So, Glass could be an important product for Google Inc (NASDAQ:GOOG). If it catches on, the company’s shares might have more room to run. It would also get the company into the device market, a segment it has yet to break into despite repeated efforts. Although making and selling physical products might not help margins, a hot product would help top line growth.
With the share price so high, investors should consider pulling some money off the table here. That said, watch the progress of Glass. Early adopters aren’t enough, however, it needs to be a mass market success if it is going to be a long-term winner.
Not the only game in town
Interestingly, Glass isn’t the only game in town. A small Japanese startup is working on a similar product called Telepathy. While you can compare and contrast all you want, the trend is increasingly obvious. Other big-name companies will quickly follow along.
For example, Samsung is less innovator than improver. The big difference, however, is that Samsung has been more willing to broaden its product portfolio than main competitor Apple.
Thus, Samsung offered small tablets before Apple. Apple eventually got there, but wasn’t the first mover in the space. So while Samsung has been rumored to be working on a watch like Apple, it isn’t too much of a stretch to believe that it is also working on eyeglass devices, too. Apple, meanwhile, is more likely to dismiss the idea until it’s proven in the market.
Like Apple, Samsung has seen its top and bottom lines advance on the strength of smartphone and tablet demand. Its shares are off from their highs, but are still priced for perfection. Investors should probably take some profits. However, if Glass takes off, look for Samsung to beat Apple to market with a similar product and be the first to benefit.
Google Inc (GOOG) Glass takes society in a new direction in a way that a watch doesn’t. That’s a scary thing, but potentially transformational. Investors looking at wearable computers should be paying attention to Glass. It could help keep the top line growing at Google Inc (GOOG). If me-too products hit the market, expect Samsung to be a prime player, too.
As one of the most dominant Internet companies ever, Google has made a habit of driving strong returns for its shareholders. However, like many other web companies, it’s also struggling to adapt to an increasingly mobile world. Despite gaining an enviable lead with its Android operating system, the market isn’t sold. That’s why it’s more important than ever to understand each piece of Google’s sprawling empire.
The article Google Is Breaking the Glass Ceiling, Will Others Follow? originally appeared on Fool.com.
Reuben Brewer has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google. Reuben is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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