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Day March 3, 2010

Android vs. Google Part II

AppleInsider | First AT&T phone with Google Android will feature Yahoo search

As the Backflip will mark the first time U.S. customers under contract with AT&T will have the option to choose between Android and the iPhone, every Motorola Backflip that AT&T sells might potentially be at the expense of an iPhone.

That Backflip sold will not generate Google any ad revenue since it will offer Yahoo/Microsoft search exclusively. Nor will the Backflip generate any license revenue for Google, because Android is licensed without a fee.

If that buyer would instead have bought an iPhone, the search from mobile Safari would have some non-zero value.

It is therefore pretty obvious that, at least in this instance, Android is destroying value for Google.

See also:

Android vs. Google (part I)


Known by All, Understood by Few

Erick Maronak, manager of the Victory Large Cap Growth Fund, says Apple is the best-run company in the U.S.

I would add it’s also almost the biggest and at the same time least understood. A lack of understanding is reflected in a high risk rating, which is itself shown in the company’s Beta.

All told, that makes Apple the fourth largest market cap in the US with the volatility and apparent risk of a startup.

Asymmetries of information don’t get better than this.


Apple, Little Understood, Is Best-Run Company | Mutual Fund Center | Financial Articles & Investing News | TheStreet.com


Suiting Up

Well, I don’t want to talk about any specific company. I’m just making a general statement that we think competition is good. It makes us all better. And we are ready to suit up and go against anyone. However, we will not stand for having our IP ripped off, and we’ll use whatever weapons that we have at our disposal. I don’t know that I could be more clear than that.

Tim Cook, my favorite Apple exec, in January 2009.

One thing should be obvious: the accusations against HTC are aimed at Google and Microsoft or more broadly still, they are aimed at any mobile software competitor that intends to use touch and gesture inputs.

When Jobs said in 2007

We’ve been pushing the state of the art in every facet of this design. We’ve got the multi-touch screen, miniaturization, OS X in a mobile device, precision enclosures, three advanced sensors, desktop class applications, and the widescreen video iPod. We filed for over 200 patents for all the inventions in iPhone and we intend to protect them.

he implied that Apple had approached this new input method with much more care than when they introduced the mouse and windowing interfaces in 1984.

Unlike the fight over Windows, which was a copyright debate, this will be all about patents. Apple ultimately lost the GUI fight over the MasOS windowing interface, which is why I think they are much more prepared this time.

Given this strategic intent, the only questions were how the war would be engaged and on what terms. A few skirmishes caused some head fakes.

First, came apparent threats against Palm. Apple was certainly debating going after Palm, but I think they realized it would not be a good strategy. Mostly because the signal would be weak. There would be few consequences to Palm being punished. Palm’s integrated model is not employed by many of the larger device vendors. Except for Nokia, all other vendors license their OS, Samsung, LG, Sony Ericsson and Motorola would not be infused with anxiety over Plam taking a hit.

Second, came the pre-emptive attack from Nokia. Apple was not ready to go after Nokia last year because Nokia did not yet have a UI “worthy of being infringing”.  In other words, there was no target to shoot at.  Nokia’s suit was pre-emptive in that it centered on their desperate wish to have a cross-license agreement–trading GSM patents for touch patents.

That skirmish should not detract from what’s the real goal here:  securing monopoly rights to mobile computing interfaces.


Palm: Pacific Crest Downgrades; Merrill Cuts Target To $5; Needham Fears “Oblivion”

Palm: Pacific Crest Downgrades; Merrill Cuts Target To $5; Needham Fears “Oblivion” – Tech Trader Daily – Barrons.com

Palm unveiled the webOS and Pre on Jan. 8th, and the stock skyrocketed from $3.30/share the day before to $7.14/share on Jan. 15th.

January 2009 predictions for Palm by Morgan Keegan:

About Palm at Sprint: Storm/iPhone-type Success At Sprint For the Palm Pre Would Lead to About 630k-1mm/quarter

Our 450k/quarter Estimate For Pre Look Wholly Realistic Based On Success Of Other “Hero” Campaigns

Your correspondent, January 2009:

Now that the land grab is over, expect Bono to get his payoff as Palm gets acquired by a hardware vendor desperate for relevance. As Motorola is on its knees, my bet would be on Samsung, though a bidding war with Sony Ericsson would not be a surprise.

Now I’m not so sure. Faucette of Pacific Crest today:

While we believe that Palm could ultimately be a very attractive acquisition target, we are concerned that if the company is not prudent in maintaining balance-sheet resources, any potential acquirer may be content to just wait until things become even more desperate.