Apple and Google?

The news that Google's CEO Eric Schmidt (also a former Novell and Sun Microsystems Executive) is to join Apple's board has created a bit of a stir this week. On the one hand it is tempting to dismiss it as a bit of a Silicon Valley lovefest, or a bit of mischief-making on both sides aimed at Redmond.

But is there more to it than that?

Back in January this year, I posted about 3 challenges for Apple, the first of which I wrote about was Partnerships. I criticised Apple (yes, really!) for it's poor record on partnerships - citing examples with both HP and Motorola as attempts which had underdelivered and not stood the test of time. I specifically suggested 3 partners Apple could consider getting into bed with - Nokia on the mobile side, Amazon for logistics to merge the physical and virtual (eg listen to a track of iTunes and buy the physical CD), and Yahoo on the services side. When discussing Yahoo, I also said "maybe Google". At the time, I felt Yahoo was in more need of friends, and that Google, being on a roll, perhaps didn't feel it needed anybody.

There were many elements to a tie-in with Yahoo (or Google) that I liked then. One suggestion was a .mac lite service - an ad-supported service that had some of the features of .mac but could be free. I also suggested Flickr integration with iPhoto, and tie-ins on music search and sampling. Essentially Yahoo becoming the provider of free, ad-supported services for both Mac and iPod users.

But an Apple-Yahoo partnership wouldn't threaten Microsoft, and it wouldn't have worried Google, though it might have pushed Google away from proactively supporting the Mac platform. Instead of course, Microsoft themselves have partnered with Yahoo, and upped the ante there.

An Apple-Google alliance - even a loose one - has the potential to radically alter the landscape if we look into the post-PC future. In this world of services and data anytime, anywhere, there's lots of opportunity for both companies. Whether it's access to your (reliably-stored) photo library or music collection anywhere you want on any device you want, or getting a map/guide to whatever part of town you're in (or museum/gallery, etc). Apple wants to be the key player in providing the physical devices, and perhaps some premium services, and Google will store it for you, let you access it wherever you are (and on any gadget) and put it in context for you (ie ontop of a map of where you currently are).

Pressure from Google on the services side weakens Microsoft, and continued Apple success with the Mac and the iPod squeezes from the other side. I've argued before that Apple and Microsoft don't really compete at this time - that Apple has embraced Microsoft essentially with Office for Mac, with Bootcamp and with the use of Intel so that users don't have to choose Apple vs Microsoft, they choose Apple vs Dell for instance. And, from Apple's perspective, I think that's where the battleground still is, though Steve Jobs almost certainly harbours greater ambitions than that. But, with the Zune strategy unfolding, it is clear that Microsoft isn't ignoring Apple's rise, and is jealous enough of their success to justify upsetting current partners in going it alone. With Microsoft's recent announcement that they are discontinuing Virtual PC (what a surprise, there), and not carrying support for Visual Basic into the native version of Office for Mac, there's more than a hint of upset, even if there are justifiable technical reasons for it.

Apple's strategy with Microsoft has been defensive of course - make sure a Microsoft product is not a barrier to using a Mac or an iPod. That's done with the OS, with iTunes and much of Office for Mac is secure for a few more years. But Apple is vulnerable to Microsoft discontinuing Office for Mac ultimately. While it needs alternative applications (Keynote is a great Powerpoint replacement, Pages, a not-so-substitutable Word replacement; and Excel is er, unique), for the masses, Apple is probably better helped by the application as a service (though a decent Open Office native product would also help). Nobody has this in their sights better than Google, and it is the threat to the MS Office monopoly from Google that I think most worries Microsoft.

The opening up of the MS Office file formats will only help this, and it is no surprise MS avoided this for so long (why didn't the EU force that on them all that time ago?). It is in both Google's and Apple's interests that the MS Office monopoly is ended, and working together, they could help hasten that.

So, Apple will be helped if Google is successful with its application strategy, and perhaps we can look for closer tie-ins between the Apple iApps and Google's products.

But I think there are some more speculative opportunities building upon Google's strong services and Apple's iPod mobile device. For some time there was speculation about Google entering into the music market, and of course, there is also the Google video offering. But I wonder if this is an area Google will not focus on, but instead beef up its value in helping people find music and videos etc. in a tie-in with Apple? But even this pales into insignificance next to where some real excitement could be.

For sometime now (having jumped on the GPS bandwagon and also observed the iPod + Nike products) I've been deliberating about how Apple could bring location services onto the iPod - as the iPod matures into a complete mobile platform. While the mobile phone industry has seemed likely to provide solutions here, they seem expensive and unintegrated and with users forced into extra addons, software that may or may not work, and expensive 3G data connections.

Let me put it another way. Anyone visiting here ever use an Apple Newton? Irrespective of your views, one of the best applications out there was TimeOut's London guide with maps, basic navigation, restaurants, attractions etc. It was actually very nicely done for the most part but with two fundamental problems. First, the data was static - it was out-of-date the moment you bought the card on which it came (I used it recently and had to laugh at the phone numbers using a format 3 BritishTelecom changes ago!). The second problem is that it didn't know where you were. Now fast forward to an iPod with a GPS add-on connecting to the iPod via bluetooth or wi-fi (similar to the Nike solution). Add in Google maps for showing you were you are, and the Google mapping services for finding locations and you've got a live TimeOut for London - and indeed any other place in the world. Lots of opportunity for other companies to supply content for such a service (eg Lonely Planet/Rough Guide; TimeOut for event listings) perhaps via a podcast like feature (note such guides already exist for the video iPod). Companies could also provide downloadable files for a user to show their own points of interest on the maps (eg all Starbucks in Manchester). Loads of advertising revenue for Google! If anyone can make this stuff simple to use, it would be Apple, built around data provided by Google.

Apple and Google could sow this market up before Nokia/Motorola/Microsoft and the phone companies themselves have even woken up to why they've failed so far. Sure there are weaknesses with this solution (which an iPod phone could go some way to fix). But if I was visiting another Town or City or just living in a big one, this is a solution that would make me carry my iPod with me everytime, everywhere - probably attached to the handlebars of my bike! I'd have the equivalent of Time Out, an A-Z book, Rough Guide all in one place (with my music too). Wouldn't this be cool?

I've been thinking there will be more on mapping and location features in Mac OS X 10.5 (aka Leopard) - perhaps one of the top secret features? I was thinking along the lines of interfacing this with iPods. The weakness though with this argument is it would mean iPod users on Windows would be second-class citizens - something Apple has been careful to avoid. Working with Google on this is a classic win-win for both companies. While Google doesn't want to marginalise itself by being seen as an Apple-flavoured solution, it would surely jump at the opportunity to be a significant part of the iPod universe, and much of it could be done without formal relationships as such a tie-in is already consistent with both companies directions.

Obviously this is all wild speculation. What do you think? Is there more to the Google/Apple story? Would you like this sort of information on your iPod?

Tags: Apple, Google, Eric Schmidt, iPod, Leopard