Now that Apple has once again passed Google in market value, can the consumer-electronics maker maintain its lead?
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While Apple’s capitalization has risen above that of Google for short bursts in the past, it has remained higher since July 22. As of Aug. 11, Apple was worth $145.87 billion, compared with Google’s $143.40 billion. This could be a momentary shift in Wall Street’s whims — like when Cisco Systems briefly surpassed Microsoft to become the world’s most valuable company in 2000.
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More likely, Apple has more solidly unseated Google as tech’s No. 2 powerhouse and is now on track to one day challenge Microsoft for the crown. While both Apple and Google are likely to remain highly valuable in the coming years, there’s reason to believe that Apple may outshine Google in the eyes of investors.
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Dedicated Apple Customers
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Google has an incomparably profitable Web-search operation, but it incurs losses in scores of other businesses. Apple, on the other hand, makes money on everything it does — even the music and applications sold in an effort to get people to buy the hardware devices that are its true business.
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And Apple has far more room to grow based on its core businesses. While Google gets about 70 percent of the revenue from the $14 billion online advertising business, Apple has well under 10 percent of the computer business, and about 8 percent of cell-phone revenue.
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What’s more, Apple’s profit machine may be more protected from competition than Google’s. As Google executives are quick to tell antitrust regulators, consumers are just clicks away from switching search engines. But Apple has its fingers all but sewn into the wallets and purses of the millions of people who have purchased billions of songs and almost 2 billion iPhone applications from the AppStore. More than 75 million people have credit…