3 Ways Google Is More Innovative Than Apple


Google Glass. Source: Google. 

In a recent interview with CNBC, Steve Jobs' biographer, Walter Isaacson, said that Google (NASDAQ: GOOGL  ) is more innovative than Apple (NASDAQ: AAPL  ) -- clearly a bold statement from someone who spent hours interviewing Jobs and many people from Apple.

While some investors will inevitably disagree, there are three main reasons he's right: wearables, automobiles, and the coming Internet of Things. Google is already strolling down these three avenues, and all of them could propel the company ahead of the iMaker in the not too distant future.

First-mover advantage in wearables
With Google's Glass experiment, the company is one of only a few technology concerns that has produced and released wearable technology. While Glass is still being tested out by "Explorers," Google recently opened up invitations to purchase Glass to those with a Google Play Music All Access account.

While Glass may not appeal to everyone, and has come with plenty of criticism, the device still puts Google ahead of Apple and many other companies looking to make a business out of wearables. Of course Apple is rumored to be working on an iWatch that could release later this year, but that still doesn't make up for the experience Google is gaining tight now through Glass.

Juniper Research expects shipments of smart wearable devices like watches and glasses will hit 130 million by 2018, and spending on the devices could hit $19 billion that same year. While it's difficult to predict exactly how consumers will respond when an iWatch or Glass hits the mass market, the fact is that Google is already making a huge splash in the space and is gaining traction with consumers and developers because of it. When it comes to innovation, tech companies can only get credit for what products they actually have made, and that's why Google wins this category for now.

The other mobile revolution
Though wearables could eventually be a huge industry, there's already one industry that's undergoing a massive technological change right now: automobiles. Car companies are trying to keep up with new technologies, platforms, and apps but the pace of mobile is much faster than a carmaker's product release. To address technology in cars, Google recently announced the Open Automotive Alliance with chipmaker NVIDIA and automakers Honda, Audi, General Motors, and Hyundai to bring its Android platform into vehicles later this year.

Source: Open Automotive Alliance.

Bringing the latest tech into cars is time consuming and expensive, and this alliance could make automobile infotainment systems tech-relevant, while equally spreading the developing responsibility across those in the alliance.

Critics will say that Apple moved into the automotive space first, with its iOS in the Car feature and Siri Eyes-Free. While that's true, what the automotive industry desperately needs is a cohesive platform, and it's doubtful Apple's legendary closed operating system fits the bill. Google has opened its alliance up to other technology companies and carmakers, essentially replicating the path it's taken to make Android such a popular mobile platform.

As The Motley Fool's technology analyst Evan Niu recently wrote: "Apple's strategy is to integrate iOS devices with cars. Google's strategy is to power the car itself with Android."

The automotive alliance is in addition to the amazing strides Google has made with autonomous cars. That experience, along with automaker and other relationships it's made in the industry, could help make mass adoption of Android in cars a reality.

Apple launched its car connectivity first, but Google is poised to revolutionize how we all use in-car infotainment systems. 

Google and the Internet of Things
Aside from wearables and automobiles, the coming Internet of Things is another advantage Google has over Apple. The Internet of Things refers to previously "dumb" devices, like a refrigerator or a shipping container, that will eventually communicate with other objects around it to improve efficiency and send relevant information to users. Cheaper sensors and pervasive wireless connectivity are helping to fuel this movement, and Google is right there.

Nest thermostat. Source: Nest Labs.

This week the company just announced its intent to purchase the in-home innovations company Nest Labs, which makes smart thermostats and smoke alarms, for $3.2 billion.

Nest's smoke detector connects to Wi-Fi networks, communicates which room smoke is coming from, tells whether the alarm is going off, monitors battery levels, and can send all of that information to mobile devices, in addition to sending traditional signals.

The company's smart thermostat is a learning device that tracks the temperature patterns of its users, knows when a user leaves the home, learns sleeping and waking patterns, and programs itself to match a all of those preferences. It uses light, humidity, and activity sensors to do all of this, without any need for the owner to set any pre-programmed instructions. While it may seem a bit too futuristic for some, it's part of the future of connected objects, and it's already here.

By 2020, Gartner expects installed base units for the Internet of Things to be 26 billion, which doesn't include PCs, smartphones, or tablets. International Data Corporation went so far to say that the Internet of Things is "poised to change everything" and will result in $8.9 trillion in global revenues by 2020.

And as for Google, its purchase of Nest puts it in a great position to benefit from this and to keep it a few steps ahead of Apple. It's not that the iMaker doesn't have the capability to create innovate products, or buy companies that do. It's just that at the moment Google is moving much faster and in more directions than Apple. That certainly could change this coming year, as Apple releases a smart watch or other product that shows off its innovative potential, but for now the future belongs to Google.

