Is Google set to overtake Apple? Are Apple’s golden delicious ideas behind it?

Posted: June 4, 2013 in Corporations, Technology
Tags: , , , , , , ,

Hiatus. Sometimes we enter a kind of interim stage. And when that happens, it is human nature to see this as somehow significant. In truth it is as significant as a stopped clock telling us the time.

Google is in at the moment. Sure, its tax affairs are not in with politicians, and the holier than thou media. But this has nothing to do with Google being evil, or amoral, and it has everything to do with globalisation and technology, which makes it hard for governments to act unilaterally.

And with Apple’s share price having fallen sharply over the last year – from $702 in September to $450 at the time of writing – and with Google’s having risen – from $647 in November to $867 at the time of writing – their fortunes have been in stark contrast.

Apple’s market cap is now $423 billion; Google’s $288 billion. The gap appears to be closing.

Google has its glasses, its driverless cars, its new Motorola phone – talk has it that the phone will know when you are driving, know when it in your pocket. There is no talk of it being able to tell you whether someone of the opposite sex fancies you however – which may be a major oversight by Google.

Apple has… well, there will be a new iPhone and iPad, but there’s not much happening.

It appears that the number of Android Apps is set to overtake the number of Apple apps too. So far 50 billion apps have been downloaded for the Apple products; 48 billion for Androids. Apple reckons it is seeing around 2 billion downloads a month. Google says it is seeing around 2.5 billion a month. Analysts reckon total downloads for the Google family will surpass Apple downloads this year.

Apple’s shares are trading at a pe ratio of just 10.76. Google shares at 26. No wondering – let the facts speak for themselves.

Poor old Apple! It is hard to see how it can make do with a mere 2 billion downloads a month

Google is an exciting company, and it may well see its extraordinary growth rate continue for some time. But the markets may be writing off Apple far too soon.

Apple is not good at hiatus moments. Apple went from almost bust to becoming the world’s biggest company by market cap via disruptive technology. With its iPod, iPhone and iPad Apple invented a market place, or at the very least (in the case of the iPod) turned a niche market with a specialist following into a mass market.

Right now, the state of technology is such that we are in an in-between stage. We are awaiting the next phase in the evolution of technology. In nature evolution does not work at a steady pace, it often works in fits and starts, it is like that in business too.

To write off Apple now, at this in-between stage, is simply absurd. Its smart watch or TV player may or may not change the world, but until we know more, we cannot say whether Apple has lost its innovative edge.

As for downloads being a miserly 2 billion a month, don’t analysts have iPhones? Don’t they know that Apple tries to impose some form of quality control on its apps? Don’t they know that in the Apple market the onus is on quality over quantity? Apps downloads may be fewer, but are existing Apple apps used more or less than Android apps, do you think?

© Investment & Business News 2013

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