If Apple (Nasdaq: AAPL) had a house band, it might be the alt-rock icons …And You Will Know Us by the Trail of Dead. The company tends to enter a new market and then redefine it from the inside, until the old guard has been forced out or killed altogether. I don't know whether Steve Jobs took any personal pleasure in knowing that iTunes destroyed Tower Records or that the iPod turned Sony (NYSE: SNE) into an irrelevant afterthought in portable music, but I can imagine a sanguine smile above the black turtleneck on those occasions.
So where are Cupertino's guns trained next? Let's take a look at some big, juicy targets -- and a couple of commonly misidentified ones to boot.
First things first
If Apple has an obvious arch-nemesis, it would have to be Microsoft (Nasdaq: MSFT). The signs of this rivalry are legion:
- iMacs and MacBooks are the antithesis to Microsoft's Windows-based PCs, as immortalized in legendary TV commercials from 1984 onward.
- iPods and their spiritual cousins have already killed the Microsoft Zune. Apple made that victory look easy.
- Microsoft struggled for four years to come up with an answer to the iPhone. Windows Phone 7 gets good reviews but hasn't caught on where it really counts -- at the checkout counter. Meanwhile, the iPhone 4 still generates fanatical excitement wherever it's going, and Apple might even fool us into buying a white model just weeks before releasing the iPhone 5. Mr. Softy clearly isn't winning here, either.
Apple may not have the power to kill Microsoft entirely, or the desire to chase some of Redmond's markets, but where Jobs has chosen to go head-to-head with this tech titan, the odds are clearly in Apple's favor across the board.
I bet knees would be rattling throughout Washington state if Apple ever decided to publish an office software suite. Apple is Microsoft's kryptonite.
The sisu is gone
Tightly linked with the first target on Apple's hit list is mobile-phone Brobdingnagian Nokia (NYSE: NOK). The Finns are facing the same iPhone bulldozer that's thwarting Microsoft's mobile plans and has joined hands with Microsoft in a common effort to stem the pomaceous tide.
Nokia is a global leader in smartphones and feature phones alike, though you'd never know it from watching the American market. But its fortunes are waning as Apples are waxing, and it doesn't help any to have Google (Nasdaq: GOOG) and its Android platform step in and steal another generous slice of the market pie.
The Microsoft deal smells like a Hail Mary when all other options have failed. If Microsoft shrewdly planted Stephen Elop as Nokia CEO in order to make it happen, then that move would also smack of desperation. Microsoft and Nokia don't add up to a Doug Flutie or a Roger Staubach, but every move Apple makes in the mobile market looks like a Montana-to-Rice gimme. And if you're looking for another sitting duck in this space, Research In Motion (Nasdaq: RIMM) practically has a bull's-eye painted on its forehead.
Sitting duck? Nope -- red herring.
Now that we mentioned Google, you probably see a large set of crosshairs centered on Mountain View. But then you'd be wrong.
Android and the iPhone are clearly competing with each other, and 2011 looks like it will serve up a clash on the tablet level as well. But the situation is different this time:
- There are winners on both sides of this seemingly epic conflict. Each platform is expanding rapidly, and the real losers are found in the rest of the mobile industry.
- Google doesn't necessarily see a conflict to begin with. From Big G's perspective, anything that makes Web browsing better, faster, slicker, and more ubiquitous goes in the plus column, including Apple's mobile-computing powerhouses. Android doesn't directly make any money for Google, so why would the company even care if Apple kills it? It's all about pushing the envelope and expanding the smartphone market.
Google has carved a few notches in its own headstock, notably in the fields of online search and marketing. The time might come for a legendary showdown in a market that matters to both Apple's and Google's bottom lines, but we're not there yet. In fact, both companies are probably too smart to really challenge the other directly -- the risk of abject failure would be too great. If Google ever starts a music service, it will be of a markedly different model than the buy-and-play iTunes solution, for example. And for the same reason, Apple will never run a universal advertising service not tied directly to its own hardware ecosystem.
The wild card
Finally, some would say that Nintendo (OTC BB: NTDOY.PK) is in mortal danger at the hands of Apple and every other smartphone builder. Nintendo president Satoru Iwata sure worries about the potential for iPhone-style casual games to hurt his more traditional gaming markets. Fellow Fool Rick Munarriz agrees that high-priced game titles for one-trick consoles and handhelds are destined for the elephant graveyard.
Me, I still think Nintendo has a fighting chance. The wealth of new thinking in the 3DS handheld tells me that the company is still reinventing the genre and likely to find an audience in any market climate. Microsoft and Sony worked for years to equal the paradigm-razing brilliance of the Nintendo Wii, and you could argue that only one of them succeeded. If that sounds a lot like the signs of Apple having its way with the mobile market, you're on my side of this argument -- these are the marks of a winner.
I could be wrong. The 3DS could fail to catch on, and iPhones might become the de facto standard in portable gaming. I just don't see it as a likely outcome. Nintendo had better respect Apple, but it doesn't need to hide in the closet with a shotgun and a year's supply of canned beans just yet.
Did I miss your favorite target for Apple's heat-seeking missiles? Share your findings in the comments section below. And don't forget to stay on top of these edge-of-your-seat nailbiters:
