Last week was jam-packed with events, showcases, acquisitions, court cases, government-bashing and more. Here are a few of the top stories.
Apple: Between the Devil and the Deep Blue Sea
At the Worldwide Developers Conference (WWDC), Apple (AAPL) tweaked its OS (better user interface, cleaner colors, improved multi-tasking), enhanced its services (Siri, Maps, iCloud), added a QR code reader to Passbook, introduced iRadio, which is very similar to Pandora’s (P) service, refreshed the Macbook Air and offered a first look into a new Mac Pro.
What Apple didn’t do is talk about new markets, collaborations and opportunities. It also didn’t deal with the question of the changing competitive landscape; it didn’t say how it intended to beat the competition or why its plans would succeed.
Somehow, solid, dependable, comfortable and easy-to-use are just not that cool when you are short on cash. So should Apple go for cheaper plastic and veer away from the “perfect” phone size? Growth (especially in Asia) seems to depend upon it. But it takes the battle to its competitors’ turf, requires repositioning of the brand and hurts profitability. If the rumor mills are to be believed, Apple is going to play this losing game and hope that its media sales will make it worthwhile.
Google: Numbers Speaking Volumes
eMarketer released a research report according to which, Google (GOOG), which is already the leader in the desktop segment, is broadening its lead in the mobile segment as well. The company will see global mobile ad revenue touch $8.85 billion this year for a 55%+ share of the market, with Facebook (FB) (a distant second) jumping to $2.04 billion, or a little over 12%.
Moreover, Google is likely to grow faster in the future because on the one hand, search activity on mobile is likely to accelerate and on the other, YouTube is catching on. YouTube VP Lucas Watson told Bloomberg that revenue tripled in the last 6 months and research firm Nielsen estimates that YouTube app use increased 42% from last year.
Onavo, which provides app usage data to software developers, financial organizations and others says that of the iPhones with Onavo software installed, 69% used a Google-made app (other than its search service), up from 32% in August last year.
iSpy…Privacy? Security?
Technology companies are seeing public ire after Booz Allen Hamilton (BAH) employee Snowden exposed the government’s snooping into their personal accounts and information. Nine technology companies, including Google, Facebook, Yahoo (YHOO), Microsoft (MSFT) and Apple were accused. However, while Apple denied any involvement outright, the denials of the other companies were carefully worded, indicating that they had provided information that they were legally bound to deliver.
PRISM, as the program is called was started by the Bush administration, when it was little more than illegal surveillance by the government. In order to legalize the procedure, the Congress authorized intelligence agencies to obtain broad electronic surveillance orders from the Foreign Intelligence Surveillance Court.
President Obama has said, “We are going to have to make some choices as a society”, referring to the need for surveillance and secrecy to ensure protection from terrorism. Based on separate polls by Times, Gallup, HuffPost/YouGov and Reuters/Ipsos, those Americans that knew enough about the matter to comment were divided on the issue, with people opposing the government’s actions just slightly ahead of those supporting them.
Google and Intel were the only stocks beating the market last week, with Cisco trading more or less in line.
|
Ticker |
Last Week’s Performance |
6 month performance |
|
AAPL |
-3.29% |
-17.11% |
|
MSFT |
-2.98% |
+26.94% |
|
FB |
-2.36% |
-11.66% |
|
GOOG |
-0.90% |
+21.40% |
|
INTC |
+0.81% |
+21.15% |
|
YHOO |
-2.60% |
+33.47% |
|
CSCO |
-1.47% |
+19.79% |
The week ahead –
Cue to the Stand
Apple’s Eddy Cue is expected to return to the stand. He has done a reasonably good job of showing that Apple was not involved in the price-fixing of ebooks that proved detrimental to consumers. Since the concerned publishers have already settled with the government, the DOJ may be expected to withdraw its case against Apple.
Cisco Investor Day
Last week, Cisco promised a four-fold increase in carrier routing speed with its all-new carrier routing system (CRS-X) that replaces CRS-3. Having won over Verizon (VZ) and Japan’s Softbank, Cisco (CSCO) expects the product to generate a 25% increase in its core routing revenues over the next two years. Let’s see what else is in store at its Investor Day on Jun 25 and Jun 26.
New Product from Facebook?
Facebook, which continues to defend its products, strategies and growth to investors who have lost a great deal of money, is now summoning interest in an event it will host on Thursday. Could this be an exciting new product?
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