Microsoft CEO Steve Ballmer believes his company’s plan to release a revamped operating system (OS) for smartphones, Windows Phone 7, will propel them into the race for smartphone OS market share and the advertising treasure the leader will enjoy. Apple and Google have seen their OS and the devices running on them rapidly erode long time cell phone leader Nokia’s dominate position. Nokia has finally taken their blinders off and has recently released a new version, Sybian 3, of their OS. One would have to go all the way back to 2006 to find Nokia’s last smartphone success, the N95, since that time, Apple’s iPhone, released in 2007, has been gaining ground as has Google’s Android released in 2008.
In my previous blog on this topic, Mobile Search and Mobile Advertising, I provided charts outlining the leader board for the smartphone OS and mobile advertising spending with projections. I noted the absence of Mircrosoft and that they would act quickly to get into the race. Microsoft has taken a two prong approach to gaining on the leaders. The first is with their innovating new OS, the second is with their legal muscle as exhibited by their patent lawsuit against Motorola. The stakes are extremely high for all the players in this space, as is the reward. Will a rash of legal maneuvering and the negative press of a patent lawsuit against an open source backed OS be effective in product promotion for Microsoft? I’m not sure the legal approach is going to help Microsoft’s image or convince the public to purchase a device, nor is it going to assimilate developers and we all know that the applications which run on top of the OS are the steroid for these entrants in the race.
In the graph below take a quick look at how the OS race has been playing out during the first three quarters of this year; it clearly shows a steady player, one that rewards developers via low cost of entry due to being open source and few restrictions, Android and Google.
I like the fact that “Do no evil” is the corporate motto and have trusted the search engine giant for years. They continue to innovate and refine their services, an important attribute an application developer considers when picking a development platform, since they rely on a steady stream of income from their applications. Google’s AdWords is the dominate search engine marketing vehicle, and I believe they will continue to refine it to allow all size businesses equal access to the mobile advertising market. Keep your eye out for more articles on this dynamic, fast growth industry news. We will.
Most people are familiar with the saying, “Second Place is the First Loser”. The goal of every business, sports teams, and individual is to be number one. Being on top is a great accomplishment. However society influences us to believe that there can only be one winner. Is second place really the first loser?
There has been a lot of news in the Industry about Yahoo lately. The most recent being Microsoft Corp. making an unsolicited $44.6 billion cash and stock bid for Yahoo on Friday, February 1, 2008. Yahoo recently announced their plan to layoff 1,000 workers due to a 23% decrease in profits from 2006. Yahoo reported a fourth-quarter profit of $205.7 million down from $268.7 million. It’s obvious that Yahoo continues to lose its stance next to Google. Google captured nearly all of the search growth in the fourth quarter of 2007. When comparing fourth quarter 2006 to 2007, Yahoo’s market share dropped by 25%, falling from 24.1% to 17.9% of total search advertising dollars. Google, however, increased its presence, going from a 70.5% to a 76.6% share. By now, everyone has either heard about or discussed the fact that Yahoo should step out of search and outsource that function to its top competitor. Google has won, so why should Yahoo even compete?
Yes, being number one is a goal of every company, but being number two in a dynamic industry, is still a great accomplishment! Many users prefer to use Yahoo over Google. Although Yahoo’s market share doesn’t come close to Google’s — it is still a valid place for users to search.
I enjoy being given a choice! I am not a big fan of monopolies of any sort. What if we only had one type of soda, airline, or shirt to wear? Things would be monotonous and boring! Better yet, what if we only had one cable or internet provider? That particular provider would have zero competition, which in turn would result in astronomical prices and limited options.
As a Client Strategist, I tend to use Google most of the time when I search, but I still like to keep my options open and search on other engines every now and then. People are different, and enjoy different things. Competition is healthy for the economy. Therefore, there will always be room for second place players.
Don’t give up Yahoo, I still believe in you!