We hope that you had a great couple of weeks!
Our team has been traveling this month. I attended CES with Anshel (virtually). Robert attended Rubrik Advisory/Analyst Day in San Francisco. Melody virtually attended the Zoom Work Transformation Summit.
This week, I will be traveling to Seattle for advisory meetings. Robert will be attending AWS Gen AI and Dynatrace Perform.
Next week, Melody will be in McAllen, TX, for ZohoDay 2024. Robert and I will be in advisory meetings in San Jose.
Our MI&S team published 26 deliverables:
Over the last two weeks, the press quoted us with 14 citations. They wanted to hear about Apple, Arm, B2B transactions in the cloud, CES, Cohesity, Galaxy, Intel, Meta, Synopsys, Qualcomm, and Xreal.
MIS Quick Insights:
A.I./Machine Learning (Paul Smith-Goodson)
- The FTC will investigate AI investments and partnerships of Microsoft, Amazon, Alphabet, OpenAI, and Anthropic. It will investigate the authority and rights of these investments and if they are anti-competitive. The British Competition and Markets Authority is also conducting a similar investigation. The government is concerned about the impact of AI on society and the economy. The FTC plans to determine if the investments and partnerships risk distorting innovation and undermining fair competition. Microsoft’s investment in OpenAI, which is not a subsidiary under its control, may face scrutiny from the European Union officials. The companies have been ordered to provide information on the matter. Let’s hope the investigation doesn’t stifle the US’s ability to compete with China.
- A new AI image generation method called InstantID has been developed to recognize a person and generate new images using a single image. However, it appears to be able to produce deepfake audio, images, and video. InstantID is a tool for zero-shot identity-preserving generation, which differs from the existing imaging tools, LoRA and QLoRA. InstantID is much better than LoRA for AI image generation. It provides a variety of image personalizations in high fidelity with a single facial image. It can create highly realistic and convincing deep fakes with no GPU and little CPU. There are concerns because it can be used for deepfakes without training or fine-tuning.
- DeepMind has introduced AlphaGeometry, an AI system capable of solving complex geometry problems at an Olympiad level. This is important on two levels. First is the capability to solve such a complex problem, and second, it comes close to the performance of a human gold medalist. This is a significant advancement in AI reasoning for mathematics. In a benchmark test of 30 Olympiad geometry problems, AlphaGeometry solved 25 within the standard time limit, compared to the previous state-of-the-art system that solved ten and the average human gold medalist who solved 25.9.
- The system uses a neurosymbolic approach, where the language model provides fast, intuitive ideas, and the symbolic deduction engine offers rational decision-making.
- We are getting closer to AGI.
- The IM believes AI will transform the global economy. It argues that if properly directed, AI benefits humanity—driving economic growth and helping solve significant challenges like climate change and global health. However, AI must have thoughtful policy guidance, or the gains will not automatically benefit social welfare. It calls for proactive ethical frameworks to govern the development and deployment of AI systems. Without guidance, it believes we could see more inequality, job displacements, and other issues.
- It doesn’t mention that over-regulation could dramatically slow AI development and allow unregulated entities like China to overtake and outpower us commercially and militarily. Overzealous AI regulation would not be beneficial.
AR/VR (Anshel Sag)
- Netflix calls Apple’s Vision Pro “Subscale” when asked whether there will be a native Netflix App for Apple’s Vision Pro. This is expected, especially considering the Vision Pro will likely ship less than a million units in the first year. Netflix’s business scales in the tens and hundreds of millions. Netflix counts a show’s success in millions of views per week, so anything under that scale simply isn’t relevant. This is the problem that many new VR devices struggle with and why Netflix has been less than willing to update the Netflix app for Quest.
Carrier/Wireless (Will Townsend)
- AT&T and T-Mobile recently announced fiscal 4Q and end-of-year 2023 earnings. Postpaid mobile service gains for both companies were bright spots, but broadband performance is an interesting contrast. As AT&T continued its momentum in building its multi-gig fiber subscriber footprint, T-Mobile reported strong performance in its 5G fixed wireless access (FWA) business, with a total subscriber base approaching 5 million. AT&T should narrow the FWA performance gap, given its recent consumer 5G Internet Air service launch. Still, it’s interesting that both operators lean into individual strengths (AT&T’s fiber investments and T-Mobile’s spectrum position) to increase market share.
- Verizon recently took a nearly $6 billion impairment charge against its wireline enterprise business as SD-WAN services continue to erode legacy MPLS circuit monetization. Ironically, LTE and 5G access are partially to blame as software-defined networking tools select the best networking option at any given point in time. The sunset of MPLS will force Verizon to shift its mix of mobility business services or risk losing customers or damaging ARPU. 5G FWA service growth could help Verizon, but it faces intense competition with T-Mobile and AT&T’s business FWA offering that has been in the market for some time.
CRM (Melody Brue)
- Salesforce has introduced new generative AI tools embedded in Commerce Cloud and Marketing Cloud, powered by the Einstein 1 platform. These tools, unveiled at NRF 2024, aim to enhance retail operations for consumers, merchandisers, and marketers. Notable features include Einstein Copilot for Shoppers, offering personalized interactions and quick product discovery; Page Designer for creating e-commerce websites using natural language prompts; and Global Promotion Management for synthesizing marketing data with predictive insights. This reflects Salesforce’s commitment to integrating generative AI for improved customer experiences and business outcomes.
- In a Bloomberg interview at WEF in Davos, Mark Benioff said CEOs universally seek more margin, increased productivity, and enhanced customer relationships. The key lies in leveraging advanced AI technology. He said, “So our Einstein product (which already does a trillion AI transactions a week, both predictive and generative)…it must augment our customers, employees, and their customers … So whether they’re doing commerce or sales or service or marketing, whatever augmentation of the human experience.” It looks like Salesforce is jumping on the opportunity it sees at hand.
Networking– (Will Townsend)
- Nile Secure recently entered into an agreement with fiber service provider Frontier to market the Nile network as a service platform broadly. Nile is an early-stage start-up that aims to disrupt enterprise networking by eliminating legacy configuration requirements that are the root of most network issues. Nile’s approach is unique, as it dramatically simplifies deployment with a managed service model that observes service quality across its tech stack, taking proactive actions when deviations occur. Since the architecture is a grounds-up, microservices-anchored design, Nile can also segment devices and deploy zero-trust principles to safeguard connectivity. On the surface, Nile’s approach is compelling, so much so that networking industry legend John Chambers is an adviser and board member.
- Fastly is a company to watch in 2024. Long known for its CDN capabilities, under the leadership of former Cisco executive Todd Nightingale, Fastly hopes to extend its edge cloud infrastructure to power new use cases and applications. What I like about the platform is the ease with which developers can leverage integrated security and high-performance networking to deliver unique and compelling user experiences for consumers and enterprises.
Compute/Storage/Cloud (Matt Kimball)
- (Si): Intel held its fourth-quarter earnings, and the results showed strong PC sales while the DCAI numbers were down (YoY). However, these numbers don’t tell the entire story. While DCAI sales were down, the company has been effectively executing against its five nodes in four years strategy – a strategy that should put them at par with their main x86 competitor. Some strategic architectural decisions combined with node parity will set them on a strong glide path for Xeon.
- (CLOUD): Oracle announced its OCI Generative AI Service this week. This service focused on enabling large language model support for Meta (Llama-2) and Cohere (Command, Summarize, Embed) with an eye to enable the business use cases that span the modern datacenter. In addition, OCI is previewing two other services. OCI GenAI agents will be functions that make it more simple for businesses to leverage GenAI (RAG is the first such agent). OCI Data Science AI Quick Agents is a service that delivers point-and-click setup of data science environments.
- Here’s what I like about what OCI is doing in AI. The team is delivering relevant functionality that will ease and accelerate the adoption of AI to an enterprise market that has been slow in adopting – despite the incredible industry hype.
- (CLOUD): NVIDIA and Equinix announced a partnership whereby Equinix will deploy, host, and manage NVIDIA DGX supercomputers in its co-located datacenters. Customers will work with NVIDIA NPN resellers to scope out and acquire DGX infrastructure as part of this agreement. The NVIDIA solution will be delivered to the Equinix datacenter of the customer’s choice, where Equinix engineers will deploy, configure, and make the solution available to the customer.
- I like how NVIDIA is working to make adopting its very complex technology frictionless. Partnering with Equinix makes perfect sense as the company’s global datacenter footprint and underlying networking technology are unmatched. Driving this through channel partners is another smart move, as it drives considerable revenue upside for high-margin services.
- What I would like to understand better is the economics. While I know the challenges around offering this DGX infrastructure as-a-service, I would like to see NVIDIA get directly behind offering this solution in a more consumable fashion for enterprise organizations that don’t have the necessary capital budget.
- (COMPUTE): IBM announced positive earnings this week, beating expectations on both the top and bottom end. I was pleased to see the continued strong growth of Red Hat (6% YoY) and the innovation that this company continues to churn out. Listening in on the earnings, I was reminded of how impressed I am with IBM’s acquisition and integration of Red Hat and its IP into the IBM portfolio. When the acquisition first closed, I was concerned that Red Hat’s identity as a company, culture, and portfolio would get, perhaps, a little lost. But it hasn’t, as IBM has carefully leveraged Red Hat IP where appropriate but has let the innovation engine continue to thrive. VMware/Broadcom announced it would be ending VMware’s channel program and transitioning (some?) resellers to Broadcom’s invitation-only channel program. Once again, it feels like the new VMware is giving its competitors, such as Nutanix, Scale, and IronSoft, a lot of ammunition to build out FUD-based campaigns. While I understand the importance of consolidating/centralizing the management of sales and marketing operations post-merger, this new organization seems to be a bit tone-deaf to what its partners and customers want. Combining this with a new licensing model that assumes savings based on full consumption of the product portfolio is putting partners and customers in a bad way. While other pundits may consider the traditional VMware licensing “outdated,” I would argue that there is a better transition approach. Ripping the band-aid off gives too much oxygen to the rumors and anxiety in the marketplace.
- (CLOUD): Looking through the cloud rankings and wondering why Oracle doesn’t get more recognition as one of the major players. I am wondering if this shifts in 2024. Consider the following – OCI’s market share is about 8.5%, just behind GCP and ahead of IBM. Also, consider OCI’s regions are on par with the “big players,” and it is rapidly catching up in terms of datacenter deployments. Also, consider this – OCI (in partnership with Azure) is the only CSP looking at enabling a real performant and secure multicloud environment for users. One of my predictions for 2024 is that the market view of Oracle as a major CSP will accelerate, and its dominance in data management will continue to fuel growth that outpaces its competitors.
- 2024 is going to be a fun and exciting year for processors. From CPUs to GPUs to custom silicon from the cloud providers to workload (and perhaps application) specific acceleration. AMD, Ampere, Broadcom, Cerebras, Intel, Marvell, NVIDIA, and many other established players are challenged by what I believe is the most dynamic semiconductor environment ever. As we hit commoditization (or de-commoditization) in some markets, these established players must reinforce their competitive differentiation. Yes, silicon is taking center stage.
- (COMPUTE)Does the server matter anymore? As giants like HPE and Dell pivot to aaS and consumption-based services, the value of a well-designed platform upon which to build services seems to have dropped in importance. But has that value dissipated? Or are major OEMs missing a messaging and marketing opportunity to drive differentiation? I believe the major OEMs have over-indexed on their “cloud model” messaging, diminishing any real value perceptions around hardware. This behavior is encouraging IT consumers to downplay the importance of (OEM) server platforms, which can significantly impact profitability and (more importantly), customer retention.
ESG (Melody Brue)
- Westcon-Comstor has appointed Kevin Brzezinski as chief sustainability officer in addition to his current role as senior VP of global operations. Brzezinski will oversee the company’s initiatives to reduce its carbon footprint and environmental impact. The creation of this new role emphasizes Westcon-Comstor’s commitment to achieving net-zero greenhouse gas emissions by 2050. The company, recently validated by the Science Based Targets initiative, aims to reduce emissions by 50% (Scope 1 and 2) and 25% (Scope 3) by 2030. Westcon-Comstor aims to source 100% of its electricity globally from renewable sources by 2030. While ESG initiatives have recently been the focus of some backlash, and climate has taken a back seat at WEF in Davos, Brzezinski has expressed the company’s commitment to achieving ambitious emission-reduction targets.
Enterprise Data (Robert Kramer)
- IBM has a solid fourth quarter 2023 with its results
- Revenue growth +3.3% 4Q2023. 2023 Free Cash Flow $11B+.
- Q4 2023 revenue $17.4B with EPS $3.87.
- IBM’s 2023 earnings emphasize the significant role of data in its AI, cloud, and consulting services – let’s summarize:
- IBM launched watsonX, a tool for AI and handling data, showing IBM’s significant data capabilities.
- IBM AI and Data strategies focus on AI for business with a strong emphasis on data. Integrating AI and data analytics into its offerings is a key part of its strategy.
- WatsonX.governance manages AI applications and ensures responsible use of data.
- IBM Consulting Services focuses on data architecture, security, and governance projects that leverage business transformation, organizing, and managing data.
- IBM’s Power10 infrastructure systems are built to handle lots of data workloads efficiently and demonstrate IBM’s data processing capabilities.
- IBM worked with Sevilla Football Club to analyze data and pick players, showing watsonX data capabilities.
- IBM partnerships with SAP, Amazon Web Services (AWS), Microsoft, Salesforce, and Adobe had a focal point of data integration and analytics components.
- New Relic, a software performance monitoring company, has introduced Pathpoint, a feature designed to bridge the gap between IT data and business outcomes. In an interview with Manav Khurana, New Relic’s Chief Product Officer, we discussed Pathpoint’s capabilities. This feature provides insights into the financial impact of user interactions and system performance by leveraging data from APM 360. Pathpoint’s goal is to assist IT and engineering teams in comprehending and managing its services, enhancing operational efficiency, and aligning technical performance with business objectives. It also offers detailed information about the customer journey, which can contribute to improving user experiences and potentially increasing return on investment.
- Veeam recently enhanced its partner program by introducing additional features. I believe there’s a significant need to maintain customer trust and build a strong ecosystem network of support. The program encompasses a global network in 150 countries with 35,000 partners specializing in various technologies. Additional elements of this program include partner price protection and marketing support, providing deal support, and partner sales training to develop expertise in specific areas like SaaS and Kubernetes.
- Salesforce addresses the retail industry with new innovations through its Einstein 1 Platform and AI, combining retail and shopper data from its Commerce Cloud and Marketing Cloud. This offers a better experience for shoppers, merchandisers, and retail marketers through interconnected data and AI-driven applications. The platform lets you better understand consumer behaviors in the buying cycle for improved results, insights, and satisfaction with retail data. This advancement brings customer data together in one place. Salesforce will also release Einstein Copilot for Shoppers, Page Designer for customized e-commerce sites, Return Insights in Order Management, Inventory Insights, and Customer and Product insights for trends. Most of these features are in the pilot stage for release this year or are now generally available.https://www.salesforce.com/news/press-releases/2024/01/14/nrf-commerce-marketing-news/?utm_source=newsletter&utm_campaign=FY24Q3
ERP/SCM (Robert Kramer)
- SAP meets and exceeds key metrics for FY2023. With a strong ERP market, SAP grows its Cloud ERP platform with AI at the center of attention. Cloud revenue is up across all regions: Americas +13%, with Brazil excelling in Q4, EMEA 27% with Germany, France, and Saudi Arabia having an excellent Q4, and APJ 28% with India, South Korea, and Japan.
