Tom Foremski, formerly of Financial Times fame and now champion of Silicon Valley Watcher has been letting people know for some time that he feels the PR industry is about to go through a real shake up as traditional media outlets die and blogs and podcasts fill the void. On January 12th he wrote a piece entitled” “Disruption in mainstream media but where is the disruption in the mainstream PR industry?. . .it’s coming.” Word has it PR Week followed up on that piece and has interviewed him with a view to producing a profile on the man. I’m encouraged to hear this as it shows PR Week is thinking about the very real challenge our industry faces with the rapid decline in traditional media.
I’m pleased to see the return of Spin Bunny even if it is poking fun at my inability to make an entry for the month of December. Any bets on how long it is before it’s taken down again by the lawyers?
I saw a couple of pieces in the last few days suggesting Steve Jobs really is the biggest celebrity in Silicon Valley these days. The piece I link to in the Merc talks about him making a bigger splash than Ellison and McNeally did at events held the same day. I also noticed a piece in, the ever so well written, Palo Alto Daily that suggested Disney is considering buying Pixar and making Jobs its Chairman. It’s a wild idea you have to admit. What is clear is that Steve Jobs is the hottest property in Silicon Valley these days. The fame is clearly not without good reason. Since returning to Apple he has given them a great product strategy, got them back on terms with Microsoft and now he’s managed to make the switch to Intel – a move that in his first tenure as CEO would have been unthinkable (remember the Apple ad with a snail on an intel chip?). All this will likely take Apple’s stock to $100 by the summer. Given the competitive nature of the tech market I can only imagine the conversations taking place in the boardrooms of other tech giants right now.
I just noticed this piece on Drew B’s blog so thanks for highlighting the article. Some of the facts in the piece are wrong but the market is definitely much better than it was a few years ago. So much so that some firms I thought would crash and burn seem to be surviving thanks to the up-tick. What’s clear to me is that the market in the Bay Area is not really being driven by the larger tech firms. On the whole they appear to be holding their spend firm. What’s increased is the number of startups who are out spending. Those of us who went through the dot com bust are watching this trend with some caution. Hiring, yes but only for clients we really believe will be around in year’s time.
I gather DC’s K Street community is keeping a low profile right now, hoping that the Abramoff scandal will soon blow over and allow them to get back to work. I’m curious to learn whether any PR work has been affected by this affair. There is an argument that PR agencies will benefit as funds are redirected and an argument that they’ll suffer simply because of PR’s association with PA. I’ve seen no evidence yet within my business of either but I’m nevertheless curious. Has anyone yet had their budgets ‘Abramoffed?’
If like me you keep an eye on NASDAQ’s symbol for its computer sector stocks (NASDAQ:IXCO) you will have noticed that in the last year this index has moved around a great deal. Currently it’s sitting at 1050 (ish). Back in April of last year it was sitting around 850. That may look like a good trajectory until you realize that at the start of ’05 it was at almost 1000. The reality is that in the last couple of years this index has risen and fallen with the peak always being at the end of the year. Only back in 2003 did the index show a steady rise from the then low of around 500. Put another way the index (and one assumes the industry) is looking to break out of the cycle. In my humble opinion this will only happen once the sector gets firmly on a new course.
If you look back to the 80s the tech industry grew at an alarming pace as the PC took off and the revolution started. In the 90s the Internet gave the sector an even bigger horizon which of course the market has since dialed back. However, since the Internet backed boom we’ve not seen a solid new ‘big opportunity’ for tech. We’ve seen several firms try and create the next wave but in general the market is rightly skeptical. What the market wants is something solid to latch on to. This means a new technology, not a new marketing slogan. We appear to be some way from a radical shift in technology such as would be created by say a move to nano technology. Yet there are two important trends that I’d point to. First is Google. It may seem obvious but Google is the new Microsoft in the eyes of the street. In the same way that Microsoft cornered the PC market, Google is deemed to have cornered the Internet. The difference between their model and Microsoft’s is simply that you don’t have to use Google, you just tend to. This makes them far less prone to the legal problems Microsoft has faced in the last ten years.
The other equally obvious, but no less important, trend is wireless. Every single device on the planet is going wireless. Right now people are making things that are wired wireless, phones, PDAs etc. In the next generation we’ll have a raft of devices that are going to be born wireless. The interesting part to me about this market is that nobody has cornered it…Yet. RIM aka Blackberry, has made a good attempt but Palm has fought back thanks to the ever so unreliable but quite functional Treo. At the same time, rumors abound that Apple will enter the space. If they do we can expect them to do well, given the success of the iPod. To my mind there is a technical barrier that needs to be overcome which is bandwidth. The really hot wireless technology will emerge once the pipe is big enough for interesting applications. In Europe 3G has already been launched with mixed success it seems. I’ll confess to feeling that this is because people are applying the bandwidth to the wrong application – namely the phone. If we all wanted a video phone why don’t we have one on all our land lines?
My summary is therefore that Google will undoubtedly have another blow out year. I saw one stock analyst has already said there shares could hit $2000 (that’s each btw). Such a valuation may seem crazy but think back to what happened to Microsoft’s stock. Therefore I think the smart brands in ’06 will be the ones that can figure out how to ride the Google wave. My other prediction centers around the gaping wireless opportunity – right now I believe RIM has a great chance of owning this space, assuming it can come up with a) an exciting vision b) some slightly more innovative devices (i heard from one source that RIMs CEO refuses to incorporate an MP3 player in the Blackberry – to that I say to him go sit on an airplane and look at what people have with them) and c) a settlement on its troubling lawsuit. If they can’t execute well here someone like Apple may well step in and eat their lunch and grasp one of the most interesting markets for the next five years.