Apple Inc. (AAPL) Is Taking a Big Risk — Which is a Good Thing

Speaking of services
Even as Google Inc (NASDAQ:GOOG) undoubtedly has the lead in mapping, Apple is taking a direct shot on desktop platforms by releasing a Mac client for its Maps service. This comes just a month after Google unveiled a new web-based Google Maps interface at its own I/O developer conference. That wasn’t the only shot Apple took at Google Inc (NASDAQ:GOOG): Siri will now integrate directly with Microsoft Corporation (NASDAQ:MSFT) Bing for search results.

Apple also unveiled iTunes Radio, its long-rumored Pandora Media Inc (NYSE:P) killer. While earlier leaks had suggested there would be some innovative twist to the service, which was why Apple was taking longer than Google with licensing negotiations, iTunes Radio really seems like most other online music-streaming and discovery services available today. Pandora initially dropped on the announcement, but recovered as investors realized maybe the threat isn’t as dire as expected.

Risky business
Cook has been talking a lot recently of how Apple’s key to success is the intersection of hardware, software, and services. Today’s hardware announcements were relatively minor, while the software and services detailed were the meat of the news. iOS 7 is a dramatic overhaul, which inevitably entails an element of risk since Apple Inc. (NASDAQ:AAPL)’s approach to software development differs dramatically from Google’s.

Google’s strategy is to release constant, smaller updates as it experiments with new ideas and incorporates user feedback. Apple’s approach is to make bigger updates less frequently. In that sense, if iOS 7 doesn’t resonate well with users, it would probably be a long time before Apple addressed any complaints — and sales could suffer in the meantime.

One thing’s for sure, though: Good riddance to fake green felt.

The article Apple Is Taking a Big Risk — Which is a Good Thing originally appeared on Fool.com and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple, Google, Intel, and NVIDIA. It owns shares of Apple, Google, Intel, and Microsoft.

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