Looking for Signs That Apple’s Runaway Growth Is Waning

Looking for Signs That Apple's Runaway Growth Is Waning

Investors have long relied on Apple to deliver one crucial attribute: growth. Now they are beginning to wonder whether Apple’s days as a growth stock are coming to an end.

With sales increases of Apple’s prime product, the iPhone, projected to decelerate, and no clear new blockbuster device on the horizon, the era of the company’s producing 50 or 60 percent annual revenue growth may be on the wane. When Apple reports earnings Tuesday, investors will be scouring the results for signs of how fast that downshift is happening.

Already, some investors have begun to treat Apple in a new way: as a “value” stock, a label typically attached to companies that generate predictable business results or a reliable dividend, rather than ones that deliver runaway revenue growth. Value stocks often command much lower valuations than growth stocks.

“People were in love with Apple because hits like the iPod and iPhone created phenomenal growth,” said Ernesto Ramos, a fund manager at BMO Global Asset Management, which manages $18 billion and counts Apple as its largest holding. “As investors shifted their minds around the fact that it’s no longer going to deliver the same sort of huge growth over the next five years, the stock became a value play.”

Ramos says his firm still owns Apple in some of its growth funds, but it began including the stock in value funds in mid-2013.

The change has important implications for Apple. While a technology-sector company like Netflix is regarded as a growth stock because its revenue grew 22.8 percent in the most recent quarter from the previous year, value stocks include aging tech giants like Cisco, Oracle and Intel. Being lumped in with those behemoths would be a perception shift for Apple.

Beyond that, switching from being a growth stock to being a value stock can be a long and painful process. Growth investors need to sell a company’s shares and drive down the price until it is low enough to tempt value investors, who buy stocks they think are cheap compared with the intrinsic value of the company. In the tech industry, a shift from growth to value also often signals to investors that a company is facing newer competitors with more innovative products, raising the question of how relevant the company can remain.

“Investors don’t like to see the words tech and value combined because when growth slows at a tech company, it usually means that something essentially is not working,” said Angelo Zino, a senior analyst at the research firm S&P Capital IQ.

A spokeswoman for Apple declined to comment.

Any change would have repercussions beyond Apple because its soaring performance in recent years helped lift the broader market. If Apple shares were removed from the equation, the performance of the Standard & Poor’s 500-stock index in five of the last seven years would drop by about 1 percentage point, according to data from S&P Dow Jones Indices. In 2014, for instance, the index rose 13.7 percent with Apple and 12.9 percent without Apple.

The Apple effect is even more pronounced when technology names are isolated. For tech stocks on the S&P 500 as a group, annual gain in 2009 declined by 6 percentage points when Apple shares were not included, dropping to 56 percent from 62 percent.

Apple’s effect became more muted last year as the company’s growth decelerated, according to the data.

Investors have turned to Facebook, Amazon, Netflix and Alphabet, which owns Google – collectively referred to as the FANG stocks – for growth. Those companies are each expected to show annual revenue gains of 23 to 40 percent for the last three months of 2015, while Apple is projected to deliver 3 percent revenue growth, according to Bloomberg data.

Ramos says companies like Amazon have bigger growth potential for his fund than Apple, though he plans to continue owning shares in the iPhone maker.

“Amazon will see about 20 percent revenue growth, and earnings per share are expected to jump considerably,” he said. “This is a very strong growth story.”

Apple’s shares have already been buffeted in recent months because of worries about the slowing economy in China, which the company counts as one of its largest markets. Half a dozen companies that provide parts for the iPhone also blamed weak demand from Apple for lower-than-expected earnings, causing worries about the company’s sales trajectory.

In total, Apple shares fell 4.7 percent in 2015. So far this year, they are down 3.7 percent, while the S&P 500 is down 6.7 percent. Alphabet is now within spitting distance of overtaking Apple as the world’s biggest company by market capitalization.

“If you wanted to outperform the market, the FANG stocks did better,” said Jonathan Krinsky, an analyst at the research and trading firm MKM Partners, though he added that Apple remained a must-watch stock because it composed such a large part of many stock indexes.

