With nearly two weeks gone in 2014, it looks like the tech sector will see another eventful year. While some interesting partnerships and products were announced at the Consumer Electronics Show (CES) last week, more is sure to come at the Mobile World Congress next month and Apple’s WWDC soon after.
CES In a Nutshell
Facebook (FB) shares recovered lost ground, helped by management statements to the effect that its advertising revenues were nowhere near what they could be. The decision to remove unwanted features like Sponsored Stories also helped. Facebook continues to see a lot of love from advertisers that are willing to pay more for ad slots even as Facebook decides not to increase ad frequency.
Yahoo! Inc. (NASDAQ:YHOO) started off by announcing its Aviate acquisition, which produces software that increases the intuitiveness of devices, based on usage patterns of consumers. It also announced a number of new products and advertising tools.
It made a huge push into content with offerings like picture-rich “digital magazines” on a broad range of topics; a news digest, which is basically an email alert comprising a summary of the top nine news stories of the day; and Yahoo Smart TV, which can send personalized recommendations from TV to online streaming.
It also simplified the ad buying process with new advertising tools such as native ads, yahoo Audience Ads, Ad Manager, Ad Manager Plus and Yahoo! Inc. (NASDAQ:YHOO) Ad Exchange. Management also mentioned that Yahoo Stream Ads and Image Ads for mobile were actually doing better than desktop ads.
Intel (INTC) was also not to be outdone: the company introduced three new technologies. The first was Jarvis, which is basically a pair of smart ear pads that connect with a smartphone to answer natural language questions. It also announced Edison, which is a circuit board based on its Quark processor. The third was a beautifully designed charging bowl with the ability to charge various devices (including wearable devices) that are simply thrown into it.
Intel also said that it would be rebranding McAfee as Intel Security and making it free for all mobile devices. But the market largely discounted these positives and expressed disappointment at its delays in the smartphone segment (Merrifield). On the positive side, Intel-based tablets are expected to gain traction this year.
Cisco (CSCO) focused on the Internet of Things, and projected significant cost savings in the next few years for governments, companies and individuals based on their adoption of the concept.
NVIDIA (NVDA), along with several other tech companies, formed an alliance targeting the automotive market (see below).
The Automobile Is the New Computer
Or that is what technology companies would like it to be. Last week, Google (GOOG) announced its Open Automotive Alliance for the express purpose of developing “a common platform that will allow automakers to more easily bring cutting-edge technology to their drivers…and passengers in a safe and scalable way”, or in other words, to encourage developers to build compelling aps for an Android-powered dashboard.
Google is less than a year behind Apple (AAPL), which announced its automotive strategy at its WorldWide Developers Conference in March last year. The list of Google partners currently includes chipmaker NVIDIA and automakers Honda, Audi, General Motors, and Hyundai, just slightly shorter than the list of Apple’s “iOS in the car” partners that includes Honda, Mercedes, Nissan, Ferrari, Chevrolet, Kia, Hyundai, Volvo and Jaguar.
Google’s Open Automotive Alliance is reminiscent of its Open Handset Alliance, which enabled it to come up behind Apple and steal the leadership position in the fast-growing smartphone market. Connected car is another upcoming market (Marketsandmarkets.com forecasts a 41.2% CAGR from 2013 to 2018), so this is another big opportunity for Google.
Microsoft CEO Search Continues as Mulally Says No
Microsoft shares stumbled last week, as Ford’s Mulally, the favorite contender for the CEO position said that he would not be joining the company. Microsoft has been saying for a while that the list has been shortened, but we have had little other than our surmises involving Satya Nadella, Tony Bates, Stephen Elop and Mulally (now struck out) to go on.
But it now appears that the company will not be going for a turnaround wiz, but will instead settle for a veteran Microsofter. Shareholders would have liked new blood, but it wouldn’t really have changed things much. Because no matter who comes next, Microsoft is already well on its way toward executing its “devices and services strategy” (for better or worse).