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It is very interesting to see how Android is a pyrrhic victory for Google. As they grab more market share, they are debasing their own products because profit m
by coliveira 11y ago
It is very interesting to see how Android is a pyrrhic victory for Google. As they grab more market share, they are debasing their own products because profit margins on mobile are so low compared to desktop. At the same time, they practically give away the top of the market to Apple, which makes more than 90% of the profits in the smart phone segment. Retrospectively, it would be much better for them to be partners with Apple and other companies in delivering search technology, without any of the costs associated to developing mobile software.
- bduerst 11y agoThere is typically a cost leader and a quality leader in most markets - e.g. android and apple, Blue Bunny and Haagen Daas, kia and mercedes (respectively). Companies that target the cost-leader position will have thin margins but make up for it in quantity. Google didn't lose anything in the Android victory over the mobile OS market, and falls in line with their strategy of making slim returns on every user (which adds up).
- coliveira 11y agoThat makes sense if you're focused on being the cost leader in that segment, such as Kia or Walmart. But Google has no long term desire to be in a market unless it is advertising. I think they will be in a bad situation when cost pressures mount over the next years.
- bduerst 11y ago>But Google has no long term desire to be in a market unless it is advertising. Which doesn't change that they're the cost leader of the market and didn't lose anything. Where do you think the thin margins per user comes from? And the company is starting to diversify away from advertising with Cloud, Play, Express, etc.