- SAP financials for Q4 and FY2023 put cloud revenue up 20% – up 23% at constant currencies for FY 2023 – as underpinned by 25 percent cloud revenue growth at constant currencies in the fourth quarter. Total revenue for Q4 was €8.47bn, up 5 percent from the fourth quarter of 2022. Total revenue for FY 2023 was up 6 percent to €31.21bn. https://www.sap.com/investors/en/why-invest/recent-results.html
- SAP gears up for a growth-centric and transformative 2024, a journey that, regrettably, parts ways with 8000 employees. Is this approach a prudent choice, an unavoidable necessity, or a vital component of its strategy for expansion and adaptation during this phase of change?
- In the new release of S/4HANA Cloud, specifically the public edition 2402 by SAP, I’m excited to see a strong emphasis on several key areas that I believe are essential for modern businesses. First, the focus on AI is expected, as it can enhance efficiency and decision processes. Additionally, the attention to sustainability is great, as tracking emissions and financial metrics can help organizations make more informed choices for a greener and more responsible future. The manufacturing enhancements are introduced with features to improve production processes, scheduling, understanding inventory baselines, and overall operational efficiency. Lastly, the emphasis on enhancing the user experience is beneficial, as user-friendly interfaces can enhance productivity and user satisfaction. https://news.sap.com/2024/01/sap-s4hana-cloud-public-edition-2402-update/?source=Cloud_ERP-S%2F4_Always-on-Video-Awareness-Global-SAPS4HANACloud-SAP_News&campaigncode=CRM-YA23-SMS-1941768&sprinklrid=12469791760
- NetSuite has a new focus on data to assist retailers with efficiencies and improving customer experiences. NetSuite Analytics Warehouse gives organizations consolidated data from diverse platforms such as ERP, CRM, Shopify, and Google Analytics for in-depth analytics, including consumer buying behaviors, inventory, and financial performance. The service comes with pre-built AI and ML models. It will be interesting to see how this technology is put into practice and its impact on international organizations’ operations. https://www.netsuite.com/portal/company/newsroom/netsuite-helps-retailers-unlock-data-to-drive-growth.shtml
- As the calendar turns, the worldwide end-user investment in security and risk management technologies will hit $215 billion, up 14.3% from $188 billion in 2023. Last year, there were 2,814 reported breaches, with over 8.2 billion compromised records in various sectors. For instance, the Real Estate Wealth Network experienced 1.5 billion records exposed, Delta Dental had 7 million records compromised, HealthEC’s breach affected 4.5 million records, 23andMe had data of 6.9 million individuals stolen, and Capital Health saw 10 million records exposed. Additionally, breaches at the National Automobile Dealers Association affected over 1 million lines of data, and the Indian Council of Medical Research reported 800,000 records compromised. Other breaches of note were KidSecurity, North Face, Twitter, and SAP SE. What’s even more astonishing is the financial impact noted by IBM, with the average data breach in the U.S. costing $4.24 million. Read more in my upcoming article on data security, organizations’ continuous challenges, and the best approaches to mitigate risks.
Financial Tech (Melody Brue)
- The crypto market presents a mixed picture following the SEC’s approval of spot ETFs this month. Grayscale’s Bitcoin Trust ETF has experienced approximately $4bn in outflows since approval, contrasting with the growth of BlackRock and Fidelity’s ETFs to over $1.5bn each. Anchorage Digital Bank has partnered with Onramp Invest to provide regulated crypto products to financial advisors, introducing an “industry-first” block trading feature for enhanced efficiency and cost savings. Anchorage’s unique OCC charter enables safe and compliant access to the digital asset economy for RIAs. Block trading for RIAs streamlines multiple trades across client portfolios for operating and cost efficiency. Spot Bitcoin ETFs are considered by many to be a potential driving force for digital assets in 2024. However, the price of BTC continues to decline, trading below $40k this week. Investors are watching how Bitcoin prices unfold without a clear consensus on the outcome. According to a Deutsche Bank survey of retail investors, over one-third predict Bitcoin prices falling below $20,000 by year-end. Interestingly, more respondents (42%) anticipate the cryptocurrency’s disappearance than those who believe it will continue (39%) to exist in the coming years.
- The Consumer Financial Protection Bureau (CFPB) proposes a rule to limit excessive overdraft fees charged by large banks and credit unions, potentially saving consumers up to $3.5 billion annually. The rule targets financial institutions with at least $10 billion in assets, focusing on the largest share of deposit account customers in the U.S. The CFPB aims to close loopholes allowing banks to exploit overdraft fees and requires transparent disclosure of overdraft loan terms, treating them akin to credit cards under the Truth in Lending Act. Innovations in FinTech and Neobanks have pushed banks to drop overdraft fees to compete. The rule, if finalized, may take effect in October 2025. While praised by President Biden, banking trade groups argue against the proposal, claiming it could harm consumers and hinder innovation.
HCM (Melody Brue)
- Ceridian announced its intent to acquire eloomi, a Learning Management System (LMS) that will be incorporated into the Dayforce platform. The LMS market is projected to reach $54.69 billion by 2032, and forward-thinking leaders must prioritize ongoing skills optimization for competitiveness and fostering engaged workforces. With the addition of the LMS to Dayforce’s current learning modules and management, Dayforce becomes a unified data model with functionality encompassing an end-to-end learning platform, learning content, people development, skills intelligence, and employee communications. As AI upskilling becomes a significant priority in companies, this approach provides easy employee access to AI-focused learning channels and personalized paths, with centralized data facilitating progress tracking, alignment with organizational goals, and adaptation to workforce changes. Robust LMS are becoming essential for identifying opportunities and addressing skill gaps.
