Recently I was listening to a podcast made by supposed Wall Street / investment experts talking about Google and how the company was now a ‘floating dead fish’ with no potential to grow and mostly downside. They dismissed Google’s announcement of 160,000 Android phones being activated per day as irrelevant because ‘Google give Android away so its not worth anything to them’. I doubt there has even been clearer evidence of how market traders and investors get completely blinkered by what’s ‘in vogue’ and show a complete lack of understanding for actually running a business!
Guess what, Android phones will not have any other search provider installed as the default. This means they are acquiring market share and future-proofing their business. The fact that Apple has installed other search engine options in iOS4 is an irrelevance.
Today, market research by StatCounter shows that Google has 98.29% of the mobile search market, vs 90.57% of computer-based search. So Google’s dominance of mobile – which they say will ultimately be bigger than computer-based Internet search – is nearly total. Smartphone growth is crazy (49% in the 1st quarter of 2010) which means the volume of searches from mobiles on Google is also going through the roof. Google is, wisely, not making too much noise about this right now … but it will.
Google is increasingly becoming a ‘buy and hold’ company. I believe the share price will be between 1000 and 1450 in 3-5 years time. The fact that it is currently unloved and overlooked by Wall Street just makes today’s pricing sub-500 a good deal.