The Shape of the Battle for Hardware, Software and Cloud

There is something strangely familiar about what is going on in tech. We’re having something like an early-1980s operating system struggle, with corporate survival as the prize.

June’s three big announcements by Apple, Microsoft and Google made plain that we have a new mainstream model for using computers. As one of the participants noted, it is marked by the interaction of “the hardware, and the software and the cloud.”

The three big companies all seem to have a big cloud computing capability, a decent-looking mobile device, and relationships with software developers. Those may be the minimum elements for competition in the new world. The two great challenges are mastering the cloud technology and convincing outside developers to join your team, making things to go inside one or another system.

It is notable that two of the three companies, along with Amazon, another contender, come to it with a history of providing cloud services. Google did search, Apple had iTunes even before its iPhone apps store, and Amazon sold books over the Web before going into electronic media. Even Microsoft has experience, though Xbox games,.

“This time, more than just owning an operating system, it is about understanding how well all the pieces fit together,” says Oren Michels, chief executive of Mashery, a company that brokers relationships between software developers and companies looking to get applications on the cloud and mobile devices. “Successful newspapers understand distribution too. Being in an online business to begin with may be the best way to succeed in an online business.”

Winning developers may be even harder. As broad and open as the Internet supposedly is, mobile applications are anything but. Writing an iPhone app is not just different from writing an app on Google’s Android operating system, it is substantially different from writing for an iPad, since there are different screen sizes and usage contexts for each device. How a person interacts with a device, including things like touch versus keyboard inputs, can differ from one culture to another.

“We’re all chasing the same finite amount of human creativity,” says Bradley Horowitz, vice president of product management at Google Plus, Google’s social network. The developers’ motivations in choosing one over the other, he adds, “are like anyone’s. They want the attention of the world. That can lead to monetization.”

There are probably a few other contenders for dominance. History may belong to the winners, but for a time in the early 1980s, Microsoft and Apple strove alongside Commodore and Sinclair, and they were all plausible contenders. The first two companies won the developers. The first two prospered.

Amazon, with the world’s largest public cloud and a popular device in the Kindle, is an important contender. Amazon just bought UpNext which makes three-dimensional maps for mobile devices. It’s hard to imagine this won’t be a feature on the Kindle soon, putting it closer to the same class as an Apple iPhone, a Google Nexus, or possibly a Microsoft Surface.

In an important sense, Amazon already has a big developer base: they’re called authors. Developers, after all, are just people who make something that in turn makes your software and hardware more attractive to consumers. For Google, this is people who modify Google Apps, but their “developers” are also the people who load videos on YouTube, or write the blog posts where Google’s ads go. How Amazon will build out a business in mobile applications, engaging more traditional software developers, has yet to be seen.

Nokia has tremendous market share in devices, which is attractive to developers since it means a big audience. Nokia has no cloud, though. The company is close to Microsof, and is run by a Stephen Elop, a former Microsoft executive.

Microsoft’s cloud, called Azure, however, seem to draw the least attention or usage. Possibly hedging its bets, in January Nokia named to its board Marten Mickos, the chief executive of Eucalyptus an open source cloud computing company based on Amazon’s cloud.

We may not see many more emerge, though it is notable and perhaps odd that there is as yet no big non-U.S. competitor to these giants. If there will be, it better move quickly.

Then as now in the tech transition, failure is fast. Already in this cloud-device contest, we’ve seen pioneers like Palm disappear as a company. Research in Motion, which might have had a brighter future, is seriously troubled. A few years from now, there may be other Commodores or Sinclairs by the wayside.