While the original blockbuster is set to hit theaters on December 18th this year, another set of star wars are in full motion: the stars of Technology are pushing hard against each other, targeting different territories and using different weaponry. Just two years ago, everyone was talking about the four horsemen — Apple, Google, Facebook and Amazon — being the stand alone companies that will shape the next ten years. But an e-commerce driven twist from China has gotten into the mix, with Alibaba now larger than Amazon, and Tencent knocking on Facebook’s door. Others like JD.com and Xiaomi are catching up fast from behind. (Disclosure: GSV owns shares in Apple, Facebook, Tencent, JD, Alibaba)
At the top, Apple’s rise over the last year was driven by the successful transition into larger phones. Challenged by Samsung three years ago, Apple’s response was the larger iPhone 6 which it released last September. Sales of the new devices have been spectacular, growing twice the industry rate, and resulting in Apple’s shares being up 133% since their bottom in April 2013.
But Apple is also experiencing pressure from different ends. China’s Xiaomi has successfully “copycatted” the iPhone, selling it for a fraction of the cost in China. Most recently, Xiaomi broke a World record by selling 2.11 million phones in a single day. In just over a year, its valuation has gone from $10 billion to $45 billion, and it won’t be long until it hits the triple digit billion mark, in my opinion.
Phone Wars — Xiaomi Mi 4 versus iPhone 6
Apple is also trying to find its way back into music streaming coolness. Its highly anticipated streaming service is expected to be announced tomorrow, but it is unclear if Apple has signed all necessary label deals yet. Spotify’s emergence as a leader in this space has been impressive. The Swedish star has been able to fight off competition from Apple, Google and Amazon combined, and is showing impressive growth with over 60 million active users and over 15 million who pay $10 per month. (Disclosure: GSV owns shares in Apple and Spotify)
Meanwhile, Facebook and Google are fighting each other on their own turfs. In both search and video, Facebook is quickly gaining momentum. Its 1.4+ billion users are now viewing over 4 billion videos per day, on par with YouTube’s metrics. And Snapchat is also getting into the mix, with 2 billion daily video views from its ~200 million users. Then there is virtual reality — a space that both Google and Facebook have strong aspirations for. Google’s Glass was a failure, and the search giant has re-focused and led a massive $542 million investment into Magic Leap, the augmented reality startup that is expected to bring a virtual world to your eyes. And last week, Magic Leap announced the release of its own augmented reality developer platform, a sign that things are moving forward.
Soon To Be Reality With Magic Leap?
Facebook on the other hand is pushing with the Oculus Rift. After getting acquired by Facebook for $2 billion last year, Oculus recent announced that the Rift will start shipping in Q1 2016 — a reason for excitement. Having high comfort with Mark Zuckerberg and with everything he is signed up for, we expect the Rift to become a hit once it comes out. Zuck’s own expectation and goal is to sell 50–100 million Rifts long-term, in order for it to be an important platform.
Stay tuned… By the time we get the new Star Wars: Episode VII, we might be watching it in a brand new virtual world. And the “International Horsemen Association” might be adding many more languages.
As published in this week’s A 2 Apple http://bit.ly/1eWYtGI