Android for Enterprise – What elephant?

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Google continues to dodge the elephant.

  • Google is having another go at cleaning up Android’s act in the enterprise, but while it continues to ignore the elephant in the room, it is unlikely to make any progress.
  • Android’s position in the enterprise almost the exact opposite of what it has in consumer where 80% of all smartphones globally use the Android operating system.
  • 4 billion data points from Egnyte, indicated that 82% of all enterprise mobile activities were carried out on iOS devices with only 18% being on Android.
  • To counteract this, Google has released an enterprise device recommendation program that lists a series of requirements to ensure the best enterprise experience as well as a list of devices.
  • This list contains mostly Android handset makers that make the least modifications from stock Google Android which makes the devices much easier manage as the differences between them are consequently much less.
  • This is why Samsung is excluded from this list as it does more tinkering with Android and preloads more software than almost anyone else prior to sale.
  • Samsung’s absence will further hurt this cause as a substantial percentage of all Android phones in the hands of users today are made by Samsung.
  • To make matters worse, this number is even higher at the top end of the range which is where one will find all of the enterprise devices.
  • However, I think that all of this is irrelevant as while Google ignores the elephant in the room, its enterprise push is likely to go nowhere.
  • This elephant remains the endemic fragmentation that exists within the Google Android ecosystem and Google’s inability to quickly patch its devices when flaws are found.
  • This results in an inconsistent experience for users but most importantly, it means that Android devices remain very insecure.
  • This is something that no enterprise can tolerate which is the main reason why Android is so badly represented in the enterprise.
  • Surprisingly, it is quite a simple process to make an Android device secure by completely locking the phone down allowing no modifications, upgrades or downloads.
  • However, in an age where most users bring their own devices into the enterprise, this is not an acceptable solution which has led to most enterprise users choosing iOS.
  • I have long believed that the only option for Google to solve its Android problems both in consumer and in the enterprise is to take Android fully proprietary like iOS.
  • Then it can create a consistent, secure user experience that will work well for both enterprises and their users.
  • Google’s progress in this direction has been glacial and it continues to make a habit of avoiding tackling this issue head on.
  • Unfortunately, the only victim of this dithering is Google itself as its usage, loyalty and penetration in the enterprise will continue to suffer until this issue is addressed.
  • The real winners here are Apple which looks set to maintain its dominance in the mobile enterprise and Microsoft which will have an easier time seeing off Google’s incursions into its patch while Android remains irrelevant in the enterprise.


Samsung & Google – Unlikely opportunity

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Samsung should capitalise on Google’s failures.

  • Samsung is making a lot of noise around its reimagining of the camera and AI on its new flagship Galaxy s9, but if it really wants differentiation in 2018, it would be wise to capitalise on Google’s failure to successfully launch its own products.
  • The Google Pixel 2 and 2 XL have been a disaster not because they were bad products but because of a series of schoolboy errors (see here) that completely masked some superb smartphone innovation and kept volumes insignificant.
  • Two examples of this innovation are:
    • First, portrait mode: This feature is now common on dual camera devices as the difference between the foreground and the background can easily be calculated using two cameras.
    • The background can then be blurred to produce the pleasing portrait effect.
    • Google has managed to do this to a competitive grade using just one camera giving a substantial benefit (lower cost and more space) to any hardware maker that can deploy it.
    • Second, machine vision: Google launched Google Lens on Pixel devices and while it still needs some work, it is clearly the best image recognition that is available on a smartphone today.
  • For me, these were two of the most significant differentiators for Pixel devices but because Google bungled many other aspects of the hardware, they are effectively absent in the market today.
  • Consequently, I see an opportunity for Samsung to maintain differentiation on new Google features by doing what Google seems incapable and of doing so at massive volume.
  • If the Galaxy s9 launches with Google Assistant front and centre instead of the dreadful Bixby, Google Lens and with portrait mode on its camera rather than a variable aperture (which no one is likely to care about), then I think Samsung will have achieved differentiation for 2018.
  • This will help it hold share and margins for this year as its competitors will unlikely to have these features before 2019.
  • Granted, next year would see all of its competitors doing the same but this is exactly what has happened with the edgeless screen differentiation that it created in 2017.
  • Consequently, I think that a Galaxy s9 that launches with these features front and centre rather than a variable aperture camera and awful AI that no one is going to use, will result in a better selling, higher priced product.
  • At the end of the day, hardware is ancillary to Google whose objective in life is to generate as much traffic as possible within its services, providing it with greater opportunities for monetisation.
  • In that context, hardware is merely the conduit for its services which is why I have never really understood its expensive obsession with making hardware as it has no hope of becoming like Apple.
  • Hence, it would make a lot of sense for Google to allow Samsung to deeply embed the services and AI that it has previously made exclusive for Pixel devices.
  • Making hardware is what Samsung really knows how to do and I think that the Samsung Galaxy flagships would be much better products as a result.
  • Samsung would also have the option to stop making investments (like its AI and Bixby) that actually have a negative return and generate higher margins as a result. (I would argue that Bixby has done more harm than good to the s8.)
  • The other manufacturers would of course be put out if they thought that they were being unfairly treated by Google, but I think that they nowhere else to go rendering their displeasure irrelevant.
  • Sadly, I suspect that Samsung is going to continue to think that it can make a difference in AI meaning lower profits for shareholders.
  • Samsung has run far farther than I thought it would and is now an investment decision taken on semiconductors and panels rather than phones.
  • Hence, I continue to prefer Microsoft and Tencent and specifically Baidu for AI.

