22-May-12
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Microsoft -- Is It Still the Atlas of Technology? Part II.
There was a time when it was very clear who dominated the technology industry: Microsoft was the undisputed giant of technology. Today, however, it is becoming unclear who is leading the direction of technology.
In this report, part two of a two-part series, we reflect on the current state of Microsoft and cover the following main points:
- The importance of history and the lesson from Digital Equipment
- An overview of financial trends at Microsoft
- A comparison of Microsoft to other technology companies of importance
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21-May-12
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Microsoft -- Is It Still the Atlas of Technology? Part I.
There was a time when it was very clear who dominated the technology industry: Microsoft was the undisputed giant of technology. Today, however, it is becoming unclear who is leading the direction of technology.
In this report, part one of a two-part series, we reflect on the current state of Microsoft and cover the following main points:
- A historical review of how Microsoft got to where it is today
- A review of Microsoft’s strategy of leveraging Windows in other markets
- A summary of how Microsoft has missed some of the largest developments in technology over the past 10 years
- The potential of cloud computing to undo Microsoft’s position as the platform of choice for all technology
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19-Mar-12
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The Impediments to Cloud Computing
The cloud computing revolution will gain significant momentum when adopted by enterprise technology users.
The current model for cloud computing is a service model, where the cloud computing aspects are offered remotely, and as a subscription-based service. This model is actually unappealing to many enterprise users.
There are two major obstacles to adoption: 1) security of data and 2) the difficulty of upgrades. We feel these obstacles will be overcome when a vendor emerges who sells cloud computing tools and components that allow an enterprise to build a pure computing environment under the enterprise’s control.
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22-Feb-12
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Pure Cloud Computing has Arrived
In our initial research reports on cloud computing, we envisioned a pure cloud computing environment as a revolutionary and transformational step that would dramatically alter the nature of information technology.
At the time, however, that vision had not been fully enabled by technology. Now, with the arrival of agnostic input/output devices for the Droid Razr, the first manifestations of our view of pure cloud computing have become possible.
We are not under any illusions that this particular implementation will alter the technology landscape immediately and by itself. But as the first real implementation of a working model, we think it is historically significant.
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24-Oct-11
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Pricing in the Potential for Cloud Computing
Traditional "giants" in technology are seeing their multiples shrink toward overall market levels if they do not have a clearly visible strategy toward the cloud. This valuation shift is not correlated to fundamentals: companies showing movement toward the cloud are receiving higher multiples than companies with similar fundamental growth trends, but no visible cloud strategy.
In this report, we illustrate this point looking at 15 selected stocks that are commonly viewed as "cloud computing" stocks.
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28-Jun-11
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Cloud Computing: A Reflection on Telecommunications
The history of the telecommunications industry holds clues for the future evolution and potential winners. Growth of new telecom services has historically been enabled by leveraging an existing network, benefiting the owner of that network. In the digital age, convergence of telecom services onto a single network has proven to be an appealing product to customers. This network will provide the next generation transmission of data that will be integral in the cloud computing revolution.
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11-May-11
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Cloud Computing: A Real and Measurable Trend
There is a very real transformational trend occurring in the technology sector that can be described as cloud computing. How you define the trend is important, however, as it is not the type of technology boom that will lift all boats. This transformation is large enough to change the current dynamics of the technology industry, which is very much focused on the IT networked-PC model.
Revenue growth is shifting away from the currently dominant technology companies who are still focused on the IT-PC model and toward companies involved in the cloud model. We believe that the current growth rates are only the beginnings of the major market shift that will occur, as evidenced by our analysis of 310 companies.
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28-Apr-11
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Cloud Computing: Not All "Cloud" Companies Are Created Equal
Earnings growth of so-called "cloud computing" stocks has outpaced non-cloud stocks by approximately 50 percentage points since 2007. Excluding Google and Cisco, the figure triples to more than 150 percentage points.
The fact that there is not a consensus definition of "cloud computing" in the marketplace has created an atmosphere where cloud has become the moniker for next generation growth in the technology sector. In this report, we will show the performance trend of a cloud computing index based on companies that the market commonly considers "cloud."
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11-Feb-11
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Searching in the Cloud -- Defining the Equity Universe
Cloud computing is the next potential transformation of technology. Our thesis for cloud computing as a strategic investment theme is it will be a strong driver of growth for the sector, as well as other groups from media to telecom. To determine what companies will benefit, we use fundamental data screening as our primary criteria, not preconceived ideas. Our research approach is explained in this paper. The actual results will follow in a subsequent report.
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26-Oct-10
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National Broadband Plan -- The Cloud Computing Spark Plug?
The FCC's National Broadband Plan aims to build the world's largest, fastest, and most widely-adopted network. If enacted as envisioned, there is no question that it would indeed be a strong stimulating force in the telecommunications sector. The increase in capacity and coverage in the wireless spectrum would enable cloud computing applications of much greater impact than are now seen. However, the political environment will likely determine how effective the plan becomes and which recommendations are adopted given the demand, legal, financial and political hurdles that currently exist.
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11-May-10
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Cloud Computing -- The Impact on Domains
The potential of the smartphone revolution is that all of the technology needs of an individual can be controlled and accessed through a single device. The iPad hints at this direction, but since it is really just a touch-screen version of the laptop model, it is more properly viewed as evolutionary, not revolutionary. This is the potential in the cloud computing revolution that nearly all of the mass media, most analysts, and many investors are missing: The current incarnation of smartphones is only a precursor to the soon-to-arrive new style of computing.
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