The Great Tech War Of 2012
Apple, Facebook, Google, and Amazon
battle for the future of the innovation economy.
From left: The late Apple cofounder Steve
Jobs, Facebook CEO Mark Zuckerberg, Google CEO Larry Page, and Amazon
CEO Jeff Bezos. | Photos courtesy of David Paul Morris/Getty
Images (Jobs); Justin Sullivan/Getty Images (Zuckerberg); Chip
East/Reuters (Page); Mario Tama/Getty Images (Bezos).
Gilbert Wong, the mayor of
Cupertino, California, calls his city council to order. "As you know,
Cupertino is very famous for Apple Computer, and we're very honored to
have Mr. Steve Jobs come here tonight to give a special presentation,"
the mayor says. "Mr. Jobs?" And there he is, in his black turtleneck and
jeans, shuffling to the podium to the kind of uproarious applause
absent from most city council meetings. It is a shock to see him here on
ground level, a thin man amid other citizens, rather than on stage at
San Francisco's Moscone Center with a larger-than-life projection screen
behind him. He seems out of place, like a lion ambling through the
mall.
Fast Company is tracking developments in The Great Tech War
of 2012 for 30 days after this story's original publication to show just
how quickly competition between Apple, Google, Facebook, and Amazon is
heating up. Follow the updates here.
"Apple is growing like a weed," Jobs begins, his voice quiet and
sometimes shaky. But there's nothing timorous about his plan: Apple, he
says, would like to build a gargantuan new campus on a 150-acre parcel
of land that it acquired from Hewlett-Packard in 2010. The company has
commissioned architects--"some of the best in the world"--to design
something extraordinary, a single building that will house 12,000 Apple
employees. "It's a pretty amazing building," Jobs says, as he unveils
images of the futuristic edifice on the screen. The stunning
glass-and-concrete circle looks "a little like a spaceship landed," he
opines.
Nobody knew it at the time, but the Cupertino City Council meeting on
June 7, 2011, was Jobs's last public appearance before his resignation
as Apple's CEO in late August (and his passing in early October). It's a
fitting way to go out. When completed in 2015, Apple's new campus will
have a footprint slightly smaller than that of the Pentagon; its
diameter will exceed the height of the Empire State Building. It will
include its own natural-gas power plant and will use the grid only for
backup power. This isn't just a new corporate campus but a statement:
Apple--which now jockeys daily with ExxonMobil for the title of the
world's most valuable company--plans to become a galactic force for the
eons.
And as every sci-fi nerd knows, you totally need a tricked-out
battleship if you're about to engage in serious battle.
"Our development is guided by the
idea that every year, the amount that people want to add, share, and
express is increasing," says Facebook CEO Mark Zuckerberg. "We can look
into the future--and it's going to be really, really good."
To state this as clearly as possible: The four American companies
that have come to define 21st-century information technology and
entertainment are on the verge of war. Over the next two years, Amazon,
Apple, Facebook, and Google will increasingly collide in the markets for
mobile phones and tablets, mobile apps, social networking, and more.
This competition will be intense. Each of the four has shown competitive
excellence, strategic genius, and superb execution that have left the
rest of the world in the dust. HP, for example, tried to take a run at
Apple head-on, with its TouchPad, the product of its $1.2 billion
acquisition of Palm. HP bailed out after an embarrassingly short 49-day
run, and it cost CEO Léo Apotheker his job. Microsoft's every move must
be viewed as a reaction to the initiatives of these smarter, nimbler,
and now, in the case of Apple, richer companies. When a company like
Hulu goes on the block, these four companies are immediately seen as
possible acquirers, and why not? They have the best weapons--weapons
that will now be turned on one another as they seek more room to grow.
There was a time, not long ago, when you could sum up each company
quite neatly: Apple made consumer electronics, Google ran a search
engine, Amazon was a web store, and Facebook was a social network. How
quaint that assessment seems today.
Jeff Bezos, who was ahead of the curve in creating a cloud data
service, is pushing Amazon into digital media, book publishing, and,
with his highly buzzed-about new line of Kindle tablets, including the
$199 Fire, a direct assault on the iPad. Amazon almost doubled in size
from 2008 to 2010, when it hit $34 billion in annual revenue; analysts
expect it to reach $100 billion in annual revenue by 2015, faster than
any company ever.
Remember when Google's goal was to catalog all the world's
information? Guess that task was too tiny. In just a few months at the
helm, CEO Larry Page has launched a social network (Google+) to
challenge Facebook, and acquired Motorola Mobility for $12.5 billion, in
part to compete more ferociously against Apple. Google's YouTube video
service is courting producers to make original programming. Page can
afford these big swings (and others) in the years ahead, given the way
his advertising business just keeps growing. It's on pace to bring in
more than $30 billion this year, almost double 2007's revenue.
