Google And The iPad

BURLINGAME, Calif. -- Apple's new iPad aims to remake a market touched on by laptops, tablet computers, netbooks and even the iPod--portable devices for the creation and consumption of media, largely text and video. That also hits its increasingly active competitor Google.



The iPad met a mixture of reviews Wednesday, largely inflected with disappointment by people who were expecting much more--a salvation of journalism, the remaking of reading, destruction of the broadcast world, something like that. On its own, however, it may be a worthy device with an acceptable price point (one likely to fall) that should attract a lot of third-party developers. There is also talk of a new kind of electronic bookstore, which should make publishers happy.

Google ( GOOG - news - people ), on the other hand, may not be so amused. Chief Executive Eric Schmidt has talked openly of creating a powerful and cheap netbook computer by late 2010. Judging from his words, the Google netbook (or, given the way fashions are trending, perhaps now a tablet) will be priced far below Apple's ( AAPL - news - people ) range of $499 to $829.

Both companies are aiming at the business market, but with very different intentions. Apple, long a seller of hardware, is thinking in terms of something cheaper than a laptop, or better than a netbook. Google sees its device as a means to accessing its main businesses of Internet search and, increasingly, Internet-based office applications like word processing. The Google machine might even be subsidized like a cellphone, thrown on at a deep discount for a subscriber to Google Apps.

The two companies have been coming at each other for a while. Google's Nexus One phone is a rival to Apple's iPhone, and Apple is said to be building big data centers to offer online services a la Google. Earlier this week, Google released software for the iPhone that lets users make cheap long distance calls via the Internet, avoiding some charges by phone companies. Google tried this last year, but Apple did not approve the product. Schmidt resigned from Apple's board soon after. The new Google software can be accessed via the Internet, dodging Apple's control.



Who wins this battle may depend on the market result of corporate style. Both Apple and Google have outstanding recent track records on innovation and disruption, but the companies go about it in very different ways. Older Apple, schooled in selling delightful consumer technology products, has a discipline of process control. Its stuff comes out with the hardware and software created in parallel for maximum performance. With the iPod music player, the online store became part of that process. New versions of products roll out, and sometimes (as with the Mac or the iPhone) outside developers contribute ancillary products, but Apple's taste in the matter rules.