34 Comments

Summary:

The Apple-Google breakup poses a promising opportunity for other existing and emerging technology powerhouses. But which one of them will be Apple’s new most-favored nation? Signs and logic point to Facebook.

Before a dramatic split last August that saw Google CEO Eric Schmidt booted from the Apple board, Apple and Google had been the best of friends. Now that the two titans are broken up, it’s looking increasingly likely that Apple will buddy up with Facebook.

Apple and Google once shared a common enemy — Microsoft — and had different enough products and goals to coexist symbiotically. But with Google creating and selling Android devices as a direct competitor to the iPhone, swooping in to buy companies like AdMob under Apple’s nose and bringing the FCC in over anti-competitive maneuverings in iPhone app rejections, Apple CEO Steve Jobs has rallied his troops by calling bullsh*t on Google.

See our infographic on the chronology of the Google-Apple breakup

The situation poses a promising opportunity for other existing and emerging technology powerhouses. Who will be Apple’s new most-favored nation? It probably won’t be Amazon, given that little issue of the iPad and the iTunes Store. It could potentially be Microsoft, which is ironically looking for friends as it faces up Google in search and productivity products. But it’s clear that Apple holds grudges. How about Yahoo or AOL for their reach? They may have more baggage than assets. At this point signs and logic are pointing to Apple’s new best friend being Facebook.

TechCrunch reported earlier this week based on uncited sources that Apple will soon add Facebook Connect integration to iTunes. I’ve heard the same thing, and further that Facebook could become the social layer on top of the Apple experience. It would be similar to but broader than the way Google Maps is integrated into location information across iPhone applications — with deep implications for personalization and easy authentication across the user experience and for app developers. Instead of that crappy experience of leaving every app to go to the web to log in to Facebook Connect, you could integrate your Apple and Facebook accounts once, directly.

Apple, which has completely missed out on the social web, would get a huge leg up with the web’s premium social service. And the partnership could be just as helpful for Facebook (which, of course, has positioned itself squarely against Google as well), in terms of enabling commerce.

Facebook Connect on the iPhone today

That’s because the real prize here, for both Facebook and Apple, is authenticated payments for digital and real-world goods. Probably the single most important alliance to be brokered today is the connection between users’ online identity and their bank accounts. Spending money online and encouraging your friends to follow your lead is a huge market (here’s the obligatory call-back to the problematic but perhaps just before-its-time Facebook Beacon product). The Facebook social graph plus iTunes’ 125 million credit card accounts would be formidable. With their powers combined it would be much harder for PayPal, Google and Amazon to compete.

 Facebook and Apple have long been chummy, with some of the earliest corporate participation on the site being the “Apple Students” group, which dated back to at least 2006 and foreshadowed the current Fan Page product. And funnily enough, just like Apple has lagged on social, Facebook has lagged on music.

Facebook already has the beginnings of an alliance with PayPal to allow international advertisers to pay without credit cards (PayPal says it has more than 81 million active accounts). But as TechCrunch points out, Apple’s Lala acquisition could help be the connector between the two companies, given the music startup’s previous experience working with Facebook on allowing users to gift songs.

Still, there’s one indicator that Facebook and Apple are definitely not on the same page yet. At launch, there was no Facebook iPad application — an obvious fit for the device — and someone on Apple’s crack app review team let through a paid Facebook rip-off app that fooled and confused customers last weekend until Facebook had it shut down for trademark infringement.

Photo of Steve Jobs by Curious Lee. Mark Zuckerberg by Deney Tereio via Flickr, Under CC License.

Related content from GigaOM Pro (sub req’d):

With the iPad, Apple Takes Google to the Mat

Please see the disclosure about Facebook in my bio.

  1. Without Flash, you can’t play Farmville. Which means all those micro payments that Apple may lust after aren’t going to work out so well when all those Flash games get turned into little Lego blocks.