IIoT and IoT (Bill Curtis)
- Big agriculture requires reliable, worldwide connectivity in remote locations with little or no terrestrial network coverage. After evaluating various satellite internet services for the past year, John Deere announced an agreement with SpaceX to provide Starlink services to connect farming equipment – tractors, combines, harvesters, seeders, sprayers, and other equipment – to farmers on the ground and to cloud services. Although John Deere’s automated farming technology operates autonomously, it always requires Internet connectivity for controlling and monitoring the equipment, recording sensor data for offline analysis, diagnosing problems, taking corrective action when the on-machine AI requires assistance, obtaining GPS correction data, updating software, and dozens of other tasks. Above all, the connectivity technology must “just work” upon delivery with minimal on-site support. Satellite is the way to go, and Deere just put a big stamp of approval on SpaceX.
- Thread Group just announced version 1.3, a significant new feature upgrade that corrects annoying limitations that Matter users experience when deploying Thread products. Until now, installing multiple brands of Thread-enabled smart home devices resulted in multiple Thread mesh networks. Thread 1.3 border routers from different manufacturers can share Thread network credentials, simplifying installation and resulting in a single mesh. Mesh unification requires border routers to exchange Thread packets over Ethernet and Wi-Fi connections, and 1.3 also supports that capability. I’m doubling down on my conclusion that Wi-Fi and Thread have already won the LAN war for homes and small businesses.
- HaLoW, Wi-Fi 801.11ah, enjoyed a resurgence of interest at CES 2024. New modules, routers, and devices promised better range in the 900 MHz band. Although lower frequencies have inherent coverage advantages, adding a new frequency band to a device requires new radios, larger antennas, and new routers. In some cases, the range improvement is probably worth the cost. However, I’m much more excited about Wi-Fi 7 and expect rapid adoption. In addition to the obvious speed advantages, Wi-Fi 7 adds the 6 GHz band, providing additional bandwidth for connecting multiple routers into a high-speed mesh. As Wi-Fi 7 prices drop, users can solve connectivity problems by overprovisioning – just add a repeater or two. HaLoW has some compelling applications, but I don’t expect big silicon companies to add 900 MHz radios to mainstream SoCs before demand ramps up.
- At CES 2024, Honeywell announced an MOU with Analog Devices to add two-wire Ethernet (T1L) networking to building management equipment. Commercial buildings with legacy wiring can upgrade to IP-based wired networking without expensive building retrofit. IP-based connectivity means that Honeywell can use Wi-Fi, Thread, Ethernet, or two-wire cables with the same software on devices and building management systems. Higher up the silicon food chain, Honeywell signed an MOU with NXP to integrate NXP’s neural-network-enabled application processors into Honeywell’s building management systems. 2024 is shaping up to be a big year for building automation as the industry finally adopts standards-based connectivity.
Modern Work (Melody Brue)
- Box has acquired Crooze, a no-code enterprise content management application developer. This acquisition includes Crooze’s team, technology, no-code app builder, and metadata capabilities. It furthers Box’s mission to help organizations manage critical processes such as contract lifecycle management, digital asset management, controlled document management, enterprise content libraries, and more. This strategic acquisition expands the Box Content Cloud for customers’ critical use cases.
- A SurveyMonkey study on consumer attitudes towards AI in customer service reveals that 90% of Americans prefer human assistance, citing better understanding, thorough explanations, and fewer frustrations. While over two-thirds are uncomfortable using AI for medical advice or financial decisions, over half are comfortable with AI in tasks like ordering food or completing work. Consumer opinions are divided on identifying AI interactions (54% confident) and recognizing AI-generated content (47% confident). 56% of respondents have negative feelings about companies using AI in customer experiences, with variations in sentiment based on age, race, and income levels. Older adults (65+) and higher-income individuals are more likely to harbor negative feelings. These are interesting data points that companies need to evaluate when making decisions on AI usage in CX.
- 8×8 has integrated advanced AI features across the 8×8 XCaaS (experience communications as a service) platform. These include meeting summaries with highlights and action items and intelligent meeting transcriptions that distinguish speakers and highlight action items and insights without taking notes. The company has also improved tracking and linking meeting artifacts to CRMs, such as Salesforce, ensuring centralized access, tracking, and reporting. 8×8’s AI announcements align with the company’s mission of delivering superior employee and customer experiences, particularly with asynchronous information sharing and streamlined follow-ups in modern work environments.
Personal Computing (Anshel Sag)
- Intel’s earnings showed that the company has turned a serious corner on the client side, while the company continues to struggle in data center with serious competition from AMD on the CPU side and NVIDIA on the AI accelerator side. IFS seems to be on track and is growing its revenue considerably.
- Apple’s malicious compliance with the EU’s Digital Markets act has made it clear that the company has no interest in playing fair. Instead, it plans to make using anything other than the App Store more painful and expensive than simply complying with Apple’s requirements.
- Microsoft’s layoff of 1900 employees from the Xbox division, which includes the newly acquired Activision Blizzard units, could not have come at a worse time. The company’s valuation crossed the $3 trillion mark and came as bad optics. The layoff only represents 8% of the division’s workforce, but the cuts seem quite painful, and we won’t know the impact for months if not years.
