Times sure are changing for college freshmen. Members of the class of 2008 entering Duke University this fall are getting a welcome package that goes a bit beyond the usual Blue Devils T-shirts and caps. Every one of them is getting a free iPod digital music player, which Apple Computer
Dang, that's more than a year's worth of Ramen noodles. But the university says the iPods will be more than just musical toys. The gadgets will be "high-tech education tools" used to record lectures, capture scientific data, and play language-training recordings.
Right. And frosh favor easy-listening favorites from Helen Reddy and Johnny Mathis over Linkin Park and the Black Eyed Peas.
In today's Motley Fool Take:
- What's Google's Growth Strategy?
- Discussion Board of the Day: Google
- (Hot) Dog of the Day
- Quote of Note
- HP's Changing With the Times
- Airfares Head North by Northwest
- More on Fool.com Today
What's Google's Growth Strategy?
Maybe it's just destiny that will have Google barreling toward portalhood anyway. After all, Yahoo!
Ultimately, one has to argue what business is Google in? It's not search, exactly. Last year, selling advertising accounted for 97% of the company's revenues, and that figure has edged up to 98% so far this year.
So if the bulk of your intake comes from selling ads -- whether it's on paid search results, email pages, or my rent-ready forehead -- isn't Google's goal to grow the number of pages that it serves up?
In Froogle, the company is already a worthy ecommerce enabler. Through Google News, it's a consolidator of news-driven content. Is Google going to become a portal someday? One can argue that tomorrow showed up early. Even if we will never agree on how to define a portal in the first place, how can we deny that the busier the matchmaker that Google becomes, the more lucrative its potential becomes?
Google is already connecting the dots. When it acquired the leading blog site Blogger and digital photo-sharing specialist Picasa, it was simply a matter of time before it got the products working together -- just as it recently began allowing its bloggers the opportunity to make a little money off their published rants through its AdSense text ads.
Portals get a bad name because of the many failures along the way. Sites like Excite, Lycos, and AltaVista have gone through various owners, yet the reason they have been discarded into secondhand bins is because they lacked the traffic that Yahoo! -- or even Microsoft
Google has the traffic. It's a gift that shouldn't be squandered. Does that mean that Google should roll out online services like personals or job ads like Yahoo! has or enter the auction game to face a formidable eBay
Longtime Fool contributor Rick Aristotle Munarriz is a satisfied Google user. However, he does not own shares in any of the companies mentioned in this story.
Discussion Board of the Day: Google
Where do you see Google in five years? Will it still be the leader in search? How would you grow the company? All this and more in the Google discussion board. Only on Fool.com.
(Hot) Dog of the Day
The roller-coaster ride that is IPIX
Is the Street really so short on memory?
Readers of these pages might recall Rick Munarriz's snarky but sage assessment of IPIX's last big feeding frenzy, spawned when Homeland Security Secretary Tom Ridge chummed the waters with a brief acknowledgement in a public speech. Back then, Rick pointed out the firm's big first-quarter losses on minute revenues.
In July, IPIX released second-quarter earnings that showcased the firm's continuing talent for losing money, to the tune of $0.21 per share. To add insult to injury, the company tried to spin the results by matching them against the Q1, rather than the prior-year quarter comparisons that are standard in financial reporting. Management has said comparisons to previous quarters "are not useful" because they "reflect revenue from the Company's commercial agreement with eBay
How's that for an excuse? We lost our biggest customer, so it's not fair to compare. You think a company like Black & Decker
OK, back to this Russian deal. As you might expect from a company engaged in such earnings-release chicanery, it's long on hype and short on numbers. There are plenty of platitudes about the need for 360-degree security cameras all over Russia. Wondering how much this big deal will bring into the company? No comment.
To judge by a Russian phone directory listing I was able to dig up, the IPIX products will line Soling's shelves next to systems from Hitachi, Mitsubishi, Panasonic, Watec, Robot, Sanyo, Yamano, and Vicros. So how will IPIX compete? Again, no answers. (If I'm missing something important here, let me know, and I'll email it to IPIX so they can tell everyone.)
