Jim Cramer has probably received more acclaim for helping individual investors than anyone. His show Mad Money is very popular and he gets praise for his Lightning Round segment. On that segment, callers ask him about a stock and gives a very quick answer as to his thoughts. I am not interested in criticizing Mr. Cramer for his quick appraisal as I think that this type of analysis is always a challenge. I am consistently amazed at his ability to give good advice on the fly.

I thought it would be interesting to compare my thoughts to Mr. Cramer’s Lightning Round. I am not going to do the full analysis like my traditional stock review posts but rather just say if I agree or disagree with him. Here are last weeks picks and my thoughts. If this article is well received, I may continue this as a regular feature.

The Lightning Round picks came from the Mad Money page on The Street.

Company

Date

Segment

Jim Cramer’s Call

Confident Investor Call

American Capital Agency (AGNC) 11/08

Not good enough

Align Technology (ALGN) 11/05

Not good enough

Yamana Gold (AUY) 11/05

Worth considering

Bristol-Myers Squibb (BMY) 11/09

Not good enough

Boardwalk Partners (BWP) 11/07

Not good enough

Caterpillar (CAT) 11/09

Already on Watch List

Chevron (CVX) 11/09

Worth considering

Changyou.com (CYOU) 11/08

Not good enough

CYS Investments (CYS) 11/08

Not good enough

Caesars Entertainment (CZR) 11/09

No- not profitable

Facebook (FB) 11/09

Not good enough

Frontier Communications (FTR) 11/07

Worth considering

SPDR Gold Shares (GLD) 11/05

I don’t analyze SPDR

Generac Holdings (GNRC) 11/08

Not good enough

Google (GOOG) 11/09

Already on Watch List

Harley Davidson (HOG) 11/09

Worth considering

Intel (INTC) 11/05

Worth considering

JC Penney (JCP) 11/07

No – not profitable

Nordstrom (JWN) 11/09

Worth considering

McDonald’s (MCD) 11/05

Not good enough

MGM Resorts (MGM) 11/05

No – not profitable

Microsoft (MSFT) 11/09

Not good enough

Matrix Service (MTRX) 11/05

Worth considering

Protein Design Labs (PDLI) 11/05

Worth considering

PPL Corp (PPL) 11/08

Worth considering

Sears Holdings (SHLD) 11/07

Not good enough

Skyworks Solutions (SWKS) 11/08

Not good enough

VIVUS (VVUS) 11/07

No – not profitable

Walgreens (WAG) 11/05

Not good enough

Wynn Resorts (WYNN) 11/09

Worth considering

Yahoo! (YHOO) 11/09

Not good enough

 

As you can easily see, I am a bit more conservative on my choices than Mr. Cramer.  I really want a company to be growing well and be profitable in order for them to be on my list.

Many others will write obituaries or pontificate about the inability for Apple to be the driving force in computing without the visionary Steve Jobs. Instead, I will simply say that the world was a better place because he was here and I think that is all any of us could ask for.

RIP Steve Jobs.

Here is the early (and obviously mostly pre-written) obituary in WSJ.com (sorry I am simply going to plagiarize the entire article – I don’t usually do this but in this one single case I will break my rule):

http://online.wsj.com/article/SB10001424052702304447804576410753210811910.html?mod=WSJ_Home_largeHeadline

By YUKARI IWATANI KANE And GEOFFREY A. FOWLER

Steven P. Jobs, the Apple Inc. chairman and co-founder who pioneered the personal computer industry and changed the way people think about technology, died Wednesday at the age of 56.

“Steve’s brilliance, passion and energy were the source of countless innovations that enrich and improve all of our lives,” Apple’s board said in a statement. “The world is immeasurably better because of Steve.”

His family, in a separate statement, said Mr. Jobs “died peacefully today surrounded by his family…We know many of you will mourn with us, and we ask that you respect our privacy during our time of grief.”

The company didn’t specify the cause of his death. Mr. Jobs had battled pancreatic cancer and several years ago received a liver transplant.In August, Mr. Jobs stepped down as CEO, handing the reins to Tim Cook.

