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

Reggie Middleton's picture

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Grand Supercycle's picture

DOW and SP500 bearish megaphone wedge charts continue ...

Jason Bourne's picture

Quick and Dirty commentary on RIMM, Google and Apple

Rimm is shit - and has been for almost 2 years.  The leaders there are not able to compete in a world where someone else has done a better job on their little bullshit email machine.  They are now trying to compete in an environment where they have never shown competence against people who live breathe innovation.  Imagine 2 - 50 year old guys taking professional DJ lessons and then trying to find a job in a hip nightclub...get it - RIMM is shit.  The only (ONLY) reason its a slightly scary short is that Microsoft or Nokia or Google might wake up some day and buy it to access a small part of its technology.  Otherwise sell RIMM its shit...

Google - great (and evil) company very dangerous, until they actually have a phone at least one phone that is actually awesome to use...yeah whatever.  Yes Microsoft made it supplying software but not really getting into hardware, but oddly enough (even though it seems backwards in terms of the open source movement) - the people want and need at least one flagship product that is totally wired to the maker of the software.  It is so much easier and natural to buy a apple laptop and deal with one company for software and hardware - no one to blame the other for something not working.  When Google buys somebody and actually starts "making" phones - then they will be a real player with a future.


Apple - They are LUCKY they have great products.  Contrary to popular belief their distribution system is shit (for consumers).  They will need to quickly get "un-evil" about how they distribute product.  Announcing a product (that is essentially vaporwarish - because you can't actually buy it with any reasonable waiting time) is going to hurt them.  They think big line ups at the stores are good....NO they are not good - what they are doing is removing all the good will about themselves and slowly but surely getting the place where they are only great because they make great products.  Whats wrong with that - nothing, for most companies - but when you get a company that has a know arrogant attitude (and Apple definately does), and you combine that with laying an egg (they havent yet) - you have the beginnings of a hole in their armor.  Apple by a mile has built the best eco system (App store) and the best product/software/service/applestore network - and NOBODY is even close or will be until maybe Google buys a handset maker.


PALM - all of the leaders that have been there for more than 5 years - you KNOW who you are - should be ......(fill in the blank).  A GREAT product way ahead of its time married itself to the devil (microsoft).  "We" all knew with the announcement that it was a STUPID move....instead of innovating and staying ahead of the market Palm took its best people and WASTED them porting shit to windows mobile.  Nice work.  Probably the worst handled move in smartphone history.  The old leaders who were part of this decision should be labeled with that one.

Oh and the new Palm Pre - "we" (the early adopters who end up being the influencers) were SO EXCITED when the Pre was being developed....then we saw it was NOT going to be carried by a GSM carrier - wow MONSTER F&*^%ing FAIL.  I can honestly say after that announcement a sadness and an invisible filter came over "us" and Palm Pre news was ....yeah whatever - hopefully they will release a GSM version in before they die and bad death.


For now sorry - NOT a fanboy, but Apple is clearly in the lead - despite the fact that they are getting evil-er and evil-er each day.



Eric Cartman's picture

Ha, just reading the comments tells me everything I need to know. Study it inside and out until you're blue in the face but you'll never know until it's decided. So place your bets and step aside. 

jimijon's picture


Everything you say may be true but you are missing the big picture, especially when it comes to "smartphones". The issue is "phone". Apple can push down last years tech for cheap while all its users will be using the same intuitive software.  And the most important thing is truly ease of use. I want to call now, text now, etc., Not see a thousand pieces of crapware installed on a phone confusing the heck out of users. In other words, the PCiszation of the smartphone.  

You talk about open source and seem to think it only applies to Google. This is another incorrect assumption. Developers like myself use open source everywhere and are pushing a lot of the apps into the more obvious use of of open source... html5/css. What, you think that open sourcing of the Android iOS is going to create superior phones? A phone is a phone is a phone.

And as Apple keeps pushing very sophisticated apis that the developers are now just digesting, Apple will be able to leverage up, down and sideways... iTouch, iPod, iPhone, iPad, iNext... and no matter what.. you will know how to use it.

So they are even executing on 8 retail type cylinders too.

