Facebook abandons #Socialmedia. Goes Olde School $FB, $TWTR, $GOOG, $YHOO, $MSFT, $LNKD

Facebook (Nasdaq:FB) launches mandatory video ads. That’s olde school television. you know when your watching a reasonably interesting show and suddenly these ads come on. Madison Ave Madmen call that Interruption Marketing. similar to tele-marketing which has annoyed tens of millions.

So where is the promise of social marketing. You know engaging the follower with relevant compelling offerings which have a high sell through rate. This is like watching the Swedish Bikini cheerleading team during a commercial break exhorting you to drink a particular beer while you are ignoring your girlfriend as you watch a very important football game. Very important to be emphasized.

Facebook will become no more powerful than network TV. Which right now is not very powerful at all.

George Gutowski writes from a caveat emptor perspective

Perfect Way to Screw Up Facebook Ads $FB, $GOOG, $TWTR, $LNKD, $YHOO,

Facebook (Nasdaq:FB) is poised to launch video ads for a reputed $2 million a day to reach everyone between 18-54. If they hang onto the business they will gross $730 million. hopefully without annoying the users.

Despite the fact it is free I’m pretty sure I don’t want to see the ads. So what if you go into your profile and change some of your settings. Age comes to mind. Tell em you’re over 55. This demographic apparently does not watch video’s. Change other aspects that makes it difficult for them to figure you out.

The ads will play automatically so watch for creative resistance from an ungrateful public who do not care to pay the bills for billionaire and multi-millionaire geeks working at Facebook.

George Gutowski writes from a caveat emptor perspective.

#Xbox and #PS4 dogfight will exhaust each other. Situation ripe for a massive disruption. $SNE, $MFST, $AAPL, $GOOG,

Sony and Microsoft have launched their gladiator proxies in the forms of Xbox and PS4. Sales since launch seem to be even on a global basis. Brand loyalty is strong. No signs of any major defections. The product narratives are holding.

Consider this. Race fans will recognize the set up. Two strong horses running neck and neck fighting for every inch. The adrenaline surges, surges and then surges some more. One cannot let the other get ahead or its all over.

Usually the two horses cannot pace themselves and a third stalking horse comes out of nowhere, sweeps around in the last turn and makes a mad dash for the finish line leaving the two favourites eating dust.

The two are playing the same game. Corporate thinking is so us vs. them who really understand the landscape.

Possible disruptors could be Apple. The iPhone and iPad were pretty good. The app store has wide distribution. Google is just desperate the make Android work. The Chinese would love to take a run at this as well.

So sit back and watch the race. The harder the more likely they will fail.

George Gutowski writes from a caveat emptor perspective.

Microsoft’s Next CEO will be a Lawyer. Here’s how they F it up. $MSFT $GOOG $AAPL $YHOO $FB

Microsoft (Nasdaq:MSFT) is looking for a new CEO. What do they need? A lawyer of course and here’s why. Big Tech is subject to much legal and regulatory scrutiny if not outright interference. Antitrust actions are constant. Law suits against competitors are daily events. If you develop something or buy it the competition immediately attacks it because they were working on something just like it. If  they don’t attack it you will attack them.

This has nothing to do with engineering. There are thousands of engineers. some of them are even good.

What you need is a good war-time consigliere.

Yahoo (Nasdaq: YHOO) stole an attractive engineer from Yahoo who is playing the engineering and development card. Marissa Meyer if you must ask.

Apple (Nasdaq: AAPL) is post Steve Jobs but still very much in the developer super product mode.

Google (Nasdaq: GOOG) is still in the grips of its two founders Larry Page and Sergey Brin. Uber developers in their own right and employers of tens of thousands of brilliant and near brilliant engineers. They came the closest to breaking out of the mould and hiring a grey hair to help lead but they yanked the chain back recently.

Facebook (Nasdaq: FB) is still in the validation stage. Mark Zuckerberg must prove himself and validate his social media concept. But as any casual observer will notice they are spending more time on legal and regulatory issues; like it or not.

So the narrative at Microsoft is we need the next big general to lead us into battle. You can almost see the biblical imagery of an angel wielding a big ass sword slaying dragons and beasts.

