May 26th, 2010
Daniel Eran Dilger
Apple is a company with thick skin. It takes an awful lot of prodding to rile the company or even provoke a response from its executives. Those jerking the company's chain better hope this resilience to their attacks continues, because a single response from Apple at WWDC could wipe out Google and the bloggers that support it. Here's how.
.When Steve Jobs talks, people listen
On the rare occasions that Apple does respond to an issue, it does so in a brutally open and devastating way, such as when Jobs lambasted the idiot chatter about music and DRM with clear cut reality, or his more recent donkey punch delivered to Adobe's Flash.
Jobs is also famous for succinctly explaining what he thinks about technologies or specific approaches to design, such as his castigation of the mini keyboards covering a third of the face of smartphones or mouse or stylus-based interfaces in the modern era of mobile multitouch devices.
Pundits and competitors, from John Dvorak to the CEOs of Palm and RIM, spent years explaining why Jobs was wrong about all this until meekly changing their collective tunes once they realized that it was them, and not Jobs, who had all the trouble seeing plain reality.
Thoughts on Music
Thoughts on Flash
Better wrong than in the way
The only thing worse that doubting Jobs is competing directly against him. Microsoft's Steve Ballmer was probably a little embarrassed to have been so wrong about smartphones back in 2007, but he's no doubt far more upset that his company was completely run out of the smartphone business by Jobs' iPhone, even as it ineffectually tried to counter the iPod with its Zune, and after having been emasculated in the area of media formats by Jobs' iTunes+QuickTime and Apple's support for open codecs like the ISO's MPEG AAC and H.264 in opposition to Microsoft's proprietary Windows Media Audio/Video.
Similarly, while it was certainly humbling in retrospect for Palm's former CEO to have said Apple was "not going to walk in" and immediately succeed in the competitive smartphone market back in 2007, it's far more humbling for him to have to watch as Palm's decade of experience that he touted be erased as irrelevant by Apple's first strike into the smartphone business.
I'll also bet that Verizon's VP Jim Gerace, who told the media "we said no" to the iPhone back in 2007 because Jobs wanted too much control over hardware and service support and software bundling and branding (among other issues) is now wishing his team had stuck it out on the negotiating table three years and billions of dollars ago.
Myth 8: iPhone will lose out to Steve Ballmer's Windows Mobile 7 in 2010
Why Apple's Tim Cook Did Not Threaten Palm Pre
How Apple could tear bloggers and Google a new one
These days, Apple's primary competitors have all fallen down on their knees while clutching their gutted bellies. Nobody is talking about Microsoft anymore, apart from stories about how the company is letting go of its most poorly performing star executives for doing so poorly against Apple in the area of consumer electronics.
Other big competitors from Sony to Nokia, once considered the major powers in consumer electronics and mobile devices, are in a similar state of panic as they work, not to make a comeback against Apple, but to simply survive as entities. Even Nintendo is worried about losing its game to Apple, something that nobody has really rivaled before. Apple has outgrown both HP and Dell in terms of value and growth.
Who is left? Google, the paid search giant that backers hope will beat Apple in hardware and software platforms… despite Google being neither a hardware vendor (nor marketer nor retailer nor support provider) nor having any real experience in managing a software platform for consumers. Fans of Google suggest that the company will take on Apple by acquiring a competing version of everything Apple has built over the last decade: iTunes, a mobile platform, hardware expertise, user interface design savvy, development tools, and a user base.
The problem is, they don't also foresee that Apple could compete against Google in its own home territory of ads. When Apple entered the mobile ad network business by acquiring Quattro, it was taking a page right out of Google's vaunted playbook: buy your way into a market. But Apple didn't just make a speculative purchase; it had a plan.
Apple's iAd program appears set to bring far more interesting (for users) and valuable (for developers) and rewarding (for advertisers) advertising to the mobile arena. That's a novel strategy Google didn't happen upon on its own. Google is still using 1990s style ad-click banners that induce or force users to leave developers' apps and take them to external web ads. That doesn't even work very well on the web; its far more annoying on a mobile device.
Reality Check: Nokia's iPad patent infringement headlines
iPhone 2.0 SDK: Video Games to Rival Nintendo DS, Sony PSP
iAd: Is Apple taking mobile ads in a new direction?
Oh but wait, there's more
While Apple's iAd strategy shows that the company can and will take on competitors and can potentially take far more than it gives up, there's also another potential strike Apple could unleash upon Google and its blogger advocate groupies. Apple could kill web ads.
Apple has over 50% of the mobile web market, and people have already postulated that the new iPhone OS 4 SDK's restrictions on forwarding private user data to third parties could deliver a devastating blow to the current mobile ad market. However, the current ad market for mobile devices is rather small.
