Google Wins android war against Apple- AAPL, T, & GOOG

Google Inc. (NASDAQ:GOOG)’s expansion in the android based Smartphones market has been accelerating in the recent years. According to data collected by Gartner Inc. the company held a 71% of the global market while competing Apple Inc. (NASDAQ:AAPL), held only 14% of the market share. In an interview to Bloomberg Eric Schmidt Chairman of the web-technology concern said, customers “activating more than 1.3 million Android devices a day” helped the company achieve the growth comparable to the scale “of — Microsoft versus Apple,”20 years ago.

Google+, with more than 100 million active users on board is also “viable competitor to Facebook,” in the niche of social platforms with wide reach, according to Schmidt. Micro-blogging website Twitter Inc. and Netflix Inc. (NFLX) could be prospective entrants within this niche, he added.

Schmidt asserted confidence in his company’s ability to lock in greater number of consumers away from traditional computing solutions. To market its open source Android based devices Google Inc (NASDAQ:GOOG) partners with hardware manufacturers to leverage “demand for ads and other Internet- based services”. The idea behind yielding a small proportion of its revenues to hardware partners like Samsung Electronics Co., is to make a “bigger pie”“not perfectly controlled and not perfectly managed by virtue of open systems.” Schmidt said.

Discussing a myriad of issues including economic, tax and state of competition in global markets, he said it would be unfortunate if the U.S. government and governance fail to reach a cordial agreement on the disputes underlying the “fiscal cliff” budget cuts and tax reforms. Schmidt also predicted the slow growth prospects in the European economy as the biggest barrier to expansion in Europe. Europe may take a while before restoring to normal amid the low productivity from debt bearing nations “offsetting the effects of higher productivity in Northern Europe”, he said.

Schmidt, also a White House advisory group member, defends his suggestions to depart from dedicated bandwidth approach by mobile carriers. However he did agree that amid multiple “rules and property rights,” this is not an easy changeover.  Leaders at wireless carriers like Randall Stephenson, CEO AT & T Inc. (NYSE:T), think that “full ownership of the spectrum” as “the best model” for carrier. Dedicated bandwidth is locked away unnecessarily and under his plan all airwaves will extinguish available “cellular bandwidth in 2016 or 2017,”

The 2011, $2 billion tax savings that resulted by applying Double Irish/Dutch sandwich technique also brought Google Inc., (NASDAQ:GOOG) under stringent scrutiny from antitrust regulators in France, U.K., Italy and Australia where revenue boosting as a result of tax planning is frowned upon despite being legal.

Sharing his sentiments over the probable legislative barriers from antitrust fronts Schmidt said that Google Inc.(NASDAQ:GOOG) is “proudly capitalistic” and he saw no reason why it should “turn down big savings in taxes,.”. The said technique was an incentive “that the governments offered” and the company still pays tax “legally prescribed ways, “He added.

Shares of Apple Inc. (NASDAQ:AAPL) were down 1.73% to close at $529.69, shares of Google Inc.(NASDAQ:GOOG) were up by 0.74% to close at $702.7, and shares of AT&T Inc. (NYSE:T) were down by 0.49% to close at $34.32.

About the Author

Alison Simpson is an Business and general assignment reporter. Alison Simpson covers financial markets and Wall Street, concentrating on developments affecting individual investors and their portfolios. Alison graduated from Trinity College in Hartford, Conn., and later earned a master’s degree from Northwestern's Medill School of Journalism. Alison also covered congress for Defense News and providing regular coverage of the budget debate on Capitol Hill and its implications for national security.

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