During his more than three decade-long career, Mr. Jobs transformed Silicon Valley as he helped turn the once sleepy expanse of fruit orchards into the technology industry’s innovation center. In addition to laying the groundwork for the modern high-tech industry alongside other pioneers like Microsoft Corp. co-founder Bill Gates and Oracle Corp. founder Larry Ellison, Mr. Jobs proved the appeal of well-designed intuitive products over the sheer power of technology itself and shifted the way consumers interact with technology in an increasingly digital world.

Unlike those men, however, the most productive chapter in Mr. Jobs’ career occurred near the end of his life, when a nearly unbroken string of innovative and wildly successful products like the iPod, iPhone and iPad fundamentally changed the PC, electronics and digital media industries. The way he marketed and sold those products through savvy advertising campaigns and its retail stores, in the meanwhile, helped turn the company into a pop culture icon.

At the beginning of that phase, Mr. Jobs once described his philosophy as trying to make products that were at “the intersection of art and technology.” In doing so, he turned Apple into the world’s most valuable company.

After exhibiting significant weight loss in mid-2008, Mr. Jobs took a nearly six month medical leave of absence in 2009, during which he received a liver transplant. He took another medical leave of absence in mid-January without explanation before stepping down as chief executive in August.

Mr. Jobs is survived by his wife, Laurene, and four children.

Although his achievements in technology alone were immense, Mr. Jobs played an equally groundbreaking role in entertainment. He turned Apple into the largest retailer of music and helped popularize computer-animated films as the financier and CEO of Pixar Animation Studios, which he later sold to Walt Disney Co. He was a key figure in changing the way people used the Internet and how they consumed music, TV shows, movies, books, disrupting industries in the process.

Mr. Jobs also pulled off one of the most remarkable comebacks in modern business history, returning to Apple after an 11-year absence during which he was largely written off as a has-been and then reviving the then-struggling company by introducing products such as the iMac all-in-one computer, iPod music player and iTunes digital music store.

 

The company produces $65.2 billion a year in revenue compared with $7.1 billion in its business year ending September 1997. Apple has become one of the world’s premier designers of consumer-electronics devices, dropping the “computer” in its name in January 2007 to underscore its expansion beyond PCs.

Although Mr. Jobs officially handed over the reins of the company to long-time deputy Tim Cook in August, his death nevertheless raises a high-stakes question for Apple of how the company—which has been in the vanguard of technological creativity for most of the past decade—will sustain its success without his vision and guidance. Other icons of American capitalism, including Walt Disney, Wal-Mart Stores Inc. and International Business Machines Corp., experienced some transitional woes but eventually managed to thrive after their charismatic founders passed on.

But few companies of that stature have shown such an acute dependence on their founder, or lost the founder at the peak of his career. Several years after Mr. Jobs was fired from Apple in 1985, the company began a steady decline that saw it drift to the margins of the computer industry. That slide was reversed only after Mr. Jobs returned to Apple in 1997.

Mr. Jobs also leaves behind innumerable tales about his mercurial management style, such as his habit of calling employees or their ideas “dumb” when he didn’t like something. He was even more combative against foes like Microsoft Corp., Google Inc., and Amazon.com Inc. When Adobe Systems Inc. waged a campaign against Apple for not supporting Adobe’s Flash video format on its iPhones and iPads in April 2010, Mr. Jobs wrote a 1,600 word essay about why the software was outdated and inadequate for mobile devices.

The CEO maintained uncompromising standards about the company’s hardware and software, demanding “insanely great” aesthetics and ease of use from the moment a consumer walked into one of Apple’s stylish stores. His attention to the smallest details in the development and design process were instrumental in shaping some of the most distinctive features of Apple’s products, while his meticulously planned onstage demonstrations helped fuel excitement that was unmatched by his peers.

At event after event to introduce new Apple products, Mr. Jobs often puckishly proclaimed “There is one more thing” before revealing the most significant news at the very end of a speech. He enforced strict secrecy among Apple employees, a strategy that he believed heightened anticipation for upcoming Apple products.