- The gangbuster success of Palworld has taken the gaming world by storm, shipping 8 million copies in under a week from a small-time Japanese developer. The amazing thing about this is that the company has effectively crossed $200 million in revenue with a game that many call Pokemon with guns, forcing Pokemon to respond publicly to its success. That said, I believe this game once again proves that if you build a good game, there are no issues selling it, which some bigger AAA studios might realize right now.
- The OnePlus 12 is probably the best value for flagship phones. It has a Snapdragon 8 Gen 3 processor and 12GB of RAM with 256GB of storage for $799. And if you pre-order it now, it comes with 16GB of RAM and 512GB of storage for the same price before any trade-in offers, which it also has going. The Phone also has a 5400 mAH battery and Wi-Fi 7 connectivity, both things that the S24 and S24+ don’t have, and frankly, it has a better camera than both, and it sells for the same price as the S24. It doesn’t have mmWave, but that’s not a concern unless you’re a Verizon customer.
- T-Mobile reported Q4 and 2023 earnings and beat the top and bottom lines while also reporting continued 5G FWA growth and continuously improving network performance and coverage while gaining customers. I believe that T-Mobile’s network will continue to attract new customers as Verizon and AT&T lag on things like mid-band and standalone.
- Magic Leap got another $590M in funding from Saudi investors to keep the company going through debt funding. The company has a new CEO, too. Magic Leap’s value in the market remains unclear as it has struggled to show any meaningful momentum or major customer wins. The company appears to be going after the professional training market, worth billions of dollars today. Still, it is also the biggest success in XR today, both in AR and VR applications. It remains to be seen whether Magic Leap can successfully attack this market like many others.
- Apple’s Vision Pro pre-orders start on Friday, and there’s already news that some of the most popular streaming platforms, like Netflix and Spotify, will not have native apps or allow iPad apps to be used in the Vision Pro at launch. None of the 46 most popular apps on the App Store will have a native VisionOS version at launch. This may be the most concerning
part of the Vision Pro launch and may hurt the value of the device. This feels like a major miss from Apple and its developer relations team.
- The Samsung Galaxy S24 line launched this week, and the company heavily focused on Galaxy AI and the new design for the S24 Ultra. I like what Samsung has done with the new flatter screen and Titanium body, but most of the hardware changes are incremental with a Snapdragon 8 Gen 3 and upgraded Telephoto sensor. Galaxy AI is the focus of this launch with its many AI features, but I feel this is just phase one of Galaxy AI, especially since it will be coming to other devices. I am not sure about Samsung charging for Galaxy AI features after 2025. That’s a major miss for building recognition as a leader in AI.
- As part of Samsung’s launch, Google announced my favorite part of Galaxy AI, which is not exclusive to Samsung. Circle to Search is a compelling AI feature that will launch simultaneously on the Pixel 8 and Pixel 8 Pro on January 31. I think this feature will change how people search, and I welcome a significant improvement in the way people search images, which has long since felt antiquated.
- T-Mobile once again destroys the competition in 5G speeds, this time pulling away from the competition with Ookla reporting median download speeds of 188.96 Mbps while Verizon and AT&T sit at about 90 Mbps, effectively less than half of T-Mobile’s speeds. Many thought T-Mobile would lose its lead at the end of the year with Verizon and AT&T’s mid-band rollouts. Still, T-Mobile has proven its network is far more resilient and faster than anticipated. It continues gaining customers while increasing speeds, which is unheard of in most MNO scenarios.
- Bethesda (now Microsoft) is releasing a new Indiana Jones first-person game, driving a lot of excitement around new IP, which the gaming industry desperately needs. Hopefully, this will do well for Bethesda and drive more demand for better and faster PCs.
- Apple has implemented a 27% fee to use outside payment processing, which has angered many of its critics who find this to be a dishonest implementation of its obligations to the court from its lawsuit with Epic Games. I do believe that this will only strain relations with
developers further and create more friction for the industry.
- Samsung is making a smart ring. We don’t know much about it, but it sounds like it will be fairly competitive with the existing products in the market. It will likely have a good experience thanks to Samsung’s experience with its smartwatches and huge successes there. I believe that I’d like to wear one myself, especially since I’m already using a Galaxy Watch6 Classic every day, and a smart ring would be a great way to monitor my sleep without wearing a watch
Quantum Computing (Paul Smith-Goodson)
- IonQ’s Forte quantum computer has successfully achieved 35 Algorithmic Qubits. The achievement is a year ahead of schedule. It was accomplished by optimizing the entire quantum computing stack. Also, new detection optics were designed and installed to accurately image and measure the longer qubit chain. The #AQ benchmark is based on achieving higher and higher performance on an application-based benchmark that is representative of the most promising commercial algorithmic approaches. At #AQ 35, IonQ’s systems will be useful in running quantum applications, such as quantum machine learning and quantum chemistry. This achievement is a significant milestone for IonQ and the quantum computing industry.
- Honeywell (NASDAQ: HON) announced a $300 million equity fundraising for Quantinuum, valuing it at $5 billion pre-money. This is Quantinuum’s first since it merged with Cambridge Quantum in 2021. The fund was led by JPMorgan Chase, with investments from Mitsui & Co., Amgen, and Honeywell, which remains the majority shareholder. This investment increases Quantinuum’s total capital to around $625 million.
