The insight gained from the VCR format wars is to compare the way each company, Sony for Betamax, and JVC for VHS, handled the war, who won, who lost, and most importantly of all, why.
The rest of this post is long, but please read it and see if you can find parallels between Google and Apple in how Sony and JVC handled the VCR wars.
Sony basically invented the home video cassette, the Betamax. Sony had the whole market to its self. There was no competition. At first.
Other companies wanted to make Beta VCRs, but Sony either did not want to sell licenses or wanted licensing fees that were so high that none of the other electronics companies were willing to pay. Sony thought that they would have the whole market for home video to themselves. See any parallels yet?
So Sony had the market all to its self, for a while. The Beta VCRs were beautifully made, expensive as all get out, and produced great video. Period.
But, JVC wanted in on the rapidly increasing action in the market for home video recorders, and either did not want to pay Sony's ludicrous licensing fees, or couldn't get a license from Sony. So JVC set about designing their own video cassette system. They named it Video Home System, or VHS. The quality of the images it produced was not as good as Beta, but were passable in those days.
Now, how could JVC make the VHS system popular enough to sell well enough to make a profit for them? There were no other VHS machines available, no VHS content (pre recorded movies to rent, etc), no VHS camcorders, etc. Why would anybody buy them? Going up against Sony's monopoly on the home video market seemed impossible.
JVC GAVE AWAY LICENSES TO FIVE OTHER COMPANIES THAT WANTED TO MAKE VCRs! Yes, "gave," as in for free, at no cost, no royalties, etc. They essentially created an open system to fight Sony's monopoly. Now is this beginning to remind you of the smartphone wars?
The VHS VCRs proliferated, there was price competition right from the start because 5 manufacturers were making and selling the recorders. And they started to sell well against Sony's high priced, heavily controlled Betamax ecosystem. The content providers jumped on the VHS bandwagon too, and VHS began to grow very fast and quickly took the lead in the market. Sony's Betamax was relegated to a niche market of purists who wanted the best quality video. But the number of content providers producing content for Betamax dwindled.
Okay, to summarize all that long-winded stuff, above: Company A creates a new, innovative, and exciting product. A thinks they will own the whole market with it and refuses to license it to others (or wants so much for a license that no one would buy one). Company G develops their own approach to the newly created market. Company G decides to make its standards essentially open source. In the end, company G wins out as their standard takes the lead in the market that Company A created.
Think about that, Company A could be either Apple or Sony, and Company G could be either Google or JVC. In either case, the company that fostered competition and started with an open market eventually won and took over the lead in the market, leaving the inventor of the market stuck in a small niche of the larger whole market. The company that tried to monopolize the market ultimately lost out. Maybe markets (as business people would define them) will ultimately reject monopolistic control and reward competition and open sources. Sure seems so in the VCR format wars, and seems to be coming true in the smartphone wars too.
This is all a long winded way of saying that Android is not going anywhere but up until and if some other development pushes them aside. Apple is probably going down eventually, and becoming a niche market player. Or they will wake up, grow some brains and license out the iphone and iOS, charge reasonable fees, and grow like a weed.
Oh, there were legal battles between Sony and JVC. Sony tried to stop the sale of the VHS system because, they claimed, it infringed on their patents. The legal battle raged on for years, as VHS took over the market. Guess who ultimately lost that court battle.
Even if Apple wins a few of the battles it is engaged in, Android will continue to grow, and stay healthy for a long, looonng time. Period.