Mr. Jobs, the adopted son of a family in Palo Alto, Calif., was born on Feb. 24, 1955. A college dropout, he established his reputation early on as a tech innovator when at 21 years old, he and friend Steve Wozniak founded Apple Computer Inc. in the Jobs family garage in 1976. Mr. Jobs chose the name, in part, because he was a Beatles fan and admired the group’s Apple records label, according to the book “Apple: The Inside Story of Intrigue, Egomania, and Business Blunders” by Wall Street Journal reporterJim Carlton.

The pair came out with the Apple II in 1977, a groundbreaking computer that was relatively affordable and designed for the mass market consumer rather than for hobbyists. The product went on to become one of the first commercially successful personal computers, making the company $117 million in annual sales by the time of Apple’s initial public offering in 1980. The IPO instantly made Mr. Jobs a multimillionaire.

Not all of Mr. Jobs’s early ideas paid off. Apple’s Apple III and Lisa computers that debuted in 1980 and 1983 were flops. But the distinctive all-in-one Macintosh–foreshadowed in a ground-breaking TV ad inspired by George Orwell’s novel “1984” that famously only aired once — would set the standard for the design of modern computer operating systems, in which users point and click on icons with a mouse rather than typing in commands.

Even then, Mr. Jobs was a stickler about design details. Bruce Tognazzini, a former user-interface expert at Apple who joined the company in 1978, once said that Mr. Jobs was adamant than the keyboard not include “up”, “down,” “right” and “left” keys that allow users to move the cursor around their computer screens.

Mr. Jobs’s pursuit for aesthetic beauty sometimes bordered on the extreme. George Crow, an Apple engineer in the 1980s and again from 1998 to 2005, recalls how Mr. Jobs wanted to make even the inside of computers beautiful. On the original Macintosh PC, Mr. Crow says Mr. Jobs wanted the internal wiring to be in the colors of Apple’s early rainbow logo. Mr. Crow says he eventually convinced Mr. Jobs it was an unnecessary expense.

Many ideas in the Macintosh came from a visit in 1979 to Xerox Corp.’s Palo Alto Research, where Mr. Jobs saw a machine called the Xerox Alto that had a crude graphical user interface and a mouse. The episode underscored his recurring role as a refiner and popularizer of existing inventions.

“Picasso had a saying, ‘Good artists copy. Great artists steal,'” Mr. Jobs said in a PBS documentary on the computer industry from the mid-1990s. “I’ve been shameless about stealing great ideas.”

Even in his appearance, Mr. Jobs seemed to cultivate an image more like that of an artist than a corporate executive. In public, he rarely deviated from an outfit consisting of Levis jeans, a black mock turtleneck and New Balance running shoes.

As Apple expanded, Mr. Jobs decided to bring in a more experienced manager to lead the company. He recruited John Sculley from Pepsi Co. to be Apple CEO in 1983, famously overcoming Mr. Sculley’s initial reluctance by asking the executive if he just wanted to sell “sugar water to kids” or help change the world.

After Apple fell into a subsequent slump, a leadership struggle led its board’s decision to back Mr. Sculley and fire Mr. Jobs two years later at the age of 30. “What can I say – I hired the wrong guy,” Mr. Jobs brooded in the same PBS documentary. “He destroyed everything I had spent ten years working for.”

Mr. Jobs then created NeXT Inc., a closely watched startup that in 1988 introduced a distinctive black desktop computer with advanced software that was initially targeted at the academic computing market. But the machine was hobbled by its exorbitant price tag and some key design decisions, including its use of an optical disk drive and a Motorola Inc. microprocessor at a time when Intel Corp. chips and floppy drives had become the norm.

NeXT eventually stopped selling hardware and failed to make money as a software company. But its operating system would become a foundation for OS X, the software backbone of today’s Macs, after Apple purchased NeXT for $400 million in December 1996.

In 1986, using part of his fortune from Apple, Mr. Jobs paid filmmaker George Lucas $10 million to acquire the computer graphics division of Lucasfilm Ltd. The company he formed out of those assets, Pixar Animation Studios, first sold hardware, then software, and later turned to feature films. Pixar went on to create a string of computer-animated hits, from “Toy Story” to 2008’s “Wall-E.” Mr. Jobs sold Pixar to Disney in January 2006 in a $7.4 billion deal that gave him a Disney board seat and made him the entertainment company’s largest shareholder.

