Is Microsoft changing its mobile strategy?

Image

Microsoft has not been doing so well lately in the smartphone industry. Microsoft has a huge deficit in mobile to make up for. IDC, the technology tracking firm, estimates that Windows smartphones will account for less than 4% of new smartphones this year, compared with just under 79% for Android and 15% for Apple.Windows 8 has not been quite as successful as Microsoft Corporation had hoped either.

But Microsoft is reshaping itself. Two days ago, it completed its acquisition of Nokia Devices and Services business for 7.2 Billion US$. With the Nokia acquisition, Microsoft hardly sees the PC as its future. Upcoming devices will likely further distance Microsoft from its PC past. “Today we welcome the Nokia Devices and Services business to our family. The mobile capabilities and assets they bring will advance our transformation,” said Microsoft CEO Satya Nadella.

Stephen Elop chimed in with a similarly worded open letter “As Microsoft and Nokia Devices and Services come together as an expanded family, we will unify our passion, dedication and commitment to bringing you the best of what our joint technologies have to offer (…) From today onwards, the possibilities are endless. As now, we’re one,” he wrote.

Microsoft is going to attempt to force a quicker than usual upgrade cycle. Microsoft seems set to upgrade Windows 8.1 to Windows 8.2 in the third or fourth quarter of 2014. Windows 9, according to rumor, is going to land in April 2015.

Advertisements

Hide and Seek: Beware Facebook users

I have always been told to be careful of using social networking and smartphones by my parents. I had originally thought they were being paranoid, but seeing the vast expanse of new users that simply pay attention to location services and other features on their phone scares me. We found out just in the past few years that the government has the ability to track where we are at any given time and even hear what we are doing by using the little rectangle we keep in our pockets: our cell phone. Facebook’s new update will make this information available to the public and your friends.

Image

Facebook’s new “Nearby Friends” option will now broadcast your location to your friends. Of course it is optional but if you do not care to release your every location at any given point, you would be smart to check and double check your privacy settings on your phones.

Other Facebook updates include the possibility of adding adds to Facebook’s iPhone app, Paper, and it will also include Birthday and event reminders from the main Facebook account.

Although the Paper app updates are actually fairly useful many people may not be a fan of the “Nearby Friends” option. I mean honestly speaking, how hard would it be to call that friend and ask them where they are? Is it necessary to use a map to pinpoint their location?

EDIT: According to a new news release by Cnet on 4/18/14, Facebook has stated it will release this location information even farther than simply your friends. They will release this location history with advertisers, but has not stated when. Facebook is essentially creating a log of your whereabouts and selling this information to advertisers.

Though Facebook is outwardly presenting “Nearby Friends” as a way to facilitate offline get-togethers, it is essentially giving Facebook another way to generate revenue off of the common public majority.

 

Apple’s Q2 Earnings: Will they beat expectations?

A woman displaying the two iPhones she bought on the opening day of iPhone 5 sales

Rewind 3 years to 2011, and this same headline would be filled with optimistic expectations in which virtually all analysts would be espousing Apple’s exceptional year-on-year growth, and justifying why Apple has tremendous potential and a must buy for any investor.

Flashing back to the current day, and analysts from numerous companies are looking forward to a rather insipid quarter with virtually no growth in revenue, and in some instances, a slight decline. Apple is slated to report its Q2 2014 results on April 23 after the markets close, and Wall Street has expectations set at a revenue of $43.6 billion. According to Thomas Reuters, analysts consensus currently stands at about $43.55 billion with an EPS (earnings per share) of $10.17. The analyst consensus for iPad sales is 19.3 million unites, a 0.5% increase from iPad sales of Q2 2013. iPhone sales, which constitute a bulk of Apple’s revenue (52.6%), are projected to be around 38.2 million units, a 2% increase from last year’s quarter. The gross margins for Apple’s second quarter is expected to be about 38.1%, a tad bit higher than previous quarter which clocked in margins between 36-37%.

Overall, analysts and investors are not looking forward to a blow-out quarter, but instead to a rather flat and dull quarter.

Furthermore, it is likely that Apple will increase their share buyback by another $30 billion. As Toni Sacconaghi from Bernstein Research stated in a report, “We expect Apple to announce a decision on incremental cash returns on its earnings call”.

However, the subject does bring up the question: What happened in the interim between 2012 and 2014? Why is it that Apple’s analysts are extremely wary and circumspect about this upcoming quarter?

Apple, three years ago, was in its prime as the smart phone industry was a burgeoning market which was expected to grow rapidly, however, that market has run its pristine growth, and now is not expanding as rapidly as it one used to. This phenomenon combined with stiff competition from Android and shrinking profit margins due to competition have impacted revenues. Hence, as a result, Apple is experiencing the tailwinds of a global phenomenon. Regardless, Apple has, in comparison, maintained it’s earnings and had an exceptional, and unprecedented quarter in January with revenues of about $55 billion on an EPS of $14.51.

As for my personal advice, I believe that Apple is still a very healthy company and holds a great deal of potential in the future. Shifting focus to the second half of the year, Apple is rumored to be releasing two new iPhones, one which will have a 4.7″ screen while the other will have a 5.5″ screen, an iWatch, an upgraded iPad Air, iPad Mini, iMac and Apple TV. In addition, the company is also rumored that a smaller 12″ Macbook will be released. Given the (alleged) ambitious product release, Apple should receive a fresh impetus in terms of revenues, and quarterly growth. Plus, given their $176 billion cash reserve, Apple, Inc. is a very stable and wealth company. Hence, I have a BUY rating on Apple, with a target-price of $625.

Be sure to have a look at Apple’s quarterly earnings on April 23. All of Wall Street will be watching.

Taxes, How do corporations pay them?

You would be surprised, but some of these big corporations such as Google, pay less taxes (percent) than you. Over the last three years Google has utilized a smart scheme that manages to detour around paying the 35% income tax for their company in the U.S and saved over 3.1 billion dollars in taxes. Of course Google is not the only one, but they sure seem to be utilizing the method wisely.

Essentially, the trick is to use income shifting, in methods that some lawyers name as “Dutch Sandwich”, or a “Double Irish.”  What companies do to get by the exorbitant tax percentage is shift their income to off shore subsidiaries where they are not required to pay these 5% tax percentage but a more lenient 2.4% maybe. Keep in mind however, these loopholes are technically not illegal…yet.

Analysts calculated that without this loophole and because of the decreased earnings it would entail, Google’s stock price which is around the 600 dollar range would be approximately a hundred dollars less. Note that the stock is currently at $536Image

To find out more about this loophole and the specifics on the subsidiaries like the Cayman Islands and Ireland, please visit the original story: http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html

Smartphone Battery Life

 

Photo Courtesy of Tech and Trends



Unless you live in a cave, this article highlights a topic that has come across all of our minds; Smartphone battery life. We have all been frustrated at having our phones die when we most need them. It is quite obvious that although many features of phones have been revolutionized with additions like ultra thin size and super light weight, the phones battery life seems to remain the same. To achieve optimum battery life would help companies dominate the market and contribute to very high sales. Even a phone that one has never considered before can pique the curiosity of buyers if it has excellent battery life. Imagine that, Blackberry coming back into the market because its phones can last for several hours even after incessant use. Chief technology officer Mujeeb Ijaz at A123 Systems states a concern amongst all buyers, “Give me a better battery because it doesn’t last long enough.” The message cannot be any more explicit, the Smartphone with the best battery life will be the first to be picked off shelves at Best Buy (if you still go there to actually buy products). However, every year we get a new phone that looks completely different than the previous one and has some different functions; however its battery life is pretty much the same. Companies have been working hard to improve their standing in the market in terms of attaining a better position in the domain of battery life. Apple, Google, Samsung, various Universities and even several start-ups are facing cut-throat competition amongst themselves in figuring out ways to extend the life of smart phones. Samsung has been designing new types of batteries with wearable computers in mind and it has introduced compact curved batteries that can be installed inside wristbands. It introduced Dream Battery last year, which uses solid electrolytes (instead of the liquid or polymer used by lithium-ion batteries) to eliminate the risk of explosions and other safety problems for flexible electronics. uBeam, a start-up in California, is experimenting with technology that involves piezoelectricity — a form of charge that is created in vibrations of certain crystals and ceramics. It is essentially attempting to develop a system in which devices pull energy from the air. Apple obviously has been trying its luck at battery enhancing technology for a while. It received a patent for a flexible battery that could fit in a wristwatch or tablet and even posted a job listing seeking engineers who specialize in solar energy. We can only hope that the technologies that are being developed now are truly effective and not a flash in the pan as we have continually seen for years. So the crux of the matter is that whoever comes up with the most effective and cheap way to keep out batteries alive longer will come out of this race victorious.

