Fake News for Facebook, Google
The fake-news issue surrounding Facebook (NASDAQ:FB) and Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) has been garnering a lot of attention lately. Perhaps rightfully so. Many argued that the companies should have cleaned up these acts a long time ago, but the amount of phony sources and questionable content hit a fever pitch during the election cycle.
Now, both companies have announced measures that will target these sources and will hopefully curb the amount of fake news found in search and news feeds. Some have even blamed these platforms for swaying the presidential election.
So if it took Facebook and Google this long to try and clean up the fake news issues, it must be a pretty tough fix, right?
Not quite, especially after four students built an algorithm-based sorting mechanism in just 36 hours aimed at labeling "verified" and "not verified" news sources. While that doesn't solve everything, it certainly shows that the companies could filter these stories if they wanted to.
As it turns out, Twitter is in fact implementing that function, allowing users to block out tweets based on specific keywords or phrases. This comes alongside an overhauled user policy, which looks to crack down on hateful and hurtful content and makes it easier to report abusive tweets, even from bystanders.
So let's get this straight: now I can finally mute out words like "Trump," "Clinton," and "election," have a more constructive conversation, and stop seeing fake news plastered all over the web after the election is finally over?
Quite honestly, it's totally disgusting.
These platforms could have fixed these issues long ago. Does anyone else find it ironic that these three companies happened to stumble upon a solution just a week after the election was over? I call B.S.
On the one hand, we could argue that the election prompted the companies to look into this type of content and behavior and has since found a fix. But seeing as though Twitter accidentally released its muted words function in late-October, and complaints had been raised on Facebook's political coverage far prior to election day - and some kids made a fix in less than two days time! - leads me to believe all of them failed to implement a solution solely because the election was driving results for them.
Apple's New Smart Glasses?
We said the company needs to find a way to grow, and if it can't do so on its own, then M&A is the next logical step.
But alas, reports are now surfacing - because obviously the always-secret Apple would never tell us! - that the company is working on wearable glasses. Details are super thin on this, of course, but given other forays into the same arena (think Google Glass or Snap (CHAT) Spectacles), it's not impossible to think it could happen.
Reportedly, 2018 could be a timetable for when the product becomes available, but again, details are thin.
So what's the impact? Personally, I'm not a huge buyer on the hype train of wearable devices. In theory, yes, the potential of the Apple Watch and Spectacles or whatever else can now be worn is neat. But in practice, I don't need to view the world through a computer/glasses screen, take phone calls on my wrist or know what my heartbeat is for 16 hours out of the day.
For some people, it's a great addition. No doubt. And commercially, these products have a purpose. But we've seen it with Google Glass, and we've seen it with countless wearable watches. The broader public just isn't buying into it in the massive way tech companies were hoping for.
In essence, it's not the next iPhone. If Apple's goal is to build a suite of wearable products, then glasses would be a reasonable next step. If it's a profitable endeavor, who are we to complain?
Like everything else Apple has revolutionized, maybe it won't be the first, but chances are it could be the best. And maybe everyone will want it then, but I won't hold my breath.
Will Jaguar's New Car Stand a Chance Against Tesla?
Jaguar's (NYSE:TTM) new I-PACE concept car is an electric powered SUV capable of going from 0 to 60 mph in roughly four seconds. Currently, the company estimates it will have a range of more than 310 miles and the capacity to recharge 80% of its battery in just an hour and a half.
Jaguar is hoping to bring the vehicle into production sometime in 2018.
This sort of fits into the argument against Tesla (NASDAQ:TSLA) - at least the ones that don't have anything to do with CEO Elon Musk.
It goes something along the lines of when Mercedes (OTCPK:DDAIY), Jaguar, BMW (OTCPK:BMWYY) and other carmakers enter the space, Tesla will be done for. Sort of like it's an annoying competitor that can be crushed, but right now, there's just no point because it's too small. Once it gets bigger and truly gets on Mercedes/BMW/GM's (NYSE:GM) nerves, then they'll squash it like the cockroach that it is - in the words of Kevin O'Leary.
But that's the wrong take on Tesla. If Tesla's going to fail, it's not going to be because its competitors finally caught up; it will be from its own failures.
Like we've said over and over again: Tesla can succeed, but it has to maneuver a tightrope in order to get there.
First, several of these competitive threats won't even start production until 2018. Tesla has already been producing cars for years and is looking to ship about 80,000 of them this year.
Let me know when BMW sells 80,000 electric cars. At last check, the i3 had sold 6,205 in the U.S. through October, which is down about 30% from last year. The i8 has sold a little under 1,300 so far this year, which is down 13% from last year's figures.
We can call that cherry-picking I suppose, but the point is clear: Tesla has a huge head start over every company looking to get into the space. By the time Jaguar and other companies start producing these vehicles in 2018, Tesla will have churned out even more of its own.
It has successfully carved out the top spot in a niche category, but a category that all the majors are poised to enter. Germany banned internal combustion engines starting in 2030. That sounds like a long ways away, but it's really not for something so bold.
Maybe that will force German carmakers to make a superior electric car. Or maybe, that will draw more attention to Tesla, which will boost sales. Most likely, both will happen, but Tesla won't disappear.
I'm just saying that we've seen a number of automakers come out with electric car prototypes and had some commentators instantly deem them as Tesla-Killers. But from the looks of it, Tesla won't be swallowed up in competition.
It is vulnerable and has its obstacles without a doubt. But I wouldn't look for this to take it down.
Quickly Speaking on Snap…
The company has reportedly filed for its IPO.
The valuation range is apparently targeting between $20 billion and $25 billion. Given how other hot IPOs have gone, I wouldn't be surprised to see it trade through that valuation, assuming the markets are still trading well come that time.
Still, the actual valuation is perplexing to me. I previously laid out my case when the company introduced its Spectacle Glasses less than a week ago.
Essentially, the company seems overvalued and here's why. If the company has a lights-out year in 2017, we're talking about $1 billion in sales. Taking the low end of the range - $20 billion - we're pricing Snapchat at 20x sales.
Even with strong margins and assuming the company is profitable, this is more expensive than the industry-leading Facebook. I know Snap is the hot name with the hot growth, but choosing between the two, Facebook is definitely more attractive.
Unless Snap shows us strong margins and earnings - or the potential for earnings - alongside continued strong growth both for users and revenues, this one is definitely overvalued.
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