Meanwhile, Apple began foundering. Computers using Intel chips and Microsoft software grew to dominate the market, a trend that accelerated after Microsoft’s Windows emulated many elements of the Mac’s visual interface.

Apple, by contrast, had to finance both hardware and software development internally. Fewer developers of application programs created products to make the Macintosh more useful. Apple would eventually decide to license its operating system to other hardware companies, but it was too late to reverse the swing to Windows-based machines.

By 1997, Apple had racked up nearly $2 billion in losses in two years, its shares were at record lows and it was on its third CEO–Gil Amelio–in four years. Eight months after the deal to buy NeXT in December 1996, Mr. Amelio was ousted and Mr. Jobs appointed interim CEO, a title that became permanent in January 2000. One former Apple employee recalls Mr. Jobs joking soon after he returned that “the lunatics have taken over the asylum and we can do anything we want.”

Mr. Jobs, who was given a salary of $1 a year along with options to Apple stock, made a series of changes that started paying off quickly. He ended the nascent software licensing program that created Mac clones, killed the struggling Newton handheld computer and trimmed a confusing array of Mac models to a handful of systems focused on the consumer market.

In May 1998, he introduced the iMac, an unusual one-piece computer that sported a colorful casing in translucent turquoise and gray. The popular machine–which sent competitors scrambling to improve their own designs—was embodied by a bold ad campaign that featured the phrase “Think Different,” with the picture of one of Mr. Jobs’s heroes, such as Albert Einstein and Muppets creator Jim Henson.

While shareholders cheered the changes, Mr. Jobs flexed his power on Apple’s Cupertino, Calif., campus. Within months of taking over, he had replaced four of the five top executive positions with former NeXT underlings. He issued emails forbidding employees on the famously laid-back campus to bring pets to the office, smoke even in parking lots, and threatening to fire anyone caught leaking company documents.

One personal assistant became a target when he failed to arrange the installation of a high-speed digital data line to Mr. Jobs’s office fast enough to suit the interim CEO. The worker said Mr. Jobs fired him for the delay, but rescinded the firing the next day after he had cooled down. (The worker ended up resigning soon afterwards).

Apple had some stumbles during Mr. Jobs’s second coming, including a cube-shaped Macintosh that failed to catch on and was scrapped in 2001. The failure was one reason that Apple posted a quarterly loss and warned it would miss estimates several times in 2000 and 2001.

But big hits followed. In 2001, Apple introduced a PowerBook laptop made from titanium, a metal more frequently found in fighter airplanes. The same year, it introduced the iPod, which transformed digital music players with features such as its smooth shape and DJ-like wheel for navigating through songs. As of Sept. 2010, Apple had sold more than 275 million iPod devices since its introduction, and it has more than 70% market share in the market for digital music players.

A key differentiator was the iTunes Music Store, opened in 2003. At the time, the music industry was largely sitting on the sidelines of the digital revolution, badly wounded by illegal downloads but unable to agree on an easy, inexpensive way to sell songs online. But Mr. Jobs helped convince major record labels to sell recordings for 99 cents each, along with antipiracy restrictions that most consumers found acceptable.

The store, which has sold more than ten billion songs, became the largest music retailer in the U.S. in 2008. It also became an incentive for consumers to buy iPods because, for much of its history, songs from the iTunes store could only be downloaded to Apple’s music player and not devices made by other companies.

At the same time, Mr. Jobs was building a deep bench of executives. He recruited former Compaq Computer Corp. executive Tim Cook in the late 1990s to straighten Apple’s operations and promoted him over time to chief operating officer. Ron Johnson, senior vice president of Apple retail, was hired from Target Corp. in 2000 to launch Apple’s stores worldwide. Apple’s lead industrial designer Jonathan Ive took charge of the physical look-and-feel of the company’s products and is said to share in Mr. Jobs’s sensibilities about design.

In 2004, Mr. Jobs had to lean on this bench when he disclosed that he had had surgery to remove a cancerous tumor from his pancreas. Apple revealed the procedure in early August 2004, but a person familiar with the situation said Mr. Jobs first learned of the tumor during a routine abdominal scan nine months earlier. The board and Mr. Jobs said nothing to Apple shareholders as the Apple executive, during that time, dealt with the tumor through changes to his diet, the person said.

