2011 – the year when Google and Apple find themselves with real competition?

By January 4, 2011 No Comments

More competition for the major web platforms would be a significant boon for startups.  Google’s huge margins make it more expensive and hence difficult for startups to acquire customers and grow and Apple’s restrictive policies for iPhone apps have a similar effect on companies in the mobile arena.  For this reason I’m a keen supporter of Android and of Microsoft’s efforts to make Bing a viable competitor in search.

Given this position you can imagine I was pleased to read the following articles on Techcrunch this morning:

The first headline is self-explanatory – when counting searches on and Bing powered they had a near 30% market share in November, and they are growing fast.  In my book that makes them a true competitor to Google in the US.  Clearly they occupy second place, but at that level of difference in market share they must be getting towards a place where economics and margins shouldn’t be too out of kilter with Google’s.  Microsoft will need to replicate that market share globally though, and my sense is they are further behind outside the US.

The second article I linked to above reports on how the 1m downloads of the Flixster app over the last week were shared between the different mobile platforms (Flixster is a service for movie enthusiasts).  Apple was way out in front with 50% on the iPhone and a further 10% on the iPad, and Android was a clear second with 30%, RIM managed 8% and Windows Phone was sub 1%.  If you follow the mobile space you will be aware of the massive growth that Android enjoyed in 2010 and overtook the iPhone in terms of new connections.  However, Android is available on a lot of lower end handsets, and many carriers have customised Android installs on devices they subsidise to push their own properties both of which combine to make headline OS market share data a bit misleading.  From a third party developer perspective the important question is how the platforms compare in terms of application and web use, and this Flixster data shows us that by this metric Apple still has a considerable lead, but Android is already a very credible second. And, once again, it is growing fast.

More competition will inevitably lead to more innovation and falling prices, which will be good for all of us.

Finally – as an aside it is interesting to note that you need deep pockets to challenge an incumbent platform with a near monopoly position, and that the companies with the resources and appetite to have a go are the monopolists from the previous wave of tech.  Microsoft is using the cash from its OS and office apps monopoly to challenge Google in search and in turn Google is using the cash from its search monopoly to challenge Apple in mobile (and also Microsoft in office apps).

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