If you haven’t seen the movie (500) Days of Summer, you should, it’s a great movie. But I’m not giving anything away (that the trailer doesn’t) by saying it’s the story of a relationship that ends for seemingly no good reason. And following the release of the documents sent to the FCC, it would seem that we’re in the midst of watching the same thing happen between two tech titans that previously had a close relationship, Apple and Google.
The statements by the two to the FCC are full of information — except for the information that Gdacted, I mean, Google, declined to release to the public. We’ve already written about some of what Google likely has in its missing portions, but the most interesting aspect of it may be why they chose not to release those portions. The answer may well be because those portions go against some of what Apple is saying, and that would put both companies in a tough position. And it would put further strain on their relationship.
This is a story of software company meets hardware company
A few years ago, much of the tech world looked at Apple and Google as the two companies that could possibly take on the Microsoft juggernaut. Apple would take on Microsoft’s heart, Windows, with its OS X. And Google would kick out its legs by taking on Office with Google Docs. The two were perhaps best suited for such a fight because each had other revenue streams to sustain a war against Microsoft (Apple with Mac hardware sales and the iPod, Google with search and more importantly, search advertising).
And the two grew closer together. In 2006, Google CEO Eric Schmidt joined Apple’s board. “Like Apple, Google is very focused on innovation and we think Eric’s insights and experience will be very valuable in helping to guide Apple in the years ahead,” Steve Jobs said at the time. “Apple is one of the companies in the world that I most admire,” wrote Schmidt in a statement. Alongside Schmidt on Apple’s board was Genentech CEO Arthur Levinson, who was also on Google’s board, and former Vice President Al Gore, who also was acting as a senior advisor to Google.
Apple started launching products that were closely tied to Google. iMovie could export directly to YouTube. iWeb offered easy embeds of Google Maps and AdSense ads. Apple TV got a special YouTube channel. And of course, the iPhone featured Google search as the default, made it easy to access you Gmail emails in mail, came with a YouTube application, and had a Maps application that used Google Maps and in fact, was built with the help of Google. It’s also interesting to note that the all of the YouTube integration required (and still requires) Google to encode videos in the h.264 format because the iPhone doesn’t support Adobe Flash (which is how YouTube videos play on the web).
Then there were the less obvious connections. Multiple reports now point to Apple asking Google not to include multi-touch support in the first Android-based phones, and Google complying, much to the dismay of many customers. And then there’s the unwritten agreement that the two sides apparently had stating that neither would hire one another’s workers.
Yes, when you used to think of the relationship between Apple and Google, the term “buddy-buddy” came to mind.
So what happened?
In (500) Days of Summer, when the main character, Tom, asks his girlfriend, Summer, what went wrong with her previous relationships, she responds, “What always happens. Life.” The same may well be true for Apple and Google, though seeing as they are giant companies, it may be more appropriate to replace “life” with “growth.”
While Apple and Google both benefitted from their close ties, both still existed as separate companies with their own agendas. While Apple was primarily a hardware maker, and Google an online software company, the two had few conflicts. But mobile changed all of that.
The iPhone launched in 2007, and the first Android phone the following year. Still, the two companies got along just fine. Sure, Schmidt found himself having to exit Apple board meetings when the iPhone was brought up, but both sides clearly saw it as a small price to pay for Schmidt still being on the board. But then the iPhone exploded in popularity, to the point where it’s now Apple’s second biggest business (behind Macs, ahead of iPods), and it’s certainly not crazy to think that one day it could be the biggest.
While Android phones haven’t exactly taken off compared to the iPhone, the platform is making progress and Google is poised to release another dozen or so Android phones before the end of this year. With all due respect to the BlackBerry (whose apps are generally considered to be sub-par), Android and iPhone are seen as the two mobile platforms right now. Some people are iPhone people, some are Android people. They are competitors. And so by extension, Apple and Google are competitors.
Yes, they have different models for how they want to do things in mobile. But it’s not entirely dissimilar to the Apple and Microsoft battle in the 1980s. Microsoft built an OS that they wanted to get on as many machines as possible, Apple built a hardware and software combination to provide the best controlled experience. These days, in mobile, Google is taking the quantity approach, with Apple sticking to its quality approach.
Meanwhile, outside of the mobile sphere, Google continued its growth despite an economic slowdown and decided the time was right to start branching out. And while it’s not ready yet, the announcement of Chrome OS is another element of its business that will directly collide with one of Apple’s. The impact might not be so big on Apple, but when so many parts of your businesses start to collide, one can imagine that it’s hard to stay so buddy-buddy.