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  2. OH God… Farmville again.. I Play it, it was just an OK game. MY facebook crashes due to all the game loading i.e. Farmville, Cafeworld etc. It’s not too much fun that I have to wait or after I click everything then “page needs to reload” message. I think Facebook needs to ditch Flash for something better. In fact, I found other social games for my iPod is more fun and I actually pay for something compare to Facebook games that I have never paid for anything.

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  3. It’s more consistent with Apple/Jobs history to invent a competing social network that spins out from the iTunes base.

    The social network crowd from Twitter to Facebook have no end of platform criticisms that could be addressed easily by a firm that understands user-friendly.

    Not as if they’d have to start from scratch. How many iTunes subscriptions are there? Adding a social network gateway creates another symbiosis.

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  4. So is Zuckerberg going to jump on Apple’s platform and then there will be this big fight. When they do something Apple doesn’t like.

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  5. Why Apple believes that it should control every aspect of the computing experience is beyond me. Partnering with Facebook is a good sign, but treating developers as partners and allowing them to develop stuff even at the expense of iTunes is important. Hell, buy them if they become successful. Don’t have enough cash?

    The worst aspect of Apple, Microsoft, Google, etc. is that they want the whole damn pie. Lighten up people! You’ll make money.

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  6. This will be interesting to watch as Apple and Facebook size up each other, the fit makes sense but in a limited way

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  7. Apple may have enough cash to acquire Facebook outright. It would be unlike Ape to do so, but it would also open tons of possibilities.

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  8. First, I must complain. Based on the headline I thought you had something far more concrete.

    That said, really like this article. I have commented here on the (old school) fallacy of closed systems vs open systems. That’s the past. Now it’s ecosystems. And Apple and Facebook have each built thriving ecosystems. If they link them up, that’s a powerhouse!

    I’ve said it many times on my site: the smartphone is the computer! Right now, Apple makes the best smartphones, Facebook is optimized for smartphones, Paypal has just released a darn good iPhone app and Apple has taught consumers to keep a lot of their stuff in the cloud.

    Facebook can’t go public soon enough for me.

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  9. If Apple thinks that consumers will trust Facebook — after its persistent invasions of privacy and spamming of users’ e-mail address books — to handle their online payments, it’s sorely mistaken.

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  10. [...] Why Facebook & Apple Will Team Up Against Google — GigaOm Damon Darlin says: New best friends? Facebook and Apple need each other to fight Google. [...]

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  11. I hate Google. But I hate Facebook more, and love Apple. This has disaster written all over it.

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  12. Interesting trajectory prognostication.

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  13. [...] 4/8/2010 Update Why Facebook & Apple Will Team Up Against Google [...]

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  14. Apple should just buy Facebook. It has the money.

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  15. Apple’s idea of social networking is its shepples sit in straight rows and clap every time Dear Leader puts up shiny trinkets.

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  16. @zonnked

    With billions in the kitty, does Apple needs to be concerned with loose change, learn to add….

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  17. I think that it is unfortunate for google as well as apple that they have split now. Because both can work for each others benefit.

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  18. Hamranhansenhansen Thursday, April 8, 2010

    Yeah, Apple should just buy Facebook. The problem with Facebook is they keep having to sell user’s data to try and make money. As part of Apple they would make money by selling devices.

    Without Flash, you can’t play Farmville.

    Sure you can. The Flash development tool can export iPad apps, iPhone apps, Mac apps, as well as Windows apps, and apparently they are adding Android and Blackberry export targets as well. Running Flash in the browser is obsolete due to FlashPlayer not being available for ARM mobiles (not just Apple devices), but running Flash natively is just getting started.

    Why Apple believes that it should control
    every aspect of the computing experience is beyond me.

    They don’t control stuff, they take responsibility for stuff, so the user doesn’t have to. If you want to take responsibility, go ahead. The Mac is a Unix, there’s nothing stopping you from doing whatever you want. iPhone OS runs open HTML5 apps, you don’t have to use App Store. You can load any ISO media into iTunes, you don’t have to use iTunes Store.