The most effective leader for Microsoft would be a lawyer with good infighting instincts. The engineers you can hire and fire.

The market would be very confused because tech expects and evangelical type of CEO. A Steve Jobs who walks onto a stage holding something and fervently saying this is it and you need it now. The next day the law suits start-up.

If Microsoft hires a lawyer as CEO the competition would be very confused. If you hire an engineer you parse his résumé and you can guess what direction he will take. A lawyer well you just don’t know. And a lawyer is just what you need.

This radical idea would confuse investors in the interim but work big time in the long run.

But like the story title says. They will F it up for sure.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Microsoft Candy is Dandy but Sex Wouldn’t Rot You Teeth $MSFT $GOOG $AAPL $YHOO

Microsoft (Nasdaq: MSFT) announces dividend increases and share buy backs. As previously predicted the Financial Skeptic called for dividend increases and share buy backs just to keep investor enthusiasm err engagement err addiction up there.

The move is essentially a “Candy is Dandy but Sex Wouldn’t Rot your Teeth” gambit. By increasing the dividend you more deeply engage income investors and protect the floor. By purchasing shares you enhance the financial engineering. but this is all Dandy Candy.

The real sex will come when the new sovereign is found and proclaimed. There will be a magnificent royal procession allowing the subjects to see the new king and proclaim allegiance. Hopefully the sex will not rot our teeth.

It’s all about Steve Ballmer’s replacement. Until we know and have confidence there is a Black Swan Co-relation which causes the market to shiver unexpectedly.

George Gutowski writes from a caveat emptor perspective. He does not like shivering unexpectedly. Follow him on Twitter @financialskepti

Microsoft/Nokia Will Screw Over Apple and Android $MSFT $GOOG $AAPL $NOK

Microsoft (Nasdaq:MSFT) in a controversial move has acquired Nokia (NYSE:NOK). Not sure if this is to secure a tenuous toehold in mobile devices using Windows or is it a way to source a new CEO. For $7.2 billion it better be to work the Windows toe hold, because you can get lots of excellent CEO’s for less than $7.2 Billion.

The acquisition comes lockstep with Ballmer’s retirement announcement so there must be a plan. Microsoft is solving Nokia’s capital shortage problem. Microsoft is relying on Nokia old Mojo coming back. Maybe they got it and maybe they don’t. Stand by for product announcements and see what they roll out.

Microsoft and Nokia were first movers and disrupters. They clawed out a strong market share and went to sleep comfortable in the status as world-class dominator. They weren’t watching and competitors started to eat their lunch. Nokia missed a few turns on the road and found themselves in the ditch.

The major flaw that everyone keeps shrieking about will be the lack of apps for a Windows-based product. Some claim developers are too beleaguered trying to cope with Apple and Android applications. This is wrong. Developers will go where the money is. Microsoft has $61 Billion in cash and growing.

Here is how Microsoft will need to throw their money around to develop the right set of trends.

  1. Bonus developers for creating Windows Driven Apps. Most will develop apps if the Windows Smartphone develops more traction.
  2. Develop apps exclusive to Windows which will drive sales of Windows Smartphones and cause some abandonment of Apple and Android. Microsoft is still strong in enterprise applications. There’s lots of stuff that is App ready which should be exploited quickly.
  3. Enterprise apps will drive multiple unit sales. Not the ones and twos at retail kiosks. Microsoft is not dry of app ideas just unexploited.

The exclusivity will the way Microsoft/Nokia screw with Apple and Android.  Watch for lawsuits. but in the ensuing years market positions will be established.

George Gutowski writes from a caveat emptor perspective.

 

 

Microsoft Bizarre Behaviour like a fish out of water. What to watch for! How to profit! $MSFT$GOOG $AAPL $YHOO

Steve Ballmer CEO of Microsoft is leaving (Nasdaq:MSFT). OK so now what? How to make a buck and not get skinned alive. Here’s a few things to keep in mind.

  1. This is going to take a year. That’s a long time even in dare I say it a “blue chip high-tech company”. Lots of noise with only a few anointed ones knowing the truth will be the norm.
  2. Everyone wants the culture changed. This means someone from the outside will be brought in and handed a big crowbar. He will then go ahead to cut, chop, slice, dice, splice and even fire people as he or she sets sail for shores unknown.
  3. Microsoft is a huge company. The MoJo that say an Apple or Google have going is hard to replicate at Microsoft. Microsoft is tied to the PC and it is now a mobile marketplace. A new guy will take forever to turn it around.
  4. Prepare for the worst and assume the new guy will fail. There are no guarantees. A failed successor will be worse than Steve Ballmer.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Microsoft Investors will be bribed, pampered, coddled and other neat stuff. Read how! $MSFT $GOOG $AAPL $YHOO

Steve Ballmer (Nasdaq:MSFT) is leaving in the next twelve months. Here are a few things Microsoft will do to keep investors loyal, happy warm and fuzzy.

 

  1. Serious dividend increases. Money talks and Microsoft has some. Lots actually. To keep investors focused the board will increase the payouts. A strong dividend will keep a floor under the stock price. Many of Microsoft’s businesses are steady predictable earners.
  2. To unlock value some businesses may be spun out and or sold off. Anyone new to Microsoft will want to write on a clean slate so let’s get going with the divestitures.
  3. No new major products and/or  initiatives will be undertaken before the new boy wonder arrives and starts putting his fingerprints on projects and idea’s. So in the meantime capex will shrink and cash flow will grow. Not a good thing but a real thing.

 

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Microsoft’s Uber Strategic Dell Move Blocks Google. Chrome is Dead $GOOG $MSFT $DELL

Microsoft (Nasdaq:MSFT) just kicked in $2 Billion into the Dell privatization deal and does not even get a board seat. Whats up with that. Firstly the $2 billion is one months excess cash flow. So it’s not big coin. Secondly it is a very small fraction of Microsoft’s overall cash position. Again so it’s not big coin. The investment is a subordinated debenture so they have mitigated some risk.

Here is the big win for Microsoft. Dell stays Windows. Google with Chrome could have done the deal but was blocked out if they knew about it at all in the early stages.

What about Microsoft’s relationship with Lenovo and Acer. For all we know Lenovo and Acer may be holding a piece of the deal. In any event Google relationship with the Chinese market is so bad Microsoft has safely concluded they will not go for Chrome. Dell will not go for Chrome. The remaining market for Chrome is not big enough.

Chrome is dead. It only cost $2 Billion and who knows it might yield a return.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or maybe follow his evil twin who is writing a Wall Street Murder Thriller at twitter@georgegutowski

Best Buy Best Suited to Best Takeover $BBY $GOOG $MSFT $AAPL

Image representing Best Buy as depicted in Cru...

Image via CrunchBase

Best Buy (NYSE:BBY) continues to lurch forward and attempt to revitalize itself. New C level officers are in place. They have decided to ramp up on-line activities. (Hey that sounds fresh) They have dwindling cash resources which is disturbing.

Do we smell a take-over. Because we do smell something.

Best Buy leading retail problem is consumers doing physical browsing and then placing on-line orders somewhere else. OK so they have a tremendous strength that they cannot leverage. In the mean time Google, Apple, Samsung and Microsoft (think games and maybe phones) all have a vested interest in selling hardware and devices. Best Buy still generates huge foot traffic and satisfies any tactile pre-purchase needs.

As a mass market retailer Best Buy has its faults which are well documented in the market place. But to someone wishing to dominate distribution channels Best Buy offers some near monopolistic advantages.

So like someone should buy them, feature their own products and kick competitors in the groin area.

Market cap of around $5 Billion and dropping. An expensive dividend yield of 4.45% and an approximately short interest position of around 10% of public float, the under 5 trailing PE ratio has got to make an acquisition look good.

Maybe go the private equity route and disguise any anti-trust issues through the chop-house process but the bits and pieces will give strategic advantage to key players. Given the huge cash balances of some tech players this is entirely doable.

Remember its a double play gambit. Enhance your own product line and torpedo some or all your competitors.

Count down?

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti