technology.

Switching landscape

Many people will still place the Amazon, Apple, Facebook, Google and Microsoft as equals in terms of ecosystem strength and fundamentals. I don't think that's right. Instead, two tens have formed. Amazon, Apple and Microsoft are at the top level while Google and Facebook are at the bottom level. Google gradually loses its power in the mobile, as Apple and Amazon consolidate power into their own realms. Similarly, Facebook's business model will be fire on all sides. Is it a coincidence that the two companies that have the majority of their revenue from ads appear to be in the toughest positions ahead?

The much more interesting development will not be found with the rivalry between Amazon, Apple and Microsoft, but with the competition between the two levels. As Amazon, Apple and Microsoft continue to strengthen their ecosystems, a by-product will be every company that wants to control several of the key features that drive these ecosystems. This will leave Google and Facebook constantly on the outside, look in.

Apple's licensing relationship with Google is likely to be put in a brighter spotlight ahead. According to my estimate, Apple receives approximately $ 9B per year with Google license revenue to be the default search provider for iPhones, iPads, and Siri. This is a few billion dollars less than how much revenue Apple receives from the App Store every year.

Apple is increasingly called hypocrites in some circles to talk a lot about having a privacy-based culture while taking thousands of dollars from Google to literally face Apple's eyes. In my opinion, the problem is not so cut and dry. There is a critical angle on this topic that is often not discussed. Apple users have the option to choose their own search standard. Apple's license agreement with Google is also probably related to the number of users actually using Google for search.

It's okay to start wondering about the long-term viability of Apple's licensing relationship with Google. It's in Apple's interest to continue moving users of Google services instead of canceling or terminating the event. How much money Google pays Apple to be the default search provider will probably still increase. Google has little or nothing but to continue paying more to access what would be a declining part of Apple-installed base.

Instead of looking for a company to implode as a result of the technology's competitive tectonic plates begin to shift, there is similarly an earthquake or volcano with companies such as Facebook and Google that turn to privacy. While turning, such as earthquakes and volcanoes, is natural and essential, it has been found worth considering how such rotations will change the overall landscape. We can never return to an environment where the five giants could thrive peacefully next to each other.

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