Tech Giants: Google, Amazon, Facebook and Apple
If only one of the four giant corporations could exist in twenty years, which one would you choose and why?
Of the four companies, I believe Apple will most likely be the only company standing in 20 years. In the four years leading up to 2013, Apple grew 700 percent and is the “most valuable U.S. public company of all time (HBS, 2013). Apple has become a part of our culture and is quickly becoming more than just a company; its products are becoming a status symbol. In the next 20 years developing countries like China and India will become economic superpowers with hundreds of millions of wealthy individuals looking to show off their newfound wealth and status. Of the four companies Apple has what people want, a sophisticated symbol of wealth and security with the functional capabilities of the newest technology. With regards to market share Apple is leading Google in terms of mobile applications, online marketing, and e-commerce access. The iOS system is more popular than the Android system and generates substantially more traffic as well.
"Apple has become a part of our culture and is quickly becoming more than just a company"
Facebook, Amazon, and Google are tools that provide convenience to our lives, but none of them have the reputation and symbolic power of Apple. In India I have seen first hand how wealthy individuals want the nicest cars, biggest houses, and newest technology that shows off their wealth, which so happens to be Apple products. Although, Apple has several competitors none of them have entered the luxury brand industry as effectively as Apple. Apple products are called “the remote controls for many people’s digital lives” this, along with its global presence makes it the most stable and diversified of the four companies (Economist, 2012). Founded in 1976, Apple is the oldest and most experienced of the four companies. With more than 19 years more experience than Amazon, 22 more than Google, and 29 more than Facebook. Although, a company’s age doesn’t always indicate sustainability, profitability, or efficiency in this case it displays all three. Apple survived the 1982 financial crisis, the 1989 savings and loan crisis, the Y2K scare, and the Great Recession. These economic downturns caused the destruction of millions of businesses and household incomes, but with great hardship and falling profit margins Apple survived them all and came out stronger than ever.
Over the years our global society has become extensively interconnected and has produced a global culture, which associates wealth with security and even fertility. Wealth and products associated with wealth have become symbols that display facts about a person such as how effectively an individual can take care of future offspring and comfortably provide food and shelter for the entire family. Of the four companies only Apple has the physical products that portray this symbolic nature of wealth and security. It may seem shallow to think that a luxury product has become a sign of sexual fertility and security, but sadly it has. This along with Apple’s diverse array of products, services and global diversification make it the least likely to be affected by the changing tastes and preferences of consumers. Also, of the four companies Apple is the only one that can take full advantage of China’s growing economy. Google, Facebook, and Amazon are currently all banned in China, one of the largest and fastest growing markets in the world. In 2012, “Mr. Cook said that Apple’s quarterly revenue from China was $7.9 billion, about 20 percent of total company revenue” (Wingfield N, 2012). Apple has also entered into more sectors of digital marketing than any of the other three companies. Also, Apple’s product and service diversification decreases business and financial risk. In 2013, Apple was competing in several sectors and industries for example, iTunes competes with Amazon and Google play in the sale of digital content, Apple also competes with Google in the smartphone industry and is gaining market share in the digital television industry. In matters of mobile payment systems and banking Apple is catching up to Google as well.
As I mentioned above there are many reasons why Apple will still be around in twenty years however, here are a few reasons why I believe the other three wont. Facebook only has one product and is therefore the most susceptible to changes in consumer tastes and preferences. If individuals gradually or rapidly stop using Facebook it will have quick and disastrous consequences for Facebook. In the next twenty years there are several nations more notably China and India that will become economic superpowers dictating much of the world’s supply and demand for goods and services. Both of these nations have thousands of years of traditions and practices that revolve around family and face-to-face contact therefore the use of Facebook, which is already banned in China, may become frowned upon in India as well. This will be a loss of millions of Facebook users. These individuals will lean toward technology that is, firstly allowed by their governments and also technology that allows for video conferencing and more intimate communication systems.
Founded in 1976, Apple is the oldest and most experienced of the four companies.
Amazon faces far too many competitors to remain profitable in the long term. Also, rising shipping costs and individual tastes and preferences changing toward brick and mortar stores will hurt Amazons reputation, sales and usefulness in the future. Amazon should have created brick and mortar stores of its own a long time ago, in my opinion it is too late now as competitors such as, Frank & Oak and even Apple who began selling their products online and in stores of their partners have already opened stores of their own all over the world.
Although, Google is more diversified than Facebook or Amazon its ideas and innovations are not very original. Google seems to be copying or acquiring everything the other three are doing. The Google phone is an attempt to compete with Apple, but that continuously leaves consumers unimpressed. Google+ attempted to compete with Facebook, but its failure and rapid decline is a sign that Google is trying different things without a clear plan. Also, the increasing number of search engines and mobile assistants like Siri are eating away at Google’s market share. This will become a serious problem for Google in the near future as Apple continues to increase its sales of mobile devices in China, where Google is currently banned. With all of its acquisitions and attempts at diversification Google still makes 97% of its revenue from ads and also “about half of Google’s revenue was earned from U.S. advertisers (HBS, 2013). This means Google is susceptible to fluctuations in market and economic conditions of the United States, without much international diversification this could be a dangerous situation for Google in the long run.
Four giants standing proud and strong, one named after the mighty Amazon River, another named after an unfathomable number and one that prides itself on its vast number of users. In the end only the simple Apple will remain. Priding itself on simplicity and elegance Apple will continue to attract consumers, find new markets and develop as a symbol of wealth, success and even fertility.
References
“Battle of the Internet Giants,” The Economist, December 1, 2012.
HBS, 2013 - Deighton, John, and Leora Kornfeld. "Faculty & Research." Amazon, Apple, Facebook, and Google - Case - Harvard Business School. N.p., 12 Dec. 2013. Web. 07 Jan. 2017.
Wingfield, N. (2012, April 24). Apple Profit Rises on Higher iPhone and iPad Sales. Retrieved January 05, 2017, from http://www.nytimes.com/2012/04/25/technology/apple-profits-up-as-iphone-sales-grow-88.html