Huawei – Really Convincing Story, Not.

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RCS unlikely to lift Huawei from its commodity margins.

  • One has to give credit to Huawei for realising that it has a problem but so far, its attempts to drive its differentiation beyond hardware are not bearing any fruit.
  • Its latest attempt in this direction is to join together with Google in supporting Google’s RCS based Android Messaging platform in its mobile devices and I presume in its infrastructure.
  • RCS or Rich Communication Services is the telecom industry’s attempt to maintain a grip on messaging once it became clear that messaging was going to move to data rather than the 2G control channel.
  • Although the technology has been around for 10 years, it has never been able to compete with the ease and ubiquity of the OTT apps and so it has never gained any significant traction.
  • The result has been is that messaging is now dominated by WhatsApp, WeChat, iMessage and so on with RCS gaining virtually no traction at all.
  • Even when Google threw its weight behind it and managed to get a several mobile operators on board, the ship had already sailed as everyone had pretty much already switched.
  • The one exception is Scandinavia where SMS is still widely used and this represents an opportunity for Scandinavian operators to migrate their users as they are yet to try something else.
  • However, in the rest of the world I am pretty sure that RCS will remain an oddity that will eventually be forgotten.
  • The problem with messaging is that it has a very strong network effect where to communicate, both terminals need to support the system being used.
  • This is why SMS was so successful as everyone who had a digital mobile phone had it already included as a single interoperable standard.
  • Huawei’s intention to include RCS in its devices is born from the hope that if RCS messaging takes off, it will work best on Huawei’s devices because it has designed it in from the factory.
  • There is nothing wrong with this strategy per se its just that it looks like the messaging networks have pretty much already formed meaning that getting people to switch to RCS will be almost impossible.
  • Unfortunately, this means that this feature, like its AI assistant, AI chip and its now commoditised imaging offering will be unable to generate any differentiation for Huawei in its devices.
  • This leaves it exactly the same boat as all of the other Android handset makers who differentiate purely on the basis of hardware.
  • With the Google ecosystem dominating these devices this means virtually no software differentiation at all resulting in the widely observed race to the bottom in terms of pricing and wafer thin margins.
  • The one exception is Samsung which makes good margins on Android devices, but I have long believed that this is because it outsells its nearest competitor by a factor of more than 2 to 1.
  • Huawei is showing very little sign of passing or even catching Samsung meaning that commodity margins are going to remain a way of life.
  • Huawei will need to do a little better than that if it ever wants to IPO.

Google – The colour purple.

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Fuchsia could replace Android Auto and Android Wear.  

  • Google’s mysterious operating system Fuchsia is starting to take shape with the addition of a user interface as well as support for programming languages that are used to create both Android and iOS apps.
  • What was first noticed as a few lines of script is gradually reaching the point where it could be suitable to run a large range of digital devices leaving me wondering whether this is its answer to the endemic Android fragmentation problem.
  • Fuchsia was first noticed on GitHub in August 2016 and differs from Android in that it is not based on Linux but on a kernel called Magenta which looks more like a kernel that is typically used for embedded systems such as vehicle infotainment units, white goods and so on.
  • Fuchsia is also a real-time operating system (RTOS) which tend to be used for smaller systems which are typically embedded where response time is critical to the user experience.
  • Windows, Linux, Unix and so on are less time critical and are designed to run multiple tasks at the same time on much more powerful hardware.
  • This is the one thing that makes me question the suitability of Fuchsia to replace Android as other factors make it look a lot like an Android replacement:
    • First, user interface: the user interface (Armadillo) that has been added looks a lot like what one would expect from a smartphone with a touch-based input system and card-based user experience design.
    • Second, Swift support: Recent code contributions by Google indicate that it is working to include support for the Swift programming language which can be used to create apps for all of Apple’s operating systems.
    • This is a significant step as it implies that Google is working to make it as easy as possible for developers to have their apps running on Fuchsia.
    • Developers often develop for Apple before turning their attention to Android due to the better economics that exist for them on iOS.
    • This support could allow them to publish on Fuchsia at the same time with no incremental effort.
    • This kind of support has been promised many many times in the past but no one has really delivered it in practice.
    • Third, obsolescence: looking at the history of Symbian, it became unusable 12 years after its creation as the core upon which it was built become obsolete and impractical to upgrade.
    • Android will be 12 years old in 2019 raising the possibility that it, too, may become obsolete requiring a complete rewrite from scratch.
  • My take home from this analysis is that Fuchsia looks most suited to be used in embedded systems such as vehicles, white goods, machinery, wearables and so on.
  • Consequently, this could be a single replacement for Android Auto and Android Wear, both of which are not ideally suited (because they are Android forks) for the use cases for which they were designed.
  • Hence, I think that it is unlikely that Fuchsia will replace Android on smartphones and tablet, but the possibility is there should Android start to struggle with obsolescence.
  • Given, its current stage of development, I would expect Fuchsia to make a real appearance in 2019 rather than 2018.
  • In order to solve the Android fragmentation problem Fuchsia would need to be closed down by Google and used to replace Android on smartphones which at the moment looks like a big stretch.
  • Therefore, I still think that a complete closing down of Android to become a proprietary OS is how Google will solve the fragmentation and updating problems that are crippling the user experience on Android.

Android – Downward slope.

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Fragmentation getting worse not better.

  • Despite Google’s best efforts, the situation with fragmentation in Android devices appears to be materially worsening, further reinforcing the need for Google to take Android completely proprietary.
  • Fragmentation in Android comes in two forms:
    • First, vertical fragmentation: this refers to the number of older versions of software that are still active and is exacerbated by a failure to update existing devices to the latest version.
    • Second, horizontal fragmentation: this refers to changes made to Android by different device makers to bring their products to market.
    • This results in a differing and inconsistent levels of performance from one device to another despite running exactly the same version of software.
  • Both vertical and horizontal fragmentation have a substantial and deleterious impact on the user experience and in my opinion are the main reason why the user experience on Android continues to meaningfully lag that on iOS.
  • Analysis by programmer Dan Luu (see here) is the clearest indication yet that instead of getting better, it appears to be getting worse.
  • I had already partially noticed this when I calculated that at the rate at which Android 8.0 is being adopted, it will take 5 years to fully penetrate Google’s own user base (see here) compared to 4 years for other versions.
  • Dann Luu’s analysis is much more granular and his chart clearly shows that for the latest version (far right-hand side), the update trajectory is meaningfully slower than for all of the previous versions.
  • Previous versions have seen a much more rapid update pattern leaving me to conclude that either the number of devices being updated has suddenly declined or that manufacturers have started making new devices using old software.
  • Either way, the effect will be the same which is more devices running older software meaning that Google innovations that require a change in the OS to function, will take at least 5 years to make it into the hands of all its users.
  • This will allow iOS to continue comfortably outperforming Google Android on the RFM Laws of Robotics that test the user experience leaving this as major point of differentiation for Apple.
  • Furthermore, it will also ensure that Google continues to underperform its revenue generation potential on Android devices leading to lower revenues and profits.
  • The more time goes by and the worse this problem becomes, the more I think that the only solution is for Google to take Android fully proprietary and put to bed the fragmentation issue once and for all.
  • This is how Google could begin to see significant revenue upside from its own Google Android devices as well as close the gap to Apple.
  • Its own efforts in hardware are unlikely to have nearly the same impact simply because its volumes are so small.
  • I continue think that Google’s shares remain pretty fairly valued and prefer instead Tencent, Microsoft and Baidu.

Google Pixel – Damage done.

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Software updates won’t fix reputation.

  • The seemingly endless problems with Google’s latest Pixel devices can most probably be completely resolved with software updates, but these will not repair the reputation damage which is likely to keep the few potential buyers that there are at bay.
  • The problems are legion:
    • First, Screen burn in: Because OLED pixels emit their own light (like plasma), they also have the potential to suffer from burn-in.
    • This refers to damage that occurs to pixels where a bright static image has been displayed for too long resulting in a residual ghost image.
    • All OLED screens have the potential to suffer from this problem but through the clever use of software, Samsung has managed to virtually eliminate this problem from its portable devices.
    • Google has no experience with OLED or screen technology in general which has resulted in the bad feedback from users seen.
    • Second, dull colours and blue cast: Since the device made it into the hands of users there have been complaints that Pixel’s OLED is dull with an odd blue cast compared to those in Samsung devices.
    • Third, clicking sounds: There have been numerous reports of clicking sounds coming from the device which is caused by the activation of the NFC receiver.
    • Fourth, audio quality: Some of the recordings that the device makes appear to play back with very poor audio quality.
  • These problems are all surmountable and look to me to have been mostly caused by a lack of hardware experience and the rush to bring the device to market.
  • Consequently, there is a massive software update that Google says will address all of these issues but I think that will not fix the biggest issue of all.
  • This is the damage that has been done to Google’s reputation for building good quality hardware.
  • At the price that Google is charging for its smartphones, there is no real margin for error as it is competing head on with Samsung’s flagships and iPhone 8.
  • I suspect that the end result will be that the Pixel 2 ships much lower volume than it would otherwise have done as there are plenty of very high-quality alternatives.
  • This will put yet another crimp on Google’s ambition to become more vertically integrated and it appears that the best way to get the most value from Google services is still to use them on another device.
  • It comes as no surprise to me that Google continues to generate more revenue per device from iOS than Android.
  • I think what it really needs to work on is fixing the Android user experience on all of the other devices out there as this is how it can close the gap on iOS which could have a significant upward impact on revenues.
  • Until then, I think Google will continue to underperform its Android potential leaving me pretty indifferent to an investment in the shares.

OnePlus – Learning curve

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OnePlus’ slip serves as a warning.

  • BBK Electronics is fortunate that OnePlus is one of its marginal brands as a gaffe of this size at Oppo or Vivo could have done real damage.
  • OnePlus is a subsidiary of Oppo which in turn is owned by BBK Electronics (like Vivo) and has its own favour of Android (GMS compliant) called OxygenOS.
  • Unfortunately, OnePlus decided to include code in OxygenOS that captured and uploaded: IMEI, serial number, MAC addresses, IMSI and WiFi network data in addition to which apps were being opened and what the user was doing in those apps.
  • This data was being uploaded and analysed by OnePlus without either the knowledge or consent of its users.
  • OnePlus claims that the data was only being used to improve the user experience but that has not earned the company a free pass.
  • However, once the company had been rumbled it was reasonably quick to react explaining how users can turn off usage data collection but for the other data it stopped short of saying that it would cease collecting it.
  • I suspect the real problem here lies in the cultural difference between China and developed markets.
  • RFM research (see here) has concluded that in China, privacy is much less of an issue where almost all services collect and use data without the user’s permission.
  • Critically, the users do not seem to mind.
  • However, in developed markets, a flagrant disregard for the users’ privacy can sink a product or service.
  • I suspect that the code used in China was simply translated into English and launched into developed markets without a second thought.
  • This is not the first time that this has happened nor, I suspect, will it be the last as smaller Chinese brands try and leave the home market.
  • Fortunately, it appears that this lapse has not also occurred at Oppo which ships a third of its volume overseas (10m units Q2 17) which would be at risk of losing a substantial part of its business as a result.
  • OnePlus is too small for anyone to really notice or care but it serves as a warning to other companies.
  • Being aware of the differences between China and the rest of the world may make the difference between success and failure.

Microsoft – Blue Squares of Death.

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Google is the big winner from Windows Phone’s demise.

  • Microsoft has admitted that Windows 10 on mobile is no longer a focus finally putting to bed any hope (however tiny) that Android handset makers had to escape from Google’s clutches.
  • Their only hope now is that the EU forces Google to make its app store (Google Play) available without having to also install the rest of Google’s ecosystem and set it by default.
  • Microsoft has already wound down the activities that it acquired from Nokia which, combined with barely a mention at developer events like BUILD, has made this fact obvious to everyone but this is the first time that Microsoft has openly admitted this fact.
  • There will continue to be fixes and security patches for a while but no more than that.
  • Microsoft has blamed the lack of availability of apps and services from third parties as the main reason for the platform’s failure, but I have long believed that there was more to it than that.
  • The issue with developers is simply that they won’t develop for a platform with very few users as there is no way to make money.
  • Without third party apps and services, it is difficult to get users to adopt a new platform resulting in a typical chicken and egg problem.
  • Consequently, to kick start a platform, the platform owner needs to prime the pump in order to generate interest that will quickly feed off of itself.
  • Microsoft has tried very hard to incentivise app developers by paying them money and even writing the apps for them but this was not enough.
  • I have long believed (see here) that to succeed Microsoft needed to encourage both developers and users and it was in the encouraging of users where Microsoft really failed.
  • I have long referred to this as the Blue Squares of Death problem.
  • iOS has always been able to sell itself and Android was also a simple sell as it looked just like iOS except that it was cheaper.
  • By contrast, Windows Phone was very different and as a result, Microsoft needed to explain to users why it was great and how they could live their digital lives with Microsoft.
  • Furthermore, devices in the stores needed to be populated with data such that users would be able to clearly see how the Microsoft ecosystem would make their digital lives easy and fun.
  • Without this data, the demonstration devices were simply screens with blue squares on them preventing anyone not in the know to understand the proposition.
  • This needed to be done in conjunction with the efforts to get developers on board in order to give the ecosystem a fighting chance.
  • Microsoft’s mobile ecosystem has always scored reasonably well against the 8 Laws of Robotics and users who did use it generally reported a positive experience.
  • Hence, I believe that it was the failure to educate the users that was the primary reason for the ecosystem’s failure.
  • Marketing has never been Microsoft’s strong point and as a result it simply told users that the ecosystem existed and never explained to them why they should buy it.
  • The net result was that the ecosystem never got enough momentum in order to keep the developers interested resulting in the long decline that we have witnessed.
  • The real loser here is not Microsoft, which is going from strength to strength in the enterprise, but the Android handset makers.
  • If Windows had become a thriving alternative to Android and iOS then they would have had far more leverage over Google which could have resulted in much better economic terms as well as greater freedom.
  • Unfortunately, with its failure, they are completely stuck giving Google a free reign to continue draining the Android industry of its profits.
  • The one exception is Samsung whose profitability I have long believed comes from its huge volume advantage rather than any differentiation it is able to create on Android smartphones.
  • Despite Microsoft’s failure in mobile, its strategy in the enterprise is going from strength to strength leaving me still comfortable with owning the shares.


Android – Further deterioration.

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Apple is 577x better at software upgrades.

  • Both Android 8.0 Oreo and iOS11 have been available for a few weeks and has highlighted, once again, how bad the situation in Android.
  • I continue to believe this has a fundamental impact on the Android user experience, loyalty and monetisation.
  • Data from shows that Android Oreo is present on 0.2% of Google Android devices while iOS11 is present on 38.5% of all iOS devices.
  • Android Oreo has been available for 44 days (August 21st 2017) while iOS has been available for just one third of that time (15 days, September 19th 2017).
  • This means that the iOS user base is, on average, being upgraded 577x more quickly than Google’s user base of Android devices.
  • To compound the problem, it looks as if the rate at which the user base is transitioning to newer versions of Android is slowing down.
  • 12 months ago, Android 7.0 Nougat had 0.1% share of the user base and currently it has just 17.8%.
  • At this rate it will take 5 years and 7 months for Oreo to completely penetrate Google’s own Android user base.
  • This is substantially worse than the 4 years that I have observed in previous years.
  • This means that when Google makes an innovation in functionality that requires a modification to be made to the underlying Android OS, it will take the best part of 6 years for this innovation to make it into the hands of all of its Android users.
  • By contrast this process is essentially complete on iOS devices within about 3 months.
  • Effectively Google is spending money on R&D that stands to benefit its competitors more than it benefits itself.
  • If Apple takes a fancy to something launched at Google i/o, it can include the innovation in its latest version and have it deployed to essentially all of its users long before Google Android makes double figures.
  • This combined with the endemic fragmentation, substantially hampers the user experience on Android making it inferior to iOS.
  • I think there is substantial financial upside for Google if it can fix this problem which is why I continue to believe that Google Android will eventually become fully proprietary.
  • This is the only way by which Google can fix these problems and it comes as no surprise that both Android Auto and Android Wear are fully proprietary.
  • While the status quo persists, Apple profitability on iPhone is unlikely to be challenged although I am much more cautious around revenue growth.
  • I continue to be indifferent to both Apple and Alphabet, preferring instead, Tencent, Baidu and Microsoft.


Apple – Worst kept secrets.

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Face ID was the star of a show where everything had been leaked.

  • Apple launched its next series of products that brings its hardware into line with the best of Android but it is in the software where the differentiation will continue to be found.

iPhone X.

  • iPhone X brings Apple into line with Samsung in terms of screen design and quality (OLED) but I suspect it is in Face ID where the real leap in innovation lies.
  • Face ID uses a 3D depth sensor and infrared camera to map the user’s face and then compare that against a previously captured map.
  • Face ID promises to be fast and not fooled by photographs or even 3D models of the user’s face.
  • It will also continue to recognise the user when wearing a hat or glasses or should the user grow a beard.
  • This should be a big improvement on Samsung’s facial recognition which is slow and unreliable to the point where it is often easier and quicker to put in the PIN number.
  • Apple has also redesigned the home button press and multitasking commands into swipes that should be reasonably easy to adjust to.
  • Beyond that there are incremental advances in the camera and image processing but at the end of the day, this device is all about the new screen.
  • Apple has brought itself into line with the high-end of Android in terms of hardware specification meaning that the price premium will be all about the iOS ecosystem.
  • Pricing is in line with expectations at $999 for the 64GB version and I estimate $100 more for the 256GB version.
  • With Android struggling with endemic fragmentation and Samsung remaining very poor at software Apple remains at the head of the pack.

iPhone 8/8+.

  • Many of the improvements present in the iPhone X are also present in the iPhone 8 with the exception of the screen and FaceID.
  • It continues to use fingerprint recognition on the home button and has a slightly improved screen although it is in the old configuration and is not OLED.
  • It has the same photographic enhancements as the iPhone X and represents a steady upgrade to the iPhone 7 with pricing staying the same.

Apple Watch Series 3

  • Apple has recognised that almost all the usage this product is for fitness and is doubling down on this use case in the new version.
  • New functions have been added that improve the performance of the device for certain activities as well as adding some new less common activities.
  • The heart rate monitor has been improved to offer continual heart rate monitoring as well as resting and recovery heart rates thereby deepening its appeal to fitness.
  • At the same time, Apple is taking tentative steps into medical with the launch of a study that looks at alerting users to abnormal heart patterns that can lead to strokes.
  • This is a work in progress but Apple clearly intends to move deeper into this area as it is working closely with the FDA on this study.
  • Apple has also added a modem to one variant of the Apple Watch which I continue to believe is completely pointless (see here).
  • Apple has done enough to keep this category going but the real use case that will make everyone rush out and buy one remains glaringly absent.

Wireless Charging

  • Apple’s new iPhones have glass backs which enable wireless charging for the first time.
  • Apple has backed the Qi standard which is also used by Samsung which I suspect will now ensure that Qi becomes the single global standard.
  • Apple also discussed a proprietary product that enables multiple devices to charge on a single mat but as this is not in the standard it will only work with Apple products.
  • Apple is moving into line with everyone else on wireless charging as even the multiple devices on one mat is not a new idea.

Take Home Message

  • The endless leaks and speculation meant that Apple was not able to spring a single surprise on the audience this year.
  • That being said, I think it has done just enough to keep itself at the top of the industry for another year.
  • This is more about the Android camp struggling with software fragmentation and low profitability than Apple raising the bar for the gold standard in smartphones.
  • The one area where it has raised the bar is FaceID but this feature needs to tested in the wild to see just how good it really is.
  • Apple’s share has enjoyed a great rally this year meaning that the valuation argument for owning the stock long-term has evaporated.
  • With no real surprises coming this year there is a case to be made for taking some profits and looking elsewhere.
  • Tencent, Baidu and Microsoft spring to mind.