Google’s Project Ara: Will it Work?

Project Ara
Model of a modular phone from Project Ara.

Google has been known for its many unique and bold ventures, such as a self-driving car, Project Tango, Google Glass, etc. The team behind all of these futuristic projects is Google’s Advanced Technology and Projects (ATAP) group. One of these audacious projects includes Project Ara.

Now you may have heard of this on the media or even heard about one of Ara’s collaborators, Phonebloks, that went viral a while back. Essentially, Project Ara is a move to create a modular cell phone, a phone that has customizable and removable hardware components (like the camera, battery, speaker, screen,etc.). These components are held together by advanced electro-permanent magnets.

The customizable and swappable components of Ara phones will be held together by electro-permanent magnets.

The idea behind Project Ara and the modular phone is based on two goals. One is to cut down on electronic waste from mobile gadgets. When our smart phones get damaged, more times than not, we replace the whole phone, even if only one component was damaged. I’m pretty sure you have or know someone who has dropped their phone and cracked the screen. Well, the modular phone would provide a cost-effective method to just replace the damaged hardware component, which is better for the environment and your wallet.

The second goal of Project Ara is to bring smart phone technology to billions of people at affordable rates. According to Ara’s website, 5 billion people don’t have smart phones. In our technologically advanced society, we tend to forget about those in less fortunate regions. Being that the modular phone is more economically viable for the consumer (or at least it is planned to be), Ara could help change the world for many people.

Here is a video from The Verge highlighting aspects of Project Ara.

On the other hand, there are down sides to this idea. Since each hardware component is separately installed, the device itself could be bulkier and heavier than existing phones, whose manufacturers tightly pack all of hardware. Also, these separate components use more power than the seamless integration in current phones. Costs for this projects are hard to say because of the high-risk in a modular phone concept. Estimates range from $50 to $500. Simply, the world may not be ready to accept the modular phone or mere may not want it.

In addition, these phones won’t be able to compete in the same markets as the top-of-the-line cell phones, such as the iPhone, Galaxy S5, etc. Simply, the modular phones won’t be able to perform as well.  Project Ara is more situated in the market of people who do not have smart phones.

At the end of the day, what you think about Ara depends on what you find more valuable. Are customization, simply repairs, and longevity  important to you, or are innovation and top-of-the-line features more appealing? Whatever people decide, one thing is clear. Project Ara will either change the way we think about our smart phones and be a success, or be an utter failure and a lost cause. Google’s ATAP estimates that Ara will be in the market for consumers sometime in January of 2015. Until then, we can only wait to see what the world’s first modular phone will become.

Google Earnings Disappoint

17google-web1-master675

Google’s core digital advertising business is so dominant that analysts are questioning just how much it can continue to grow. The company has been trying to respond to this by unleashing its vast cash hoard on robotics, artificial intelligence, smart thermostats and, just this week, high-altitude drone satellites. The only thing all these acquisitions have in common is a focus on the future — often, the distant future. The risk in thinking about what will be big in 2050, however, is that you can lose sight of 2014.

Google’s first-quarter earnings report, released after the market closed on Wednesday, surprised Wall Street. The company had originally gushed profits without breaking a sweat. Now it takes more effort.

One big reason was a problem of several years’ standing: Internet users are migrating to mobile devices, but ads on phones and tablets still do not have the familiarity and appeal they do on bigger computers. And they are not as profitable for Google. Google’s ad volume jumped 26 percent in the quarter,  while the amount advertisers pay dropped 9 percent.

 

 

Yahoo over Google?

Yahoo CEO Marissa Mayer speaks during her keynote address at the annual Consumer Electronics Show in Las Vegas

Yahoo Inc’s Chief Executive Marissa Mayer is reportedly working on a plan to persuade Apple Inc to ditch Google as its default search engine in favor of Yahoo. Mayer’s effort is in advanced stages, with a detailed pitch already prepared for Apple executives, an outside source said. Mayer, a former Google executive, has managed to get support from some Apple executives, including longtime acquaintance Jonathan Ive. Design head Ive exerts enormous influence over strategy and products in engineering and design-heavy Apple. Google search, which has been the default search engine in iOS and powered Apple’s Safari Web browser used on iPhones and iPads for quite some time, pays Apple about $1 billion per year for traffic driven to its servers and subsequent ad network. Apple’s decision to stick with Google’s services over the years also reflects a desire to maintain a familiar user experience. 

