Sunday, March 8, 2015

Week's Winners & Losers: Apple Goes to China; Microsoft Gets Spurned

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Sign in Chinese advertising the Apple iPhone and iPad at a China Mobile store in Beijing, ChinaAlamy Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From a software giant's dream CEO candidate telling them to keep dreaming, to the world's consumer tech leader at last getting its smartphone into the hands of the world's largest wireless carrier, here's a rundown of the week's best and worst results in the business world. (AMZN) -- Winner The leading online retailer was a loser in last week's column after its reputation took a hit in Europe. But it bounced back this week after Jeff Bezos went on "60 Minutes" Sunday and offered up a future of drone-shipped deliveries. We need to be realistic. A fleet of unmanned drones delivering shiny new Kindle Fire tablets isn't going to happen anytime soon. However, Bezos has once again positioned on the leading edge of e-tail. The maneuver got the media talking about Amazon, and that's free advertising during peak shopping season -- even if the drones never land on your doorstep. J.C. Penney (JCP) -- Loser The struggling department store chain can't seem to catch a break. It had initially encouraged investors by posting a 10.1 percent improvement in comparable-store sales for the month of November -- only the chain's second positive month since the end of 2011. However, investors lost their enthusiasm when comparing that showing to the nearly 32 percent plunge in comparable-store sales during last year's holiday quarter. In short, J.C. Penney still has a long way to go. Things got even more complicated on Thursday when the retailer revealed that it had received a letter of inquiry from the SEC. The trading regulator wants to take a closer look at J.C. Penney's liquidity and financial statements. It's just an inquiry, but it only creates more uncertainty. Chinese Internet Stocks -- Winners Investing in China's expanding Internet naturally carries a fair amount of political risk, but the world's most populous nation became a bit more attractive this week when it approved the rollout of its first commercial 4G wireless network. China's move from 3G to the faster 4G led to a boost in the shares of several Internet stocks, particularly the ones with popular streaming video websites including Youku Tudou (YOKU) and (SOHU). Sohu also announced a deal to stream popular Nickelodeon shows for free in China, a move that should benefit Sohu and Nickelodeon parent Viacom (VIA). Yes, "SpongeBob SquarePants" is about to get dubbed into Mandarin. Microsoft (MSFT) -- Loser Ford (F) head Alan Mulally had been at the top of the public's wish list to be Microsoft's next CEO, but reports this week find Mulally claiming he will stay at the automaker through at least the end of 2014. It may not play out that way. Microsoft has the resources to make anyone consider its offers. However, if Microsoft settles for Stephen Elop or any other internal hire at a time when the software giant is so clearly in need of an outsider to carve a new path, the market's not going to like it. Apple (AAPL) -- Winner The consumer tech giant's stock hit a new 52-week high this week after The Wall Street Journal reported that a deal would be announced later this month to have China Mobile (CHL), the world's largest wireless carrier, offer the iPhone. China Mobile had 759.3 million mobile customers at the end of October. Yes, that's a big number, and most of them are using older feature phones. China Mobile could quickly become Apple's biggest iPhone customer.

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