6X!

How cheap is that?

Let's say Apple gets hit hard by the global economic collapse and free cash flow falls to $7 billion next year and stays there for the next decade. If you bought the whole company today, you would get your entire investment back in 7 years, and you would get all the cash Apple generated in perpetuity from there for free.

What if the carnage is even worse than that? What if Apple's free cash flow falls more than 30%, to $5 billion, and stays there for a decade. Then it would take you ten years to get your whole investment back, and you would get all the future cash the company generated from there for free.

Can Apple's stock go lower? Hell, yes--stocks can always go lower. Is it really cheap at this price? You'd better believe it.

See Also: Apple Stock Cheap, Cheap, Cheap

Google Lively, a virtual world in which users can create their own environment and avatar and communicate with each other, is about to be shut down. True, this was one of Google’s 20% projects, meaning that it was created by one of Google’s engineers in their “spare” time, but still, time and money were invested in it and it flopped badly, with hardly anyone ever using it. Competing with Second Life is obviously not something that can be done casually.

The most clear example of a Google failure, however, is Google Answers. A high profile project and a direct competitor to Yahoo Answers - which, by the way, is still operational - Google Answers was shut down back in 2006. Its model of experts answering questions (instead of just having an open model with everyone answering, like on Yahoo Answers) didn’t hold up too well, and although the service is still a valuable resource, it wasn’t meant to be.

Jaiku has not officially flopped yet. But, the fact remains that after acquiring the service back in 2007 Google has done absolutely nothing with it, while Twitter - Jaiku’s direct competitor - has grown immensely. Hell, even other competitors in the space, such as Pownce, have experienced better growth than Jaiku, which can be seen from the Compete traffic comparison below.

No innovation, no new features; in fact, after the service was acquired by Google, its official blog has had only two updates: one to say that the service is back up, and another to warn about maintenance downtime. Perhaps Google has something huge in stock for Jaiku, but from what can be seen on the surface, it’s going nowhere.

Directly related to the Jaiku-Twitter story is Dodgeball, another short messaging service that Google had acquired in 2005. Unlike other Google flops, this one wasn’t entirely wrapped in nice, apologetic words. Dennis Crowley, the founder of Dodgeball, was frustrated with his experience working with Google, and he claimed that Google simply didn’t think Dodgeball was worth investing any resources in. It’s no secret that every startup’s wet dream is getting acquired by Google, and the Dodgeball incident has so far been the only stain on Google’s near perfect resume.

Is there a lesson that can be learned from these mistakes? Perhaps it’s still too early to tell, but if you add Orkut - Google’s social network which is arguably doing well, but also hasn’t done anything revolutionary lately - to the mix, it becomes fairly obvious that Google is not good at building communities. One more reason to bet on Facebook one day being bigger than Google, if you’re the betting type.

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What Google is really after, of course, is more of P&G's $9 billion of annual ad spending. We can't imagine clicking on a search ad for Crest, but perhaps P&G could help solve YouTube's business-model problem.

WSJ: So far, about two-dozen staffers from the two companies have spent weeks dipping into each other's staff training programs and sitting in on meetings where business plans get hammered out. The initiative has drawn little notice. Previously, neither company had granted this kind of access to outsiders.

Closer ties are crucial to both sides. P&G, the biggest advertising spender in the world, is waking up to the reality that the next generation of laundry-detergent, toilet-paper and skin-cream buyers now spends more time online than watching TV. Google craves a bigger slice of P&G's $8.7 billion annual ad pie as its own revenue growth slows.

The struggle by these two heavyweights to formulate successful strategies highlights how tough it is for myriad other companies, from newspapers to auto makers, to profit from Americans' rush online.

"We're trying to open the eyes of our brand managers," says P&G's Stan Joosten, whose title is "digital innovation manager," a job that didn't exist until last spring.

Left 4 Dead is a survival-horror first-person shooter built on Valve's Source engine. Set in a modern day survival-horror universe, the co-operative gameplay of Left 4 Dead (L4D) casts four "Survivors" in an epic struggle against hordes of swarming zombies and terrifying "Boss Infected" mutants. Developed by Turtle Rock Studios and Valve, creators of the Counter-Strike and Half-Life games, the latest AI technology allows for multiplayer games of one to eight players. Click here for details and the latest pricing

Go to war in the final tension-filled, unforgiving battles against a new ferocious enemy in the most dangerous and suspenseful action ever seen in WWII. Call of Duty: World at War completely changes the rules of engagement by redefining WWII gaming. It brings an uncensored edge to combat, as soldiers face the most harrowing and climatic European and Pacific battles. Click here for details and the latest pricing

the fan-favorite real-time strategy game in its latest incarnation with new features, powers, technologies, and a different world. Now, you can play not just by yourself but also cooperatively with a friend as you take on the enemy in this glorious, over-the-top romp. Click here for details and the latest pricing

In Mass Effect you are Commander Shepard of the starship Normandy and you are the last hope for all life in the Galaxy. Saren, a rogue member of the elite and untouchable Spectre agents, has discovered the secret to unleashing an apocalyptic force on the galaxy, and only you stand in his way. Click here for details and the latest pricing

