Will Google Win The Mobile Computing War? Let's Walk Through Where They Stand Now & How To Value Them
BoomBustBlog is just about the only financially orientated publication that declared for nearly a year now, the inevitable conquest of Google's Android OS and ecosystem. I feel our highly contrarian research and analysis has been proven correct beyond a shadow of a doubt. Fresh off the heels of "If You Need More Proof Of Apple’s Inability To Keep Up With Google’s Android & Over 100 Other Android Hardware Vendors…" and Sony's widescale adoption of the Android platform, we have Nokia's apparent capitulation and what could be the (inevitable) assimilation into the "Borg". After all, they are just the largest manufacturer of phones (both feature phones and smartphones) in the world - that is, at least they are for now.
Google topples Symbian from smartphones top spot:
(Reuters) - Google's Android dethroned Nokia's Symbian as the most popular smartphone platform in the last quarter of 2010, ending a reign that began with the birth of the industry 10 years ago. Research firm Canalys said on Monday phonemakers sold 32.9 million Android-equipped phones in the last quarter, roughly seven times more than a year ago, compared with Symbian's sales of 31 million. The landmark piles pressure on Nokia as it struggles to reassert itself at the top end of the mobile handsets market. The success of the open-source Android operating system, which has become the standard for most phone makers, leaves Google well placed as cellphones are due to surpass computers for accessing the web. Among key players in the industry so far only Nokia, Apple and RIM have not resisted using it. ... Canalys said the overall smartphone market grew 89 percent from a year ago in the fourth quarter, with all vendors in total selling 101.2 million smartphones.
Stephen Elop, the Nokia CEO, is quoted as saying during the firm's latest conference call (via endgadget):
The Future of the Mobile Computing Wars: Contiguous Rich Client Computing!
Contiguous Rich Client Computing: The ability to perform normal, daily computing tasks that include:
- 3 dimensional, full HD media production and consumption,
- full, high optics including still and HD video in 3D,
- productivity tasks via Office suites,
- real time multimedia collaboration aka videoconferencing,
- the ability to store, retrieve and transfer data at the terabyte level, wirelessly and quickly
- the ability to seamlessly transfer computing sessions and states from device to device, ex. from cell phone to notebook to desktop to large screen monitor
... all in a device the size of a 4.5 inch, 5 oz. cell phone. Sounds delicious right? Sounds like tasty pie in the sky? Well, its quite possible, and it is what the major manufacturers should be working on right now. Let's run through a quick history of the last 20 years of that tasty pie in the sky. Please expand to full screen.
Will The Meritocratic, Playing Field Leveling Nature Of The Web Fall Victim To The Net Neutrality Scheme? If So, Many High Traffic Low Margin Sites (Read The Little Guys) May Go Bye-Bye
I received a thought provoking email the other day, and thought it would be good for sparking the debate on the future of the web. Please be aware that this is a reader's opinion, and not necessarily my own, but he definitely seems to have thought his viewpoint thoroughly through. I welcome any and all comment. Portions of the email have been removed to preserve anonymity.
Reggie,
You're well aware of the current models, primarily advertising and direct marketing driven by web publishers such as BusinessInsider, ZeroHedge, SeekingAlpha, etc. Although these combination publishers/aggregators/bloggers have achieved a certain level of success they don't really have a model, at least as I see it, that will supply them with an ongoing stream of steady high-quality content, such as the research and analysis provided by your blog.
If you consider the understandings of the surplus in content as described by Yochai Benkler in Wealth of Networks, Clay Shirky's Cognitive Surplus or Rachel Botsman's Collaborative Consumption, it seems there is no end in site to free, high quality content. I believe that the so-called net neutrality regulations are going to change that. A tiered internet will probably create a situation where casual bloggers will lose visbility as a "pay to play" model emerges.
Reggie Middleton Takes The Challenge To Goldman Sach's Apple Proclamation One Step Farther, Apple's Closed System Risks Failure!
[caption id="attachment_4227" align="alignleft" width="575" caption="I'm not saying that I'm bigger than those guys over there at West Street doing God's work, but I'm not a small man.... BoomBustBlog and the new media cabal vs Goldman Sachs and the established socio-political oligarchy, Ooooh! You couldn't script a better reality TV show."]