Investors may still someday reanoint Apple as a growth stock, especially if the company can create a best-selling new product that drives up its sales rate. Wall Street analysts cite Microsoft as an example of a business that lost steam and then made the adjustments necessary to deliver strong revenue growth again.

And Apple may have some product aces up its sleeve. The company entered wearable computing last year with the Apple Watch. Apple is also trying to become a dominant software platform in the auto industry and is working on a car. (An executive who was overseeing the car project, Steve Zadesky, is leaving the company for personal reasons, according to a person with knowledge of the matter, who asked to remain anonymous because the details are private. The Wall Street Journal earlier reported on the departure.)

Apple has been reclassified as a value stock before. FTSE Russell, which makes several closely followed stock indexes, found in 2013 that Apple no longer met its criteria to be treated purely as a growth stock. Some of the company’s enormous market capitalization was reallocated to the Russell Value Index, as well as being in the Russell Growth Index. A year later, when the company’s sales had risen strongly with the introduction of the iPhone 6, FTSE Russell placed Apple solely back in the growth index.

Tom Goodwin, FTSE Russell’s senior research director, said that stock price, sales growth and analyst expectations determine whether a company is placed in the growth or value index, or in both. About a third of the stocks that Russell tracks are included in both indexes, he said.

But until Apple reveals another hit or shows a significant pickup in iPhone sales growth, Apple should be viewed as a value-oriented name, said Zino of S&P Capital IQ.

“Historically Apple was the name to own if you wanted to outperform the market,” he said. “Now there are other places to look.”

[“Source-Gadgets”]

5 Net Neutral Apps That Give You Free Mobile Internet Data

5 Net Neutral Apps That Give You Free Mobile Internet Data

Getting data access without spending money sounds great, but this usually involves some kind of catch. That’s why different platforms such as Airtel Zero and Facebook’s Free Basics triggered such a debate about net neutrality, and why zero rating (or making sites free to access) can be bad for the users. It’s been over a year since this debate really kicked off in India and the issues are still developing, but there are a number of apps on the market that are offering users free data, without any exclusivity or limitations. All these apps are for prepaid users. Here’s what we found:

1) Gigato
Probably one of the best known apps in the category, Gigato has been around for a while and allows users to “earn” data on the app, which can then be redeemed from your carrier. The way it works is simple – just install the Gigato app, and it will show you a number of apps you can try or use to earn data. The earned data is usually a little higher than the used data, so although the initial usage is cut from your data plan, you come out ahead. For example, you could use 20MB of mobile data on WhatsApp or Twitter, and earn 25MB which can be redeemed from your carrier.

When you launch the app, you can see a list of supported apps you already have on your phone, and Gigato will also recommend other apps you can install to get data benefits. Since Gigato includes many popular apps, it probably won’t require you to change your habits to get a little extra cash on the side, which is great.

gigato_app_splash.jpgWhen installing Gigato, you give it permission to check your apps, so it can see how much mobile data is being used by its ​partners​, and give you rewards accordingly. Based on user and expert reports ​online​, it doesn’t seem that Gigato snoops on your data to see what you are doing on the Internet, so it should be without any privacy concerns, but it’s certainly something you should be aware of.

Get Gigato on Google Play, free.

2) Earn Talktime
The Earn Talktime app is pretty similar to Gigato in that it incentivises you to use different apps, but the way it works is a little different. While Gigato gives you recharges for using mobile data on apps, Earn Talktime pays out money which can be used to pay for prepaid recharges when you download apps.

So, you can make Rs. 5 if you download the Droom app, or Rs. 20 to download Myntra. Downloading Lybrate and then asking one question on the app will earn you Rs. 50.

earn_talktime_screens.jpgYou also earn money for referring friends, and you can then use this to recharge your data via your mobile operator. From what we’ve found through searching online, there have been no reports of privacy problems with this app, and our own usage showed that it works without any real problems, but considering that Earn Talktime incentivises specific actions you should be aware of potential privacy concerns with this kind of app.

Get Earn Talktime on Google Play, free.

