Apple 2.0

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Charlie Wolf: Google Maps a mixed blessing for Apple

December 14, 2012: 8:18 AM ET

Both companies benefit from a better map app, but Google more than Apple

Google Maps for iPhone.

Google Maps for iPhone.

FORTUNE -- The first analyst we've seen to comment on Google's new Maps app for the iPhone is Needham's Charlie Wolf. He makes several points:

  • A dependable, well-designed iPhone map app benefits both companies, but Google (GOOG) probably more.  Google is in the advertising business, and the app should soon begin to generate location-based ad revenue from millions of iPhone users.
  • It's more of a mixed blessing for Apple (AAPL).
  • On one hand, the app should go a long way to repairing the bad rap iOS 6 got when it launched in September with its own map program. It could attract, Wolf writes, "a meaningful number of new users to the iPhone who had previously shunned it."
  • On the other hand, if users flock to Google's app it will slow Apple's efforts to fix its own. "That's because," Wolf explains, "users' input is critical in improving the quality of the application, and Apple will now receive less feedback on its own Maps app."
Wolf's conclusion: "The risk in the Apple story—and a legitimate one—is that the company may no long[er] innovate at the same pace and with the same disruption that marked the Steve Jobs era. The Apple Maps fiasco earlier this quarter, along with the firing of two senior executives, only served to heighten this perception."
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Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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