Google Stock Prediction: Android Desktop Computers Will Boost Google’s Advertising Business

motek 1The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology  – Senior Analyst at I Know First

Google Stock Prediction: Summary

  • Alphabet is worth adding to your long-term growth portfolio.googl
  • Google has won an important legal victory over Oracle’s $9.3 billion suit involving Java APIs on Android OS devices.
  • Google’s advertising business will continue to profit from Android’s dominant position on mobile devices.
  • The upcoming commercialization of Android OS-based laptops and computers will further increase the total market for Google ads.
  • Microsoft and Apple are not a threat to Google’s leadership in mobile advertising.

Oracle (ORCL) wanted Alphabet (GOOG) to pay it $9.3 billion for alleged illegal use of Java APIs (Application Program Interfaces) on Android Operating Sytem. Unfortunately for Oracle, Google won this legal contest that was originally filed six years ago. A jury in San Francisco ruled that Google’s use of 37 Java APIs was fair use.

Java was originally developed and owned by Sun Microsystems. Oracle bought Sun in 2009 for $7.4 billion. Now that an American court/jury has freed Google from any copyright infringement over the use Java APIs, I expect GOOG’s stock price to rise higher this year. Oracle’s defeat means it’s business as usual’s for Google’s lucrative search advertising business on Android devices.

GOOG has risen more than 6% over the last 30 days. I expect that more institutional and retail investors to add GOOG or GOOGL to their portfolios once they realize that Alphabet is not obligated to pay anything to Oracle.



Business As Usual For Alphabet

Alphabet and its partner developers are no longer under the dark threat of Oracle’s false claim that use of Java APIs are not under ‘fair use’ rules. Yes Oracle owns the copyright on Java APIs but they are all usable by other third parties who build mobile apps and software for Android OS.

Even if Oracle tries again to appeal the San Francisco federal jury’s judgment, Alphabet has already announced that the Android N version will now use APIs based on OpenJDK, not the proprietary JDK owned by Oracle. There is almost zero chance that Oracle will ever get a share of Alphabet’s multi-billion advertising income from Android OS devices.

Google has received billions of dollars from Android-powered devices via advertising and app store purchases since 2010. Alphabet’s revenue rose notably every year since 2010. Alphabet’s revenue in 2011 was only $37.9 billion, almost half of what it made last year, $75 billion.



This increased revenue stream was also parallel to the upward 5-year trend of Android OS’s market share in mobile. As of Q1 2016, The Android OS already commands more than 84% share on smartphones. Having this overpowering presence on smartphones makes Alphabet a long-term winning bet for growth-minded investors. There are now 1.4 billion Android device users who are all fair targets for Google’s advertising campaigns.



Expanding Android’s Reach Beyond Mobile

Alphabet’s advertising income from Android devices will no longer be limited to smartphones and tablets. My Seeking Alpha article discussed the coming age of AndroidBooks. Two ex-employees of Google created Remix OS, a desktop-like custom version of Android OS.

With Remix OS, Android is now a real rival to Windows and Mac OS X on the desktop PC market. Remix OS has transformed the touch-centric Android OS to imitate the traditional mouse-and-keyboard operation of Windows. There are now Remix OS Android laptops available.


(Source: Jide)

Allwinner, one of the top Chinese vendor of ARM-based processors, is also helping computer manufacturers create $100 Remix OS Android 2-in-1 laptops. Taiwan-based display vendor AOC has also unveiled its Remix OS Android-based all-in-one computer. Business users might just embrace Android computers as real productivity machines that could replace their ageing Windows 7 computers.

Google certainly benefits from more people using Android devices as productivity machines. The more people who use Android devices, the more eyeballs there are for Google’s targeted ads.


I am long on Alphabet. I highly recommend GOOG or GOOGL to long-term growth investors. Aside from Facebook (FB), Alphabet has no other rival on digital advertising. Microsoft (MSFT) has dumped its digital display ad business to AOL last year. Apple (AAPL) has shut down its iAD sales team and it also will close its iAd App Network advertising service this coming June 30.


Alphabet has a big lead in the $160 billion/year global digital advertising business. We should hitch our wagons to Alphabet’s rising star. My buy recommendation for GOOG is also in line with the positive algorithmic forecasts of I Know First. GOOG has an extremely good one-year algorithmic forecast score of +273.85. It’s a strong assurance that GOOG will most likely breach $800, rather than go below $700.

As in the bottom forecast image I Know First previously predicted the GOOG stock movement in this Tech forecast from January 9th 2015 to January 9th 2016. Showing an amazing signal of 452.03 and predictability of 0.43 for the year period achieving a fantastic return of 42.13%.

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