In June 2007, Mr. Jobs made another splash when Apple introduced the iPhone. The cellphone pushed the envelope in the mobile phone market with features that included a touch-screen interface, allowing tricks such as blowing up images by spreading a thumb and finger on the phone’s surface.

Mr. Jobs was typically hands on in the creation of the iPhone. People familiar with the matter say the CEO was the one that made a decision to change the screen of the iPhone from plastic to glass after he unveiled the product at the Macworld trade show in 2007. The iPhone team scrambled to procure glass that would meet his exacting standards, so the devices could be manufactured in time for the launch, which took place just seven months later.

Despite skepticism about Apple’s ability to enter an already-competitive market dominated by the likes of Research in Motion Ltd.’s Blackberry devices, Apple quickly became a force in the mobile phone market, selling 92 million iPhones as of December 2010. The product kicked into a higher gear earlier this year when Apple said it would begin selling iPhones through Verizon Wireless in addition to carrier AT&T.

Last year, Mr. Jobs also unveiled the iPad tablet computer to great fanfare, billing it as “magical and revolutionary”. In the first nine months of the product’s release, Apple sold 14.8 million iPads as consumers snapped them up to use as a casual multimedia device for activities such as emailing, watching video and reading. People who work closely with Mr. Jobs said the project was so important to him that he was intimately involved in its planning even while recovering from his 2009 liver transplant.

A major selling point for both the iPhone and iPad has been the App Store, which allows developers to easily make application programs that users can download for free or for a small fee; the store meanwhile has seen more than seven billion downloads as of the end of 2010.

One cloud to Mr. Jobs’s reign came in 2006 when Apple also disclosed that an internal investigation had discovered that stock option grants to Apple executives between 1997 and 2002– including to Mr. Jobs– were improperly dated. Apple became the most high-profile technology company caught up in a broad series of options backdating scandals that helped inflate the profits executives made from their stock awards.

Apple later disclosed that Mr. Jobs helped select the favorable option dates, but denied that he did anything wrong since he didn’t understand the accounting implications of his actions. Apple’s investigation ended up blaming two ex-Apple executives – former general counsel Nancy Heinen and former chief financial officer Fred Anderson – for their role in the backdating. Both were later charged by the Securities and Exchange Commission. They ended up settling the charges. Mr. Jobs was never charged with any wrongdoing.

Those who knew Mr. Jobs say that one reason why he was able to keep innovating was because he didn’t dwell on past accomplishments or legacy but kept looking ahead and demanded that employees do the same. Hitoshi Hokamura, a former Apple employee, recalls how an old Apple I that was displayed by the company cafeteria quietly disappeared after Mr. Jobs returned in the late 1990s.

“Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose,” Mr. Jobs said in a commencement speech at Stanford University in June 2005, almost a year after he was diagnosed with cancer.

—Pui-Wing Tam, Don Clark and Jim Carlton contributed to this article.

Read more: http://online.wsj.com/article/SB10001424052702304447804576410753210811910.html#ixzz1ZxNfJ9Ik

 

The financial and technical news is buzzing this week about Google’s [stckqut]goog[/stckqut] acquisition of Motorola Mobility Inc. [stckqut]mmi[/stckqut] My general rule is that when a company acquires another company that is bigger than 10% of the parent then a Confident Investor needs to get cautious. Google’s revenue is $33.3B and Motorola Mobility’s revenue is $12.7B. Too many companies get very confused and get lost during a merger of this size and this is quite likely to happen here. For this reason, I am removing Google from my Watch List until Google has had some time to integrate MMI.

When the news of the merger first broke, the discussion was all about Google buying the robust library of patents that Motorola Mobility owned. While this is an immediate benefit to Google as they fight in the very litigious environment of mobile platforms, it would be foolish to limit this acquisition to just that portfolio.

Google is paying $12.5B for MMI. This is a pretty high premium to pay for the rights to the patents. If Google just wanted the rights to protect against lawsuits then they could have licensed these patents for far less money. Of course, Kevin Smithen, an analyst from Macquarie USA, thinks that Google only wanted the patents and will spin off the hardware business relatively quickly.

