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Apple (AAPL) simply builds better phones. It's easy to understand and the hardware is gorgeous. Apple's iOS App Store is awesome. They have better quality products and they are making more money than Google (GOOG). But the battle for dominance is not a clear win by any measure. Google dominates in OS market share with its Android mobile operating system and Apple is winning in App Store revenue. But even the competition for App store revenue is not a sure win for Apple since Google is constantly improving its app quality, upping its per user revenue for each Android device. To read a more detailed discussion of the Google vs Apple app store competition, read my previous article.

Apple does sexy. Google does not. But what Google does do is functional.

Google vs Yahoo - The Battle No One Noticed

I used Yahoo (YHOO) in the early days of the Internet. My browser was Microsoft's Internet Explorer and my home page was "My Yahoo". I was a huge Yahoo fan. I read Yahoo news, used Yahoo Finance and my primary email was a Yahoo email. I found myself switching one service at a time as Google launched their competitive services. Eventually, I was no longer using Yahoo except for the occasional reference to Yahoo Finance which still has value over Google Finance but not much.

The reason for the switch is that each of the products was clean and fully integrated. Yahoo developed functional products but they were all effectively stand-alone products. Google integrated everything. It was nice. When Chrome was launched, it solved a core problem for me. I moved from one computer to the other frequently and Chrome meant that I didn't have to use awkward external services for managing bookmarks. It didn't hurt that it felt faster and cleaner than Internet Explorer.

It wasn't the sex appeal that caused me to switch from Yahoo and Internet Explorer to Google but the functionality.

Mobile Is The Final Battlefield

I was reading an article titled Google's Cloud is Eating Apple's Lunch on TechCrunch this morning and was struck by the comments made by developers indicating their dissatisfaction with iCloud. The article links to another article titled Why Doesn't iCloud Just Work.

This matches my experience pretty accurately. I've used and developed for Apple products since the Macintosh was launched in 1984. It's always been sexy but it's never been easy. In my previous article about scalability I described why I believed that Google was going to succeed in mobile in spite of not having a sexier product than Apple and in spite of the fact that Google Play was earning less than Apple's App Store. The simple fact is that Google does functional better.

The main point that the articles make is that iCloud simply doesn't work. iCloud is the back-end framework that allows iOS apps to save their data. It is the framework for saving your contacts, music, photos, documents and game scores. Pretty much any data that you generate using an App can and should be saved to iCloud. That iCloud doesn't function as well as it should is a serious problem.

So let's talk about some of the other subtle and less mentioned losses that Apple has had to Google.

Google Maps vs. Apple Maps

Since the launch of the iPhone, Apple's Maps application was powered by Google Maps. In September 2012, Apple switched to their own mapping application using data provided by third-parties TomTom and AutoNavi. From the moment it launched the new Maps App was criticized for numerous reasons including lack of features, inaccurate labeling and location information. The Apple App Store location in Sydney, Australia was wrong. The App was gorgeous but it just didn't work.

The problem was so bad that Tim Cook was compelled to write a letter to customers apologizing. Incidentally, even when he made mistakes Steve Jobs never apologized. He just fixed the problem, usually with something so much better that you forgot what you were mad about.

Siri vs. Google voice search

Google doesn't even have a name for this feature. It' just a facet of Google search. Compared to Apple's Siri, it works much better. I realize that part of this is related to the fact that Google has absolutely amazingly functional search engine backing their voice search but you simply can't overlook that.

In a comparison between the two mobile voice search features, Arstechnica puts the two services through their paces asking them twenty questions. The article compares the rules of the questions and displays screenshots from both products.

While the two services perform fairly well, Google wins every time that Apple relies on the "Would you like me to search the web for you?"response. The other primary data source for Siri is Wolfram Research's Wolfram Alpha which is an absolutely amazing product but a bit egg-headed for most users.

For me, it's this simple. Google understands me but Siri doesn't. I guess a southern accent doesn't work for Siri.

Google Apps against Apple Apps

As of the time of this article, Google has 25 apps in the Apple App store for the iPhone and 14 for the iPad. Apple has no apps in the Google Play store.

Two of the Google apps, YouTube and Google Maps (this one should be obvious) are in the top 20 downloaded free apps for the iPhone.

To keep the pressure on, Google has now released Google Now for the iPhone including the Google voice search feature we just discussed.

Conclusion

Every time, I suggest that Apple is losing the battle against Google, Apple fans rally to defend the legendary company. They point out the current sales, the amazing products, the piles of cash and support it with a dazzling array of charts and graphs.

But it's not a single item by itself that will result in Apple losing this battle. It's all the little things. It's the lack of scalability for the Apple App store. It's the succession of feature failures that Apple has had over the course of its history. It's the simple fact that a lot of the most functional and usable Apps are provided by Apple competitors or at the very minimum developers who offer the same apps in Google Play.

I've stated repeatedly that Apple is changing. Its paying dividends and enacting stock buy-backs and in general acting like a well-behaved large-cap company should. And its currently trying to find its new price point which I can honestly say, I'm not sure where that is. It's definitely not $700 per share but where it actually should be is complicated by the unbelievable legacy the company has and its transition to a mature company.

Investors who are losing faith in Apple are jumping ship but dividend investors are rabidly climbing on-board. Apple still has so much cash on the books there is hope that they will pull a rabbit out of the hat and announce something exceptional but I don't think that's going to be the case. We'll have to wait till the September product announcement that Tim Cook hinted at to see whether Apple delivers on the promise of "amazing new hardware, software and services".

Source: Google Vs. Apple: Death By A Thousand Paper Cuts