Like a lot of people I am watching the meteoric rise of Google stock.
This latest rise is partly because of the hinting that they are nearing fruition to predictions that I made over a year ago. (ed: I’m not bitter, just tired of slapping my forehead) Google is going to become a telecommunications company. I think that most reporters and stock watchers are being shortsighted about the whole thing. I think that the physical mobile “phone” isn’t that big of a deal.
When they become a telecom, that will fundamentally change the world. They can give free phone calls to anyone, anywhere. This has the potential to lower barriers to entries of people in developing economies. In return, this will both “do no evil” and eventually help to light up the dark spots of the world that can’t click on AdWords.
I think the talking heads are more concerned with whether it will be as “cool” as the iPhone. That point is moot. They can hire designers make it cool. Plus, people will buy it because it is a Google phone. What I’m interested in is this… how are they going to give an inexpensive phone long battery life while running CPU intensive voip software? What type of WiFi capability are they going to build into it and how will it scan for open networks?
With this in mind… should I buy Google stock? Well, they are entering a space that has lower barriers to entry. A Chinese company could make a device that had the capacity to make mobile VOIP calls for relatively cheap. But the real thing holding me back: The dollar.
Paul Saffo has a great post about the topic. In a nutshell, the dollar is cratering as the market sloughs higher. It is impossible to ignore. The rise in oil, gold, basically all commodities, and global instability have created a situation where the dollar isn’t worth very much. Then why is it a bull market?
To me, this creates a situation where people are waiting for the next newsworthy event as a sell signal. There are storm clouds on the horizon and I’m not going to push the boat out.