And the Chrome OS bombshell had much larger fallout. It intensified and perhaps even reinvigorated the FTC’s investigation into the relationship of Apple and Google, and specifically their interlocking directorates. And then Apple rejected (or “didn’t approve” depending on who you believe) the Google Voice app, prompting an FCC investigation into the relationship between the two companies as well. A few days later, Schmidt stepped down from Apple’s board.
The missing app that gets no love
But let’s not forget that before the whole Google Voice thing, Apple “requested” that another application Google made for the iPhone instead be made into a web app, Latitude. While it’s not entirely clear if Google submitted that app and Apple rejected/didn’t approve it, it really doesn’t matter. It is another example of Apple shooting down a Google app, turning one incident into a pattern. And that pattern points to something. (As does the fact that Google mentioned Apple’s “request” very publicly in a blog post.)
As we have heard from multiple Google sources, it would seem that Apple is getting paranoid about Google taking over the iPhone. Maps, YouTube and Search were apparently fine, but with new apps like Latitude and Voice, it was certainly starting to look possible that eventually Google apps would take up the entire first screen of apps on the device.
And while most companies may not mind that, and would let the customers decide, Apple is not most companies. Their stated reason for both the Latitude and Voice removals say more or less than those apps would cause confusion with consumers because they are similar to core iPhone functions (Latitude is like Maps and Voice is like the phone). And no matter how buddy-buddy Apple and Google were, no company likes the idea of another company controlling so much of its product.
Naturally, if someone else controls your product, your product may be in trouble if they pull support. Or, and I’m just speculating here, maybe Apple felt that Google was using the iPhone as a gateway drug of sorts to give users a taste of what their apps can do, get them hooked, and then getting them wanting more with more functional versions of the apps on the Android platform.
Just look at some of the examples, Gmail works on the iPhone, but it doesn’t have push support for some unknown reason. On Android, it has push support and better label support and star support, etc. Maps work on the iPhone but doesn’t feature Latitude, on Android, it does. Further, Latitude would have worked on the iPhone (and does through the web browser), but it’s a lame version. Android, which allows apps to run in the background, has the better version. Same with Google Voice, even if it was on the iPhone, it would not run in the background.
The bottom line
The real bottom line for all of this is money. On the surface, it doesn’t seem to make a lot of sense why Apple would want to reject the Google Voice app. It actually would have made more sense if Apple worked with Google to integrate Google Voice into the iPhone, giving them more leverage over the carriers that Apple still very much relies on for its device.
While Google Voice still requires the carriers for its functionality, eventually, it’s not hard to see it having a VoIP component that bypasses the carriers. As we learned from all of the open spectrum stuff, Google clearly envisions a future where there isn’t just a handful of carriers that control all wireless access in the U.S. Instead, it wants a more open system with many different providers. And there won’t be confusing and ridiculously priced voice and data plans in their system, there will just be fairly-priced data plans.
Of course, all of that sounds great to us, but Google has an agenda too. They want all of this because they believe that easier access to the web means more people using Google, which helps their bottom line.
So why wouldn’t Apple want to help Google in shaking up the system? Because doing so would hurt its own bottom line. Where do you think Apple is making all of its money off of the iPhone? It’s making it on the subsidy that AT&T pays them every time someone buys an iPhone.
The first version of the iPhone didn’t have a subsidy, and at $600, not surprisingly, not as many people bought it. So Apple switched things up and agreed to waive the money it gets per month from AT&T contracts, in exchange for AT&T subsidizing each phone and paying Apple the difference. If AT&T (or any other carrier that eventually gets the iPhone) doesn’t exist with the outrageous rates they charge, they don’t pay Apple the huge subsidy. And if they can’t charge the ridiculous rates (which they wouldn’t be able to do and survive in Google’s dream scenario), they can’t subsidize the phone down to $200, and pay Apple the difference. If the phone isn’t $200, not as many sell. And so on…
And so now we see a few different ways in which the Apple/Google situation has become complicated. And any combination of these can certainly sour a relationship — even one that looked so promising for so long. It would seem that the story has turned to one about growth, control, and above all, money. Those aren’t exactly the things that love stories are made of.
[images: Fox Searchlight]
I hope Apple dies and takes those horrible industrial-looking mac pros with it. I thought they were supposed to make things look nice? My mac pro looks like a big metal toolbox or something.
You have a mac pro and you’re complaining? I hope there’s sarcasm there. Seriously. I’ll trade you my iMac.
YUMMY!
apple = closed, google = open….all should have known that this is an un-holy alliance..anyway lets c how it all pans out
i am bored with this closed v open debate. People miss the point when they focus on this distinction. Look, Linux is open but has pathetic market share on the desktop. The most important aspect is the customer. Is the customer going to have a better experience with the iphone or android. That’s what will determine the success of either platform. Not whether it’s closed or open.
Perfectly said.
