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June 07, 2007

Google Anticipates Own Success With Apple's Launch of iPhone

By Susan J. Campbell, TMCnet Contributing Editor

Both considered giants in their own right and their own industries, what would Apple and Google stand to gain from partnering together? Considering the overlapping opportunities of their two industries, quite a bit and the first nugget is set to be the Apple iPhone (News - Alert).

 
The two giants are using this anticipated launch as a way to gain greater dominance in the growing mobile market for communications, entertainment and Internet browsing. The new Apple phone is already set to feature Google’s search and mapping applications. And, videos from Google’s YouTube (News - Alert) can be wirelessly streamed to Apple TV set-top boxes for television viewing.
 
According to a report from Daniel Del'Re, staff reporter for The Street.com,  this initial collaboration is only the beginning of a strategic partnership with sights set on video distribution and advertising on mobile devices.
 
While it is anticipated that Apple’s success in the portable music market will lead to success in portable video, speculation also points to advantages of the Apple/Google partnership where iTunes and YouTube are concerned. If Google were to make its YouTube library of video clips available via iTunes online music store, Google could eventually realize the same success that Apple has enjoyed through digital music.
 
Experts agree that Apple will rely heavily on the success of iPhone over the next few years as iPod sales are expected to wane as the sales mix shifts from first-time purchasers toward replacements.
 
Speculation has also arisen regarding the possibility of Apple working with third party companies to develop must-have applications. Major handset makers such as Motorola and Nokia have sought similar strategies in order to increase the value of owning their phones. Apple head, Steve Jobs put an end to such assumptions, although Google is already one step ahead with its Apple TV project and the iPhone’s inclusion of Google Maps and search.
 
It may help that Google CEO Eric Schmidt is a member of Apple’s board and he is actively pushing Google into the mobile market. The company has already released mobile versions of its email and mapping applications for Java-, Microsoft (News - Alert)-, and Palm-based phones.
 
Google has not kept its options limited by only focusing efforts on Apple. The company is also working with Motorola and Helio, a joint venture between SK Telecom and Earthlink (News - Alert), in an effort to link GPS data to search results to provide consumers with information regarding the closet stores, movie theaters, and other locations while mobile.
 
Obviously, the driver for Google’s expansion into these other areas is to put its search engine into more users’ hands no matter where they are. The anticipated boost in volume of Google searches could also greatly impact its related advertising revenue. The same is expected by providing YouTube via mobile devices. The company is already running ads alongside some videos on YouTube and the videos will soon be available on Verizon Wireless phones thanks to a partnership between Google and Verizon Wireless.
 
While the iPhone presents a key mobile venue for Google, the company is not focused on the new Apple venture to appeal to its own mobile vision. In fact, rumors are buzzing that Google has considered its own branded device. However, the company also recognizes the value of capitalizing on the success of others.
 
Whether or not iPhone will meet the projected 10 to 15 million shipments in 2008 and 25 million in 2009, the latest installment from Apple is still expected to match shipment’s of Research in Motion’s BlackBerry, securing its place among the tip Internet-ready phones offering Google services.
 
No matter the outcome, both Apple and Google are perfectly positioned to realize tremendous market and revenue advantage from the launch of the iPhone. While Apple’s new baby may face some stiff competition from BlackBerry and other Internet-ready products already tearing up the market, the success of iPod will set the tone and the problems that BlackBerry has faced recently has some users looking for other options. Either way, Google is in the right seat to enjoy increased usage from market dominating devices.
 
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Susan J. Campbell is a contributing editor for TMC and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.
 
 







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