Microsoft – Brankrupt of New Ideas?


ms_masthead_ltrMicrosoft has launched its new product “Bing”, which is supposedly a new search engine. From a product positioning standpoint, it appears that it designed to compete with Google’s search engine. I do not know the nuances of Bing’s capability, and I do not intend to make a relative comparison for pros and cons. In this product launch what caught my attention is the amount of money being spent on its branding exercise, its promotions, its marketing, etc. Media reports suggest that Microsoft has allocated $80million to $100million for this exercise.

In my post on opportunities of technology dividends, I had mentioned that I am wary of Microsoft’s habit of squandering cash in meaningless acquisitions (i.e. meaningless projects). I believe this is a perfect example of squandering cash on meaningless projects. continue reading rest of the article….

Opportunities for Technology Dividends

This article originally appeared on The DIV-Net, March 25, 2009.

Standard and Poor’s “S&P North American Technology Sector Index” (henceforth referred as Tech index) is widely used to benchmark the technology sector in North America. As of February 2008 the Tech index had a weightage of approximately 20% to 23% in overall S&P500 index.

The Tech index represents different sub sectors that include hardware (20 companies), internet (21 companies), multimedia networking (27 companies), semiconductors (43 companies), services (31 companies), and software (40 companies). This is a total to 182 companies in the Tech index. However, similar to any market capitalization based index, Tech index is also top heavy. The cumulative weightage for top 10 companies is approximately 64%, for top 20 companies it is approximately 79%, while top 30 companies it is approximately 86%. The table below shows top 30 companies including the annual per share dividends. There are 17 companies out of top 30 companies that pay quarterly dividends. continue reading rest of the article….

Demise of Dollar – Does it Affect Dividend Growth?

A quick and simple answer is, no it does not affect dividend growth if dividend investors understand what it really means.

Corporations pay dividends from the combination of profitability, cash flow, income, prudent money management, etc. With the current state of economy in United States (and other parts of the world) majority of the corporations are facing negative growth. In such a scenario where will dividend growth come from? In these challenging environment dividend investors need to look at the macro economic scenario and understand how it will play out in long haul over a period of next 10 years, 20 years, or 30 years.

We read a lot about demise of US dollar. At a very fundamental level, which country’s currency becomes a global currency will depend upon political maturity and economic stronghold at global level. continue reading rest of the article….

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