Google v Apple – The Battle Has Begun

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Google v Apple – The Battle Has Begun

Competition between Google and Apple is no longer subtle. The two tech giants have locked horns and are now battling for supremacy in a number of markets.

Apple is rumoured to be considering ending its partnership with Google and moving on to Bing instead. In fact, they have already included Bing as one of the search engine choices on Safari.

More worryingly for Google, the recently acquired mobile advertising network, AdMob, will reportedly be blocked by Apple. iPhone users constitute the largest market segment for AdMob.

In order to avoid regulatory problem, Apple is shutting out AdMob in a rather sly manner. The iPhone manufacturer has changed the developer agreement for the iPhone in such a manner that AdMob could be completely excluded from its services.

The new agreement states that ad networks will be allowed to share data only if the data “is provided to an independent advertising service provider.” In case there was any ambiguity, Apple goes on to clarify that “an advertising service provider owned by or affiliated with a developer or distributor of mobile devices, mobile operating systems or development environments other than Apple would not qualify as independent.”

Google develops mobile devices – Nexus One. Google has its own operating systems Chrome OS and Android for mobile. And Google is the driving force behind the Android development environment. Thus, the new agreement squarely shuts out Google-owned AdMob.

Apple has only recently announced the availability of iAds, its own ad-serving platform, and has already generated $60 million worth of commitments for mobile ads that will run in the second half of 2010. While the amount is almost negligible compared to the $23.7 billion that Google earns from advertising, the fact that it was done in just 8 weeks is definitely noteworthy. Also, these commitments have been made by well reputed brands such as Unilever, General Electric and Citigroup.

Colin Gillis, a financial analyst at BGC believes that mobile ads could generate 10% of Apple’s revenue by 2012.

While Google’s mobile operating system, Android, is doing quite well, it is still ranked fourth worldwide behind, Nokia’s Symbian, BlackBerry’s Research in Motion and Apple’s iPhone respectively.