Is Google Ready to Enter Into a Price War With the Likes of Apple?
5. The investment is too high Although investing in a new operating system is expensive, its no match for the research and development and production costs that go into hardware. Hardware is extremely expensive to produce, and in far too many cases, delivers small margins. Its best for Google to stick with high-margin businesses and let Apple try to make profits on expensive equipment.Following that, Google should be ready to enter into a price war with Apple if it ever decides to try hardware. Apple will press the envelope on design and features, forcing Google to catch up. Meanwhile, the iPhone makers margins will stay strong. Plus, Apple can dump billions of dollars into research and development without even thinking twice about it. Getting into a price war with Apple is something the search giant just wont want to do. 7. Too many competitors Right now, Google is doing well in markets where it has little competition. In search, its only real concern is Microsoft, and Bing has little market share. In the OS space, Android is the only suitable choice for any vendor not named Apple. In the advertising market, Google is pretty much the only company that matters. But in hardware, the company would be facing off with a slew of competitors. And theres no telling if its devices will shine or get lost amid all the others. 8. The Sony model is dangerous The latest rumors surrounding Google seem to suggest that the company is trying to become more and more like Sony and get into every market that it can. Its a bad idea. Sony today is floundering because it took too many risks and tried to do too much. Theres something to be said for sticking with core competencies. And for Google, that means search, advertising, and Androidnot tablets, smartphones, and home-entertainment devices. 9. Home entertainment issues are enough to make trouble What makes Google think that it can be successful developing a home entertainment device? The company is trying to appeal to consumers in the living room with Google TV, and so far, its failing. Delivering a device that will likely work with Google TV wont change the fact that the entertainment platform falls short on many levels, including content support. 10. It all comes back to advertising When its all said and done, Google does everything to enhance its advertising initiatives. Whats not clear is how advertising will play into its decision to get into hardware. Chances are, its ads will be running on the software included in its hardware products. But how will consumers respond to that? Hardware and advertising dont necessarily play nice with each otherand Google should accept that. Follow Don Reisinger on Twitter by clicking here
6. A price war Google cant win