Tech Stock Trends For 2010
As the year comes to a close, we’re issuing our Top Ten Predictions for 2010. In the new year, the bulk of innovation will be aimed at the consumer market and the way in which we interact with computers. How and when we experience them will change dramatically over the course of next year.
So without further ado, here’s our Top Ten for 2010:
1. Cloud Not So Schmoud
Cloud is the next killer app–those without it will be killed. 2010 is the year that Office Web Apps and Google’s Chrome OS launch. Both platforms will accelerate the shift to Web-centric computing. Apple just acquired Lala Media, which points to Apple moving iTunes (and the App Store) into the cloud. Smartphone penetration will accelerate the shift as consumers demand mobile access to content. As more devices proliferate and as Internet becomes ubiquitous, demand for cloud-based access will become the norm.
Twitter led the way and soon real-time will be an expected feature throughout the Web. Real-time resonates with people, and it has a multitude of uses–as folks like Google, Facebook and Foursquare are proving. Google jumped on the real-time search bandwagon in early December. Smartphone adoption will accelerate real-time’s relevance big time in 2010.
2. Local Is As Local Does
Apple showed us the utility behind having navigation capabilities with us at all times with the launch of the iPhone. Now services such as Foursquare, Gowalla and Google Latitude are catching on and an array of products will increasingly leverage sophisticated location-based services in a variety of new ways. E-commerce and advertising are not far behind. Location-based services will be a part of social media (Twitter), a part of mobility (Android) and a part of an increasing number of diverse interactions on the Web.
3. Standalone Products are Toast
Standalone GPS devices will finally die (with the exception of specialized, niche markets) and so will stand-alone mass market cameras/video cameras. The Kindle and other e-readers will not be that far behind as screens improve and functional multipurpose devices come to market (aka the Apple media pad). The iPhone has e-reader capabilities via the App Store already. A larger-screened device will show the world that stand-alone products–be they Garmin GPS devices, Flip Video Cameras or Kindles - are feature sets, not sustainable franchises.
4. Privacy Continues To Slip Away
Privacy will continue to erode at a dizzying rate. Consumers will voice concerns, but ultimately the value of the new products will outweigh the loss of privacy.
5. Mobility Madness
People are not bullish enough on mobility. Penetration will accelerate in 2010 and the number of mobile Internet devices sold will be significantly greater than the pundits at Gartner and elsewhere suggest. This, in turn, will drive location-based services, cloud computing, real-time products and services, advertising, and e-commerce. Mobile payment systems will also become the defacto norm.
6. Context Dethrones Content
The Web and its consumers are constantly overrun by information (content) overload. Algorithms only solve for so much and become more difficult to solve for as content becomes real-time. But the convergence of algorithms, location-based services and social media enables real-time, relevant, personalized filtering. Context is King.
7. On-Demand Everything
2010 will mark the inflection point for television, movie and music content becoming accessible anywhere, at anytime. It’ll happen in 2010, and Apple’s Lala acquisition will prove to be the catalyst that leads the way.
8. Digitized Physical World Emerges
Mobility and search by image combine to yield a digitized physical world. Links to the virtual world appear in the real world. Think of the bar codes appearing in restaurant windows as a first step - scan them with your phone, and they link to a review on Google or Yelp. When you have robust search by image, each object becomes its own bar code.
9. Microsoft’s Decade of Dominance gives way to Apple and Google
The cloud makes operating systems less relevant and leaves Microsoft’s core business exposed on a number of fronts. The brand is increasingly tarnished in the consumer’s eye and no longer holds the sway it once did over developers. The mobile offerings so far have been woefully inadequate, leaving the company out in the cold as mobility takes off.
Today, Microsoft’s market capitalization is $265 billion, and its enterprise value is $237 billion. This compares with Apple at $172 billion and $152 billion and Google at $187 billion and $165 billion. During 2010, Apple and Google will further narrow the gap in value and both will begin to eclipse Microsoft’s enterprise value by year end.
10. Else but are critical to watch:
o Enterprise demand will improve–this is the only trend we see that is outsized bullish for Microsoft.
o China will become an increasingly important technology buyer–no longer just a producer of parts and consumer of cheap electronics, premium products are finding a market among Chinese end-users.
o Tech M&A will continue, led by software and services deals as suppliers position themselves for cloud and contextual computing paradigms. Expect a big acquisition out of IBM by the end of next year.
o User interfaces with computing devices undergo the first major shift in decades. In mobile, expect more use of gestures, tilt and accelerometers. On the desktop, Apple’s magic mouse and HP’s touchscreen computer point to a new paradigm for computing. Touchscreens and gestures will dominate.
Adopted and adapted from Rebecca Runkle (Managing Director of Technology Forbes Magazine)’s article at Forbes Magazine