Open versus closed won’t affect the customer, true, but it does show off different goals and methods, and thus a relationship between somebody open and closed is a pretty impossible relationship. What Akintayo A. Olusegun said had nothing to do with success so in other words, you didn’t even read his comment carefully, but directly started another old fashioned open versus closed debate which was totally offtopic.
couldn’t agree more.
Great write-up. Cannot wait to hear what the FCC comes back with…
Great article, I enjoyed reading it.
Funny how all these apple lovers suddenly change their tune when TC does….
when did MG start writing tl;dr-borderline articles? and why doesn’t he just blame AT&T?
Excellent post. What I like about the Google and Apple story is that they are pretty much are without peers.
Who else could you imagine playing the disruptor role across media, mobile, the PC and the Internet?
Put another way, given their respective mammoth ambitions, how could they not end up as frienemies?
Mark
–
The Chess Masters: Apple versus Google
http://bit.ly/IHPmW
I like your article, also the pics you select.
Maybe the movie itself is more comfortable than the G-A thing.
Personally, I ain’t interested in *either* corporate monolith. Palm are the ones who get my motor running. They’re uniquely positioned in a way that other mobile companies aren’t. Think about it; other mobile manufacturers want to tie you into their own ecosystems. Android wants you to use Google. iPhone wants you to use iTunes & Macs. WinMob wants you to use MS services.
Palm, on the other hand, are not competing with any of them in this respect. They’ll happily let you cherry-pick which software services work best for *you* with no pressure to go a particular way. Put your contacts on Google, your media on iTunes and use AIM for IM. etc etc Palm doesn’t care; their focus is giving you a slick mobile interface with which to use these services.
That’s funny, last I checked there were atleast a half dozen non-Google-Experience Android phones in the pipelines. Not to mention Android is nearly completely open source. Maybe you don’t quite understand what the implication of that is, but basically suffice to say you’re not tied to anything. Anyone who wants to create a phone based on Android can easily rip out all the Google services code. In fact, being as modular as it is, there isn’t much ripping involved.
It’s Palm actually that i’m worried about. Being that they seem to have returned to their single licensee model, they are very invested in their own success, software and hardware wise. Sure they may not actually have their own internet services to tie into, but you can be sure that whatever companies they sign agreements with will be peddled quite eagerly. I say this coming from being quite a Palm advocate back in the mid 90s to early 2000s.
Ripping the Google services out of Android would take away a lot of what makes it special, though. Those other half-dozen phones will be just like the previous rush of me-too Windows Mobile devices: functionally identical with minor UI tweaks that are more about making them look different than actually being useful.
Still, time will tell yada yada
Hats off to Google and Apple…….. They are both doing excellent in the Web and It field
I was just amazed to read the relationship between Apple and Google. The growth of one means the end of the other. Eager to know what Apple going to do with Google Voice
zooey deschanel :$
Being a Techcrunch article and all, I didn’t expect much in the way of intelligence. But really, this article pushes the envelope on Apple apologism.
To be clear, the reason Apple should be castigated is not that they blocked Google Voice, or any other particular app. The reason is there exists the ridiculous notion that you need Apple’s approval to install any arbitrary app.
If Microsoft forbade you from installing any unapproved app on your Windows PC (or if Apple were to pull the same kind of idiocy on their desktop products), would Apple apologist/fanboys still be so eager to defend their sacred host in Cupertino? Now that I’ve posited the question, I shudder at the very possibility that such a world may exist.
The reason Apple can get away with this kind of ridiculous nonsense is because its user base isn’t speaking loudly enough with its wallets. Now frankly, mom and dad users are partially forgiven here, but I really expected more from the “tech blogging” community. Oh wait… no not really.
Apple has never pretended that the iPhone is open to all comers, like Microsoft has pretended with Windows. The iPhone has always been billed as a very tightly controlled system, take it or leave it. Just like Sony PSP or X-Box or Verizon.
But that “closed system” helps ensure that developers apps aren’t bootlegged and that apps play nicely with each other and that the overall user experience is enjoyable. That’s why the iPHone sold like hotcakes even before there was an App store.
If you want a phone that’s open to all comers, then you should try Android or WinMo or Symbian, although I bet you will quickly find that they aren’t quite as open as they like to portray themselves.
Hear, hear! Speak with yer wallets! [And for GoOgle, if yer interested, speak with yer clicks.] Says it all. Period. Case closed.
Great analogy to the movie..
I Enjoyed reading it.
You’re right, it was a great movie. Hope people go see it!
If Apple and Google benefitted from their close ties, surely there split is going to have some effect on their new technologies? Maybe they’ll find that they should have remained friends afterall.
Corporate counsels comments are interesting. It would appear they word-smithed them without reviewing all of the previous statements made by Google, Apple and ATT.
