In the PC era, the big rivalry was between Microsoft and Apple. Apple’s products were considered to be better, but Microsoft’s ability to leverage its operating system across a number of manufacturers proved to be the stronger model. By 1997, Apple was in such bad shape it needed an investment from Microsoft to keep the lights on.
Yet Apple came back with a vengeance in the post-PC era, in which its ability to seamlessly integrate across devices was decisive. Apple products became more than just productivity tools, but fashion icons and soon Apple took Microsoft’s former place as the most valuable company in the world.
That rivalry is mostly over now, but a new one is brewing between Google and IBM. It’s an unusual business rivalry because the two rarely compete in the same markets or for the same customers. In truth, it is a rivalry for technical rather than market dominance. Yet much like Apple vs. Microsoft, it’s likely to determine much about how technology shapes our world.
The Cognitive Era
On February 10th, 1996, IBM’s supercomputer, Deep Blue first beat world chess champion Garry Kasparov in a head-to-head match, something many thought a computer would never do. Fifteen years later, in 2011, IBM’s Watson beat human champions on the game show Jeopardy!, which ushered in the new era of cognitive computing.
More recently, Google has made headlines of its own. In March of this year, the company’s Alpha Go system bested world champion Lee Sedol in the massively complex game of Go, a feat eerily similar, although far more impressive, to Deep Blue’s win 20 years earlier.
So far, the two companies have taken far different approaches to deploying the technology. IBM has targeted specific verticals, such as health care and has made the technology available for developers to use as an engine to power their own applications. Google, for its part, has open sourced its technology, but mainly used it to improve its own products.
Still the growing rivalry is unmistakeable. Very few companies are capable of developing this type of deep learning technology and clearly, both IBM and Google are leading the pack. To be sure, other companies such as Facebook and Microsoft are also developing capabilities in this area, but up to this point at least, they don’t seem to have made quite as much progress.
The Race to Build a Viable Quantum Computer
Another prominent area in which the two companies are competing is quantum computing. Last December, Google announced on its blog that it was able to solve specific problems 100 million times fast with a quantum computer. This was considered a breakthrough because up to that point, it wasn’t clear that the technology could actually be made to work.
More recently, IBM has announced its own breakthroughs, such as the ability to arrange qubits in a lattice and to detect errors, both critical for creating a practical quantum computer that can be used for commercial purposes. It has also made quantum computing available to the general public through the cloud.
Much like deep learning, there are other companies competing in the quantum computing space. D-Wave, a Canadian company with investments from Jeff Bezos and the CIA’s In-Q-Tel, is also competing in the space and, in fact, built the machine on which Google performed the test noted above. Microssoft also has a serious, although somewhat speculative effort.
So while they are far from alone, Google and IBM also seem to be leading the pack when it comes to making progress toward a quantum computer.
A Cloud Like We’ve Never Seen Before
New technologies like artificial intelligence and quantum computing will take on greater significance in the years to come because we are about to see a major paradigm shift in technology. For the past 50 years, we’ve been advancing Moore’s law, which predictably doubled the power of technology and made it relatively easy for many firms to compete.
Yet that era is now ending and Moore’s Law is unlikely to be a factor after 2020. There are some new technologies, like 3D stacking and silicon photonics that will extend progress, but clearly we will have to create fundamentally new computing architectures, like quantum computing and neuromorphic chips in order to advance.
This is one area where the two giants are actually beginning to compete directly, but again their respective approaches are worlds apart. Google’s cloud business, much like Amazon’s, is largely self-serve and basically offers the company’s infrastructure to other companies. It is simple, cheap and effective and will likely include quantum computing in the future.
IBM’s approach is currently centered around its Bluemix “platform as a service” offering and will also evolve in the years to come. It is investing in a wide spectrum of architectures, including quantum computing, neuromorphic chips as well as a number of other approaches.
A Different Kind of Rivalry
Today, IBM and Google are very different businesses. While Google offers products directly to consumers, IBM mostly designs powerful systems for enterprises. Google makes the bulk of its money through advertising, while IBM has a large and highly qualified sales force that can service demanding customers.
To be sure, in many ways, IBM and Google are at opposite ends of the spectrum when it comes to focus, business model, and operational structure. Still, in conversations with both companies, I can’t help but feel them eyeing each other warily. After all, while their businesses may be far apart, they are both competing for the same technological high ground.
Yet this is decidedly a different kind of rivalry than Microsoft vs. Apple or Pepsi vs. Coke. Even where the two firms have similar businesses, their divergent approaches makes it rare that they compete for the same customers. Google is focused on consumers and Silicon Valley startups, while IBM is set up to provide a high level of service to large enterprises.
It is, of course, possible that at some point in the future IBM and Google will compete more directly for customers. For now though, it is mostly a competition for who can expand technological horizons faster and more completely. It is, then, a contest in which the most likely winner is the rest of us.
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