- Lines. I'm still waiting to see a line for an Android phone. Apple's ability to initiate global pandemonium is unparalleled. Every Apple store, no matter its geographical location, experienced long lines and shortages for the iPhone 5.
The lines and delays will remain one month after launch and might even extend into the holidays. These consumers aren't a group of crazed kids lined up for the latest "Harry Potter" movie. Apple lines are filled with successful businesspeople who can't wait to get their hands on the best consumer product in the world. No competitor can generate consumer demand like Apple.
- Clicks. I don't click on online ads. Ever. I don't know anybody who clicks on online ads. When I watch television, I use Dish's hopper to skip every commercial I can.
According to a recent Ad Age study I'm not alone. Less than 1% of people click on digital ads. We avoid them like the plague.
So how did Google earn $2.8 billion last quarter? In their own words it was because of "refinements to the company's Internet search technology that lured more Web surfers to click on revenue-producing ads." Do you want to know what that really means? It means they became more sophisticated at tricking users.
By making the "close x" button even smaller it increases the number of accidental clicks. By placing ads over text it increases the number of accidental clicks. By relaxing ethical standards of the software it can increase the number of fraudulent clicks by greedy Web sites and competitors looking to drive up the cost for advertisers.
I have been suckered into clicking on ads because of their placement more times than I can count. It's even worse when I'm Web browsing on my mobile device. Google has become a master at leveraging the inefficiency of fat finger.
Ninety-six percent of Google's revenue come from advertising. In other words, Google's revenue comes from something we all try to avoid while 96% of Apple's revenue comes from something we're willing to wait in line for.
As Google's price per click rate drops because of confirmed click fraud, Apple maintains premium pricing power because its products are best on planet.
Inside the bowels of Google and Facebook (FB) they're asking themselves how much longer the pay per click honeymoon will last. In a recent report issued by Trademob it was revealed that at least 40% of mobile ad clicks are fraudulent or accidental.
It's no wonder that both Facebook and Google are trying so desperately to expand their business models. The Apple envy is apparent with each and every attempt to launch competing products.
- Innovation. Jim Dalrymple at LoopInsight has done a great job of putting the Samsung/Apple patent case into proper perspective. Among the multitude of great posts, my favorite is the 31-second clip of Steve Jobs at the iPhone introduction in which he concisely lays the foundation of Apple's homegrown innovation.
Most people have forgotten that a keyboard or stylus were the technologies of choice prior to Apple's multi-touch. Apple changed the entire industry.
Purchasing a Samsung Galaxy and its stolen IP is in essence choosing South Korean copycats over America's finest. If you want American innovation, buy Apple.
Android is a free version of Apple's innovation that originated during Eric Schmidt's time as one of Apple's board of directors. He saw where Apple was about to take the industry and knew that Google would be a victim unless they copied Apple's game plan.
Unfortunately for Google investors, Android is a zero-margin product with a singular purpose of generating mobile ad clicks. Being two steps behind and unable to catch up has become Google's identity. As soon as an alternative ad platform is developed to eliminate the fraud of clicks, Google will be left naked.
- Mobile. The Apple ecosystem is the gold mine of technology. In a mind-blowing report released two weeks ago, Onswipe claims that the iPad accounts for 98.1% of all mobile tablet browsing.
Google's recent stock action is performing as if it was added into the Apple ecosystem, not taken out. Losing the native app for maps and YouTube in iOS6 is a major blow to Google's mobile future. The data that they had access to via Google maps on iPhone's was invaluable.
On Sept. 12, GOOG stock was priced at $680, the day of the iPhone 5 event. Since that time, the stock has risen $88. Such a big run in the aftermath of getting booted from Apple's ecosystem looks more like a short covering rally than anything else.
As apps continue the trend of replacing Web sites, Google advertising will suffer. I'll repeat, you'd rather be getting in the Apple ecosystem than getting out.
Google's mobile future is dependent upon Android and fat fingers. Apple's mobile future is dependent upon the profits of iPhone, iPad, and iPad mini sales. Last quarter Apple earned $8.8 billion in profits compared to Google's $2.8 billion. Apple's lead stands to increase with the introduction of iPhone 5 and an iPad mini.
- China. I'd rather be experiencing growth in China than be out of China. Another win for Apple. Google has no excuse for not staying in China. The evolution of open news flow will take time and Google should be part of it. Instead, they quit.
EconomicTiming.com we've demonstrated what can happen when an investor is in tune with a market leading stock like Apple. That being said, we know there will come a time when Apple's tenure as leader of the pack will end. Has that moment arrived? Is it time to abandon Apple in favor of Google? Let's consider the following five elements: