RIMM and Cloud Thoughts on a Friday

Starting with RIMM this morning I am not sure what more I can write.  As I wrote before the company is in a negative product cycle.  The good news is they actually have value in their consumer brand awareness, but there is no value in email anymore.  Email is a feature and it is not a killer app, it is a common feature set of smartphones.  To be competitive RIMM will have to innovate and catch-up in the product cycle marathon.  I am not sure that it can.  For the analysts and investors who think the stock is cheap, I would say that tech stocks work on growth and margins.  When these two metrics turn negative the stock is a short.  In the span of 49 days RIMM twice revised their forward guidance to the downside.  If the company cannot predicate their earnings power I do not know how we can debate if it is cheap or not.

I have been writing a lot about new drivers in the network (here, here, here and here) and how various dislocations are going to affect the network and procurement of infrastructure.  I am giving props to Phil Harvey and this interview with Randy Bias of Cloudscaling.  The broader article is here.  My comment about this interview is: spot on.  Well done.  If I was running money in the tech sector I would think very carefully about what this man is saying.  I think it is going to be impactful on infrastructure providers as well as service providers and if you extrapolate his thinking, it might just explain a few things.

/wrk

* It is all about the network stupid, because it is all about compute. *

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