If Smithen is correct then the various Android manufacturers have nothing to fear. In fact, this would be the best of all worlds in that MMI will be severely confused as it moves into Google and then shuffled back out to private equity or some other manufacturer. This would be a recipe for near death for MMI going through that many transitions and their competitors will take advantage of that confusion. The various phone manufacturers would also enjoy the fruits of Google’s largess and have fewer patent problems as Apple[stckqut]aapl[/stckqut], Microsoft [stckqut]msft[/stckqut], and Oracle [orcl[/stckqut] try to stop or get a piece of the Android revenue stream.

However, I do not think that Google will miss the opportunity to compete with their top competitor: Apple. It is very clear that the Android OS will continue to be the most popular mobile phone OS just like Windows on the desktop is the most popular OS. However, just like on the desktop, the preferred vendor is Apple. Whenever a new phone running Android is introduced, it is compared to the gold standard, the iPhone.  Whenever a new version of Android comes out, it is compared to the gold standard, iOS. Whenever a new tablet comes out, it is compared to the gold standard, iPad.

I do not think that that Google wants to be the Microsoft of the phone. Rather, their culture is much closer to being like Apple. If you look at all of the products from Google (usually creating little to no revenue for the company) most of them are about defining and creating a great user experience. This is what Apple has almost always tried to do. The one place that Google doesn’t do this is in mobile phones where their OS, Android, is placed on so many different form factors that they no longer have a great user experience across the entire platform.

The addition of MMI to Google gives them the unique opportunity to create a phone platform that is tightly coupled between hardware and software that is only seen in products from Apple or Research In Motion [stckqut]rimm[/stckqut]. There, though, is the rub. Few companies have been successful at running a business that is equal parts hardware and software. Apple is the only one true success in that area while others were successful for awhile and then struggled (think RIM and Palm). Most companies do not do a great job of being great in both hardware and software. Rather, they focus on hardware (think HP[stckqut]hpq[/stckqut], Dell[stckqut]dell[/stckqut], and Lenovo) or they focus on software (think Microsoft, CA[stckqut]ca[/stckqut], and Oracle[stckqut]orcl[/stckqut]) and they let the other side be “good enough” to support the core. Yes, HP makes software but that isn’t the core of their business and, for the most part, their software is designed to operate their great hardware. Similarly, Microsoft makes computer mice but few people consider this to be the core of what Microsoft is. For years, Oracle was a software only company until they bought Sun, another company that struggled being a software company and a hardware company.

Apple though has carved out a unique position in that they make great software and equally great hardware and they combine the two together to enable an awesome user experience. That is what Google has the potential to do with MMI. It won’t be easy and they could elect to take the easy way out and spin off the hardware business. In addition to being incredibly difficult to do well, it is also risky in that their Android partners would be very unhappy about a well integrated Android phone competing with a “stock” phone running Android. The road to excellence may force Google to upset their partners a great deal and Google simply may not be up to the task of accomplishing this goal.

The Motorola Mobility deal also allows Google to be excellent in another area that is dominated by no one and may be even bigger than mobile phones. Motorola generated nearly $3.6B in set-top boxes and services for television. Google has dabbled in this area of the market without much huge success. The combination of Google’s software with Motorola’s set-top infrastructure could create an integrated environment that would have everyone else on the outside looking in on a very strong revenue stream.

This acquisition could be only about protecting Android from patent suits but that would be a shame since Android doesn’t add significantly to Google’s bottom line. If Google wants to be truly great, this acquisition could be about trying to learn from Apple and teaching the master a trick or two. The question is: can Google out-Apple Apple? While this will be interesting to watch, I would prefer to watch it from the sidelines and not as an investor so I will sit back for a few months to see how this proceeds.

Apple [stckqut]aapl[/stckqut] has come under a great deal of discussion in the past week or so due to it’s ever expanding hoard of cash. Most companies hate having that much cash in the bank (or perhaps they are not fortunate enough to accumulate it) but Apple seems to really enjoy having a big savings account.