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It appears as if I wrinkled a few feathers of the birds that are doing God's work with my missive "Goldman’s $430 Target, Screaming Buy On Apple At Its All Time High Is In Direct Contravention To Reggie Middleton’s Logic – Who’s Right? Well, Who Has Been More Right In The Past?". This is a good thing! A little creative destruction and anarchy is positive for the complacent masses. I say we take this up a notch, pull down our pants and see who is truly the most intellectually endowed, the outside the box researcher, entrepreneurial investor and thinker that has called nearly every major financial institution bust and market downturn since 2007, or those who are doing God's work with a 38% accuracy rate over the last 3 years with billions of dollars of government assistance.
In my rant yesterday illustrating weaknesses in Goldman's argument of Apple, I hinted at the potential for Google to turn the App Store delivery model on its head by transforming application sales into an advertising based model, of which Google thus far reigns supreme and the closes runner up is not yet close enough to compete. I will take this concept further in an attempt to show those who cannot see the forest due to an excess of tree bark in the way one of the several risks that Apple faces now that it has become so successful - risks that are not mentioned in the reports of prominent sell side analysts - Yes, even those that are doing God's work!
Why Traditional Media Still Doesn't Get It Regarding Google, And Why Not Getting It May Marginalize Them!
In media, particularly video, distribution costs have been literally flattened by the web, production costs have been dramatically reduced by digital HD technology and do-it-yourself CGI, and marketing made democratic via viral and social networking channels; the barriers to entry that allowed the big media houses to rake in fat margin profits no longer exist. Its just a matter of time before the world at large figures this out. It would behoove those in positions of power and influence in these shops to come to this realization and truly embrace the magic of distributed computing in lieu of trying to force the genie back into the bottle, replete with all of its accompanying magic.
With this being said, there has been much talk regarding the MSM blocking access to their content though Google TV, Google's new initiative to merge the Web and TV content through a unified, seamless interface...
ABC, CBS and NBC Stupidly Block Google TV | The New York Observer
The Wall Street Journal is reporting that the Big Three TV networks have decided not to allow their programs, which already stream online, to be available through Google TV, which puts the web onto consumers' televisions.
According to the The Journal's Sam Schechner and Amir Efrati, "The move marks an escalation in ongoing disputes between Google and some media companies, which are skeptical that Google can provide a business model that would compensate them for potentially cannibalizing existing broadcast businesses."
Fox joins broadcasters in blocking Google TV link - Crain's New ...
AP) - News Corp.'s Fox has joined broadcasters ABC, CBS and NBC in blocking access to full episodes of shows when searched from Google TV's Web browser. That's according to a person at Fox familiar with the matter.
Comedy Central, MTV now blocking Google TV | Crave - CNET
Reggie Middleton Wasn't the ONLY Openly Apple Bear in the Blogoshpere, Was He?
The latest on Apple's earnings that went so far in corroborating what I've been preaching for months to a bunch of crazed, excitable Apple fanatics who simply refused to see facts for what they were:
From CNBC:
Apple surpassed quarterly earnings expectations again with the help of strong sales of its iPhone, but iPad sales and margins disappointed [strong demand, but the smart money is waiting to see what the Android tablets are capable of - I don't think they'll be disappointed], and its shares sank.
Weaker-than-projected gross margins [exactly as I anticipated - see How Google is Looking to Cut Apple’s Margin and How the Sell Side of Wall Street Will Enable This Without Sheeple Investor’s Having a Clue] and iPad shipments disappointed investors who had expected more from a company that had smashed Wall Street's targets in each of the past eight quarters. Apple shares dropped 7 percent in late trading after initially being halted. The stock finished the regular Nasdaq session [AAPL 318.00 
3.26 (+1.04%) 
] more than 1 percent higher. Sales of Apple's popular iPhone jumped 91 percent to 14.1 million units in the quarter. The company sold 3.89 million Macs, an increase of 27 percent. Apple sold 9.05 million iPods, marking a decline of 11 percent year over year. The company 4.19 million iPads in the quarter....
