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One needs to look no further than Google's most recent quarterly report filed with the U.S. Securities and Exchange Commission, in which it spells out potential risks ahead in its business:
As we have limited experience to date in operating versions of our products and services, including Google Mobile and Android, developed or optimized for users of alternative devices and as new devices and new platforms are continually being released, it is difficult to predict the problems we may encounter in developing versions of our products and services for use on these alternative devices and we may need to devote significant resources to the creation, support, and maintenance of such devices. If we are unable to attract and retain a substantial number of alternative device manufacturers, distributors, and users to our products and services or if we are slow to develop products and technologies that are more compatible with non-PC devices, we will fail to capture a significant share of an increasingly important portion of the market for online services, which could adversely affect our business.
The key phrase is "difficult to predict the problems we may encounter." Google's never really been in the volume smartphone business before. One key factor with the launch of Android 2.0 is it marks the first time Google may face challenges with post-sales support of smartphones.
By contrast, with the Droid's launch in the offing, Apple said this in its most recent SEC report:
The Company is focused on expanding its market opportunities related to mobile communication devices including the iPhone. The mobile communications industry is highly competitive and includes several large, well-funded and experienced participants. The Company expects competition in the mobile communication industry to intensify significantly as competitors attempt to imitate some of the iPhone's functionality and applications within their own smart phones or, alternatively, collaborate with each other to offer solutions that are more competitive than those they currently offer. This industry is characterized by aggressive pricing practices, frequent product introductions, evolving design approaches and technologies, rapid adoption of technological and product advancements by competitors, and price sensitivity on the part of consumers and businesses.
With its back to the wall in the mobile device market, facing its stiffest challenge to date, Apple says it is "focused on expanding its market opportunities." This is a company with swagger.
Apple has what Google doesn't: experience in post-sales support. With millions upon millions of iPhone customers and users of various iterations of its iPhone software operating system, Apple has a mountain of data that probably gives it a good idea of what Google and Motorola are in for with customer problems, issues and complaints. While the guys in Schaumberg, Ill., and Mountain View, Calif., are grappling with the inevitable bug fixes, compatibility concerns and "known issues," Apple is planning on its expansion.
Today for Apple, the competition has never been stronger. So is its opportunity.
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