If you're thinking of buying now, treat IPIX with all the enthusiasm you'd have for a live hand grenade. In addition to slim revenues and big losses, during the last six months, insiders have sold nearly 8.5 million shares. President and CEO Donald Strickland has sold 330,000 shares at prices as low as $7.50, and he now owns a measly 6,700 stubs. Foolish investors ought to follow his lead and stay out of the stock. With 41% of the float already sold short, it's not even worth the effort to bet against this beast.
Quote of Note
"I may not have gone where I intended to go, but I think I have ended up where I needed to be." -- Douglas Adams
HP's Changing With the Times
Last week, Hewlett-Packard
In The Direct PC Model, they exhorted us not to think of companies like HP, Dell
It's true that there's a very different competitive environment in electronics today than we've seen historically. Whereas it's not difficult to recall a time when, simply put, PC makers competed with PC makers and electronics companies (like Sony
But that's where the consumer business, strength in the PC market aside, is heading now. It's no longer just the early adopters who are shelling out for nifty digital devices. Brian and Dale couldn't predict which devices would "make it" at the time of their writing, but that didn't stop them from closing on a strong, prescient note: "The forward-thinking PC companies will reinvest their free cash flows in the areas offering the greatest potential returns, perhaps becoming totally different business animals in the process."
Fiorina's announcement was a perfect illustration of this process set in motion.
Fool contributor Dave Marino-Nachison doesn't own any of the companies in this story.
Airfares Head North by Northwest
I know, I know. Can't we ever report good news about the major airlines? Well, not if there isn't any to report. At the risk of appearing to be gleefully piling on after recently lampooning the high-wire act that has become US Airways
Late last week, Northwest said it will start charging a $5 call center fee for tickets booked over the phone and a $10 fee on tickets booked through American and Canadian airports. The airline will also stop absorbing the roughly $7.50 per ticket it is charged by reservations networks, such as Sabre Holdings
How important is this? Well, the company said that in 2003 distribution payments equaled $180 million. Without those costs, reported net income would have been 73% higher last fiscal year.
Yeah, folks, that's not chump change, and Sabre, in particular, was so annoyed by Northwest's move that it promised to make the airline's fares less prominent on its network and to charge more for selling its flights, according to a Chicago Tribune report. That prompted Northwest to sue, charging that Sabre had no contractual right to discriminate against it in offering flights.
Although Northwest's move might appear a bit like the late-night fare boostAMR
So let's just call this what it is: The latest move in an industrywide effort to ape low-fare carriers. After all, Motley Fool Stock Advisor pick JetBlue
I think Motley Fool Income Investor chief analyst Mathew Emmert sums it up best when he says that major airlines will fail. After all, when the big carriers start throwing away the infrastructure they've spent years building, it's easy to believe we've arrived at the end of the airline industry as we've known it.
For more Fool coverage of the descent of the major air carriers:
- Mathew Emmert's supposedly relaxing vacation turns into an exercise in growing gray hair.
- US Airways is back talking with pilots after a spat, but the airline still appears off course.
- Is UAL's (OTC BB: UALAQ) United really sticking it to retirees?
- American's late-night fare hike is unfair airfare warfare.
Fool contributor Tim Beyers gets no joy from lampooning the airline industry -- he has family who retired from United Airlines. Tim owns no position in any of the companies mentioned, and you can view his Fool profile here.
More on Fool.com Today
Bonds aren't pretty, but you've still gotta buy them, Shannon Zimmerman says in Fortify Your Portfolio.... It's almost too easy to set your kids up for a cushy retirement -- and that's the problem, Dave Mock says in Put Your Kids on Easy Street.... Two credit junkies talk about couples and credit, the real FICO, and conspiracies in Dayana Yochim's Credit Tete-a-Tete.
In other news:
- Plato Gets Top Grade
- Albertson's Labors Over Results
- Credit Dings = Insurance Woes
- I've Got a Golden Ticket!
For a list of all our stories from today, see our Today's Headlines page.
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