3) Paytunes
While Gigato or Earn Talktime need you to actively do different things to earn talk time, the Paytunes app replaces your ringtone with advertisements and you’re paid for each call that you get. There are some checks in place to keep people from gaming the system, but for users, Paytunes actually fits into the day to day flow of actually using your phone.

paytunes_splash.jpgThe payouts aren’t very high – you have to answer at least three calls to get 1 Rupee worth of points in the app, but even if you get around 15 calls in a day, that works out to a payout of Rs. 150 per month, which can be used to recharge your data pack, or pay other bills via MobiKwik.

Get Paytunes on Google Play, free.

4) My Ads (India)
Watch an ad, and then answer a few simple questions and you earn money. The concept is so simple that it doesn’t really need to be explained. You can watch the ads over Wi-Fi, and don’t need to download or use any other apps. It’s just like the apps you watch on TV, except that here, you aren’t forced to watch an ad in the middle of your shows, it’s just something you’re doing for a little talk time.

myads_india_app.jpgIt’s not the most convenient way to consume ads, but getting paid Rs. 8 to watch a 45-second ad sounded reasonable enough to us. That money can then be used to recharge your phone, so you can use the money for mobile data.

Get my ADs (India) on Google Play, free.

5) Recharging your phone
Apps like Freecharge, Paytm, or Mobikwik or Airtel Money, just about every app that allows you to recharge your phone online also offers special deals and cashbacks. This means that when you’re recharging your phone, using any of these apps can get you a great deal. The specific deals vary on a day to day basis, so keep one or two of the apps you liked the most installed on your phone, and check these before hitting the recharge button to save a little more money.

paymobicharge_app.jpgThese are the five methods of getting free Internet access we found that worked. Have you tried any of these? What was your experience like? Tell us about that, or any other similar apps you liked, via the comments.

[“Source-Gadgets”]

Behind the Scenes of Face Swap Live, the ‘Creepy’ App That Launched a Thousand Memes

Behind the Scenes of Face Swap Live, the 'Creepy' App That Launched a Thousand Memes

When I smile, Hilary Clinton smiles back. When I raise an eyebrow, hers lifts in unison, like a bizarre game of Simon Says. When I grimace, the wrinkles on her forehead deepen, her lips crinkling and pursing to one side.

Thanks to the wonders of computer vision and a goofy new app called Face Swap Live, I am controlling Hilary’s face – with nothing more than the expression on mine.

If you haven’t yet experienced the viral, nightmarish joys of Face Swap Live, it’s well worth the 99 cents it’s currently selling for. Download the app and point your phone’s camera at a friend, and it will convincingly map their face, in real time, onto someone else’s: yours, a baby’s, Beyonce’s, Richard Nixon’s.

Since appearing in the app store about a month ago, the app hasn’t strayed far outside of Apple’s most-downloaded offerings, peaking in the United States. at No. 14. And while the technology isn’t perfect – the app’s first truly ubiquitous meme was a disastrous face-swap between a dad and his baby – the results are lifelike enough, enough of the time, that the “Today” show dubbed it “Kafkaesque” and the Daily Dot called it “creepy.”

“It’s a lot of fun,” said Jason Laan, one of the app’s two creators. “But behind the fun, there’s some really amazing, hardcore technology.”

Laan, a chemical engineer by training, has a long history of turning serious tech to more frivolous purposes: In the eight years since he founded his app development firm, Laan Labs, he estimates that they’ve launched around 50 products, from Tap DJ (“mix and add FX to your iPod music!”) to Dog Vision HD (“see the world how your dog sees it!”).

But for Laan, computer vision – the science of training computers to extract and understand information from pictures, the same way humans do – has always possessed a special intrigue. Researchers at places like Google and IBM, with their extraordinary 3-D cameras and lightning-fast processing speeds, had enabled computers to catalog objects, recognize faces and even interpret feelings. Laan and his partner, Will Perkins, began wondering if the iPhone’s improving camera and processing capabilities would allow them to try out similar projects, albeit less seriously.

So late last winter, Face Swap Live was conceived. The app that has since launched a thousand YouTube videos, Imgur posts and nightmare memes.