JP Morgan's Analysts Agree with BoomBustBlog Research on the State of JPM (a Year Too Late) but Contradict CEO Jamie Dimon's Conference Call Statements
As I sit in the car, surrounded by thick NYC traffic, on my way to the highly anticipated CNBC interview (the Squawk on the Street show) on JP Morgan, banks, real estate and related issues, guess what I happen to drive by... MORE construction - causing me to ponder what additional damage will be done to banks that backed these deals. Then, less than an hour later I read from CNBC and Bloomberg that JP Morgan's analysts predict that forced repurchases of soured U.S. mortgages may be the “biggest issue facing banks”. Bloomberg goes on to state:
Future losses from repurchases of home loans whose quality failed to meet sellers’ promises will likely total $55 billion to $120 billion, or potentially $10 billion to $25 billion for the next five years, the New York-based mortgage-bond analysts led by John Sim and Ed Reardon wrote in a Oct. 15 report.
I immediately blurt out, "Now hold the hell on a minuted!!!" That report of the 15th sounds an awful lot like the article I published on the 12th, “The Robo-Signing Mess Is Just the Tip of the Iceberg, Mortgage Putbacks Will Be the Harbinger of the Collapse of Big Banks that Will Dwarf 2008!” (Hey, no peeking, no copying, fellas!) which, among many other things, reiterated what I said in the 4th quarter of LAST YEAR!!!.
To be fair, the JP Morgan report is very similar to mine in content, scope and gist - JUST A YEAR OR SO TOO LATE! I quote (again) "Reggie Middleton on JP Morgan’s “Blowout” Q4-09 Results":
As I Warned in June, DO NOT DISCOUNT Microsoft in This Mobile Computing War! Their Marketing Campaign is PURE GENIUS! and it Appears as if the Phone Ain't Bad Either
Many have discounted Microsoft in the mobile computing wars, primarily because they have made quite a few managerial, marketing and technical missteps that have cost them a significant advantage in the smartphone space. Well, as anyone that studies their history knows, the corporate (and corporate division heads) graveyard and infirmary are literally littered with companies that underestimated Microsoft due to their size and early fumbling when entering into markets.
Simply ask the makers of dBase, FoxPro, Wordperfect, Lotus, nearly all of the server OS companies, as well as the makers of GeoWorks, Sony & Nintendo gaming divisions, and the list can go on for quite some time. I'm not saying that MSFT wins everything, or even that they will win this one, but the largest software company in the world with some of the most promising tech, widest user base and several hundred million dollars in marketing (very useful, just ask Apple) and developer incentives will be the purview of fools to ignore or automatically discount into the failure bin. I have said as much in the recent past...
- There Is Another Paradigm Shift Coming in Technology and Media: Apple, Microsoft and Google Know its Winner Takes All
- Don’t Count Microsoft Out of the Ultra-Mobile Computing Wars Just Yet
- After Getting a Glimpse of the New Windows Phone 7 Functionality, RIMM is Looking More Like a Short Play
As for the marketing part, this commercial is pure, utter and undeniable GENIUS!!!
[youtube EHlN21ebeak]
Did Reggie Middleton, a Blogger at BoomBustBlog, Best Wall Streets Best of the Best?
Summary: Bloomberg features what they consider to be the most successful and accurate financial analysts since 2008. Of course, the firm that "Does God's work" is the one that won! Reggie Middleton disagrees, and thinks a blog beat them all! I urge the mainstream media to look beyond the traditional banking centers of influence for analysis. Not only is it soooo old school in a new digital age, but they just might find comparable (if not superior) talent in the blogosphere.
I urge the mainstream media to take a look at more than just the traditional sources when they make these all star rankings...
