AAPL Could Erode Google’s Mobile Share, Says Goldman; MSFT Makes Progress
Goldman Sachs computing analysts Bill Shope and Heather Bellini and colleagues this morning offer up a longish (79 pages) summary of what they see as the "platform wars" and the rise of tablet and smartphone computing. The authors' point is that tablet computers will drive smarthpone market share as the "ecosystem" across the two tends to be mutually reinforcing. In this respect, they see Apple ( AAPL ), which the firm rates a Buy, having an advantage with half or greater share of tablets, and Google ( GOOG ) being at a disadvantage as it tries to rival Apple's iPad. For Microsoft ( MSFT ), they write, next year is "critical, given it is coming from behind in both device areas and platform loyalty is raising switching costs." The analysts surveyed over 1,000 mobile device users and conclude that "ecosystems drive platform stickiness, thus leading to a slow decline in android smartphone share starting in 2013." The report has Apple controlling 61% of tablet sales volume come 2014, up from 56% today, compared to 23% for Google's Android, while Microsoft ( MSFT ) will come from almost nothing to 16% by 2014, and will keep growing at Google's expense thereafter. The rise of apps built on the HTML 5 Web standard will be disruptive, but not before another 3 to 5 years, they write. "and as such platform loyalty will continue to build in the meantime." Lastly, the television set is the next major battleground for all parties, they write: Looking ahead, we believe the next big market disruption could be in the form of smart TVs. These devices, integrated with existing mobile ecosystems, could be the battleground for the next big compute revolution. As such, smart TVs’ ability to become another platform component will likely mean significant investment from Apple, Microsoft, Google, Samsung and others. The authors' premise is that the debate over " open " versus " closed " software platforms is misunderstood by investors.
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