Now, the “who is lying” game begins.
This will likely add fuel to the fire over at the FCC.
Great article, really enjoyed reading it.
Great article. I very much enjoyed reading. It will be interesting to see what follows from this.
beautifully written, but google is evil making sub par apps for the iphone and better functioning ones for the android …
thanks. on the apps thought, remember too that obviously Google has deeper access to Android (and whatever it wants to do with it) than it does to the iPhone.
Apple has never pretended that the iPhone is open to all comers, like Microsoft has pretended with Windows. The iPhone has always been billed as a very tightly controlled system, take it or leave it. Just like Sony PSP or X-Box or Verizon.
But that “closed system” helps ensure that developers apps aren’t bootlegged and that apps play nicely with each other and that the overall user experience is enjoyable. That’s why the iPHone sold like hotcakes even before there was an App store.
If you want a phone that’s open to all comers, then you should try Android or WinMo or Symbian, although I bet you will quickly find that they aren’t quite as open as they like to portray themselves.
BTW I love your blog!
The article is waaaaay better than this chic/gayguy -Flic!
excelent article!!!
I predict apple will be a strong opponent of goole.
Google do well in software, and apple do well in hardware.
Fast forward 10 years and people will be complaining how the only smartphones available are the free ones with some data charges, annoy them at every step with ads from Google – when they want to make the call, when they want to browse, etc. , and wish they could just get something they could pay for and not have to deal with any ads, have a company that can provide full service behind the phone, took some care to cultivate and innovate new things all things not possible with the thin margins from ads, etc. But then any company that could do that were driven out of business long ago without being able to compete with free and so they will sigh and put up with it.
No, I am not an Apple fanboy but sometimes one does get too much of what they wish for.
well.. you really are a very good writer.. can you please write for me for free ?
> apple = closed, google = open
That is ridiculous. The world is not that simple, and especially not the technology world.
The browser in Chrome OS and Android is WebKit, which is an open source project started by Apple. WebKit also provides the browser core for Blackberry, Nokia, Palm, and others. WebKit is what brought the full Web to smartphones. Totally open because of Apple. The lead developer of WebKit is Dave Hyatt, who works for Apple. He’s improving the Web rendering on Palm Pre right now, as well as on all other smartphones and many PC’s, and Google’s 2 operating system projects.
You can read the source for an iPhone’s kernel, which is the called “xnu” and is the same open source kernel from the Mac. The whole core OS is open you can read the whole thing. If you split the iPhone OS into a 4 layer cake and the same for Mac OS, the bottom 3 layers in both cakes are the same and they’re open. They’re also certified Unix-compatible as well as complying with many other open standards. All Apple products are extremely interoperable with standard devices and protocols.
The video in iTunes (and YouTube) is ISO MPEG-4, which is standardized QuickTime (also in Blu-Ray and many other places). It enables people other than Apple to make QuickTime players. For example, in 2008, Adobe Flash moved to MPEG-4, and there are hundreds or thousands of players from various manufacturers, including things like GPS makers, camcorders. It would have been easier for Apple to lock you in to iTunes with QuickTime but they waited and worked towards standardization. They lost a year of iTunes video for this but it was the right thing to do. MPEG-4 is much bigger now than QuickTime could have become, and Apple is still the leader in audio video production and consumption.
Then there is Bonjour, aka zero configuration Internet Protocol networking. This was a kind of holy grail for a long time and Apple not only created it, they gave it away broadly and even made a Windows service for it. Bonjour enables you to plug together a bunch of PC’s, routers, printers, and other devices, or attach them all via Wi-Fi, and they all find each other and tell either other what services they can provide.
Apple participates in many open source projects. Because Apple makes their money by selling hardware direct to users, they have money to invest in creating software that sells more hardware, and they have money to pay open source developers. Many participants in the technology industry do not support software development in any way at all. Many just totally ignore it and it is a 3rd party item.
And, when you consider that consumer computing is basically a Mac or a Windows PC right now, and you consider that Microsoft is the most closed company in the world and in computing history, it is pretty stupid to say Apple is closed. So I should have bought Microsoft to run my Adobe apps instead? That would be more open? No. Duh.
Finally, the first thing I did with the last Mac I bought was install my favorite text editor, configure the built-in Apache2 for virtual hosts and clean links, enable the built-in PHP, a little hosts file configuration, and then I dropped dozens of W3C standard web apps into the Web server root (/Library/WebServer/Documents/) and they all worked. Web development is even more open than the Linux kernel. And the whole thing is not only there in OS X, the Web was invented on early OS X. The first Web browser and server ran on NeXT in 1990 and took great advantage of the Unix core even then.
So you ought to rub a couple of brain cells together before you say something as stupid as Apple isn’t open.