Drag and drop living, squirming, talking globs of goo to build structures, bridges, cannonballs, zeppelins, and giant tongues. The millions of innocent goo balls that live in the beautiful World of Goo are curious to explore. But they don't know that they are in a game, or that they are extremely delicious. The most addicting and awe-inspiring puzzle game will set you on an adventure that you'll never forget!" Click here for details and the latest pricing

• EC (Early Childhood)
  games contain no material that parents would find inappropriate.
• E (Everyone)
  games contain minimal cartoon or mild violence and/or infrequent mild language.
• E10+ (Everyone 10+)
  May contain more cartoon, fantasy, or mild violence, mild language, and/or minimal suggestive themes.
• T (Teen)
  May contain violence, suggestive themes, crude humor, minimal blood, and/or use of strong language.
• M (Mature 17+)
  May contain intense violence, blood and gore, sexual content, and/or strong language.
• A (Adults 18+)
  
  Click on any of the category icons below for the "gifts to consider" recommended for this year.
  
  

  Gadgets	Laptops	Video Games	PC's and LCD's

  
  

For the first time in human history, the day-to-day interactions between people are being permanently recorded and formatted in easily organizable segments of information. This has a plethora of consequences on how we record history, but here are the five big ways I see social media altering how we utilize and record history:

1) Everyone will have the ability to know what you did and who you were with on a daily basis.

What were you doing on July 14th, 2008? Unless it was your birthday, you probably don’t know.

It may seem like an insignificant question, but 20 years from now, knowing what you did or who you were with during a certain day could be great for reminiscing about the good old times. Or maybe you’re a researcher that needs to pinpoint the exact movement of a new virus. Or you’ll want to prevent the election of a presidential candidate with embarrassing information.

When you tweet you’re hanging out with @mashable or @ben_parr, you are not only making a statement to friends and followers, but you’re writing down in history that on this date you were with these people. 20 years from now, you’ll know who you hung out with from the day-after, because of hung over Facebook wall posts and tweets. This phenomenon will only get stronger as more people rely on social media services.

2) Historical trend analysis will leap to a new level of precision.

Let me give you an example. Let’s say you’re a researcher who wants to figure out the evolution of political ideology over an election cycle. What data could you work with from 1856 to 1860, when Lincoln was elected? Newspaper clippings, a few historical documents, speeches, but not enough information to really trend the triggers that altered political thought. Even if all of that data did exist, it would be hell to find it.

How about 2004 to 2008? There’s a stark difference. We have Twitter, Facebook, blogs, websites, forums, and search habits. We can start to trend how search terms increased, what events triggered visceral reactions, and how people of both sides reacted to the political opinions of the day. The information is archived, easily organized, and a large stock of it is readily available to the public.

3) We will not use history to learn from our mistakes, but to prevent them before they happen.

Google’s recent partnership with the government is an example of the prevention phenomenon in action. Google has been giving the Federal Government information on flu-related searches in order to track and contain epidemics before they begin (you can find the public version of the tool here). We can track the history and progression of the flu with stunning accuracy. In turn, we can use that data to prevent the outbreak of the next drug-resistant virus.

Yes, it raises certain ethical questions, but the point is still the same - it changes how we analyze and utilize history.

4) There is little room for hiding details about our lives.

Less than flattering pictures on Facebook have already disqualified tens of thousands of people from jobs. But when someone of the current teenage generation runs for President, what do you think will happen to every tweet or blog post they ever wrote? It will be analyzed and checked. Embellishing about your life story will be difficult, because we can go back and see if you were an angry person in your childhood or who your friends really were.

5) An ethical war over the use of this information will arise.

If the government can use search data to track disease, what else can they use it to track? Is it right to charge a political candidate with guilt by association just because they were Facebook friends with an eventual criminal? I can’t even begin to imagine the ethical debates such detailed history may cause.

It’s often said that history is recorded by the victors. Now history is recorded by computers and anybody can pick up that data and come to their own conclusion. The study of history will dramatically change as more and more people use and rely upon social media for daily interaction. No diary, history book, or recording can compare to the data available through social media. My belief is that social media may prove to be as pivotal as the printing press in the study of history.

So I’ll ask one more time. What were you doing on July 14th?

Imagery courtesy of iStockPhoto, lcsdesign; flickr, quiplash

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Divx, the developer of video compression software, has filed a lawsuit against Yahoo for trying to end a two-year advertising services agreement with DivX. The lawsuit was filed in California Superior Court in Santa Clara County and maintains that the termination would hurt the financial results of DivX for the year 2008 and 2009.

"Yahoo’s decision to breach is unjustified given DivX’s fulfillment of its obligations under the agreement," said DivX Chief Executive Officer Kevin Hell, adding that his company would aggressively pursue legal action.

