[heading]7 Companies Apple Could Have Bought That Are More Innovative Than Beats[/heading]
What will come of Apple’s $160 billion stockpile? That question has grown murky since the 2011 passing of founder/CEO Steve Jobs. A little light was shed last week when a big announcement was made, and now some wonder: is Apple going to go on a spending spree? Is Silicon Valley about to hit it big, again, all thanks to Apple? Time will tell. What’s for sure? Apple has just made its biggest acquisition.
Apple (AAPL) is nearing a $3.2 billion acquisition to buy Dr. Dre’s Beats Electronics. Many have suggested reasons for the purchase, but nobody really knows. One occurring reason, the simplest explanation, is that Apple sells music, and people listen to music with headphones.
But were the headphones the best option for the company known for its cash stockpile?
Bitcoinomics isn’t so sure, and we would like to offer five different companies that Apple might have better spent its money on. In short, what the following suggestions have in common, is they are decentralized technologies.
Open Garden, Inc. is a free, closed source mobile application for Windows, Mac, Android and iOS. It enables peer-to-peer mobile internet connection sharing with faster data transmissions by automatically and actively choosing and switching to the best available network. Open Garden promotes open wireless networks and is a member of the Open Wireless Coalition, which was founded by the Electronic Frontier Foundation.
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This technology naturally scares mobile carriers. AT&T requested that Google Play block its customers access to Open Garden. A spokesperson stated that Open Garden violates company policies by enabling unauthorized tethering and mobile connection sharing. Open Garden’s founder and CEO, Micha Benoliel, stated this was a lie, and that his company does not do anything illegal.
By entering into the space of decentralized internet carriers, Apple could become the gatekeeper of the internet, above all other telecom companies, if it should use to use its power in such a way. Decentralized solutions are the wave of the future, current trends suggest.
As mass political protests swept across Brazil in June 2013, Miguel Freitas followed the news on Twitter. Tweets revealed information quicker than the mainstream media and even blogs. “Brazilian media is highly concentrated,” says Freitas, an engineer based in Rio de Janeiro. “I have been able to read news that a lot of friends never heard about.”
Freitas likes Twitter, believing it promotes democracy and allows protests to be organized in places like Brazil and the Middle East. He became gravely concerned when Edward Snowden leaked details about the US government’s massive surveillance of internet traffic and social networks. Freitas started building a new version of Twitter. It was to be a more secure and robust version of Twitter, using code from two other massively successful online projects: bitcoin and BitTorrent.
“As much as I like using Twitter for news reading, the possibility of a single entity being able to control this important flux of information made no sense to me,” he says.
Meet Twister – decentralized social network that theoretically cannot be shutdown by one entity. Furthermore, Twister is designed to prevent other users from knowing whether or not you’re online, your IP address, or who you follow. Just like Twitter, you can still post public messages, but when you send direct and private messages to others, they are protected using encryption. A test version of the app that runs on Android, Linux and OSX has been designed. The code is open source, so others can create a Windows or iPhone version.
Twister is simple to use for an app that is decentralized and emphasizes security. Alternatives to Twitter and Facebook, like Pump.io, Identica and Diaspora, have required that you operate your own dedicated server or trust someone else to run a server for you. Twister works instead like peer-to-peer file sharing software: Launch the app, it connects with other users. Hence, no need for a central server.
It uses the bitcoin protocol to achieve this. The protocol handles user registration and logins. Similar to how miners can verify transactions over the bitcoin network in order to make sure no one double-spends bitcoins and everyone only spends their own coins, a network of Twister computers verifies user names aren’t registered twice, and that posts attached to a particular user name are really coming from that user using. Handled through the BitTorrent protocol, posts themselves are distributed through the network quickly and efficiently, allowing users to receive near-instant notifications about new posts and messages, without the need for central servers.
Apple would do well spending some of its cash on such tech companies as Twister. It is a revolution in communications, like the internet itself, and goes beyond Twitter, which has had a dissapointing stock price since its IPO in 2013.
