I think most business experts would say Apple is in a better position. It’s usually preferable to go after a high profit market niche. Nobody wants to be in a commodity market. Apple also has higher brand loyalty, but they probably spend more per customer too. Google spends very little on customer service. It’d be naive of Google to think they can simply raise prices in the future and expect customers to remain loyal. Napster tried that.
Also, Apple not only has more margin, but higher overall profit, so they’re the ones with more wiggle room to test products, try new markets, etc.