- The funds will be used to develop a fault-tolerant machine and enhance Quantinuum’s commercial software offerings. JPMorgan Chase has collaborated with Quantinuum since 2020, utilizing its H-Series quantum processor and software development kit, TKET.
- I expect to see new hardware in a month or two. Quantum advantage must be close behind.
Security (Will Townsend)
- Zscaler recently announced the security industry’s first zero-trust SASE solution. The company is leveraging its mature cloud-based Zero-Trust Exchange Platform to extend access beyond users to protect device and server traffic at branches and within operational technology environments. Unsurprisingly, Zscaler employs an adaptive AI engine to assess risk and incorporate telemetry to strengthen security. It is differentiated, which is significant given the number of companies offering SD-WAN services that merge security functionality.
- Generative AI darling OpenAI is working with the U.S. military to develop new cybersecurity tools and a ChatGPT-based solution to reduce veteran suicides. There is widespread concern that AI tools can weaponize military operations, and OpenAI remains steadfast in not doing so. Still, the opportunity to leverage AI to combat threats and ransomware and do so in the name of national defense is compelling if guardrails are established to ensure it is done so ethically and responsibly.
- Is 2024 The Year Of Low Earth Orbit Satellite Services? By Will Townsend
- Microsoft Uses AI And HPC To Analyze 32 Million New Materials, by Paul Smith-Goodson
- Copilots And Chatbots Will Make Jobs Easier, Not Eliminate Them, by Melody Brue
- My Favorite Phones Of 2023: Something For Everyone, by Anshel Sag
Research Notes (MI&S)
- RESEARCH NOTE: AMD Goes Mainstream at CES 2024, by Anshel Sag
- RESEARCH NOTE: Marvell’s Opportunity to Capitalize on Three Trends in Optical Networking, by Will Townsend
- RESEARCH NOTE: Why 2024 Will Be A Banner Year for Nutanix, by Matt Kimball
- RESEARCH NOTE: Samsung Injects The New Galaxy S24 Line With Galaxy AI, by Anshel Sag
- RESEARCH NOTE: Dynatrace Elevates Data Observability and Monitoring with AI Automation, by Robert Kramer
- RESEARCH NOTE: Appian Brings AI Automation to ERP and SCM Data, by Robert Kramer
- RESEARCH NOTE: NVIDIA GeForce Gaming at CES 2024 — Lots of GPUs and AI, by Anshel Sag
Blogs Published (MI&S)
- RESEARCH PAPER: Intel’s AI Strategy, Offerings, And Differentiation, by Patrick Moorhead
- RESEARCH PAPER: Accelerating Innovation Begins With Data, by Matt Kimball
The G2 on 5G by Moor Insights & Strategy, with Anshel Sag and Will Townsend
- John Deere Starlink, Samsung Unpacked, NTT DoCoMo Open House, T-Mo WV, LRCA Private Cellular
- The G2 on 5G Podcast – Helium Mobile, T-Mo 6x CA, Ericsson Aussie AgTech, SpaceX Launches for D2D
The Six-Five Podcast by Moor Insights & Strategy and Futurum Research, with Patrick Moorhead and Daniel Newman
- Ep 201: We are Live! Talking Intel and UMC, IBM, SAP, ServiceNow, Apple, Intel
- Intel Automotive – Intelligence on the Road
- Ep200: We are Live! Talking Davos 2024, Samsung Unpacked, TSMC, IBM, Synopsys, Intel & DigitalBridge
- The Six Five Insider with Christina Montgomery, VP and Chief Privacy & Trust Officer at IBM
- Toyota Partners with IBM to Build a Customer Centric Supply Chain
- Samsung SDS America Optimizes Cloud Spend Through Automation with IBM
- Ep199: We are Live! Talking CES, Memory Market, Arm, HPE, Mobileye, GenAI
Moor Insights & Strategy Podcasts, with Patrick Moorhead, Melody Brue, CP Smith-Goodson, Matt Kimball, and Will Townsend.