Face-swapping makes a pretty ideal consumer application for the new computer vision tools, incidentally. While the technology is novel, the art form is not: Know Your Meme traces the first instances back to the early aughts, when the visages of an eccentric Vietnamese singer and and a 16-year-old Chinese kid began showing up on other bodies and in other places.

In 2004, the Something Awful forums fatefully began switching the faces of babies and their grandparents. It was an onerous Photoshop process, a labor of lolz, if you will: isolating the faces manually; copying, moving and rotating them; blending and feathering the mismatched edges until the heads and bodies fit. Even all that work made for some pretty unholy collages: The babies’ heads pixelated, over-large; the grandparents’ shrunken and neckless.

“Wasn’t that (expletive) creepy?” exclaimed an SA writer in 2004. “Now I have to go to bed … Oh, the dreams I’m going to have.”

But the appeal of the face-swap has always been its weirdness – the degree to which it inverts and diverges from reality. The best face-swaps are also the most surreal: Tom Cruise as Jack Nicholson, Barack Obama as George Bush, Nicholas Cage as literally everybody.

“There’s something about absurdity that gives Internet memes a lot of traction,” said Britney Summit-Gil, a doctoral student at Rensselaer Polytechnic Institute who studies Reddit culture. “Absurdity has a long, storied history of entertaining humans.” And it’s not so different from awe, she says – one of our more viral emotions.

Oddly enough, however, we’re moving closer to a world where face swaps are both less “awesome,” in the sense of inspiring wonder, and less obviously absurd. Thanks to innovations like the ones that spurred Face Swap Live, face-swapping no longer requires any time at all, to say nothing of expensive editing software and human effort.

Just look at how fast Face Swap Live is, an accomplishment Laan and Perkins credit to a basket of cutting-edge algorithms. When they look at your face, they simply look for reference points – the corners of your eyes where the color changes, the curve of your chin – and then line them up with those points on another face, auto-smoothing and blending them in.

With better cameras, Laan and Perkins say (3D cameras, particularly, like the ones Intel just unveiled atCES), our smartphones could do far more than copy-paste a face. Already, Disney is working on a technology that can map your face down to its individual wrinkles. At Stanford University and Germany’s Max Planck Institute, researchers have developed a technique that photorealistically transfers one person’s facial expressions to another – not face-swapping, in the traditional sense, but face-hijacking via algorithm.

These researchers believe we’re moving closer to a world where remote workers can Skype into meetings half-clothed, their faces mapped onto a body in a business suit. They suspect we’ll be able to tweak actors’ bad takes and zap unsuspecting bystanders from live TV news.

Far outside the realm of face-swapping, real-time computer vision – particularly of human bodies and faces – will enable a million other technologies: self-driving cars, diagnostic computers, robots that understand emotions and react accordingly. We won’t even delve into the more dystopian applications, like live video-manipulation or mass surveillance.

I ask Perkins and Laan about that, because it’s seems odd: a silly app that advances a promising, and ominous, technology. Do they contemplate the juxtaposition at all, I wonder?

“We just want to have fun,” Laan says. Then they both laugh nervously.

[“Source-Gadgets”]

The New Way Police Are Surveilling You: Software That Calculates Your Threat ‘Score’

The New Way Police Are Surveilling You: Software That Calculates Your Threat 'Score'

While officers raced to a recent 911 call about a man threatening his ex-girlfriend, a police operator in headquarters consulted software that scored the suspect’s potential for violence the way a bank might run a credit report.

The program scoured billions of data points including arrest reports, property records, commercial databases, deep Web searches and the man’s social media postings. It calculated his threat level as the highest of three color-coded scores: a bright red warning.

The man had a firearm conviction and gang associations, so out of caution police called a negotiator. The suspect surrendered, and police said the intelligence helped them make the right call – it turned out he had a gun.

As a national debate has played out over mass surveillance by the National Security Agency, a new generation of technology such as the Beware software being used in Fresno has given local law enforcement officers unprecedented power to peer into the lives of citizens.

Police officials say such tools can provide critical information that can help uncover terrorists or thwart mass shootings, ensure the safety of officers and the public, find suspects and crack open cases. They say that last year’s attacks in Paris and San Bernardino, Calif., have only underscored the need for such measures.

