In the tech sector, there does not appear to be any belief in the adage, “Can’t we all just get along.” Competition is fierce and the biggest players in the tech sector are fighting one another over every niche. Two of the biggest companies, Apple Computers and Google, have had a recent series of spats that illustrates just how high the stakes are and how hard both companies are working to dominate the tech sector. Google remains the world’s most-used search engine and smartphones powered by Google’s Android operating system still have the largest market share in the United States. Apple is anything but complacent now that it is the world’s most profitable company. In order to keep its place at the top, Apple is working to weaken Google.
Like Microsoft, Apple Computers had a vested interest in Google acquiring Motorola Mobility. Motorola and Apple were locked in a legal battle over patent rights and Fair, Reasonable and Nondiscriminatory (FRAND) licensing issues. When Google bought Motorola, it assumed those legal battles. At the moment, Apple has more of an interest in the FRAND lawsuits. Apple is taking Google/Motorola to court over four unresolved alleged FRAND violations, while Google/Motorola only has one FRAND claim against Apple that a jury trial would resolve.
Apple Computers is working to hit Google at its heart: the search business. While Apple has not actively pursued fighting Google’s search engine in a serious fashion before now, they are changing their strategy now. Sales of the Apple iPhone 4S in China vastly exceeded Apple’s estimates. Apple underestimated the popularity of the iPhone 4S in China, but with a new deal with Baidu, Apple is prepared to cut into Google’s global search dominance.
Baidu is a search engine that has a staggering majority of Internet search traffic in China. With over three-quarters of China’s Internet search requests being processed using Baidu, a strategic partnership between Apple and Baidu can only be bad news for Google. As China is Apple’s fastest growing market for the iPhone 4S, Apple’s willingness to add Baidu as a pre-loaded option on Chinese iPhone 4S’s, is a direct attempt to attack Google’s market share of the Internet search industry. In the coming days, Apple will decide if the iPhone 4S smartphones sold in China will have Baidu as the default search option. If Apple and Baidu synergize their popular products in China, it could result in a powerful blow to Google.
It is unclear how Google might respond to the alliance between Apple and Baidu, which might mean that Apple is putting Google on the defensive.
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