Yahoo on Wednesday again posted anemic quarterly revenue growth as the Internet company’s advertising business continues to lag compared to its rivals (nearly two years into Mayer’s comeback effort ). Mayer is trying to revitalize Yahoo’s business, revamping many of its Web products, but its ad sales business continues to struggle while rivals such as Google, Facebook and Twitter continue to post double-digit revenue growth.

 

Conference in Review

There was once an old adage that “Practice makes Perfect,” and as cliche as that sounds it is the truth. The only way we, as an organization, can create a successful conference is through practice. The mock conferences that are held at the Minnie B Veal are steps in the right direction to achieving success; therefore, we must constructively criticize and praise, simultaneously,  the mock conferences.

Cons:                                                                                                                                                 – Preparation: Akshay and I were not necessarily prepared to lead a conference, but, instead, we were seemingly just thrown into the fire. We were not sure how to go about leading this conference or how to stir up controversy among the companies; as a result, we both learned that it is crucial to have done the necessary research to successfully lead a conference.

– Indecisiveness/Confidence: During the conference Akshay and I were hesitant to make decisions that would negatively affect the companies. This was due in part to our inexperience but it had a lot more to do with our confidence or lack thereof. We were not confident that we had made decisions that were within the boundaries of our autonomy. From this, leaders can learn to be sure of the power they hold and to justify each decision confidently.

– Focus: One of the companies during the conference was not active in their goal to further improve itself. The directors in the company were becoming distracted with online sources and were not focused on the task at hand. Focus is key in creating a successful company. Each member must be working to devise ways to further the companies success.

Pros:                                                                                                                                                  -Creativity: Creativity and innovation are key in creating a product that will bring in a stream of revenue. One of the companies, Nokia, decided to partner with Tesla to use its OS system into the cars entertainment systems. Moves such as these will bring in a plethora of profit to a company as it is innovative, attractive, and different. Why not partner up with a front running, popular, global car company to promote your brand to increase your market share?

-Different Looks: As leaders of the conference, it is key to throw different looks at the companies so they are put through difficult times to see how well they respond. The world’s greatest companies are the ones that became even more powerful after facing adversity. Akshay and I found ways to negatively affect the companies. For example, we had Tesla sue Nokia for faulty engineering; as a result, Nokia was forced to create a settlement for 100 million dollars. The setback caused Nokia to explore different ways to create revenue. The different looks will get the companies thinking, which is the ultimate goal of the conference.

 

Is Apple Taking a Step Toward Renewable Energy?

Image

As you may or may not have noticed, Apple has been in the spotlight for some time. Is the next big thing for Apple renewable energy?

Reports say that Apple has taken over the efforts to complete a hydroelectric plant just outside of Prineville, Oregon. What is a hydroelectric plant, you ask? Remember those big wooden water wheels at a river side you see in movies and TV shows? Those are basic forms of hydroelectric plants. Water falls and rotate big turbines, which in turn generates electricity. Larger and more advanced forms of these wheels are used in places all over the world, like the Hoover Dam.

If you haven’t noticed already, the many industries of the world are overlapping, and more so as the world becomes more developed. Apple is primarily has niches in computers, cellular phones, and related technologies. The energy industry may seem an oddball for Apple but it really isn’t, and for one simple reason: data centers.

Data centers are used by Apple around the world to power the company’s many programs, such as iCloud. These data centers, like one nearby the hydroelectric plant in Oregon, use a lot of power, thus in turn produce a lot of heat. Cooling these plants are very, very costly.

100% of the energy that powers these data centers is claimed to be from renewable sources. However, currently Apple is still buying much of that energy from third-party plants. Apple seems to be making a move to fulfilling their own energy needs and reduce independence on other provides, a notion furthered by Apple’s recent efforts to build grand solar farms.

Now what does this mean to us consumers? Well, it’s too early to say what these projects will impact as far as Apple’s products and pricing goes. What we can be certain with is that it will have an impact on the company in the future as it steps toward a more eco-friendly system of business, something that fans and contemporary hipsters alike look forward to.

##

Source: http://techcrunch.com/2014/04/12/apple-nabs-itself-a-renewable-power-plant-project-in-oregon/