Google v. Apple on Your Phone

Today's tech news has been dominated by the debut of a Google phone that puts the Internet giant in direct competition with Apple's iPhone. But there's another move in the Google-Apple tug-of-war that sneaked under the radar...


Some background. In the future as imagined by Google CEO Eric Schmidt, our phones will be our main lifeline to the Internet in the next decade. That's why Google, which makes nearly 97 percent of its revenues from online ads, recently bought AdMob, a mobile ad display company, for an insane $750 million, which is 17-times more than AdMob's sales. In other words, this is a sector Google expects to explode.

But Apple is game to what's happening with smart phones and advertising too. So they've bought their own mobile ad firm Quattro Wireless, for the relative deal of $275 million. This is an important move, albeit one that won't change the company in obvious ways over the next few months. As this Ars Technica article dutifully points out, mobile advertising is just another place where Apple is competing directly with Google (even though Schmidt sat on Apple board for years until 2009). This list now also includes cloud-computing, music-streaming, and phone hardware and software.




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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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