Imagine what could happen if Apple introduced Safari 5 at WWDC with support for a plugin API (as sort of postulated, teased, hinted or simply hoped for by John Gruber this week), and then demonstrated this new plugin architecture with a free, bundled plugin that blocked web ads. This would be a bit like Tivo for the web, except far easier to do in a way that web advertisers would notice.
Web blocking plugins are common on Firefox and Chrome, and already exist for Safari (using undocumented or deprecated APIs like SIMBL/InputManager). However, no major browser vendor, and certainly no major platform vendor, has ever shipped their browser with an ad-block plugin, and certainly not one that was activated by default.
One might think that it could have occurred to Microsoft that doing this in Internet Explorer could have killed off Google some time ago, back before IE's market share began dropping below the level of full critical mass. Apple's share of the desktop web browser market is a tiny sliver below 5%. But that 5% is extremely visible on the Mac, and were Apple to promote Safari as not just fast, but ad free, it would likely blaze deeper into the Windows world, just as Firefox and Chrome have.
Daring Fireball: Safari extension API suggestion
Hitting Google where it counts.
Google currently pays Apple hundreds of millions of dollars to capture the audience of Safari Mac and iPhone users performing search queries (just as it singlehandedly also supports Firefox development the same way). Apple could continue to get this revenue (because paid search ad placement is the most valuable thing to Google) while also stripping Google of its display advertising revenue via an ad-block plugin.
This would increasingly bleed Google of both ad reach and revenue in the area of display ads on the web, which are already not all that profitable. Google's only recourse would be to match this capability in Chrome and Chrome OS and Android, but this would be a painful way to try to compete with Safari's ad-free experience. If Microsoft were to realize what was going on, it could match Apple's efforts, resulting in Google's ad monopoly over the web simply being ignored to death by web users.
The casualties to this siege on Google's adware web would be the content publishers who are monetized by Google's ads. These are also the bloggers who are ripping Apple apart, so why not starve them out of business? After all, Apple now has an alternative business model to the ad supported web: native apps on the iPhone and iPad. It could also launch desktop, web-based apps within Safari that allow companies to develop HTML5 content monetized by subscription or by App Store purchase.
This would rid the web of ads and turn content into a paid model much like what existed before the web destroyed print, periodicals and newspapers with low quality content framed by copious amounts of irritating, flashing ads that pay just enough to perpetuate themselves and starve out good content, but not enough to actually fund high quality writing, reporting and other content.
Web ads are a noxious weed choking the intelligence and sophistication out of our society's media, and Google is making its massive fortunes delivering this scourge. Do no evil? How ridiculous, that's Google's core competency!
Why Apple Plays God with the iPhone SDK
Apple vs Google: it's all about who pays
Other casualties of the war on ads
While content creators (a group that includes yours truly) would simply have to adapt to a paid subscriber model to survive, other casualties would find the death of Google's ad support far more destructive. This group includes "Search Engine Optimizers," who create fake websites that Google happily monetizes with its ads.
It also includes groups that scrape content from legitimate sites and plagiarize their content with either no attribution or a meaningless little link that directs people back to the original item (but doesn't). Google puts lots of ads on those pages too, so it has a financial interest in not stopping this practice. That's just part of the evil Google does without anyone ever pointing it out. Google cultivates an adware pandemic.
There's lots of other spamming and fraudulent activity that Google facilitates through its free Gmail accounts linked to ad supported websites that generate clicks through a mess of highly ranked SEO adware garbage that Google says it doesn't like but ultimately benefits from as the merchant of that adware. Erasing all those ads right at the browser would dry up not just Google's display ads but wipe out the business model supporting all those fraud sites and spamblogs.
Of course, the other big casualty of a war on web ads would be Adobe as the vendor of Flash, the preferred platform of web ads. I'm sure Apple wouldn't mind killing both birds with one stone.
Would this be Apple's biggest accomplishment?
The big question here is: does Apple have the balls to revolutionize the web and return the world's journalism and entertainment to a paid premium model (like magazines and books and newspapers and HBO) rather than an adware garbage model?
The company has already established a paid model for music, movies, TV, iPhone and iPad apps, audiobooks, and iBooks. It also supports the distribution of entirely free content such as podcasts, iTunes U, free iBooks, free apps and so on.
The next step for Apple is simply cutting the adware jugular that feeds Google's voracious appetite for acquisitions and fuels the world's SEO spammers and their fraud sites and spamblogs. If the company could get that done, Jobs' iPad would become the second most important thing the man has ever accomplished.
Apple: fix the web. Kill the ads. Everyone will follow, even the whiny bloggers.