The Next Great Tech Rivalry

Jun 4, 2010
6

The consumer electronics industry has had its share of great rivalries. Apple vs. Microsoft; Microsoft vs. Google; Google vs. Yahoo; and though these companies surely remain in competition, the intense rivalries that drive product development and benefit the consumer have mostly faded. Apple and Microsoft may jockey for position in measurements of market capitalization, but they're both successful with dramatically different product categories now. Microsoft may want a piece of Google's search pie, but Google holds a commanding lead that seems unlikely to falter. And do I have to even explain how Yahoo is no longer competitive with Google?

Sure, there's plenty of overlap. Apple and Microsoft both make smartphones. Google will have its own OS on netbooks by the end of this year. Many of Yahoo's best services, like Flickr and Yahoo Groups, compete directly with Google products. But these rivalries have either faded or the fire is dying down to embers.

So what's the next big battle? It isn't Google vs. Apple, as many have claimed. Sure, both companies are focused on the hot smartphone market, but Android products and iPhone products can peacefully coexist for the foreseeable future. It's a big market, and though the systems may seem similar in their functions, in fact they specialize in different features. The Apple iPhone is a multimedia powerhouse, and it comes with a more carefully curated app store that offers games, productivity apps and social networks, but mostly games. Android is an open system, highly customizable for users and carriers alike. It's complex, but rewarding, where Apple's iPhone OS is simple and dazzling.

The next big battle will be between Google and Facebook, and it will be over the basic question: where do we go first? When we wake up our laptops from sleep, or pick up our smartphones off the bedside table, what's the first site we visit? Because that site will set the tone for the rest of our Web experience.

When Apple and Microsoft compete over operating systems, what they're really competing for is our dollars. One of them makes a product we want and we buy it, pure and simple. When Google and Facebook compete, they aren't after our money. We don't pay Facebook for our social network, and we don't pay Google for search. Both of them make money through ads. We are the product, and we are being sold to advertisers. When Google and Facebook compete, they are competing over who can do the best job selling their users.

Why does Facebook want to eliminate privacy so badly? Is it Mark Zuckerberg's utopian view of society? Of course not. The more personal data Facebook can collect and offer to advertisers, the more money they can glean for ad space. Why stamp "Like" buttons on Web sites across the Internet? Is it so we can express ourselves as we read a story on CNN, or watch a video on FunnyOrDie.com? Of course not. Facebook wants us to follow our friends and visit the sites they visit. Facebook wants to show CNN that it can deliver the goods. Facebook can prove to advertisers that it can drive eyeballs like a shepherd corralling sheep.

How about Google? Why would Google give away free email with huge storage capacities? Why give away an operating system to phone manufacturers? Because when we use Gmail, we see Google's ads. When Google jumps into the mobile advertising pool - and they're already on the diving board - Android users are going to get soaked with Google's advertising.

Google and Facebook are the next big tech rivals because their services don't just overlap, they preclude each other. Facebook's now-ubiquitous "Like" button is a shot across Google's bow. Sure, if we need a targeted search, we'll still use Google to find the proper site, but those aren't the sites that we'll return to daily. When a friend recommends a site she likes, we're more likely to visit, more likely to return and much more likely to tell other people.

Likewise, Google offers great services for email, photo sharing, blogging and even microblogging, but in the end we probably won't rely on both Google and Facebook for the same tasks. If I post all my pictures on Facebook, with tags, am I really going to post them again on Picasa? Why bother? If I have something interesting to share, will I use Buzz or update my Facebook status? For a while, I might try both, but eventually I'll use the one that most of my friends read.

The rivalry is really about which site we go to first. That's what's most interesting to advertisers, because they want to catch us at our most attentive, when we've just finished our coffee and we're ready to procrastinate. That is how Google and Facebook will sell us.

So, what should you do? Delete your Facebook page? Don't be silly. I'd sooner throw out my address book and old high school yearbooks than delete my Facebook account, because that's what Facebook is. It's a way to overcome distance and time to reconnect with people. It's a way to get in touch with people you know without worrying about their phone number or email address. You don't need those specifics with Facebook, you just need to know their name.

Should the government step in and break up Google's search monopoly? That would be just as silly. The government stepped into the fray against Microsoft, but Microsoft didn't change in the long run. Not because Microsoft beat the government, but because Microsoft didn't have to change to fix the problem. A monopoly on operating systems doesn't matter when every important feature takes place within a Web browser. In that case, there is no monopoly in the browser wars. Even if Google holds a monopoly on search traffic, that won't matter when the Internet moves past search as a primary tool and becomes a conduit for social traffic.

We should do nothing. Don't bother, there's nothing we can do, we're just the product being sold. There will always be value in social networking, just as there will always be value in Internet search engines. Facebook will always gather the most personal data it can find to sell to its advertisers. Google will track trends and search patterns to provide the most targeted ads.

That's okay, because advertising, for lack of a better word, is good. To paraphrase Gordon Gekko, advertising is right; advertising works. Advertising clarifies, cuts through and captures the essence of the consumer spirit.

Advertising is our friend. It has always given us something for nothing, starting with radio, through television and now Internet services. Sure, it's a friend that calls us fat and influences us to make crazy decisions from time to time, but it can be funny or poignant, and it always wants to talk about our favorite subjects. Aren't those the friends who are the most fun to be around?

I wouldn't advocate giving up privacy, but I've been using the Internet long enough to know that everything I post online may someday be available for the whole world to see. There's no privacy on the Internet just like there's no privacy walking down a busy street. I would no sooner post nude photos or outrageous opinions on a telephone pole in Union Square than on Facebook.

Advertising is a fact of life, so it might as well be good. That's what we'll get from this tech rivalry. Advertisers will be able to reach exactly the audience they want, and we'll be able to see only ads for the products we might find interesting. After all, do I want to see an ad for a new Honda right now? No, because I'm not in the market for a car. But with a toddler at home, I might be interested in strollers and life insurance. With summer fast approaching, I might be interested in travel deals or some new clothes. If advertisers can figure that out from my Facebook page or my Google search history, it will creep us out, but we'll get over it.

If they do it right, we might not even notice it at all.


Must Read Bits & Bytes