Wednesday, March 2, 2011

Will Google (GOOG) Come to Dominate Nokia (NOK), Apple (AAPL), Microsoft (MSFT) in Smartphone Wars?

While some could argue that Google (NASDAQ:GOOG) already dominates the smartphone battle, although Apple (NASDAQ:AAPL) is the more profitable of companies in the segment at this time, we are really at the early stages of the war, and it'll take years to find out the fate of companies like Nokia (NYSE:NOK) and Research in Motion (NASDAQ:RIMM), and others.

Seeking Alpha says, "Apple’s weakness then was that it designed and made the computer and also designed and made the operating system. The company lived inside a patent and copyright protected walled garden. Then Microsoft (MSFT) came along with an operating system (which was not as good as the Apple one) that any manufacturer could use on their computers. So suddenly Apple were competing against a lot of hardware companies, each of which was also competing against the others. And Apple lost, principally because it was vastly too expensive compared to the Microsoft based computers which had prices honed in the furnace of competition.

"And now we see history repeating itself. But this time the company is being destroyed by Brin and Page. Once again Apple has created a walled garden with its iPhone and iPad devices, once again it came to dominate the market and once again competition between a lot of manufacturers using an operating system from a third party is destroying its business model. Currently the iPhone is the sixth best selling smart phone in the U.K.; the top five all use the Android operating system. But the reason they are beating Apple is not because Android is better, it is because Android phones are cheaper, honed in the furnace of competition."

Google was trading at $604.41, up $3.65, or 0.61 percent, as of 2:13 PM EST. Apple was at $351.88, gaining $2.57, or 0.74 percent. Nokia was at $8.65, up $0.03, or 0.41 percent. Research in Motion was at $66.00, dropping $0.40, or 0.60 percent.




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