Throw in new products announced and unannounced and you have a lot of growth there that delivers cash. 

Meanwhile they too are strategically executing on mapping and search. This is where they actually are even thinking about Google. 

cheers and keep up the research

monkeyfaction's picture

I work in software development. Almost every single one of my colleagues has bought a HTC Desire running Android in the last few weeks. Some have even switched from apple.

The HTC Desire running Android is basically the geeks' iPhone. Tons of settings to tinker around with and you can have a go at writing apps using the desktop PC you already own.

You need to buy an Apple Mac to do iPhone development. You just need a PC running windows or Linux and some free open source software to develop for Android. You don't even need an actual phone - the dev. software comes with an emulator.

The biggest advantage that the iPhone has over Android is the number and quality of the apps. In less than a year from now this won't be true. Us geeks will all be developing on Android.

earnyermoney's picture

"Google is not in the mobile space for search ads, it’s looking to become the next Microsoft with Android as the next Windows."


I have no doubt this is their goal. Open source is a Trojan horse to commoditize your competitors high margin products. Of course if Google can use open source to commoditize their competitors products, the same can be said of Google's competitors. They'll have more than 2 competitors.

oddjob's picture

Debates over smart phones are akin to rearranging the deck chairs on the Titanic.

Brain Cancer bitchez!

TBT or not TBT's picture

But a lot of ZHers NEED to be able to hit refresh on the go.   Our self-estime rises and falls with the accuracy of our calls.

Ying-Yang's picture

Oh... I forgot to add "Googlization Baby"


ZakuKommander's picture

Remind us again of all of Google's successes outside its search engine core.

Mercury's picture

Computing and personal technology services are turning portable, thin client, and to the cloud.

I don't know about the "cloud" part.  Memory and processing power are always getting smaller and why do you want to outsource that and in the process, insert more failable technology, connectivity infrastructure and dumb customer service people between you and your programs/data?  Sounds like a step backward to the mainframe days.  Ever notice that when the market's going berzerk it's almost impossible to log onto your online retail brokerage account?

Ying-Yang's picture

"Ahhhhh Grasshopper, when you can take this pea from my hand....."

You now understand Reggie. Well done and well stated.

You may now leave the Shaolin Monastry.


Calls and Putz's picture

Just like PCs 30 years ago, Apple's closed model will eventually cost them the edge in phones - two Apps on Android that everyone raves about are Swype and Tasker.  Neither will ever, ever be available on an iPhone because Steve Jobs will never give up control of the OS.

The iPhone is already a badly dated and behind-the-curve device. Android FTW!

Skeebo's picture

Not a virus, not even a significant threat vector.  A Russian security company (admittedly with a fairly good reputation until now) planning a product for the platform "finds" the first ever malware application for that platform?  Hmmm...


Let's not forget the small fact that you won't find this "virus" on the Marketplace, you have to manually install it, and go past the warning screen that tells you what abilities and access rights the app has in order to be "infected".


So let's review, to get this virus, that a company about to push a security product just happened to find, you have to

  1. Go find it off the Marketplace or get an unsolicited link to it
  2. Manually install the app
  3. Ignore the message telling you that the app has the ability to send text messages and access to your private information stored on the phone

Uh yeah... don't install Apps that aren't hosted on the Marketplace and you'll be just fine.

Rogerwilco's picture


Have you been asleep for the past oh, thirteen years? Jobs announced in 1997 that the "war" with Microsoft was over. AAPL takes care of its shareholders, not pimple-faced gear heads.

It's really very simple. Its 2001, one investor puts $10K in AAPL, and another investor puts $10K in MSFT, which one is happier today?

thecooler's picture

Coming from an apple fan boy and stock holder I can tell you that after using an HTC Incredible on verizon for about a week now, yes, google will continue to eat away at Apple. I was not a believer until recently. HTC, Samsung and Motorola are going continue to push out these new Super Amoled hummingbird dual core phones this fall and the long awaited Verizon iPhone in Jan. will be a non event, Apple waited to long. So I decided to sell my beloved iPad, why? I can only imagine what these hardware manufactures will do with the new Android software and the upcoming Android 3.0 gingerbread in a tablet. For now, the obvious play for me is to sell RIMM, they really put up a goose egg the other week with the Torch. 6.0 is basically the same and the hardware specs on it are a joke, from 2008 at best. Horrible!

