Technology Stock Roundup: Tech Stocks Down But MSFT/INTC Gain

Apple (AAPL) plunged last week due to HFT trading, Google’s (GOOGL) legal troubles in Europe continued to increase while Intel (INTC) continued to drive deeper into the wearables market.

Apple Plunges for No Apparent Reason

Apple shares plunged last Monday as a result of high frequency trading (:HFT), which is the use of computer algorithms to trade shares at a very rapid pace. As a result, 6.7 million shares were traded in a minute, pulling prices down over 6%.

The decline was a head-scratcher for most, especially considering the company’s superb Thanksgiving weekend. But analysts attempted to explain anyway: Apple was affected by Morgan Stanley downgrading the technology sector and lowering Apple’s own weighting; people freed up capital to invest in oil and energy, which had grown cheaper over the weekend; and some even came up with data supporting the view that consumer spending was weak during the weekend.

Google Gets More Heat in Europe

Competition authorities in the EU are going at Google from a new angle. They have formally asked Yandex, the most popular search engine provider in Russia to provide information in support of a new anti-trust case against Google for the bundling of Google Mobile Services (:GMS) with Android.

GMS is the closed platform that most Android apps are currently built on and is responsible to a very great extent for the Android experience (Google Play, Maps, Gmail, Drive, YouTube, Hangouts and Chrome). Yandex has its own services that it would like to bundle with its own popular search engine. But creating a forked version of Android becomes a problem because Android and GMS are so closely integrated that taking Android without GMS significantly detracts from the experience.

Gigaom contributor David Meyer writes that according to his sources, even large Google partners operating in important Russian speaking countries were forced to use Google search as default. They were also prevented from pre-installing Yandex search on the home screen and were later banned from pre-installing any Yandex services at all.

Intel Drives Deeper into Wearables

Intel is now teaming up with Luxottica to make high-tech, high-fashion eye wear over a number of years. Fashion is Luxottica’s strong point: it is well known for brands like Ray Ban, Oakley and Persol. Intel’s strong point is technology and its determination to succeed in the wearables market.

This is one of several alliances Intel has made in the recent past, but the last week seemed to be reserved for eyewear, since it also replaced Texas Instruments in Google Glass and promised to sell the device into certain markets.

As far as fashion goes, Intel earlier tied with Fossil to make fashionable hi-tech wearables and a few weeks back, it announced MICA, a hi-tech bracelet for the fashion-conscious.

GOOG = Class C shares (new, non-voting)

GOOGL = Class A shares (old, 1 vote per share)

Other stories you might have missed-

Corporate

Intel to Invest $1.6 Billion in Chinese Factory: The Intel factory in Chengdu, West China is going to see a cash infusion of $1.6 billion. Local and regional governments will support construction to bring Intel’s most advanced chip testing technology to China.

Box CIO Sails for Yahoo: Box CIO Ben Haines is joining Yahoo as its VP of corporate applications and platforms. Yahoo (YHOO) and Box are different in every way: one is a new innovative company and the other an old giant trying to claw back into relevance. They haven’t had much to do with each other thus far and it remains to be seen if they will in future. Box continues to delay its IPO citing industry weakness.

Microsoft/BKS Part Ways: Microsoft (MSFT) has announced the end of its agreement with Barnes & Noble, in which it had invested $300 million, with a commitment to put in another $305 million over the next five years. Microsoft loses a lot of money (it’s getting back just $62.4 million in cash and $54 million in shares). If Nook decides to sell off its digital business altogether, Microsoft will get 22.7% of the proceeds. But this is still a positive for Microsoft because it can stop making the ongoing payments that were yielding no returns.

Juniper CEO Shaygan Kheradpir Out: After less than a year at the networking company, Kheradpir has been replaced with veteran Rami Rahim, who is well-liked at Juniper. There appears to be no strong reason for the decision other than the fact that his conduct with respect to a particular customer was suspect. Kheradpir has been under pressure from activist investors Elitott Management and Jana Partners to streamline the business and sell/spin off some parts of the business. But when he started with headcount reductions it instead led to uncertainties amongst employees and business partners.

Amazon Raises $6 Billion in Debt: Amazon’s (AMZN) has decided to borrow money in what is the biggest bond-issue in its history, as its profits continue to decline and investments continue to increase. The issue was in five parts: 4.95% 30-year bonds of $1.5 billion, 3.8% 10-year notes of $1.25 billion, 4.8% 20-year securities of $1.25 billion, 2.6% 5-year debentures of $1 billion and 3.3% 7-year obligations.