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Daniel Harris, a financial services analyst at Goldman Sachs Group Inc. [Clean cut, meticulous, ivy league, cookie cutter Goldmanite, Hamptoms in the summer, straight out of the Wall Street handbook - I get it] |
... Goldman Sachs and KBW did better than most at figuring out where markets were headed. Goldman is No. 1 and KBW No. 2 in the Bloomberg Markets ranking of the world’s best financial sector research firms. Goldman’s Harris is one of the top three analysts of financial service firms, according to data compiled by Bloomberg. 2,500 Analysts [but no bloggers, which is exactly where this story went awry, IMHO :-)] The ranking is based on stock recommendations made by more than 2,500 analysts worldwide at 77 research firms and investment banks from January 2008 to July 2010. It looks at the analysts’ “buy,” “hold” and “sell” calls on shares of 90 of the largest banks, diversified financial service companies and insurers in the U.S., Europe and Asia with at least 20 analysts covering them. Even the best of the firms and individual stock pickers failed to accurately predict the fall and rise of most big financial stocks. Goldman Sachs’s analysts won their No. 1 rank by making 30 accurate calls on the 79 financial stocks they follow, or 38 percent, while KBW’s No. 2 post was based on 27 prescient calls on 78 stocks. ... “It was a very difficult climate to make stock recommendations in,” says S.P. Kothari, a professor of management and deputy dean at Massachusetts Institute of Technology’s Sloan School of Management in Cambridge. “First, you had to predict the downfall of the financial sector in 2008, which only very few people did. Then, you had to change your outlook to catch the recovery -- all within a relatively short period of time.” [So true, at least sort of. The problem was not about changing your outlook, it was about going against the fundamentals to catch manipulated stock price action to capture bank stocks as they shot to the upside in an environment where they were doomed to simply crash back down. Of course, I don't really expect to hear a lot of that in the MSM, but it does peek its nose out every now and then] Looking for Ideas... Jason Brady, a managing director at Santa Fe, New Mexico- based Thornburg Investment Management, which oversees about $56 billion, says he doesn’t read analyst reports for picks on individual stocks. “It’s unusual to see original thinking in these reports, even though that’s what’s most valuable to me,” he says. “The ones who are different aren’t always right, but they’re frequently the most interesting and thoughtful.” [May I suggest you subscribe to BoomBustBlog, I am the antithesis of the sell side, and have nothing but crazy ideas - that is until a year has gone past, and people say "hmmmm..."] |
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Yeah, I bet these guys get paid an awful lot of money for that as well. I hope Bloomberg's editors dont' forget us poor bloggers in the future comparisons. Uhh.... Not that I'm hating or anything (I definitely want to give these Goldman dudes credit where their due), but I think I may have just BLOWN THESE GUYS OUT OF WATER with damn near zero recognition. Come on mainstream media, it's a new day and age and you should know by now there are other places to look for analysis other than the big banks that "Do God's work"! Give the little man some luv! You know times are hard when you get featured as the best of the best with only a 38% success rate! Then again, and admittedly, these last few years were very hard - all jokes aside. Let me recast this Bloomberg article in BoomBust fashion. |
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Is the US Government About to Forgive Mortgage Debt? Let's Crowdsource Our Way Through a Scenario or Two!
Is it possible for the US Government to choose to forgive mortgage debt? Sounds outrageous? Read on for the legal theory behind this claim and let me know what you think? I thought it was little esoteric as well, but as I looked deeper... Well, I'll let you be the judge.
A lot of attention accrued to Representative Grayson's calling out of foreclosure fraud, and for good reason. The story is absolutely amazing, and kudos to a member of congress that defends his constituency.
[youtube AqnHLDeedVg]
It's not as if other entities have failed to take notice. ZeroHedge has its usual witty commentary regarding the possibility of foreclosure transactions potentially being unwound due to fraudulent foreclosure activity. The NYT ran an article stating that Fitch will look into lowering the credit rating of companies that participated in the submission of inappropriate foreclosure paperwork, which apparently seems to include an awful lot of companies. It goes on to state (as excerpted by Zerohedge):
Fitch Ratings said that Wednesday it was asking mortgage companies about their internal processes for executing foreclosure affidavits. If it finds the processes lacking, Fitch will consider downgrading the company’s rating.
The agency also said if the issue is widespread, the resulting delays and extra costs to foreclose could increase losses related to residential mortgage-backed securities.
Here's the twist. A lawyer who happens to have followed my writings over the years has suggested that most are missing the big picture in focusing on fraudulent foreclosure documents. He contends (and I'm paraphrasing here, these are not my words, per se) "that since the U.S. has ownership interest in many (if not most) delinquent and distressed mortgages, this fact will be counted as policy in litigation. As a consequence it matters A LOT if you can say that your client has a Fifth Amendment Due Process right (or third party beneficiary Federal common law right) to a HAMP modification which is in FACT a minimization of the risk of default (not that flaky 31% number) BECAUSE, among other things, the U.S. has no economic incentive to foreclose". Now, I am no lawyer and thus the legal issues are beyond my domain, but I must admit I found the theory interesting. So, I've decided to crowdsource this one in anticipation that some of the more astute legal minds can shed some light on the validity of the theory. I'll supply the financial stuff in this post, and I'll rely on the legal eagles to peer review the theory.
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