Tech Roundup: AMZN-MSFT & AAPL-ACN Deals, WMT Chooses NVDA
Apple has announced that it will host its annual product launch event on Sep 12. The company is broadly expected to announce three new models, including a massive new version in the form of the iPhone 8/X/whatever. There will also be other announcements.
But that was just part of the excitement last week, since there were some big announcements from Amazon AMZN-Microsoft MSFT, Apple AAPL and others.
Here are the details:
Amazon Wins Important Ally in Microsoft
While talking to your electronic devices isn’t that cool yet, technology companies are betting that they soon will be. But your voice assistant needs to go through a ton of data to get really good at assisting, which is the main reason that Amazon and Microsoft are getting together.
Amazon’s Alexa is the dominant voice assistant in the home, with its Echo devices offering 20,000 plus “skills” (services) including ordering things on Amazon and elsewhere, turning out the lights and so on. It is also housed in a growing number of smart home devices. But unlike the Google Assistant-powered Home device or Apple Siri-powered Homepod, it can’t sync the home and work lives because it doesn’t have access to work devices. Microsoft’s Cortana is similarly handicapped, with access to work lives (through 500 million+ Windows 10 devices offering access to email, work calendar, etc) but no access to home lives.
So later this year, once the integration is complete, you can tell your device “Alexa open Cortana” or “Cortana open Alexa,” for immediate access to all the services provided by the other. It’s important to note that the two assistants aren’t being molded into one, but just using data from the other for training purposes.
Apple Extends Enterprise Reach with Accenture Deal
Apple has been creeping up on the enterprise through partnerships and the one it announced with Accenture ACN last week, builds on earlier deals with IBM, SAP, Deloitte and Cisco. The companies will focus on banking and retail verticals for now through an Accenture dedicated practice for iOS. The group, which will include developers and other experts from both Apple and Accenture, will have offices spread across the world and will focus on modernizing Accenture’s customers’ operations through iOS devices and services.
The deal, according to Apple, is built on a growing trend within enterprises to create internal iOS developer teams that optimize business operations for iOS devices. So the apps developed by the partnership will mostly be for internal use by enterprises to manage and maintain a growing fleet of Apple devices.
This is a good deal for enterprises because Apple devices are generally more secure, run the same version of OS, have an uncomplicated backup system in the iCloud and also run software from Microsoft and other competitors when required.
All this will help Apple sell more devices and services and Accenture service its clients better by migrating legacy workloads to Apple’s leading edge technology.
Walmart Tapping NVIDIA in Cloud Push
Walmart is one company with faith in NVIDIA NVDA GPUs. According to Trip Chowdhry of Global Equities Research, the company will be greatly increasing NVIDIA GPU clusters over the next six months in preparation for an entry into the deep neural network space. What this means is that Walmart intends to develop artificial intelligence of its own based on the data it collects from its own customers. The whole thing will happen in the Walmart Cloud, the cloud computing network called OneOps that it acquired back in 2013 and on which it currently hosts most of its own infrastructure.
He adds that Walmart’s NVDA GPU Farm will be a tenth of the size of the AWS GPU Cloud, which is pretty big for starters. There were also some other details about its running Ubuntu Linux and not Red Hat Linux to create a hybrid of Convolution Neural and Recurrent Neural Networks.
Walmart said earlier this year that it was getting ready to completely move away from AWS, which makes perfect sense given the way Amazon has taken share from traditional retailers. Target is also following suit.
Ticker | Price Change Last Week | Price Change Last 6 Months |
AAPL | +2.62% | +17.35% |
FB | +3.43% | +26.10% |
GOOGL | +2.31% | +12.03% |
MSFT | +1.54% | +15.11% |
INTC | +1.19% | -3.89% |
CSCO | +2.74% | -5.71% |
AMZN | +3.49% | +15.26% |
Other stories
Corporate
Apple Bidding for Toshiba Chip Unit: In another twist, Toshiba said that it couldn’t come to a decision about a favored buyer of its stake in Toshiba Memory, its JV with Western Digital. One of the bidders is a Bain Capital-led group, which has come back to the bidding process after replacing government backed investment firms with Apple.
The government investors wanted Toshiba to settle things with WDC (which says its JV rights are violated by a sale to any party, in this case its competitors, without its consent) before they invested. Since WDC has taken the matter to court and Toshiba needs the deal approved by March in order to avoid getting delisted, this was a no go. With Apple as one of the investors and the government groups ready to invest after the case is settled with WDC, this becomes a viable alternative to the WDC-led offer.
The Honhai-led group (the only other bidder) is unlikely to be chosen since the Japanese government is unlikely to approve a deal in favor of Chinese ownership. So what it boils down to is a Bain Capital-led group, which also includes Toshiba customer Apple and WDC rival Hynix on the one hand and a WDC-led group on the other. WDC spent over $15 billion to acquire a 50% stake in the JV and this will be money down the drain if processing secrets are lost to competitors. So WDC needs to win the bid.
Apple Speaks on Net Neutrality: Apple has finally taken a stand on net neutrality. In a letter to the FCC on the last day comments were accepted, Apple said that net neutrality facilitated consumer choice, transparency, competition, investment and innovation, while a ban on paid fast lanes was essential to ensure that carriers like AT&T, Charter, Comcast and Verizon couldn’t give preferential treatment to their own services or those from providers willing to pay them (fast lanes).
In 2015, the FCC decided to tighten regulatory control over Internet service providers by reclassifying them as common carriers, which effectively characterized them as utilities. But President Trump-appointed FCC chairman Ajit Pai would like to repeal that reclassification, something that will make net neutrality difficult to enforce.
As a reminder: the opposite view is that customers like Netflix, Google and increasingly, Apple, who use the network much more than others should share the cost of upgrading the network, in the absence of which network innovation will be throttled. This argument doesn’t really hold up since Google’s efforts at gigabit Internet have stepped up competition in the space and pushed carriers to upgrade.
Google’s Assistant Gets New Boss: 21-year old Michael Sayman, who joined Facebook as a teenager and was given a full-fledged engineering job after he turned 18, just jumped ship to Google. At Google, he will be product manager for Assistant. Google’s Assistant is pitted against Amazon’s Alexa, which has the lion’s share (more than 70%) of the market.
Google, which accounts for most of the rest of the market, needs some magic to take share from the market leader as well as growing competition from Apple’s Siri. Sayman, who taught himself to code from Google tutorial videos wrote, “On a personal level, I also see the Assistant as an opportunity for Google to lower the barrier of entry for kids/teens of all ages and backgrounds, to learn how to program -- and encourage them to explore the world of computer science in ways that were once considered impossible.”
Samsung Self-Driving Car Permit: Samsung is the latest in a long list of automotive and technology companies that have applied for and received permits to test self-driving technology. Samsung already has a permit to test its technology in Korea and it already has an agreement with Hyundai, under which it equips some Hyundai cars with sensors and AI-powered modules. The company doesn’t intend to manufacture self-driving cars, so in all probability it wil go the same route as Alphabet and Apple.
New Products/Technology
Facebook Reality Show: Facebook’s FB recently-launched and expanding Watch video tab now has a new reality series called “Ball in the Family,” which will feature LaVar Ball and his family, including his son, Los Angeles Lakers rookie Lonzo Ball. The Ball family has captured headlines because of the senior Ball’s dramatic promotion of his son. The series will however involve more than just the game; family and relationships will be showcased as well.
Nest Tries Lower Pricing: Alphabet’s GOOGL Nest has introduced the Nest Thermostat E (for energy, everyone, easy, etc according to the marketing folks) for $169, $81 off the earlier version. This one uses polycarbonate instead of aluminum, is small and white-grey, doesn’t tell you the time and weather and is designed for invisibility. Other than these things and the fact that it also doesn’t offer some input details, it functions pretty much like its more conspicuous cousin, regulating the temperature in your home, allowing manual temperature setting, responding to your commands from pretty much anywhere and helping to control your smart home.
New Fitbit Smartwatch: Fitbit’s purchase of smartwatch makers Pebble and Vector may finally be paying off. Last week, the company launched its Ionic smartwatch for the fitness-conscious that at $300 is expected to offer some real competition to Apple, Samsung and others. With four days of battery life, improved sensors for more health insight (such as tracking sleep apnea), superior heart rate tracking during exercise and at other times, a better OS pairing with iOS, Android and Windows devices so you don’t need your phone while on a run, the ability to store up to 2.5GB worth of songs including Pandora stations for offline listening, the ability to pay with Fitbit Pay (using technology from its Coin acquisition) and water resistance up to 50 meters plus laps tracking to help swimmers calculate calories burnt in the pool. It’s also offering swappable bands so you to suit your mood or the occasion.
Google Assistant Gets Inside More Devices: Soon after Google announced that its AI-powered voice controlled Assistant would be inside third-party devices, Sony, LG and some other companies announced that new speakers and to-be-launched fridges and washing machines that would incorporate the Assistant. The data sharing arrangement between the partners isn’t clear yet and is likely to vary on a case by case basis. Sony for instance might be interested in data sharing since it’s also entering the smart home controller market. But LG might not, if it intends to merely integrate Assistant with its electronic appliances.
Collaborations and M&A
Apple-Tencent In China: In recognition of the Chinese brand’s growing position in China, Apple will now accept WeChat Pay in its mainland China App and Music Stores provided the phone is running on iOS 10 or 11. Since Alibaba is the market leader, it already accepts AliPay. But it doesn’t look like Apple is making significant headway in the huge mobile payments market currently dominated by the two Chinese players. Apple’s wallet for instance accounts for a mere 1% of in-store payments, according to Business Insider.
Microsoft-Valve Deal: Microsoft has announced that its hardware partners will be selling $300 VR headsets to be used with Windows 10 PCs. It hopes these devices to do very well in the market and has entered into a partnership with the popular Steam gamestore owner Vive that will allow Steam apps and games to run on the devices. Microsoft is also working on “Halo”-based content and ensuring that lower-end computers with integrated graphics hardware can also be used with these headsets.
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