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Is Google Now the Best iPhone App?

With 750,000 or so apps available in Apple’s (NASDAQ:AAPL) App Store, the arrival of one more isn’t usually cause for fuss.

But Google’s (NASDAQ:GOOG) newly released Google Now — which is actually baked into a new version of Google Search for iOS — is a big deal.

As an app that competes in many ways with Apple’s own Siri voice assistant, Google Now is another shot at replacing one of Apple’s default installed apps with Google’s own; it’s the second salvo since Google Maps came back to challenge iOS 6’s built-in (and flawed) Maps app.

The other notable point of this milestone is that, due to Android fragmentation, Google Now isn’t available on most Android phones. As Gizmodo pointed out, the availability of Google Now means “the iPhone is one of the best Android phones you can buy.”

Both points come back to a common root issue: Companies make money from online ad revenue. (Google in particular depends on it.) Mobile is becoming the platform of choice for users, and mobile search makes targeted advertising increasingly valuable.

For Google, getting its own voice assistant on the App Store means that iPhone users who aren’t happy with Apple’s Siri have another option. According to many reviewers, Google Now is actually better at voice control than Siri. Perhaps even more importantly, Google’s voice-controlled assistant runs just fine on older iPhones, whereas Apple restricts Siri to the iPhone 4S or iPhone 5 (and its latest iPad).

I updated Google Search on my iPhone 4 last night to get Google Now. The software was bang-on in interpreting my voice commands, and the information it returned was fast and relevant. If Google can get a chunk of iPhone users to install and use Google Search (along with Now), that means recapturing search revenue that would otherwise have gone to Apple.

The second big thing about Google Now is how it starkly illustrates the problem Google faces with Android fragmentation. While Gizmodo’s headline sounds a little over the top, there’s a nugget of truth to it.

Google Now was considered to be one of Android’s key advantages — a killer feature that was often compared to Apple’s Siri, but was actually capable of much more. But for Android devices, Google Now requires Jelly Bean — a version of the operating system that only 25% of Android smartphones are running. Even worse, many of those phones will likely never be upgraded to Jelly Bean.

The iOS version of Google Now might not be as fully featured as the Android version — for example, because of iOS limitations, it’s not as easily accessible and currently lacks notifications — but the vast majority of iPhones will be able to make use of it, while only a quarter of Android smartphones can.

And that’s the business dilemma posed by Android fragmentation.

Besides increased support costs and ticked off customers, Google can’t reap the full benefits of having its operating system powering 70% of smartphones when so many of them are running older operating system versions with little hope that manufacturers will put the effort into upgrading them.

Why should they? If Samsung (PINK:SSNLF) can get away with convincing customers that the way to get Jelly Bean is to buy a new Galaxy S4, why wouldn’t it go for the new phone sale?

Apple is going to be facing more incursions like this from Google, making iOS 7 — its next mobile operating system, and the first under the oversight of Jony Ive — critical if it wants to keep control of its own mobile desktop instead of having it overrun by Google apps.

At the same time, Google will continue fighting tooth-and-nail to maintain a presence on the iPhone and iPad — a position that has even greater importance when you consider the fractured state of Android.

With all of this wrangling, there’s a decent chance that alienated Android users might actually switch to the iPhone — at least those who aren’t stuck on using a 5-inch smartphone. If they can get the key Android features on Apple’s device, the switch probably makes sense.

Frankly, it wouldn’t matter all that much to Google (it doesn’t collect any license fees for Android), so long as Google apps were front and center on that iPhone.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media, https://investorplace.com/2013/04/is-google-now-the-best-iphone-app/.

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