Cybernaut 

Unstoppable tech?

The Apple iPod may not be the best value or even the most powerful or user friendly of portable music devices out there, but it’s still the one gadget everybody wants.

Despite promises that this device or that is an "iPod killer" (Microsoft’s Zune is apparently the next iPod killer) Apple confirmed last week that iPod sales are up 32 per cent in the third quarter of 2006 compared to the previous year, with 8.1 million units sold.

Apple is also doing a brisk business in notebook sales after the switch to Intel processors capable of running Windows and Linux as well as Apple OSX – 61 per cent ahead of last year all told.

Together, notebooks and iPod sales helped push a 48 per cent increase in third quarter profits for the company, taking anti-Apple Wall Street completely by surprise.

At the same time Apple was announcing its good fortune Google announced they had something to celebrate. According to company filings, profits more than doubled in the second quarter for the company to $721.1 million, up from $342.8 million the previous year. The result? Google stock rose once again to a new high of $393.01.

All those investors who decided Google was overpriced at $85 per share in its initial public offering are no doubt kicking themselves, hard, right about now.

Even Nortel, the Canadian telecom company, had some good news to report. After watching the stock plummet from a high of $124.50 in 2000 to penny stock status, the company’s fortunes are looking up thanks to a new partnership with Microsoft to develop a communications software platform. It didn’t really help the stock price all that much, but it’s a sign that the company is at last coming back to life.

At the same time these tech companies are up, companies like eBay, Microsoft and Intel have slipped slightly as of late, prompting some analysts to predict a general slowdown in tech.

Who do you believe – the investors pointing to the success of Apple and Google, or the investors pointing to companies sliding in the other direction? What’s the trend here, or could it be possible that there’s no trend at all?

There isn’t a company in the world that can sustain growth every quarter, four times a year, for years on end, but that’s what investors seem to want. Some companies losing value on the stock market these days are still making huge profits, but are simply missing profit targets that were probably too aggressive to begin with.

But while you have to take tech stock reports with a grain of salt, tech is generally an indicator of the economy as a whole – when individuals and organizations have disposable income, they’re both more likely to spend or invest some of that money on technology products.

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