5 Lessons From the Apple vs. Google Battle
BY Steve Tobak
Take a look at what happened between Apple and Google recently. There are lessons you can learn about dealing with rivals in your industry.
Tech giants like Google and Microsoft have a strange sort of relationship with Apple. It’s known as coopetition, meaning cooperate competition. Although they have competing platforms, they develop applications for Apple devices.
There are two reasons for that. Apple customers want them and Apple represents a large customer platform. In the case of Microsoft’s Office suite, that means product revenue. In the case of Google Search, for example, that means add revenue.
Sometimes that gets sort of complicated.
When Apple launched the iPhone in 2007, Steve Jobs and company had no idea that Google’s Android operating system would become a direct competitor. So the inclusion of Google Maps in the original iPhone -- sort of an afterthought to show off the capabilities of the multi-touch screen -- made plenty of sense.
Well, you know how that turned out. Android became the world’s biggest smartphone platform; turn-by-turn navigation turned out to be a huge deal; Google included it in Droid phones but not iPhones; and Apple killed the Google Maps deal in favor of its own app, before it was ready for primetime, and suffered a PR disaster.
Then Google comes out with its brand new Maps for iPhone 5 -- complete with turn-by-turn navigation, there are 10 million downloads in the first two days, the Wall Street Journal’s Walt Mossberg says it’s the best he’s ever seen bar none, and Google comes out looking like it saved Apple’s you-know-what.
Never mind that none of this would have happened if Steve Jobs had known that Google was planning to compete with Apple when the two companies were supposed to be partners. Jobs was so angry when he realized that Google had more or less cloned the iPhone (in his eyes), that, according to Walter Isaacson’s biography, he said, “I will spend every penny of Apple's $40 billion in the bank, to right this wrong. I'm going to destroy Android, because it's a stolen product. I'm willing to go thermonuclear war on this."
While this does sound like a complicated and sordid story, it’s surprisingly common in the business world where we tell up-and-comers to “keep your friends close and your enemies closer” and we now have terms like coopetition and frienemies. In any case, I’ve got a few words for the wise along those lines.
Don’t let your emotions get in the way of smart business decisions. There were better ways for Apple to handle this whole thing. Google reportedly offered to include voice-guided navigation under certain terms that Apple refused to agree to. Well, Apple could and should have bit the bullet for one more year so it had enough time to make its own app bulletproof. Instead, it rushed a product prematurely out the door, and paid an even bigger price.
Know your present and future competitors. Yes, I know this sounds remarkably like I’m expecting executives and business leaders to have a crystal ball on their desk, but the future is not always so unpredictable. Jobs reportedly knew of Droid, he knew how important mobile was or he never would have launched the iPhone to begin with, so it shouldn’t have been a stretch for such a visionary to see that Google would seek to compete in that market. I’m guessing that Jobs didn’t want to see it because of his personal relationship with Google’s founders, Larry Page and Sergey Brin.
What people say and what they do are two different things. I’m always counseling people to learn to read between the lines, especially when they’re dealing with high stakes business. When Google chairman Eric Schmidt sat on Apple’s board he reportedly insisted that his company was not a direct competitor of Apple’s. In hindsight, we can all see how that was true in some sense, but not really. Many years ago I had a friend who was fond of saying, “I don’t trust anything I hear and only half of what I see.” Yes, it’s a bit cynical, but I’ve never forgotten it and it’s served me well.
Patent litigation is a lousy way to fight a competitive battle. Now Apple’s embroiled in all sorts of patent lawsuits with Google, Motorola, Samsung, and others. Well, I’ve been involved in some pretty intense intellectual property disputes before and one thing I’ve learned is this. When it comes to protecting your IP, there’s a very good reason why litigation is and should be your last resort. It’s expensive, it’s distracting, it’s time consuming, and the outcome is never certain. At the end of the day, it’s a lousy way to keep others from stealing your inventions.
Sometimes it pays to lose a few battles so you can win the war. There’s one positive thing I can say on Apple’s behalf and that’s this. You never know how things will turn out and, more than any company I know, Apple has a funny way of getting the last laugh. I mean, for how many years were we all absolutely certain that Apple had lost the war with Microsoft? Now Apple’s market value is twice that of its archrival’s. I’m just saying.