Since all the other bloggers that discuss companies and investing seem to have chimed into this conversation, I have to decided to do it as well.  Here are my suggestions:

  1. Use the cash like they have been. Apple uses its cash very effectively and very aggressively. As pointed out in PC Magazine, Apple effectively uses its cash to gain a technical advantage by locking up its supplier community in ways that their computer and device competitors such as Toshiba, Dell [stckqut]dell[/stckqut], and Hewlett Packard [stckqut]hpq[/stckqut] simply cannot afford to do. They are able to help manufacturers build their plants to create new components and lock in a pricing and supply chain that virtually locks out or delays the competition from the latest and greatest hardware advances. This competitive advantage means that they can continue to create large amounts of profit and build more cash.
  2. Increase R&D and rapidly expand their products with things that people want. Last year, Apple spent about 2.7% of revenue on R&D (and last year about 3.1%). I would like to see this grow to 7 or 8% of revenue. Yes, this is a big increase but Apple has a unique opportunity to solidify their presence in the markets that are important to them. Think what would happen if Apple had twice as many products that covered a broader spectrum of electronic experience.
  3. Increase their library. They should vastly increase their library of movies and video content to stream.  While they shouldn’t be stupid about the deals that they cut but they need to make deals with every movie and TV content holder out there. The consumer needs to feel that if they want to watch a professionally created video, Apple will always have the content. Making a ton of money in this area is not incredibly important (but don’t do it at a loss). What is more important is that they use this content to drive the sales of more multimedia devices and computers. While they are at it, they need to cut deals with the newspapers and magazines as well. Apple has had some short-sighted rules that have prevented the allegiance of those that create printed material – they need to put these rules aside.
  4. Streaming. They should make it so that they can stream to their subscribers more easily and more reliably than ANYONE else.  Supposedly they are investing in more data centers and that is a project that should be accelerated and expanded. Also, there are rumors of acquisition discussions with Hulu, this would be an acquisition that makes sense as it fits with their core offering today. Some commentators suggest that they should diversify by buying a company like Facebook but that would be ill-advised. Most companies that try to expand into vaguely related markets end up screwing up (think of EBay [stckqut]ebay[/stckqut] buying Skype).
  5. Integration with the cloud. They should make it so that integration between their products on your local network and between their products and the cloud is seamless and easy – in fact even fun.  Lion looks like it has great features in this area but they should take it to a new level. They would do well to expand that connectivity by putting a Windows application out there that makes Windows computers integrate easily and rapidly with Macs/iPhones/iPads. This doesn’t mean iTunes but instead iTunes on steroids – no cords – use the cloud, the private cloud, and the local connectivity connection of the computers.Read More →

It seems that Netflix (NFLX) will be adding the number one game console, Nintendo’s Wii, to its list of streaming destinations this spring. This is good news as Netflix moves from a DVD delivery service to a content streaming service.  The ability to stream will be tied to the user’s membership.

Netflix will need to do more to make streaming a simple matter. They are competing with the cable stations (that typically only offer a small number of movies). The advantage that Netflix needs to offer is the ability to stream a large number of titles to a variety of devices so that they remain a force in the industry as others start to offer this service. Their DVD rental business had a very high cost of entry for competitors but streaming to a computer is not nearly as high cost. Their key is to control enough customers that the studios give them preferential pricing.

BloggingStocks.com also has some interesting analysis.  Here is part of what they think and you can click through to read more:

Nintendo fans and movie buffs, unite and rejoice! At long last, Netflix (NFLX) has said its streaming video service will be available for the Nintendo Wii this spring. Wii is bringing up the rear a bit here, as consumers with an Xbox 360 from Microsoft (MSFT) or a Sony (SNE) PlayStation 3 already enjoy access to Netflix films.

Here’s the fine print: Wii users have to have a broadband connection and a Netflix subsription that costs $9 per month or more. Upon receiving a special “instant-streaming” disc for the Wii, they will have access to their instant queue, essentially using the Wii as a portal through which to play the films (of course, a TV is still necesssary). Currently, there are about 17,000 titles (movies and TV shows) available for streaming, a far cry from the 100,000 names a Netflix subscriber can get in good old-fashioned disc format.