“We want to replace YouTube, Dropbox, Facebook, Spotify, ISPs, and more with decentralized apps based on proof of bandwidth,” stated Bitcloud, which aims to be a distributed autonomous corporation that hopes to “decentralize the current internet” so it can “create a new internet to replace it”.
That might sound high-fallutin’, but it is a sign of the times in which we live. Technology is changing everyday and in big and meaningful ways. Life is exciting. And the internet is going to look completely different in 5-10 years, in large part thanks to bitcoin.
One of the main philosophies of Steve Jobs was to keep Apple’s “powder dry.” That is, Jobs liked having a lot of cash on hand. But buying other companies is not the only option Apple has with that grip of cash.
Bitcoin has been around for the last 5 years and it has caught the attention of the world. Many people think bitcoin and think of something controversial, if not illegal almost. But the truth is, bitcoin is simply technology, and a technology that has changed the world already.
Buy obtaining bitcoins, Apple would merely be taking stock in a new technology. It would be like holding cash, but with much more volatility. The upside potential, however, could turn Apple into the biggest company on the planet. And all they would have to do is spend a small amount of their fortune on the bitcoins. It would also fit in with their philosophy to keep funds outside the US banking system.
5. Genesis Coin
GenesisCoin has developed a multi-featured bitcoin ATM. “Genesis Coin Inc. provides hardware and software solutions for digital currency markets, with plans to deploy 100 Bitcoin ATMs around the world by the third quarter of 2014. ”
Genesis Coin Inc. provides hardware and software solutions for digital currency markets, with plans to deploy 100 Bitcoin ATMs around the world by the third quarter of 2014.
The company is one of the more silent BitcoinATM companies, but has one of the more solid models.
Apple obviously is interested in getting into the online music market, symbolized by its purchase of Beats Electronics. But, if it wants to be out in front of the future of the music industry, it must look to the decentralized mediums such as many of the aforementioned businesses.
The vision for this project is about using the best aspects of peer-to-peer file-sharing technology often rightly called ‘super distribution’, and fusing that with the latest technology in digital payment systems, to radically change the way the technology has been applied so that ordinary people actually earn money by becoming the new distribution channel for digital music. In this way, Bittunes deals directly with the Music Piracy problem, with a carrot not a stick, rewarding artists fairly, and allowing users to potentially earn 5-10x profits on song purchases. To achieve this will not be easy, but the end result could be nothing short of revolutionary.
If Apple truthfully wishes to get into the music space, then something along these lines is clearly the answer.
Bitpay just struck it big with another $30 million investment after having Peter Thiel climb onboard earlier.
According to its website, BitPay will join CoinBase as a payment processor with zero fees. Currently, Coinbase is using the model towards a merchants’ first one million sales, after which merchants will pay 1% fees. BitPay’s new model, however, asks for $30 per month per merchant, with zero additional fees. This is unprecedented in payment processing space, and will certainly send shockwaves through various payment processing spaces.
Both BitPay and Coinbase represent the world’s first zero-fee payment processors, driving home how revolutionary modern payment methods are.
This certainly must make leading credit card companies nervous, considering their 3% fees and history of high fee debacles:
In July 2012, Visa, MasterCard and several major banks agreed to pay U.S. retailers a record $7.25 billion in penalties to settle a long-lasted lawsuit alleging the card giants conspired to fix so-called “swipe fees” paid by shops and supermarkets.
Swipe fees are levied on retailers for using their cards for each transaction. The fee is deducted by the card’s issuing bank.
To be certain, the news is bullish for the Bitcoin price, and will likely not make the impact it should via mainstream financial channels.
Apple can of course do with its money as it likes. But, in the modern technological environment, Beats Entertainment doesn’t exactly make the most impressive company for Apple’s biggest acquisition ever. Apple is trying to stay relevant to the younger generation, but it might do this more efficiently by venturing into decentralized technologies and not a rap artist who hasn’t released an album since “2001.”
At the end of the day, Beats Electronics $1 billion in revenue helped Apple make the decision.