- We’re LIVE for Episode 15 of the MI&S Hot Desk Podcast
- Ep17: Datacenter Podcast: NVIDIA & Equinix, Zscaler, Quantinuum, Oracle, Frontier & Nile
- We’re LIVE for Episode 14 of the MI&S Hot Desk Podcast
- Ep16 of the MI&S Datacenter Podcast: We’re Talking AWS, HPE, AI & Quantum, Nutanix, Cisco, AI 2023
- Apple / VR / Anshel Sag / https://news.yahoo.com/netflix-youtube-spotify-snub-apples-192605589.html
- Apple Vision Pro / Patrick Moorhead / https://www.wiwo.de/my/unternehmen/it/vision-pro-gelingt-apple-mit-seiner-brille-woran-google-und-microsoft-scheiterten-/29612918.html
- Arm / Blackhawk / Patrick Moorhead / https://winbuzzer.com/2024/01/12/arm-reveals-plans-for-blackhawk-core-aims-to-outperform-iphone-cpus-xcxwbn/
- Arm / Blackhawk / Patrick Moorhead / https://www.techpowerup.com/317948/arm-confirms-existence-of-next-gen-cortex-x-blackhawk-unit
- Arm / Blackhawk / Moor Insights & Strategy research company / https://www.vietnam.vn/en/hieu-nang-tren-nhung-smartphone-android-sap-vuot-mat-iphone/
- B2B transactions in the cloud / Patrick Moorhead / https://www.fastcompany.com/91009968/reimagining-b2b-transactions-in-the-cloud
- CES / AI / Anshel Sag / https://news.futunn.com/en/post/36584097?level=1&data_ticket=1705680028911426
- Cohesity / Azure OpenAI / Patrick Moorhead / https://www.cohesity.com/solutions/responsible-ai/
- Galaxy / Smart Rings / Anshel Sag / https://www.androidcentral.com/wearables/samsung-galaxy-ring-has-huge-potential-but-also-huge-roadblocks
- Intel / AI & Chip / Patrick Moorhead / https://www.crn.com/news/components-peripherals/2024/intel-q4-earnings
- NVIDIA / AI & Chip / Patrick Moorhead / https://nz.finance.yahoo.com/news/nvidias-rivals-are-circling-but-theyre-still-years-from-catching-up-211621835.html
- Qualcomm / Meta / Anshel Sag / https://www.hpcwire.com/2024/01/25/metas-zuckerberg-puts-its-ai-future-in-the-hands-of-600000-gpus/
- Synopsys / Chip / Patrick Moorhead / https://venturebeat.com/ai/synopsys-agrees-to-buy-system-design-firm-ansys-for-35b/
- Xreal / Air 2 Ultra / Anshel Sag / https://www.computerworld.com/article/3712164/2024-will-be-a-big-year-for-ar-vr-but-mainstream-adoption-will-lag.html
New Gear or Software We are Using and Testing that is Public Knowledge
- Alienware Aurora R16 Desktop PC
- Bang & Olufson Cisco 950 Wireless Earbuds
- HP Poly Studio P15 Video Bar
- Varjo Aero 2
- Ziyun Weebill 3S
Events MI&S Plans on Attending In-Person or Virtually (New)
- January 2024
- AWS Gen AI Jan 31 (virtual) (Robert Kramer)
- Dynatrace Perform, Las Vegas, Jan 31-Feb 1, 2024 (Robert Kramer)
- February 2024
- ZohoDay 2024, McAllen, TX, February 6-8 (Melody Brue)
- Iron Mountain Speaking Engagement, Los Angeles, Feb 15, (Matt Kimball)
- MWC 2024, Barcelona, February 26-29 (Patrick Moorhead, Will Townsend -in person, Anshel Sag – virtual)
- NVIDIA GTC, March 18-21 (Anshel – in person, Matt Kimball – virtual)
- Intel IFS Direct, San Jose, Feb 21 (Anshel Sag)
- Mobile World Congress, Barcelona, February 24-29th (Patrick Moorhead, Anshel-virtual, Will Townsend)
- RingCentral Analyst Summit, Bay Area, February 26-28 (Melody Brue)
- 8X8 Industry Analyst Summit, San Diego, February 29 (Melody Brue)
- March 2024
- Salesforce TDX Analyst Conference, San Fran, March 5-7 (Robert Kramer)
- Connected Americas, Dallas, March 12-13 (Will Townsend)
- GTC 2024, San Jose, March 17-19 (Anshel Sag)
- Enterprise Connect, Orlando, March 25 (Melody Brue)
- ElasticON Tour March 26, New York (Robert Kramer- TBD)
- Adobe Summit, March 26-28, Las Vegas (Melody Brue – hybrid, Robert Kramer)
- April 2024
- Fortinet Accelerate, Las Vegas, April 1-5 (Will Townsend)
- Intel Vision, Phoenix, Apr 8-9 (Matt Kimball)
- Google Next, Las Vegas, April 9-11 (Robert Kramer)
- NTT Upgrade, San Francisco, April 10-11 (Will Townsend)
- Appian World, Wash DC, April 15-17 (Robert Kramer)
- Datacenter World, DC, Apr 15-18, (Matt Kimball)
- Oracle Analyst Database Summit, San Francisco, April 24 (Robert Kramer, Matt Kimball)
- May 2024
- RSA Conference, San Francisco, May 6-9 (Will Townsend)
- International Super Computing, Hamburg, May 12-16 (Matt Kimball)
- Blue Yonder, Dallas, May 13-15 (Robert Kramer)
- Informatica World, Las Vegas, May 20-23 (Robert Kramer)
- IBM Think, Boston, May 20-23 (Paul Smith-Goodson, Robert Kramer)
- Dell Tech World, Las Vegas, May 20-23 (Matt Kimball)
- Nutanix .NEXT, May 21-24, Barcelona (Matt Kimball)
- June 2024
- SAP Sapphire, Orlando, June 3–5 (Melody Brue, Robert Kramer)
- Snowflake, San Francisco, June 3-5 (Robert Kramer)
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- Patrick Moorhead, Founder, CEO, Chief Analyst; Broad technology coverage plus deep insights into Cloud, Enterprise SaaS & Semiconductors.
- Melody Brue, Principal Analyst, Modern Work, HR Tech, Marketing Tech/CRM, Sustainability
- Bill Curtis, Analyst In-Residence, IIoT, and Deep IoT Technology
- Matt Kimball, Principal Analyst, Datacenter Compute & Storage, AI Semiconductors
- Robert Kramer, Principal Analyst, Enterprise Data Technologies, ERP/SCM
- Anshel Sag, Principal Analyst; Personal Computing
- Paul Smith-Goodson, Principal Analyst; Machine AI Frameworks, Models, Tools and Quantum Computing
- Will Townsend, Principal Analyst; Security, Carrier Services, Networking