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  • Report this Comment On January 19, 2014, at 2:42 AM, JbUps wrote:

    All apple need do is introduce its own search feature and Google's business model will not look so secure.

  • Report this Comment On January 19, 2014, at 3:41 AM, innovatedilemma wrote:

    I appreciate your reasonably fair assesment based on your opinion. Those are indeed three areas that GOOG is venturing into. If you want to call them innovative then feel free to do so.

    However, it seems you are unaware of one critical fact. GOOG has annual profits less than a 1/3 of AAPL's (11 billion vs. 37 billion). Of those 11 billion in profits, 90% comes from search and mobile advertising. In short, GOOG makes almost nothing from actual products.

    Please tell me... Where is the market acceptance for GOOG products? Moto X has been DOA in phones. Chromebook has yet to make any inroads in the tablet or PC market. The innovation you cite with GOOG Glass is a product with no real sales that no one currently uses. Where are the lines around the block for GOOG products?

    AAPL doesn't need to be first to market or publicize everything it does. It has hundreds of million loyal customers who keep buying their product. When AAPL releases an iWatch, an iTV, or whatever, it is a virtual certainty it will sell. By comparison, GOOG products don't sell at all. All to often people conflate Android (the OS) with Samsung smartphones, as if GOOG is making the phones. All GOOG does is pump the advertising.

    As JBups pointed out above, if AAPL built a search engine, GOOG's only real money maker, pumping ads, would be immediately damaged.

  • Report this Comment On January 19, 2014, at 5:44 AM, JbUps wrote:

    @innovatedilemma. great response

    Apple needs to go on the offensive. They need to go after Google where it will hurt, advertising dollars. Google clearly has been trying to disrupt Apples business so it's only fare play at worst, competition in reality. Let's see how "innovative" Google is when those add dollars start shrinking. Wasting money on Motorola, robots, and smoke alarms will be seen

    for what they really are, a waste of share holder money.

  • Report this Comment On January 19, 2014, at 1:05 PM, secularinvestor wrote:

    The author’s arguments are naive and ill informed.

    Wearables

    Yes, Google is first with Google glass, which appeals to Geeks. However that does NOT make Google ahead in wearables. Apple already have many companies such as Nike in its ecosystem producing wearable devices and there are dozens of Apps which communicate with the power sipping, 24/7 M7 motion sensor chip. For example when I recently installed a Pedometer App it immediately displayed my walking history, day by day, from the time I started using my iPhone 5S.

    iOS in the Car is Way Ahead of Android

    The author admits this: "Critics will say that Apple moved into the automotive space first, with its iOS in the Car feature and Siri Eyes-Free. While that's true, what the automotive industry desperately needs is a cohesive platform, and it's doubtful Apple's legendary closed operating system fits the bill”

    Where Apple always win is by the careful overall design which leads to exceptionally easy to use devices with superior reliability and higher user satisfaction levels, compared to Android’s chaotic, fragmented experience. Audi recently announced that they are developing Android for their cars.

    However, SIX MONTHS AGO Apple announced that they were working with the following auto manufacturers on iOS in the Car and Siri: Mercedes, Honda, Nissan, Ferrari, Chrysler, Kia, Volvo, Jaguar, Land Rover BMW and Toyota i.e. most of the world’s major makers.

    Internet Of Things.

    Google is way behind the curve here. The real innovation leader is Arm Holdings (ARMH) who for many years have been producing the reference designs for the chips which power the Internet of Things. Arm's reference designs are in most Internet of Things chips and devices produced by over 700 Arm partners - ONE of which is NEST.

    Apple IS The REAL Innovation Leader.

    The latest iPhone 5S is a generation or two ahead of any other smartphone with its combination of 64 bit A7 chip, Touch ID, M7 sensor chip, and the advanced digital camera software which requires the superior processing power and graphics of the 64 bit SoC.

    All other premium smartphone makers and chip manufacturers have announced that they will following Apple’s lead with their own 64 bit chip devices. But the problem is they DO NOT HAVE a proper 64 bit OS which is backwards compatible with 32 bit Apps.

    Apple already have the hands on experience of writing 64 bit Mac OS which is backwards compatible with 32 architecture. Apple have spent YEARS re-writing iOS 7, from the ground up with millions of lines of new code. It will take competitors years to catch up, IF EVER.

    Meanwhile, every day, dozens of new and updated iOS Apps are coming out designed to take advantage of the amazing power and speed of the 64 bit A7 SoC.

    Google and the entire Android ecosystem has been left trailing in the dust, struggling to catch up with Apple’s innovation lead.

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