When Google announced Android and Chrome, it was easy to think that they were going after Apple's core business, and when news of Google's own phone leaked last weekend, that seemed to only reinforce the idea, but I see the two companies with very different goals. Yes, they are both going mobile in a big way, but the bigger the mobile world from Google's perspective, the better, regardless of the phone or OS.

Apple's All About Hardware, Baby

For Apple, the mobile market is about selling iPhones and cultivating the iPhone ecosystem in the extremely successful and oft imitated App Store. News came out the other day that the Android's app store had reached 20,000 applications, which prompted PC Mag's Lance Ulanoff to Tweet:

RT @mike_elgan: Android apps hit 20,000. http://bit.ly/5nYzIR Me: and the AppStore said, "Talk to me when you hit 100,000"

What's more in its latest earning report, Apple reported it sold 7.4 million iPhones. The San Jose Mercury News reported in October that this resulted in some serious cash for Apple:

Perhaps more tellingly, the number of iPhones Apple sold in the most recent quarter were up 41 percent from its third quarter. And the revenue it raised from such sales hit $2.3 billion, which was up 185 percent from the year-ago period and 36 percent from the third quarter.

These numbers paint a clear picture that the iPhone is a big part of the company's revenue strategy.

Google's All About Ads

If you look at Google's most recent earnings, it gets nothing from sales of Android phones because they are giving the OS away. Even if they sell their own phone, it will be a fraction of their overall revenue stream (even if it's wildly successful). Google is all about selling ads. Everything they do, every free service they provide, is focused toward generating more income for that ad selling machine. And by all accounts, it's working pretty well for them.

Like Apple, they had a very nice quarter. According to a report on CNET:

Excluding traffic acquisition costs of $1.56 billion paid to Google partners, the company reported revenue of $4.38 billion, exceeding analyst estimates of $4.24 billion and backing up CEO Eric Schmidt's recent statements that Google was seeing more spending from advertisers.

These Companies Have Different Plans

What you have is two companies both working the mobile angle hard because it's clear there is a lot of money to be made there, but Apple wants to sell handsets, and while Google may dabble in this area, they are never going to be a hardware company. At its core, Google is a search engine that sells ads, period. Everything else is window dressing to get you to the ads. In fact, Google is best served by successful handset retailers like Apple, who sell popular phones and provide easy access to the internet and Google services. The more phones that run Google services, the happier the company should be whether that's Apple, RIM, Windows Mobile or anyone else out there.

It makes good fodder for blog posts to suggest that there is a mobile war in play with the advent of the Google phone, but if you take a closer look, it's clear that Google benefits from a wide open mobile landscape where it can operate across every smart phone everywhere. Any other approach would be counter-productive. As for Apple, I'm sure they aren't thrilled about Android, but they can let their product stand up to anyone's. It's still the standard bearer of smart phones.

There are only about 150 million smart phones in the world compared to a billion feature phones. This means that neither Apple nor Google need to be in competition as they satisfy different segments of that larger market. This is totally a contrived situation about a conflict which doesn't exist.

I think they are not at all in competition with each other

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Hi allysa, thanks for the reply but next time keep in mind that do not revive a dead thread that is 2 years old