Rebirth of England.

Chapter 633 New forces

"No matter what, Apple can't monopolize the smartphone market..."

As Barron spoke, Jobs also looked thoughtful.

Just as he said, although the sales of touch-screen smartphones from Apple and Honor Electronics have each exceeded 1000 million units this year, the mainstream of the market is still traditional feature phone brands such as Nokia, Motorola, and Samsung.

For example, Nokia, the current mobile phone "king", announced its third-quarter sales of nearly 1.2 million units, and its annual sales have steadily exceeded 4.6 million units, accounting for nearly 40% of the global mobile phone market share. The sales of Apple and Honor Electronics are beyond the reach of Nokia, let alone Samsung - as the world's second largest mobile phone manufacturer at this time, Samsung's market share has exceeded 16%.

Apple and Android are the future, but the future has not yet arrived. Therefore, at present, facing the more powerful traditional mobile phone manufacturers, Apple, Android and even Honor Electronics are all considered part of the "new forces" of mobile phones. Baron means that he does not want to see internal fighting among the "new forces" at this time - if they want to compete with each other, they can wait until Nokia, Motorola, Samsung and other "antiques" are driven into history...

As for the iPhone, it was not until the launch of iPhone 4 that it became a "street machine".

At present, IPhone 3G and Mate series phones have been praised by many users, but their user base is still relatively limited compared to the entire mobile phone market.

What's more, even among the "new forces" in smartphones, there are not only Apple and Android - whether it is Microsoft, which is more powerful but has a smaller market share than the other two in the mobile operating system field, or Google, which is about to join the chaos in the mobile operating system, both are probably more threatening to Apple than the "newcomer" Android.

It seems that this meeting between Barron and Jobs did have some effect.

Although Apple and Android did not reach any specific cooperation agreement in the end, they later reached a tacit understanding that they would carry out some "collaboration" in the field of touch-screen smartphones, and that patents in certain areas would be cross-licensed on an equal basis.

After all, in terms of patents, companies like Honor Electronics have already purchased patent licenses from Philips at high prices, and have not been "attacked" much by traditional mobile phone manufacturers. However, Apple has been involved in many patent lawsuits so far.

This is also the reason why three years later, they participated in the group acquisition of Nortel's patents.

……

"The employment situation in Silicon Valley is becoming increasingly severe. Many companies have gone bankrupt due to a broken capital chain. Even those that have survived have chosen to tighten spending by closing some projects and laying off employees..."

Accompanied by Ivanta, Barron went to Woaw's headquarters building in Silicon Valley.

Downstairs in the building, Barron looked around. Silicon Valley was still prosperous, but it was obvious that the expressions on the faces of the people passing by were much more solemn than they were a year or two ago.

"Compared to large companies, it is more difficult for start-ups, because although large companies like Woaw are subject to many restrictions, they at least still have some financing channels. However, for start-ups, it can be said that unless they are very promising and have the potential to become unicorns, it is already difficult for them to get money from venture capitalists..."

Because he manages IC Capital, Ivanta has a deep understanding of this. As a well-known investment company, IC Capital receives countless emails and visits from companies seeking investment every day...

And the attitudes and requirements of those start-ups have become lower and lower with the current economic situation...

"How is Woaw?" At this time, they had already entered the building. Barron, Ivanta, and Woaw's North American CEO Sage Byrne, along with a bodyguard, were in the same elevator. This time, Barron's questions were directed at Sage Byrne.

"The impact of the crisis also involves many aspects. The most important one is that our advertisers have become more cautious. Starting from the first quarter today, our advertising revenue has shown a trend of slowing growth, and the situation is getting worse. According to the latest data, the advertising revenue in the third quarter has dropped by more than 10% compared with the same period last year. It is foreseeable that the fourth quarter of this year will also be bad. Although we have used many methods to increase the enthusiasm of advertisers, but..."

Sage Byrne shrugged and said helplessly:

"The general market environment is like this. Other companies, including Google and Yahoo, are in similar situations... Yahoo's situation is even worse. They directly fired the previous CEO, and Yang Zhiyuan had to personally save the crisis again."

Sage was right. Seven years after the Internet winter in 2001, the Internet industry was affected by the subprime mortgage crisis and once again entered a freezing moment.

Woaw's situation is not simply caused by the decline in advertising revenue. On the one hand, in accordance with Barron's requirements, they have invested a lot of manpower in the development of mobile Internet. Whether it is Apple's iOS system or Android system, Woaw is one of the earliest Internet companies to actively develop its APP and optimize it.

But realistically speaking, the current market share of Apple and Android systems is far from what it will be in two or three years, and the returns they can bring to Woaw are limited.

In addition, in terms of research and development, Woaw has also been investing in the research and development of technologies such as cloud computing and streaming media. In these areas, the investment is relatively large. It can be said that a considerable part of the previous income has been invested in research and development. Although these technologies have achieved some results, it is still not time to generate profits.

Finally, there is YouTube. Last year, Woaw acquired YouTube from IC Capital. After acquiring this video sharing platform, Woaw also invested resources in YouTube, including a large amount of funds.

Of course, the effect is significant. The user growth of YouTube is very satisfactory, and there is good synergy between it and Woaw.com.

But for now, or for a long time to come, YouTube needs continued investment from Woaw, and its advertising revenue is far from covering the subsidies YouTube provides to its content creators. Baron also knows that this is necessary, and it is these content creators who ensure YouTube's competitiveness in the video platform field.

And as a video website, YouTube's operation also requires high broadband and maintenance costs, which are considerable expenses.

In his previous life, after Google acquired YouTube, it also continued to provide blood transfusions to it, and it took many years before it started to make a profit...

"As I said, a crisis is both a danger and an opportunity..."

Barron told Sage:
"Now is also an opportunity for Woaw to absorb some excellent personnel, and some start-ups that can complement Woaw can be acquired."

Whether it is the continued research and development or the support for projects such as YouTube, they are all layouts for the future of Woaw, so it is necessary to continue.

As for the funding aspect, Barron will solve this problem when he comes this time.

(End of this chapter)