Mitchman's picture

I agree with you on RIMM.  I have a corporate-issued Blackberry Curve and the thing stinks.  It is slow, has a small screen and the keys are fit for the fingers of a two-year old.  I still say that company is toast in 18 months.

Rogerwilco's picture

Sold your iPad? Wow that was quick. The good news is you can go out and buy one of these:

Im guessing it's not quite what most Android folks had in mind for their "iPad killer", but hey, it has a USB port! Enjoy.

thecooler's picture

um no I don't buy china knock offs, be patient the Android tablets are coming and there gonna be big. But hey, if that thing runs apps in the background it just may be an iPad killer your looking for.

Sudden Debt's picture

so it will be one BigBubble company against the other BigBubble company. So the big winner will become the Super BiggestBubblefoam company of the world and when that one goes bust it will have the same effect like the dotcom crash but with only 1 stock name and the same kind of damage.



Thoreau's picture

Apple lost the initial PC war because they allowed Gates to rip-off virtually every innovation they - Apple - created. Ain't gonna happen this time. Apple is more cutthroat this time around for good reason. I don't like it anymore than anyone else; but Job's is simply looking out for his baby.

As for Google, I use and enjoy their email service; but I'm getting sick and tired of their Big, Bigger, wannabe Biggest Brother posturing. They're going to have some serious PR issues in the future.

Rasna's picture


Remember back to how the whole Windows GUI movement started... Xerox PARC (Palo Alto Research Center) developed the whole Windows/Icon based paradigm... Apple (Jobs and Woz) and Microsoft (Gates) came in and saw it an BOTH ripped  it off from Xerox... I'm not sure, but I'll guess that neither Apple nor MS paid any royalties.

Johnny Bravo's picture

And how is Apple not like big brother?

"You cannot use the music you buy from us on other devices"
"You cannot use our software on other computers"
"We will not allow people to make software for our devices without using our development tools"
"We will continue using proprietary technology to try to corner the market."

Big brother indeed.

Rogerwilco's picture

Good analysis Reggie, but there is another element you need to add to the mix. Apple has the best supply chain management people in the business. On top of the inventory balancing and logistics, they have cleverly "managed" to ensnare key suppliers with long-term deals for crucial parts like flash memory and touch screens. This gives Apple huge economies of scale and it eliminates the uncertainties that routinely face their smaller competitors. Are they perfect? No, and the white iPhone fiasco is an example where one simple glass facia is costing them tens of millions in lost revenue. Dell used to be the king of the hill in this area, but Apple now shows the rest how it's done.

Johnny Bravo's picture

Yeah, work your workers to death, kill 20 of them, and force them to work 34 hours straight without overtime pay.

Apple sure has the "supply chain management" DOWN.

LePetomane's picture

Damn.  I'm a sheeple.  :(

JohnKing's picture

Apple only needs to enter the search game to do a google smackdown. I really don't see how destroying a business model with open source OS benefits google, to the contrary, I think they are heaping hot coals on their own head.

dlmaniac's picture

As a pro in the field for long enough, I can guarantee this whole 'thin client' thing is a fraud. People want rich client, or they'd be using text-based commandline consoles all along. Investors should not fall for that propaganda.

Johnny Bravo's picture

Apple is already in the search business.  It's called Safari, and 6% of people use it.

JohnKing's picture

Safari is a web browser, I was suggesting Steve Jobs might just enter the search engine business, the barriers aren't that high and I know that he does play a mean game of pay-back. Google has burned pretty much all of their alliances that got them where they are today so don't underestimate the hubris factor, when these guys go down, they'll go down hard.


There's an old saw that goes something like: "Be nice to folks on the way up, you'll meet them on the way down."

earnyermoney's picture

I thought Safari was a web browser not a search engine. I'll let you discover the default search engine for Safari.

TBT or not TBT's picture

Safari is a browser.    Like Firefox or Internet Explorer, or so many others, reaching back to Netscape.