But the powerful systems also have become flash points for civil libertarians and activists, who say they represent a troubling intrusion on privacy, have been deployed with little public oversight and have potential for abuse or error. Some say laws are needed to protect the public.

In many instances, people have been unaware that the police around them are sweeping up information, and that has spawned controversy. Planes outfitted with cameras filmed protests and unrest in Baltimore and Ferguson, Mo. For years, dozens of departments used devices that can hoover up all cellphone data in an area without search warrants. Authorities in Oregon are facing a federal probe after using social media-monitoring software to keep tabs on Black Lives Matter hashtags.

“This is something that’s been building since September 11,” said Jennifer Lynch, a senior staff attorney at the Electronic Frontier Foundation. “First funding went to the military to develop this technology, and now it has come back to domestic law enforcement. It’s the perfect storm of cheaper and easier-to-use technologies and money from state and federal governments to purchase it.”

Few departments will discuss how – or sometimes if – they are using these tools, but the Fresno police offered a rare glimpse inside a cutting-edge $600,000 nerve center, even as a debate raged in the city over its technology.

An arsenal of high-tech tools
Fresno’s Real Time Crime Center is the type of facility that has become the model for high-tech policing nationwide. Similar centers have opened in New York, Houston and Seattle over the past decade.

Fresno’s futuristic control room, which operates around the clock, sits deep in its headquarters and brings together a handful of technologies that allow the department to see, analyze and respond to incidents as they unfold across this city of more than 500,000 in the San Joaquin Valley.

On a recent Monday afternoon, the center was a hive of activity. The police radio crackled over loudspeakers – “subject armed with steel rod” – as five operators sat behind banks of screens dialing up a wealth of information to help units respond to the more than 1,200 911 calls the department receives every day.

On 57 monitors that cover the walls of the center, operators zoomed and panned an array of roughly 200 police cameras perched across the city. They could dial up 800 more feeds from the city’s schools and traffic cameras, and they soon hope to add 400 more streams from cameras worn on officers’ bodies and from thousands from local businesses that have surveillance systems.

The cameras were only one tool at the ready. Officers could trawl a private database that has recorded more than 2 billion scans of vehicle licenses plates and locations nationwide. If gunshots were fired, a system called ShotSpotter could triangulate the location using microphones strung around the city. Another program, called Media Sonar, crawled social media looking for illicit activity. Police used it to monitor individuals, threats to schools and hashtags related to gangs.

Fresno police said having the ability to access all that information in real time is crucial to solving crimes.

They recently used the cameras to track a robbery suspect as he fled a business and then jumped into a canal to hide. He was quickly apprehended.

The license plate database was instrumental in solving a September murder case, in which police had a description of a suspect’s vehicle and three numbers from the license plate.

But perhaps the most controversial and revealing technology is the threat-scoring software Beware. Fresno is one of the first departments in the nation to test the program.

As officers respond to calls, Beware automatically runs the address. The searches return the names of residents and scans them against a range of publicly available data to generate a color-coded threat level for each person or address: green, yellow or red.

Exactly how Beware calculates threat scores is something that its maker, Intrado, considers a trade secret, so it is unclear how much weight is given to a misdemeanor, felony or threatening comment on Facebook. However, the program flags issues and provides a report to the user.

In promotional materials, Intrado writes that Beware could reveal that the resident of a particular address was a war veteran suffering from post-traumatic stress disorder, had criminal convictions for assault and had posted worrisome messages about his battle experiences on social media. The “big data” that has transformed marketing and other industries has now come to law enforcement.

Fresno Police Chief Jerry Dyer said officers are often working on scant or even inaccurate information when they respond to calls, so Beware and the Real Time Crime Center give them a sense of what may be behind the next door.

“Our officers are expected to know the unknown and see the unseen,” Dyer said. “They are making split-second decisions based on limited facts. The more you can provide in terms of intelligence and video, the more safely you can respond to calls.”

But some in Fresno say the power and the sheer concentration of surveillance in the Real Time Crime Center is troubling. The concerns have been raised elsewhere as well – last year, Oakland city officials scaled back plans for such a center after residents protested, citing privacy concerns.