Yahoo on the other hand wants to somehow restructure the agreement and settle things out of court. According to a Yahoo Spokesman:

Yahoo is disappointed with DivX’s decision to pursue legal action rather than renegotiate this agreement. We intend to vigorously defend ourselves in court, but will reserve further comment until we’ve had an opportunity to review the suit,

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Chinese pirates have unleashed hell on Blu-ray and are ripping the DVDs like there wont be any tomorrow. The hackers are ripping off movies burned on Blu.ray discs, encoding into AVCHD, and selling the proceeds for $7 with an ever recognizable Blu-ray banner to go with it. So what could be the price tab on this, MPAA estimates it to be $224 million for the next 6 months:

The MPA estimates that within the next six months the high-definition discs could account for 10% of $224 million that its member companies lose from piracy in China. While a legitimate Blu-ray discs costs about $30, a pirated Chinese disc goes for as little as $7.

[Image via UberGizmo]

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One person who has acted on this subject in the past is Joe Biden. Yes, the same guy who’s now the U.S. Vice President. In fact, he’s been pretty active in trying to defend the rights of media companies. Let’s take a look at his accomplishments.

Joe Biden’s earliest tryst against piracy came in 2002, when he drafted a letter to the Justice Department, urging action against people who ‘intentionally’ allow copying over p2p networks. Then last year, Biden supported an RIAA-led bill to restrict Americans from copying songs from Internet radio services. His efforts got him invited to the MPAA’s party in favor of the Digital Millenium Copyright Act.

In April of this year, Biden tried to get the US government to spend a billion dollars so that authorities could monitor p2p networks for illegal activity. What constitutes illegal activity, I have no idea.

Joe Biden has been pretty vocal about other aspects of the Internet as well, most notably a strong supporter of having Internet filters in place for schools. Another interesting tidbit is that at one time, the man also supported levying an Internet tax on people.

It remains to be seen what Joe Biden will do in his newfound political role as Vice President. However, going by his track record, it’s fair to say he’ll be on the media companies’ side most of the time.

What do you think of Joe Biden’s war against Internet piracy? Do you know of other political figures who have the same ideals? How do you think politics affects Internet legislation? Let me know in the comments.

Joe Biden: Piracy’s New Enemy

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Screen Digest estimates that YouTube will make $100 million in US revenue this year compared to Hulu's $70 million. Next year, the firm estimates, both will make about $180 million. (See article in FT)

Before moving on, it's worth noting that Screen Digest is presumably talking about gross revenue. Hulu passes a far larger percentage of revenue through to its content providers (70%-80%) than YouTube does, so with $70 million of gross revenue, Hulu's net revenue would be a paltry $14-$21 million. YouTube also shares some revenue with some content providers, but a far smaller percentage, which is why News Corp and NBC built Hulu in the first place.

Also, as we noted last week, Google will be adding search-placement ads to YouTube, in which producers can pay to have their videos appear on search results. This should help boost YouTube's revenue and takes advantage of YouTube's enormous traffic (83 million monthly users to Hulu's 6 million).

But all that said: The fact that a research firm can make this prediction when YouTube has more than 10-times Hulu's US traffic illustrates the challenges Google faces in making YouTube into a real business. This is why YouTube is, intelligently, increasingly working with premium content providers. To get MGM et al as partners, we suspect YouTube is having to give up, if not a Hulu-like share of revenue, at least close.

YouTube still has the ability to squash Hulu: To do so, it has to match (or come close to matching) Hulu's revenue sharing terms and make its display, embedding, and editing tools as good as Hulu's. If it does this, it will erase the advantage Hulu has had over the past year, and its vastly greater size will make it a must-partner for every major video producer.

YouTube will also be able to make other revenue around the videos, so this wouldn't mean surrendering completely: Its position as the leading global video aggregator and search engine is still immensely valuable. Matching Hulu would, however, mean that YouTube would continue to be a vastly lower-margin business than Google's main business--which is why Google has fought like hell against going that route. But it sounds as though it may be time to throw in the towel.

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How Google Can Fix Company And Stock
Search Ads On YouTube a $1 Billion Business?

The phone is called INQ1. Its specifications? Fairly standard: a 2.2 inch QVGA screen, 3.2 megapixel camera, HSDPA, accelerometer, 50MB + 4 GB of memory. The platform that powers it was created by INQ Mobile, a company that’s specialized in mobile social networking solutions.

The phone is not available yet, and the details are sketchy; I was unable to find out what platform it’s really based on (I assume that INQ’s software will work on top of an existing platform such as Symbian of Windows Mobile), or which company built the hardware. What’s known is that INQ1 will give you quick access to Skype, Facebook, Windows Live Messenger and Last.fm, with eBay support coming soon.

This is all UK only, where INQ1 will be available for as low as £15 per month offering unlimited free Facebook, Skype, Windows Live Messenger and web access, as well as 75 minutes of calls to other networks, unlimited texts, unlimited email and unlimited free 3-to-3 calls.

Is this a revolutionary device? No. It’s pure marketing: the iPhone can probably do everything INQ1 can and possibly more. But it shows that social networking has become the buzzword in marketing circles and that we can expect practically every device connected to the net from now on to be touted as “social networking enabled”. Good news for Facebook, MySpace, and the rest; bad news for everyone who didn’t anticipate how big social networking will one day become.

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