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Below the Belt: The TV Wars
RTMB's new feature - Below the Belt - will post here on a
periodic basis providing the smart investor with tidbits of
information allowing profitable opportunities...This is RTMB's
A headline title showing up in today's mainstream internet sites
states "Apple TV is Irrelevant." Of course the author is wrong and
way off base.
All indications appear that
) are ramping up to stage a massive battle for ownership of the
airwaves. Much money, development, time and effort has been spent.
Google has set up a beta site, a small midwestern town named Kansas
City, Kansas (it is small in comparison with KC, Missouri).
Google is using that city as a site to test out it's wi-fi
network for the entire area. Recently there are signs that it goes
beyond that. The local newspaper reported that Google is installing
super-speedy Internet service in area that also applies for set-top
filed with the Federal Communications Commission on Tuesday
signaled yet again that Google Inc. looks poised to sell television
programming with its coming Internet service in Kansas City.
An application to the FCC submitted by Google Fiber -
the Google division promising ultrafast Internet service to the
Kansas City market - calls the device "GFHD100." It is
speculated that it stands for google fiber high definition. A test
report submitted to the FCC suggests the black box will have
inputs for USB data hook-ups; LAN - or local area network -
computer cables; and HDMI - high-definition multimedia interface -
lines for digital audio and video signals. It also includes a Wi-Fi
transmitter for wireless data signals that require approval from
Google has also applied for an FCC license for an
"antenna farm.". Such a collection of satellite dishes could be
critical for capturing commercial television programming. The
company has also gained licenses in Kansas and Missouri to sell
Google announced more than a year ago that it would build a
high-speed Internet network in the Kansas City market, including
fiber optic cables to homes capable of delivering
download speeds 100 times faster than the national
Google would likely need to provide a bundle and offer a TV
package to lure customers away from the cable and phone operators
who sell Internet hook-ups to most households.
In the meantime, the whispers about Apple TV continue to
increase. Apple, of course, has been silent about its future
products. However, CEO Tim Cook recently gave an interview at the
AllThingsD conference and said that TV "is an area of intense
interest for us." According to a report by Piper Jaffray analyst
Gene Munster, Apple should unveil a new TV display in late 2012 and
launch it within the first half of 2013. He cites supply chain
checks, various third party reports.
RTMB recommends GOOG and AAPL for long-term investing. Both
stocks are very volatile and not for those who can't withstand
short term double digit percentage drops.
According to CNBC's All-America Economic Survey in March, half
of all households in the United States own at least one Apple
product. Furthermore, homes that own at least one Apple product own
an average of three. Overall, the average household has 1.6 Apple
devices. One-in-10 homes that do not currently own an iProduct plan
on purchasing one next year. If Apple is successful with a TV unit,
one can only expect these statistics to improve. An apple TV
product can only add to an increase in revenues.
If you are a long-term investor, the best opportunity to buy a
growth stock is on a market dip, and that opportunity may be
presenting itself right now in GOOG. The analysts predict earnings
will increase 21.60% this year and another 19.20% next year.
Please note, however, the GOOG P/E ratio of 32.96 is twice the
market P/E of 14.40. Apple's PE is below the market PE of 14.40.
Apple pays a cash dividend, Google does not. If buying only one of
these stocks, it should be AAPL.
Information regarding Google was obtained
The most recent picks by «RobMarketsBlind» are:
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