This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Why Google Seems Wired and IBM Seems Tired

IBM's Watson supercomputer, which is designed around cloud analytics, can profit from Google's growth, but that's just a niche. Google itself is the main stream.

All this dominance comes at a price. Google's motives are under constant suspicion, much like those of the U.S. government. It's the same treatment given Coca-Cola (KO) two generations ago and, later, to IBM itself. Google's "Don't be evil" mantra, detailed on its company philosophy page, turns out to be impossible to put into practice.

Thus, nations such as France keep trying to enforce local laws on Google's global presence. Thus, China continues to discourage its people from using Google, supporting home-grown alternatives. Thus, Google regularly faces law suits over things its users do, such as the suit from an Iowa executive over what someone did on Google's Blogger service recently.

But these are the problems of leadership, problems IBM would dearly love to have. Step into a new model car and the amount of electronics in it will boggle the mind. Google wants to own that, too.

It's the kind of audacious move IBM can't even dream of making, because its field of dominance is smaller, and shrinking, while that of Google is enormous, and growing. Which is why Google earnings are worth more than twice what IBM's are, and the gap should continue to widen in 2014.

At the time of publication the author owned shares of GOOG and KO.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

 

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
GOOG $630.38 0.00%
IBM $147.98 0.00%
AAPL $113.29 0.00%
FB $91.01 0.00%
TSLA $248.48 0.00%

Markets

Chart of I:DJI
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 +1.21 0.06%
NASDAQ 4,828.3250 +15.6170 0.32%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs