It's Not a Contest

A recent article from the Business Insider--which was reprinted in the SF Chronicle--claims a new storm's a-brewin' between the new heavyweights of Silicon Valley: Apple, Google, and Facebook.  Microsoft is dismissed as a has-been dinosaur.  Here's what's wrong with that entire argument.

First, calling Microsoft a has-been is like calling the United States a has-been on the world stage.  To be sure, there are upstarts who are rising very fast, but America is still the 800-lb gorilla, who can conquer multiple countries at the same time with impunity, and simultaneously repair multiple sectors of its own economy and set a monetary policy that makes it more competitive on the world stage.  America is still the world's only superpower.  Are we in decline?  Possibly, but it's going to be a very long time before someone actually eclipses us.

The same is true about Microsoft.  They still have a market cap larger than any other tech company in the world.  That much money means a LOT.  This year they've come out with a new desktop OS and office suite (their two golden cows), along with a new mobile OS, very strong gaming hardware, and cloud computing.  They may be on the decline, but it's going to be a very long time before another tech company is actually larger than Microsoft.

That being said, what about the new kings of Sliicon Valley: Apple, Google, and Facebook?  What about their trumped-up rivalry?  Another Business Insider article breaks down their nine-front "war."  Here's why it's wrong:

1. Mobile platforms: iOS vs. Android vs. mystery Facebook project

First, Apple already lost this battle; Android has already eclipsed iOS market share.  They took advantage of Apple's eternal Achilles' Heel: the fact that only Apple makes Apple products.  I read a long time ago that Apple chose to have a small market share, and it's true.  As an individual company, they have one of the largest market shares of traditional PC's, as well as smart phones, and they totally dominate the mp3 player market, but in terms of overall platform penetration they've always been and will always be a niche.  As long as they refuse to share Mac OS or iOS with third party hardware companies, that will always be the case.

All Google had to do was copy the IBM/Microsoft strategy.  Google's own phone was a disaster (much like IBM's PC business), but their technology has taken the market by storm (much like the IBM-compatible personal computer specification).  That doesn't do much for the hardware specification (just ask IBM), but it does a lot for the software platform (just ask Microsoft).

What about Facebook?  First of all, let's see this super-secret project of theirs before I give it even a chance of survival.  It may never see the light of day.  Second, it's going to face the same criticism as Windows Mobile 7: It may be very nice, but it's a little late to the party.  The Network Effect is a powerful force.

But wait - turns out it isn't a contest at all.  Facebook's super-secret project is based on Android.  It will probably be a layer on top of the OS, kind of like Motorola's Blur.  Nobody claimed Motorola was "at war" with Google.

2. Recruiting

Yeah, sure, recruiting is important.  But it turns out there's a lot of talent to go around, especially in this economy, and especially since old wonder companies like Sun had to shed so many brilliant engineers.  Besides, as Steve Jobs demonstrated, the real question isn't the talent at the company, it's whether the people at the top know how to harness it effectively.  Steve Jobs was never a skilled engineer; remember the Macintosh ///?  Exactly.  His brilliance is as a businessman who can wrangle the many fiefdoms of Apple into a cohesive company.  Ask Apple, Google, and Facebook whether any of them are feeling a "brain drain."  No really, go ahead.  I'll wait.

3. Social Networking: Facebook vs. Buzz vs. Ping

Really?  This is a "battle" the way Coca-Cola is "battling" Pepsi and RC Cola.  (Hint: there never was a contest.  Coke won a long, long time ago.)  No further discussion is warranted, and none will be given.

4. Search

Again: Really?  Does anyone honestly think that Google will be toppled from its search throne any time soon?  Sure, new products like Bing have chipped away little pieces, but that just proves how hard it really is.  This is another non-contest.

5. Payments and identity: iTunes vs. Facebook credits vs. Google Checkout

I don't know, maybe this is a real contest.  Online commerce is still in its infancy; what about Paypal, which is owned by eBay?  But it seems like there's a false trichotomy here, especially when iTunes and Facebook credits are niche players.

6. Advertising: Apple iAds vs. Google ads vs. Facebook ads

Again, there's no real contest here.  Facebook is undoubtedly making money with its ads, and Apple probably will too.  Other companies are trying to get a slice of the ad pie, most notably Microsoft and Yahoo.  But will any of them eclipse Google?  If so, it's going to be a very long time before it happens.

7. Operating Systems: Chrome OS vs. OS X vs. Facebook platform

Wait a sec, didn't we do this one already?  Kinda; this "battle" involves the well-established Facebook web app platform, pitting it against Mac OS X and Google's unborn baby called Chrome OS.  But it's not really a contest; no one can get to Facebook's platform without a desktop OS like Mac OS X, and Google's offering hasn't even left the barn.  Ultimately, this is another false trichotomy because it ignores the 800-lb gorilla in the room: Microsoft.  Nerds have been predicting a return to thin clients for ten years now, and it still hasn't materialized.  I don't know why not.  Both Microsoft and Google are working on it, but neither seem to be trying very hard.  In the mean time, it's going to be a frosty day in June before someone has a larger desktop OS market share than Microsoft.

8. Office Apps: Google Docs vs. iWork vs. ???

Again, a false trichotomy.  The only real player here is Microsoft Office.  Personally I don't use it; I use a combination of OpenOffice and Google Docs.  But anyone who thinks there's a real threat to Microsoft Office is kidding themselves.

9. E-Mail: Gmail vs. MobileMe vs. Facebook mail

Another non-contest.  MobileMe never took off and Facebook Mail doesn't exist yet.  Gmail is the email juggernaut because it's the best.  Does Facebook Mail have a chance?  Quite possibly, but let's see it first.

Is the computer industry a fluid place where market dominance is ephemeral?  Certainly.  But there's a difference between reality, and the hyped-up drama of the news media.  Is there a nine-front "war" being duked out between three brand new juggernauts?  Not really.

J<