History Repeats Itself – Google is the Microsoft of Mobile Computing

by Ian Rosenwach on 11.2.2009

History is repeating itself in the mobile marketplace. Some of the companies have changed, but the business strategies and even a few of the players are still the same.

In looking back to how the PC market developed, Microsoft took an open approach. They licensed their OS to lots of hardware makers and said “you do what you do best and we’ll do what we do best”. Companies like Dell, Gateway, and Compaq built hardware and licensed Windows for the OS. They benefited from the usability and consumer familiarity with Windows.

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Apple, on the other hand, insisted on having full control of both the hardware and software. There was no licensing of the OS. You could only get the Mac OS on Mac hardware. Sound familiar…iPhone?

Fast forward 30 years and now Google is taking the open approach, and then some. Their Android mobile OS is open-source and companies like Samsung, HTC, and Verizon are the new hardware players. You won’t see an Apple mobile OS on any of their devices anytime soon, and likely ever.

Now, an important point is that the economics have changed. The mobile OS market is more competitive than it was when PC’s were gaining mass adoption. Microsoft was able to insist on hefty licensing fees for Windows. Android is open source . In some cases, there are even revenue benefits for the hardware markers, as Bill Gurley wrote on his Above the Crowd blog. Bill calls this the “Less than Free” business model.

Apple hasn’t changed and that is becoming more and more clear. They may also be trying to learn from past lessons. Microsoft has powered some core apps on the original Mac, notable Excel. Google powers two core apps on the iPhone pre-installed OS including YouTube and Maps, plus have many popular apps in the app store. Google Voice could supplant arguably the core feature of the iPhone – voice calls. Apple is afraid of becoming to reliant on Google for core OS apps.

Notice that Google built Google Maps with GPS for Android phones first – not the iPhone. What do think happened then, when Microsoft released MS Office on PC’s before Macs? Consumers flocked to PC’s because that’s where their most useful apps were.

This about it from the consumer perspective. Today there are several mobile operating systems including ones by Blackberry, Google Android, Symbian, Microsoft Windows Mobile (they’re way behind), and probably a few I’m neglecting to name. As a consumer, I don’t want to have to become comfortable with a new OS every time I get a new phone. It’s too much work. In the same way that Windows became the standard OS for PCs, there will be a standard OS for mobile devices. This is the target Google Android has their eyes firmly set on.

We know how things developed in the personal computer OS market. Microsoft created one of the most powerful monopolies in history. Apple owns its slice of the pie, but this is not nearly as big as Microsoft’s.

Is the same thing destined to happen in the mobile computing space, except replacing Microsoft with Google?   Does this mean Microsoft has already lost in the mobile OS market?

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