Legal/Regulatory

Apple Could Pay $1 Billion in iPod Antitrust Case: The decade-long case claiming that Apple modified iTunes software to lock in users and prevent them from deflecting to competing platforms is now before the jury. The plaintiffs in this case are 8 million consumers and 500 retailers and resellers that bought iPods from 2006 to 2009. This also enabled Apple to overcharge for the service (7.5% to retail customers and 2.3% to resellers for total damages of $352 million). If Apple loses, it could be liable to triple damages, which would take the amount to roughly a billion dollars.

Cisco Sues for Network Patent Infringement: Cisco (CSCO) has filed a couple of lawsuits against Arista Networks for infringing 14 of its network-related patents and also for copyright violations. Arista was formed by former Cisco employees and has seen some strong growth in recent times.

New Technology/Products

Apple Could Launch 4-inch iPhone 6 Next Year: Chinese website Feng.com is saying that its supplier checks indicate that a smaller iPhone will come to market next year. Different media reports have different takes on the device, but it appears that the 4-inch device will replace iPhone 5C and will be called iPhone 6 Mini.

Intel to Enter Google Glass: Intel processors will replace those from Texas Instruments in the new version of Google Glass expected to ship next year. Intel will be pitching the device to healthcare and other workplaces that require greater efficiencies and precision. This could breathe new life into the expensive and controversial device that has seen slow adoption amongst consumers.

Juniper Leverages Wedge Design to Fight Cisco: The Facebook-designed Wedge SDN switch design has found an illustrious adopter in Juniper, increasing competition and possible market share losses for industry leader Cisco. While Cisco has its own SDN design, a Cisco product is unlikely to fetch the kind of cost advantages that a Wedge-based switch could. Facebook has no interest in competing with Cisco, but it does want the cheapest infrastructure out there to speed up Internet connectivity.

Google For Kids Is Coming

Google Offers Big Incentives to Biz App Resellers: Google is adding a layer in its commission plan for resellers. The current commission it pays out is 20%, but Google will offer something extra to reseller partners that are the most successful. This premium layer will also get other support from Google so they can spend more time helping employees with the products and tackling technical issues. Unseating Microsoft won’t be easy, especially since it has a very successful Office 365 and enterprise agreements that lock in its partners, but signing on more partners and incentivizing them to do more would certainly be one way to go about it.

Amazon Prime Members Get Little Perk: Amazon will be putting its own “Amazon Elements” sticker on diapers made by Irving Personal Care and baby wipes made by Nice-Pak Products. It will also provide a ton of info for the environmentally conscious on how, where and with what ingredients the items were manufactured. Prime members get these essentials a whole lot cheaper, so this looks like a good way to rope in young mothers.

M&A

Microsoft Acquires Acompli Mobile Apps: Microsoft has confirmed its acquisition of mobile email startup Accompli that was leaked a few days back. The firm makes an app integrating calendar and native outlook support, and also enables file sharing for business purposes. Searching for files, older messages and people is also easier.Being an OS agnostic app targeted at business users, it could further Microsoft’s efforts to increase cross-platform penetration by leveraging mobile devices and the cloud.

Intel Buys PasswordBox

Some Numbers

Facebook: Better Conversions on Cyber Monday: According to IBM's Digital Analytics Benchmark Hub, Facebook referrals generated $123.44 per order compared to Pinterest’s $97.78. The latter is supposedly more conducive to shopping, which says something about Facebook’s effectiveness. Conversions from Facebook were also higher at 2.3% compared to Pinterest’s 1.6%.

iPhone Gains Share: According to latest numbers from Kantar World Panel, which provides smartphone market share estimates based on a three-month rolling average, the larger screens on Apple’s iPhone 6 have helped the company regain some market share. While the greatest gains were seen in the U.K., Germany and other markets also grew.

Overall market share in the U.K was nearly 40%, while in Germany it was over 16%. Its share in Europe as a whole increased more than 5%, while in the U.S. it was up by around 1%.

Yahoo Mobile Ad Share Could Beat Twitter’s: eMarketer estimates that Yahoo’s digital ad market share in the U.S. will edge past Twitter’s next year to 3.74%. Twitter will be at 3.69%. Market leaders Google and Facebook will be at 35.17% and 16.68%, respectively.

Google Pulls Ahead of Apple in TV Streaming: According to a report from research firm Parks Associates, Google’s Chromecast now accounts for 20% of sales from set-top-box/streaming sticks. Roku remains in the lead with a 29% share, but Apple has been pushed to third place with a 17% share. Amazon’s Fire TV is at number four with 10%. Chromecast is the cheapest device at $35, Roku has two devices at $50 and $99, while both Apple TV and Fire TV come for $90.

The price differential is on account of additional hardware that the other devices provide so you won’t need a separate device to watch content/run apps, but that’s less important right now as it is fetching Google market share. And additional devices can always follow.

Amazon Devices See Unprecedented Success

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