    Apple … want the whole damn pie

    That’s ridiculous. App Store developers get 70%, iBooks book publishers get 70%, music and movie publishers get 90%. Apple open sourced their Web browser engine and it’s used in Google Chrome, Android, Palm, Nokia, Blackberry, and Adobe products.

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  19. [...] Neue Freundschaften beschwört bei GigaOM [...]

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  20. Facebook is showing more and more problems every day and people are getting more and more turned off by it from what I can tell. One thing that Apple and Google both share is they are both extremely innovative and both make products that work impeccably. You can’t say either of those things about Facebook. I love all my Apple products but if they partner up with Facebook I’ll ditch my iPhone in a heartbeat and go back to my Blackberry or try an Android phone.

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  21. ”Still, there’s one indicator that Facebook and Apple are definitely not on the same page yet. At launch, there was no Facebook iPad application — an obvious fit for the device — and someone on Apple’s crack app review team let through a paid Facebook rip-off app that fooled and confused customers last weekend until Facebook had it shut down for trademark infringement.”

    Those are all excellent points. They are also points which do tell us that these two companies are almost certainly not yet on the same page – Besides, Google would only go and buy out Bebo or Myspace anyhow.

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  22. I think when people say “Team up against Google”, they are referring to the many mini-markets that Google is trying to get in.

    But, we all have to remember that Google is miles beyond both these sites. Last time I checked, Google is developing its own OS, has data-centers around the World that can rival any ISP, has small usable programs, the future around television (Google TV and TV ads, failed but gave much info about what it would need from another company that will be eventually bought out ), and it’s upcoming ability to develop a city-wide broadband service that is cheap ( coinciding with the current administration’s talk of “cheap, high-speed broadband expansion ).

    The writing is on the wall what Google is trying to. While Facebook/Apple/Microsoft are battling for information supremacy on the net, Google is trying to own the internet itself. Why sell candy bars, when you can control the entire cocoa market?

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  23. [...] 4/9/2010 Update Why Facebook & Apple Will Team Up Against Google [...]

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  24. [...] 4/10/2010 Update Why Facebook & Apple Will Team Up Against Google [...]

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  25. wow, can’t believe i missed seeing this earlier.

    great piece liz… right on target.

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  26. I think Facebook has some serious work to do on the trust/privacy/security front before I would trust them with my credit card information.

    Apple and Amazon have both invested a ton of time, energy and money in building the trust relationship that they have (mostly) with consumers. Facebook is at square one as far as I’m concerned.

    It doesn’t mean I disagree but that maybe it will take longer and depend more on how Facebook executes than some expect.

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  27. I find this humorous! I think the whole thing is a bunch of rubbish. Who cares. Let them fight it out. I’ll just find an obscure 3rd party and wait it out. xD

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  28. [...] will vanish and be replaced by an auto-login. (This painless sign-in might be the reason Apple is said to be looking to integrate Facebook Connect in its iTunes [...]

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  29. [...] will vanish and be replaced by an auto-login. (This painless sign-in might be the reason Apple is said to be looking to integrate Facebook Connect in its iTunes [...]

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  30. [...] jugarán un papel crucial en el desenlace final de esta historia. Y todo parece apuntar a que Apple y Facebook cada vez se ven con mejores ojos. De hecho, ya se habla de que la nueva versión de iTunes incluirá Facebook Connect como soporte [...]

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  31. [...] will vanish and be replaced by an auto-login. (This painless sign-in might be the reason Apple is said to be looking to integrate Facebook Connect in its iTunes [...]

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  32. [...] Facebook most closely with Google on mobile apps vs. native apps, and the second points to the expected partnership between Facebook and Apple to provide a social layer throughout the iPhone, iTunes and other Apple products. That move would [...]

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  33. [...] I found a huge brouhaha around Ping and Facebook. Apparently, those two are not BFFs anymore. There was some talk earlier that Facebook and Apple were working closely on a version of Ping. It was rumored that Facebook [...]

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