Will Apple finally put a crosshair on Google?

From the consumer's point of view it is amazing that both Apple and Google perhaps the web's two most popular companies have recently started competing head to head on some products and services.

This includes Apple heading into Google's domain with mobile advertising for the IPhone and Google's Chrome browser and Android mobile phone OS.

In recent times both Google ($6.7 billion in advertising revenue for the first quarter of 2010) and Apple (Revenue for the fiscal quarter ending March 27 was 13.5 billion) have been both extremely profitable.

In this authors opinion they will also continue to do so, but it is likely that in especially the mobile phone market advertising their will battle lines drawn between the two.

Consider that in August 3, 2009-Apple® announced that Dr. Eric Schmidt (Google CEO) resigned from Apple's board of directors, due to conflicts of interest. Just the first steps in what could serious competition within a few years.

Mobile Phone Handsets

On a local US market basis based on the market research from The NDP Group RIM's Blackberry OS remained at the top with 36%, while Android jumped to number two with 28%, followed by the iPhone OS at only 21%.

This certainly sounds impressive however looking at the below table it is obvious that Apple has tremendous potential for growth just for handset sales alone when looking worldwide.

Google just has an open source mobile OS so an increase in mobile phone handset sales is likely a cross subsidy ploy to increase their mobile advertising business availability, which this certainly does.

Source: (http://www.gartner.com)

Mobile Phone Advertising

In conjunction to the potential windfall to Apple from handset sales alone as indicated above, a report from Gartner (http://www.gartner.com) a business research company forecasts that the worldwide mobile advertising market alone will be worth over $12 billion by 2011. In addition consumers would spend about $6.2 billion in 2010 in mobile application stores. So potentially market penetration could be higher for both Google Android Phones and Apple IPhones worldwide with their share of the pie likely to increase with corresponding profits. These gains would be further increased with the pie growing larger with budgets from mobile advertising growing over time.  For both companies a definite win-win in this new lucrative market.

Web Advertising Market, Are They Still Allowing New Entrants?

So while the $12 billion in the growing mobile advertising market would be successful for both companies, why should Apple not go after Google in their comfort zone in the mainstream internet advertising market?

For the United States market Interactive Advertising Bureau reported that internet advertising was $5.9 billion for the first quarter of 2010. Worldwide spending on internet advertising is forecasted by some to top $100 billion in 2011.

So while it is interesting that Google and Apple are competing head to head in the mobile advertising market, I wonder if Apple perhaps thinks that $100 billion dollars in worldwide internet advertising potential should be ceded mostly to Google. Can Apple compete with Google's online products and services? I certainly think of all the companies Apple definitely could do it.