by ilene - October 25th, 2010 12:32 am
Veverka’s story Sky’s the Limit in January was my first exposure to the cloud investing theme and I’ve made an obscene amount of money riding the stocks he introduced me to all year. In his latest missive on the topic, he looks at the downside of cloud adoption and what investors should watch out for.
Cloud computing for large enterprises has been successful – too successful – and now large enterprises want to take it even further. By contracting out more and more of their IT operations, these businesses are eliminating their own internal need to buy a lot of the equipment that is baked into next year’s forecasts.
The ramifications for many large cap tech stocks may be huge.
The message of the article is that no one is really ready for this shift to happen quite this quickly, many companies will be caught flatfooted. Large OEM equipment and IT vendors like Cisco, Oracle, Hewlett-Packard, Dell and IBM have the most to lose from this premature migration. Amazon, Microsoft and Google on the other hand look to extend their dominant positions in cloud services.
If you trade or invest in tech stocks, make sure to read this article this weekend.
A Private Party (Barrons) - sub req
by ilene - September 8th, 2010 11:17 pm
And the winner is…Cloud! The tech industry sub-sector with perhaps this year’s meatiest move is undoubtedly cloud computing. Names like Riverbed ($RVBD), Akamai ($AKAM) and 3Par ($PAR) have all been putting up insane numbers this year, performance-wise.
My awakening to the group’s potential back in January came courtesy of a kickass cover story in Barron’s (Sky’s The Limit)- ever since then the cloud computing stocks mentioned (and some that were omitted) have been nothing but fire – in a market that is unchanged year-to-date.
Here’s a peek at the majesty that is Cloud Stock-age thus far in the Twentyten:
Regular readers know that I’ve been hammering away at the cloud theme all year, even hoping for the advent of a Cloud Computing ETF at one point this past spring, albeit in a tongue-in-cheek sort of way (we still haven’t gotten one).
What’s next for the group?
* I have a hard time believing that Cisco has much interest in trailing behind Riverbed in market share for very much longer. Riverbed’s Steelhead product suite speeds up transmission of applications and data from the cloud to the end user, this is a corporate IT Holy Grail as it allows for the efficient decentralization that global entities need. I could see Cisco or one of its rivals making a move for this name as this would give them the number one offering in this crucial space instantly.
* Akamai’s global "private web" video serving solution will probably continue to be the delivery method of choice as Web TV becomes a reality and online streaming continues to be monetized. The wake up call for me on Akamai was when I learned that it was their technology that was the backbone for NBC’s serving of Winter Olympics video to everyone’s mobile devices.
* The bidding war over 3Par (between Dell and H-P) kinda gilds Rackspace’s ($RAX) lilly a bit when you think about it. Rackspace took over an abandoned shopping mall in downtown San Antonio and built an amazingly scaled-up cloud hosting center. Their fanatical reputation for customer service to their cloud hosted customers is the heart of their story, however – anyone can build a server farm.
by ilene - August 17th, 2010 8:28 pm
The hippest of hipsters are slowly becoming "Techno-Nomads" or "21st Century Minimalists", the very antithesis of the old consumer materialism, and I find this very admirable. The cloud computing revolution is making it so that we will all eventually be able to shed a lot of our proverbial baggage as more and more items can be stored online indefinitely.
Here’s an article on the BBC about this new "Cult of Less" movement. As someone who is a former "Hoarder", I’m highly intrigued…
Let’s face it – digital files, applications and web services are replacing the need for many of the physical goods that pepper our homes, crowd our desks and fill our closets.
From online photo albums to virtual filing cabinets to digital musical instruments, hi-tech replacements are becoming ubiquitous.
But as goods continue to make the leap from the bookshelf to the hard drive, some individuals are taking the opportunity to radically change their lifestyles.
Meet Kelly Sutton, a spiky-haired 22-year-old software engineer with thick-rimmed glasses and an empty apartment in Brooklyn’s Williamsburg neighbourhood – a hotbed for New York’s young, early adopters of new technology.
Mr Sutton is the founder of CultofLess.com, a website which has helped him sell or give away his possessions – apart from his laptop, an iPad, an Amazon Kindle, two external hard drives, a "few" articles of clothing and bed sheets for a mattress that was left in his newly rented apartment.
This 21st-Century minimalist says he got rid of much of his clutter because he felt the ever-increasing number of available digital goods have provided adequate replacements for his former physical possessions.
"I think cutting down on physical commodities in general might be a trend of my generation – cutting down on physical commodities that can be replaced by digital counterparts will be a fact," said Mr Sutton.
Can we all become Techno-Nomads overnight? Of course not, there is a degree of unrealisticism here for grown ups with houses and families. That said, going possession-less is a fantasy that may be closer than you think to being possible.
by ilene - January 15th, 2010 2:02 pm
Here’s a very good assessment of the Google-China conflict by Nicholas Carr writing in The New Republic.
Google is being widely hailed for its announcement yesterday that it will stop censoring its search results in China, even if it means having to abandon that vast market. After years of compromising its own ideals on the free flow of information, the company is at last, it seems, putting its principles ahead of its business interests.
But Google’s motivations are not as pure as they may seem. While there’s almost certainly an ethical component to the company’s decision—Google and its founders have agonized in a very public way over their complicity in Chinese censorship—yesterday’s decision seems to have been spurred more by hard business calculations than soft moral ones. If Google had not, as it revealed in its announcement, "detected a highly sophisticated and targeted attack on our corporate infrastructure originating from China," there’s no reason to believe it would have altered its policy of censoring search results to fit the wishes of the Chinese authorities. It was the attack, not a sudden burst of righteousness, that spurred Google’s action.
Google’s overriding business goal is to encourage us to devote more of our time and entrust more of our personal information to the Internet, particularly to the online "computing cloud" that is displacing the PC hard drive as the center of personal computing. The more that we use the Net, the more Google learns about us, the more frequently it shows us its ads, and the more money it makes. In order to continue to expand the time people spend online, Google and other Internet companies have to make the Net feel like a safe, well-protected space. If our trust in the Web is undermined in any way, we’ll retreat from the network and seek out different ways to communicate, compute, and otherwise store and process data. The consequences for Google’s business would be devastating…