I have something that needs to be said. I realize that it will be unpopular.
Apple (Nasdaq: AAPL ) , Google (Nasdaq: GOOG ) , and Facebook? Come with me.
Here's the deal, guys. The three of you are ridiculously popular right now. Kudos, accolades, and high-fives all around! However, the problem is that you are becoming too popular. You're just not leaving scraps for anybody else to share the wealth.
Don't get me wrong. I'm not poo-pooing capitalism -- to the victor go the spoils. However, the three of you have changed the game and doomed the future of so many other companies. You know this. I know this. The problem is that folks in the video game, media, and general leisure industries -- and their investors -- don't realize this. Why is it up to me to tell them?
Everyone seems to think that an improving economy is going to raise all ships. But they don't realize that the three of you have shot holes in the hulls of sinking companies and gurgling sectors that just aren't going to surface when recovery sails in.
Let me speak to three of you, one at a time.
A million iPads in less than a month? Good grief. Analysts are gushing over the 12 million apps and 1.5 million books downloaded by newbie iPad owners, but we both know that the real problem here is that most of those apps are freebies. I'd wager that the vast majority of those books are also the public-domain ones being dispensed at no charge.
Do you see the problem? Instead of forking over $60 for a new video game, folks are spending $2.99 to buy Plants vs. Zombies on the iPhone or settling for an ad-supported casual game for free. Instead of snapping up the latest Nora Roberts or Stephen King novel, bibliophiles are rediscovering Jane Austen and Sir Arthur Conan Doyle on the gratis.
You don't think this is disruptive? Video game diehards will argue that it's insulting to compare a brainless app to the intricate console games of today. Bookworms will cringe at the notion that public-domain reads are sapping the demand for fresh lit.
Well, wake up, fanatics. It's not about the quality. It's about being satisfied enough with the low-lying fruit that the premium experiences are no longer as valuable. GameStop (NYSE: GME ) comps took a 7.9% hit during the holiday quarter, and Barnes & Noble (NYSE: BKS ) suffered a 5.5% smack. Wasn't this past holiday season cheerier than the grim 2008 outing? Video game and book consumption models have been altered, and it's naive to think that comps will improve during this year's holiday shopping season when costly iPads, iPhones, and iPods dominate big-ticket lists.
As much as I respect the achievements of News Corp.'s (Nasdaq: NWS ) Rupert Murdoch, I've had to shake my head at Murdoch's distaste for Google News as a traffic generator. Murdoch is one of the many print moguls convinced that Google is using newspaper companies with its news aggregator.
Murdoch has been quite vocal, threatening to pull out of Google's search queries, license its news feeds exclusively through rival Microsoft (Nasdaq: MSFT ) , and begin charging for its online newspapers.
Here's where I think the Google bashers have it wrong. The world's leading search engine is generating free traffic to the online editions of leading newspapers. It's the equivalent of serving up a reader without the grunt and production work of printing out a publication. Print subscriptions on local dailies are so cheap that Google is actually doing the printing press and delivery fleets an operating-cost favor.
In other words, it all boils down to effective advertising. Unlike a print ad that will typically appeal or apply to a tiny fraction of the readership base, cyberspace allows companies to serve up perfectly targeted ads. If the more effective online ads aren't as lucrative as the old school print ads, guess what? This only means that print advertising was overpriced to begin with.
This isn't going to change. Newspapers can blame Craigslist for killing their classifieds and Google for disrupting their circulations, but the inability for many print companies to thrive online is even more telling about the inadequacies of the fading print model.
Still, you're a meanie, Google, to be taking down the newspaper and magazine industries like that.
The sticky social-networking site keeps getting bigger. Earlier this year, Facebook overtook Google in Internet traffic (according to industry analyst Hitwise). Three months ago, it cracked 400 million registered users.
In and of itself, Facebook isn't a leisure killer. It helps friends and family connect, and that makes it a lot easier to arrange movie, concert, and other social outings. It also creates greater awareness of birthdays and other life events where real-world gifts are more appropriate than virtual freebies.
However, the time suck is the real Facebook thief. If someone is tending to their FarmVille crops or engaged in several windows of online chat, do they even have time to catch primetime television?
Even new media standouts are at the mercy of Facebook. Am I the only one concerned about Shutterfly (Nasdaq: SFLY ) ? I can't think of the last time that I had some prints developed. It's been over a year since I last ordered a Shutterfly photobook. As more members of my family pop on the social network, everyone has access to the snapshots that used to ramp up photofinishing charges in the past.
You're poking too hard, Facebook!
Making lemons out of lemonade
It's not all bad, but here are potholes to the upsides as all three companies tag in on the ring.
Facebook's free diversions put more disposable income into consumer pockets, but Apple's costly gadgets snatch it. Google's AdWords platform and mobile advertising through Apple's iPhones are providing more bang for the sponsored buck, but time spent on Facebook dries up the click ticks to pursue advertised offers.
There will be far more losers than winners by the time the body count is complete, though -- to be fair -- it will hopefully mean thicker slices for those victoriously left standing.
Are Apple, Google, and Facebook helping or hurting the economy? Share your thoughts in the comments box below.