Rob Nabarro, a Fresno civil rights lawyer, said he is particularly concerned about Beware. He said outsourcing decisions about the threat posed by an individual to software is a problem waiting to happen.

Nabarro said the fact that only Intrado – not the police or the public – knows how Beware tallies its scores is disconcerting. He also worries that the system might mistakenly increase someone’s threat level by misinterpreting innocuous activity on social media, like criticizing the police, and trigger a heavier response by officers.

“It’s a very unrefined, gross technique,” Nabarro said of Beware’s color-coded levels. “A police call is something that can be very dangerous for a citizen.”

Dyer said such concerns are overblown, saying the scores don’t trigger a particular police response. He said operators use them as guides to delve more deeply into someone’s background, looking for information that might be relevant to an officer on scene. He said officers on the street never see the scores.

Still, Nabarro is not the only one worried.

The Fresno City Council called a hearing on Beware in November after constituents raised concerns. Once council member referred to a local media report saying that a woman’s threat level was elevated because she was tweeting about a card game titled “Rage,” which could be a keyword in Beware’s assessment of social media.

Councilman Clinton J. Olivier, a libertarian-leaning Republican, said Beware was like something out of a dystopian science fiction novel and asked Dyer a simple question: “Could you run my threat level now?”

Dyer agreed. The scan returned Olivier as a green, but his home came back as a yellow, possibly because of someone who previously lived at his address, a police official said.

“Even though it’s not me that’s the yellow guy, your officers are going to treat whoever comes out of that house in his boxer shorts as the yellow guy,” Olivier said. “That may not be fair to me.”

He added later: “(Beware) has failed right here with a council member as the example.”

An Intrado representative responded to an interview request seeking more information about how Beware works by sending a short statement. It read in part: “Beware works to quickly provide [officers] with commercially available, public information that may be relevant to the situation and may give them a greater level of awareness.”

Calls for ‘meaningful debate’
Similar debates over police surveillance have been playing out across the country, as new technologies have proliferated and law enforcement use has exploded.

The number of local police departments that employ some type of technological surveillance increased from 20 percent in 1997 to more than 90 percent in 2013, according to the latest information from the Bureau of Justice Statistics. The most common forms of surveillance are cameras and automated license plate readers, but the use of handheld biometric scanners, social media monitoring software, devices that collect cellphone data and drones is increasing.

Locally, the American Civil Liberties Union reports that police in the District, Baltimore, and Montgomery and Fairfax counties have cellphone-data collectors, called cell site simulators or StingRays. D.C. police are also using ShotSpotter and license plate readers.

The surveillance creates vast amounts of data, which is increasingly pooled in local, regional and national databases. The largest such project is the FBI’s $1 billion Next Generation Identification project, which is creating a trove of fingerprints, iris scans, data from facial recognition software and other sources that aid local departments in identifying suspects.

Law enforcement officials say such tools allow them to do more with less, and they have credited the technology with providing breaks in many cases. Virginia State Police found the man who killed a TV news crew during a live broadcast last year after his license plate was captured by a reader.

Cell site simulators or StingRays, which mimic a cellphone tower and scoop up data on all cellphones in an area, have been instrumental in finding kidnappers, fugitives and people who are suicidal, law enforcement officials said.

But those benefits have sometimes come with a cost to privacy. Law enforcement used cell site simulators for years without getting a judge’s explicit consent. But following criticism by the ACLU and other groups, the Justice Department announced last September that it would require all federal agencies to get a search warrant.

The fact that public discussion of surveillance technologiesis occurring after they are in use is backward, said Matt Cagle, an attorney for the ACLU of Northern California.

“We think that whenever these surveillance technologies are on the table, there needs to be a meaningful debate,” Cagle said. “There needs to be safeguards and oversight.”

After the contentious hearing before the Fresno City Council on Beware, Dyer said he now wants to make changes to address residents’ concerns. The police chief said he is working with Intrado to turn off Beware’s color-coded rating system and possibly the social media monitoring.

“There’s a balancing act,” Dyer said.

[“Source-Gadgets”]