1. Apply the new-product continuum on p. 332 to Google€™s Moonshot Factory. Which category is most evident?
2. Assess the prospect for driverless cars. Once the technology is perfected, what obstacles will Google have to overcome before the concept becomes widely adopted?
3. If you were an executive at a car manufacturer, would you adopt Android Auto or CarPlay for your vehicles?

Google€™s dominance in search and other online spaces allows the company to collect vast amounts of data that help it deliver targeted advertising. In fact, advertising accounted for more than 90 percent of Google€™s $66 billion in 2014 revenue. However, as growth in the core advertising business slows, company executives are seeking to diversify Google€™s revenue stream. Plans for some promising new products, including Google Glass, have been scaled back. Moreover, Google€™s ability to link its various Web sites to the search process has attracted the attention of antitrust regulators in Europe.

Android OS
In terms of global sales, smartphones that use Google€™s Android operating system account for roughly 80 percent of the market. Google provides Android€”known for its green Bugdroid brand mascot€”free to handset and tablet manufacturers; Samsung, Motorola, HTC, and LG, not to mention Google€™s own Nexus devices, all use Android. One reason for Android€™s popularity is the fact that Samsung and other handset manufacturers offer a variety of screen sizes and price points.

By contrast, Apple€™s iOS is only available on Apple€™s iPhone. Prior to 2014, the iPhone was not available in large screen sizes. Although the number of apps available for Android slightly exceeds the number for Apple, some developers prefer the iOS platform. One reason cited is the superior ease of use of Xcode, Apple€™s development environment, compared with Android€™s Eclipse. Also, the iOS customer base tends to be more affluent.
As mobile video games grow in popularity, Apple and Google are jockeying for dominance in the mobile space. Both companies offer game developers extra promotional support in exchange for exclusivity for new game titles. For example, Electronic Arts recently released €œPlants vs. Zombies 2€ on Apple€™s App Store two months before the title was available for Android phones. One industry observer likens the competition to an €œarms race for the best content.€

Self-Driving Cars
The phrase €œautonomous functionality€ has been used to refer to cars that can park themselves, and one day, perhaps even operate without a human driver. Driverless technology is one example of the type of €œmoonshot€ that Google is aiming for. While traditional car manufacturers such as BMW, Daimler, and Audi are seeking incremental improvements via driver assistance technology, Google hopes to achieve a quantum leap. However, many technological hurdles remain, and it is unclear how regulators will respond to a fully autonomous car (see Exhibit 10-12).
Such cars will be equipped with roof-mounted lasers. Although the technology originally cost about $75,000 per vehicle, engineers working on the project expect that figure to quickly fall within a range of $10,000 to $15,000 per vehicle. Data from the lasers create a picture of the vehicles€™ surroundings. Those readings, plus information from sensors in the wheels and elsewhere, are fed into an onboard computer. Software then selects the appropriate speed and route.
Company executives predict it will take five years for Google to perfect the technology. Meanwhile, the company is competing with Apple in the automotive space on a more modest scale. Both companies are creating platforms for connecting their respective smartphone software with automotive in-dash systems that provide entertainment, maps, and other services. Music streaming, stateof- the-art voice recognition, and other functions will be standard equipment in the years to come.

Exhibit 10-12

Transcribed Image Text:

Cooge