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Mature industries generally come to be dominated by a few big players, and the Internet is no exception. The big players define the environment and the platforms that everyone else has to deal with; resistance is generally futile, until the next era comes along, usually many years later.
On the heels of third quarter earnings announcements, the WSJ has a piece reflecting on how much of commercial Internet activity is dominated by five companies:
- Amazon (e-commerce, cloud services)
- Apple (mobile, music/TV services)
- Google/Alphabet (search, mobile, online video)
- Facebook (social networking)
- Microsoft (consumer/enterprise desktop platform, cloud services)
This dominance didn't occur overnight.
Not coincidentally, all five companies beat analysts' earnings estimates for Q3. Microsoft, dealing with the continued decline of PC software, managed to make up for it through the impressive growth of its Azure cloud business.
Business Insider has a related piece on Amazon's dominance of the cloud segment; Microsoft is in second place, IBM and Google are struggling to keep up, and everyone else is basically tied for last.
We're adding a little something to this month's sales contest. As you all know first prize is a Cadillac El Dorado. Anyone wanna see second prize? Second prize is a set of steak knives. Third prize is you're fired. Get the picture? You laughing now?
- Alec Baldwin, Glengarry Glen Ross
(Score: 0) by Anonymous Coward on Sunday November 08 2015, @06:38PM
Quarter. That's it. A nice *QUARTER*. They're on top now. TFA's claim that they can't be knocked off that perch is a bit dicier. Social media and consumer products (Apple) are fickle. Just look at Digg or Sony for examples. Tech dominance? Look at the descent of Cisco and Oracle. Microsoft's had a pretty hideous last 15 years, considering they used to be 'THE' company, but they're growing again. Amazon is turning retail on it's ear, but Amazon's cloud infrastructure has pricing that seems to be caught in a race toward the bottom. Either is full of uncertainty 10 years out.
Meanwhile, AT&T, GE, Exxon, and the pre-tech stalwarts are more steady businesses, not nearly as volatile. And meanwhile, there are tech trends: autonomous systems, 3d construction. I'm optimistic about most of these companies, but I wouldn't remotely consider them unassailable.
(Score: 0) by Anonymous Coward on Sunday November 08 2015, @07:00PM
Dude. It's always been about the quarter. Chiming in with the fact that it isn't the quarter that matters is like saying it's not that the candy tastes good, but what its made out of. No one cares.
There are charts and diagrams and statements about "past performance doesn't mean future profits" and yeah, but I will tell you this: what MS did 15 years ago doesn't really matter today, so don't look at that. What they did a quarter ago affects their stock price today. Maybe what they did 15 years ago allowed them to do what they did this most recent quarter, but no one uses metrics that way.
All of the other companies you mentioned I invested in and lost money. If you want to froth, you have to bubble. The cream will rise to the top along with the scum; the bubble will pop and spray everyone with a mix of creamy scum that will go more rancid than the scum itself. It happened before and it won't be long until it happens again.
So pump and dump or be a chump like everyone else that holds on.
No, I don't like it. But history repeats itself, people will freak and dump when things are cheap, and smart people will start scooping up that fertilizer/shit to grow more creamy scum.
MS has a great tactic, anyway. Give away the ad delivery service for free and then prevent anyone from being able to do anything about it. They will get used to it at home, and with BYOD demand support for it at work, and soon the workstation images at work will be windows 10 if they aren't already from the impulsive people with local admin rights.
MS figured out that if you give complicated tools to admins, paper certs wont use them. So they won't. It will all be sucked into the cloud and there will be little with the technical capability to stop it because good people are too expensive to retain, and the rampant cheating for MS certs has watered down the skill set available from the selection that I don't even know any that pursue it any more -- except for maybe kids on tomshardware that haven't learned that an A+ will actually provide better skills.
Bet your money on Facebook, Google, and MS to deliver the ads, and bet your money on Google, Apple and Amazon to sell what's in the ads. Apple is a little more opaque about the ad delivery, but just because they are not doing it on an OS level at present doesn't mean you aren't getting ads as a result of their data collection.
There is absolutely no surprise in this valuation and stock returns--invest into it while you can before it bursts.