Apple CEO Tim Cook predictably panned Google’s wearable tech last week. Here’s why one Fool thinks he might be off base.
Apple (AAPL -0.34%) CEO Tim Cook has certainly made it clear he doesn’t mind criticizing the competition.
For example, back in February, he panned the OLED technology used by Samsung in the screens of its Galaxy series devices, while at the same time, offered Apple’s own Retina Displays as a superior alternative. While I happened to find those comments particularly curious considering Apple had reportedly just hired an OLED expert of its own, that still didn’t stop shares of OLED supplier Universal Display (OLED -0.34%) from falling as much as 7% that day.
Even so, it’s hard to blame Cook for wanting to extol the virtues of his own company’s strategy and products.
Now, Cook has trained his sights on the search behemoth Google (GOOGL 0.99%).
More specifically, while discussing the future of wearable technology last week at the D11 Conference hosted by AllThingsD, Cook stated, in no uncertain terms, that he doesn’t think many people will buy Google Glass.
Why not?
Though he admitted there were “some positive points in the product,” here are three choice quotes he used to take jabs at Google Glass:
- “I think it’s probably more likely to appeal to certain vertical markets, and I think the likelihood it has broad-range appeal … that’s tough to see.”
- “There’s nothing great out there that I’ve seen. There’s nothing that’s going to convince a kid who has never worn glasses, or a band, or a watch, or whatever to wear one … or at least I haven’t seen any.”
- “I wear glasses because I have to … I don’t know a lot of people that wear them that don’t have to. They want them to be light and unobtrusive and reflect their fashion … so I think from a mainstream point of view [glasses as wearable computing devices] are difficult to see. I think the wrist is interesting. The wrist is natural.”
Editor's Note: Analysis and insight for this article were originally sourced sourced from our friends at Huffington Post
First, as the folks over at the Huffington Post so astutely pointed out, it’s no coincidence that Google partnered with designer glasses start-up Warby Parker, best known for making trendy (and often bulky) “hipster glasses.”
Even so, with or without incorporated lenses, Google’s own pictures of the device make it hard to claim Google Glass is particularly gaudy:
Better yet, if recent reports prove true which say Google has decided to use ultra-slim OLED displays from Samsung in the commercial version Glass, you can bet the final product will be even more streamlined by the time it’s offered to the masses.
However, while fashion could undoubtedly lead to a variety of interesting arguments for or against owning Google Glass, a larger question remains which could easily determine Google’s success or failure: What level of invasiveness are people willing to accept in the first significant iteration of wearable computing?
To be sure, a computer worn near the eye is bound to be more closely tied into our everyday lives than a watch, but that’s exactly what’s making people nervous about Google Glass. After all, though many people are arguably too-often connected to their digital lives through smartphones at present, Google Glass takes those electronic interactions to an entirely new, more intimate level.
Worse yet, privacy concerns had surfaced even before the device was released to 2,000 beta testers, even as Google had added simple safeguards like a voice command requirement for taking pictures. Unsurprisingly, hackers quickly released an app — appropriately dubbed Winky — to enable users to simply wink to snap a photo.
As another example, if you have a habit of ducking away from awkward conversations before people see you, you might hate that a San Francisco-based tech start-up named Lambda Labs is set to release a Facial Recognition API for Google Glass in the very near future.
In the end, Tim Cook may be right in saying Google Glass isn’t ready for commercial adoption on a wide scale, but it’s not for the reasons he thinks.
On one hand, Apple may be better off if they enter the space by unveiling a smart watch of their own, but Cook will have his work cut out for him if he wants to convince consumers they absolutely cannot live without an Apple device strapped to their wrists. Google Glass, on the other hand, certainly boasts that “wow” factor, but Big G took such a huge leap forward with their tech that they might be scaring consumers away.
For what it’s worth, this technology isn’t exactly Google’s first long-term oriented project to freak people out; it’s safe to say the company’s driver-less cars have attracted a fair amount of skepticism so far. In addition, chairman Eric Schmidt did say last month the commercial release of Glass is still “probably a year-ish” away, so they’ve got at least some time to iron out the details before their prime time debut.
But what do you think? Is the world ready to accept Google Glass? Share your thoughts in the comments section below.
Now, let’s focus on the stocks that are pivotal to this narrative and what they mean for savvy investors.
Apple Inc. (AAPL -0.34%)
Apple’s market strategy is revealing, especially in light of Tim Cook’s comments on Google Glass. By focusing on wrist-worn devices like the Apple Watch, Apple showcases its commitment to integrating technology seamlessly into daily life.
Investment Rationale:
- Market Leadership: As an industry leader, Apple’s innovative prowess ensures it remains a formidable force in technology.
- Product Ecosystem: Apple’s ecosystem is a fortress of customer loyalty, making it a reliable choice for sustained revenue and investment returns.
Analyst Ratings and Forecasts:
| Metric | Value |
|---|---|
| Consensus Rating | Overweight (Buy) |
| Average Price Target | $184.41 |
| Potential Gain | 12.1% |
| Number of Ratings | 35 |
Summary of Analysts’ Outlook:
Analysts are overwhelmingly bullish on Apple Inc., with a consensus rating of Overweight (Buy). The average price target of $184.41 suggests a potential gain of 12.1% from the current price. Many analysts believe that Apple’s strong brand loyalty, growing services segment, and increasing demand for its products will drive future growth.
Google Inc. (GOOGL 0.99%)
Despite Cook’s criticisms, Google continues to forge ahead with Google Glass, demonstrating a clear commitment to pioneering new technological frontiers.
Investment Rationale:
- Pioneering Projects: Google’s investment in next-gen technologies offers potential for significant long-term growth.
- Market Influence: Google’s vast resources and influence ensure it remains a heavyweight contender in tech innovation.
Analyst Ratings and Forecasts:
| Metric | Value |
|---|---|
| Consensus Rating | Overweight (Buy) |
| Average Price Target | $3,344.41 |
| Potential Gain | 24.1% |
| Number of Ratings | 34 |
Summary of Analysts’ Outlook:
Analysts are overwhelmingly bullish on GOOGL, with 27 out of 34 analysts recommending a “Buy” or “Overweight” rating. The average price target suggests a potential gain of 24.1% from the current price, indicating a strong upside potential. This optimism is likely driven by Alphabet’s dominance in the digital advertising space, its growing cloud computing business, and its impressive cash reserves.
Universal Display Corporation (OLED -0.34%)
Universal Display plays a critical role by supplying OLED displays for Google Glass, highlighting its importance in the wearable tech sector.
Investment Rationale:
- Niche Expertise: Specializing in OLED technology, Universal Display stands to benefit from advancements and contracts in wearable tech.
- Growth Potential: Continuous advancements in tech hardware signal long-term growth potential for this specialized supplier.
Analyst Ratings and Forecasts:
| Metric | Value |
|---|---|
| Consensus Rating | Overweight |
| Average Price Target | $245.15 |
| Potential Gain | 24.1% |
| Number of Ratings | 14 |
Summary of Analysts’ Outlook:
Analysts have a bullish outlook on OLED, with 10 out of 14 analysts rating the stock as “Buy” or “Overweight”. The average price target of $245.15 suggests a potential gain of 24.1% from the current price. This optimism is likely driven by the growing demand for OLED displays in the smartphone and TV markets, as well as the company’s strong financial performance and leadership position in the industry.
These insights aim to equip investors with diverse perspectives on wearable technology’s market dynamics, potential pitfalls, and future possibilities, thereby strengthening their investment strategy in tech stocks.