Five Predictions for 2012

Loading...
Loading...
What can we expect from Apple, Zynga, and insider trading reform in the coming year?
It's almost hard to believe that we are less than 30 days away from 2012. But after the confetti has settled and people drag their drunken bodies back to their homes and apartments, we will be faced with another new year. And what will that new year bring? Are we headed for a rehash of 2011? Or will this be a year of major changes in the tech world? New legislation to prevent politicians from trading with insider information? And maybe, just maybe, the rise of a social gaming company? Let's take a look inside the crystal ball to get a glimpse of 2012.
5. Insider Trading Reform Will Be Swept Under the Rug
What can we expect from the proposed insider trading reform? Nothing. While politicians will say they support it on camera, most will run as fast as they can to escape the idea that they may one day have to follow the same rules endured by everyday traders. That's not to say there aren't some honest politicians who would never commit this atrocious crime. I'm going to give them the benefit of the doubt and assume there are. But if these politicians exist, isn't it about time they've spoken up? Isn't it time for them to step forward and say that this has gotten out of hand, and that it's time for everyone to play by the same rules? The problem is that even the most truthful politicians have their careers to think about. If they believe the support of other, less scrupulous politicians is more important than the number votes they may gain by pushing for insider trading reform, they will not fight to get a bill passed that will provide any significant changes.
4. Apple Will Launch Refreshed Products Before its First TV
While the MacBook Pro and other Apple
AAPL
devices have been
rumored to receive a significant makeover
for several months, the 2011 Apple lineup proved to be very similar to that of its 2010 offering. Considering the popularity of the original iPad, the iPhone 4, and the 2010 MacBook Air, Apple could get away with releasing a
a few rehashes
this year. But that is about to change. It won't happen overnight, and it won't happen with every product, but 2012 is very likely to bring us a new iPhone design, a new MacBook design, and some additional changes to the iPod lineup. The latter changes could simply fall in line with whatever design adjustments are made to the iPhone 5, as the iPod Touch tends to mirror that of the current iPhone. The MacBook evolution is harder to predict because the Air is still fairly new, the old white MacBook has been discontinued, and Apple seems to be content with its current Pro lineup. However, the big rumor is that the Pro and Air will slowly be united as one with an uber-powerful 15-inch MacBook Pro that is super light, super thin, and uses the same solid state memory featured in the Air. That would certainly be a dream come true for many consumers, particularly those who like the air but don't think it's powerful enough.
3. PS Vita Will Flop in America
Would you spend $250 on a handheld game machine that didn't have any compelling games available at launch? Nintendo (
NTDOY
) fans didn't. They are some of the most loyal consumers in the world, and they still
ran from the launch of the Nintendo 3DS
. Nintendo has since made
significant improvements
to its lineup, even releasing one game that
no one should live without
. But it's an effort that many view as too little, too late, especially at a time when people believe that do-everything devices are the way of the future. The problem with the PS Vita is that, aside from lacking a single game that justifies the $250 price tag, Sony
SNE
is pushing the handheld device as an iPod competitor. The company is hyping PS Vita's Web browsing capabilities, as well as its Wi-Fi and 3G connection options (the latter of which is only available with a more expensive version of the device). Sony is heavily promoting the PS Vita for its control features, which include a touch screen and a touch pad underneath the device (something I must admit sounds very intriguing). But at the end of the day, who cares? I'm having a hard time caring. And I'm one of the guys who lined up in front of Target
TGT
to get a PlayStation 2. If Sony can't persuade guys like me to get a PS Vita at launch, it is going to have a very rough 2012.
2. Patent Lawsuits Will Intensify
It seems as if the battle between Apple, Samsung and other tech companies
may never come to an end
. You can't go a few weeks without hearing about
another lawsuit
, an update to an existing suit, or the
Loading...
Loading...
negative impact of these legal practices
. For better or worse (most likely worse), these lawsuits aren't going anywhere. After realizing that it may be easier to hurt the competition through legal action than it is to beat them with innovative products, tech companies became all too eager to take advantage of patent law. And when it pays off, it
pays off big time
, ensuring that this battle will continue for quite some time.
1. Zynga Will Release a REAL Game or Die a Miserable Death
Zynga's IPO may be
just around the corner
, but is the company
destined to die in 2012
? With games that appeal
to the same psychology as gambling
and
profits declining at a horrifying rate
, Zynga has not become the big, bad social games company that many anticipated. Earlier this year, Zynga attempted to change that (or so we thought) by hiring the man responsible for creating NBA Jam, NFL Blitz and Smash TV: Mark Turmell. Turmell now serves as Zynga's senior creative director. Considering the length of time it takes to produce a quality video game, it isn't too surprising that Zynga hasn't changed since Turmell's arrival. However, 2012 will be the company's make-or-break year. While its IPO could feasibly thrive (especially if investors are fooled by the prospects of social gaming, which are based solely on the assumption that mainstream consumers won't tire of the same old thing), Zynga is likely to stumble in the coming months. We've already
seen proof
of the company's demise. Turmell may be the only man who can change that. If he was hired by Zynga to produce original content in the style of his previous works, he might just have what it takes to revolutionize social gaming. Imagine the potential for an NBA Jam or NFL Blitz-caliber social game that is free, offers multiplayer functionality, and can run in any browser and on virtually any handheld device. A game like that would be huge! But are we there yet technologically? And even if we are, does Zynga have the brains to pull it off?
ACTION ITEMS:Bullish:
  • Those who anticipate a significant iPhone upgrade may want to look to Sprint S, Verizon VZ, and most of all AT&T T for big sales.
  • If you think Sony can pull a rabbit out of its hat and make PS Vita a smash hit in North America, expect Electronic Arts ERTS – which is expected to release at least one new game at the system's launch – to be one of the earliest beneficiaries.
Bearish:
  • Tech investors will have a hard time avoiding companies that are involved in patent suits. Those who are seeking a more patent-safe tech company might want to consider Google GOOG, which stands to gain a ton of new patents through its acquisition of Motorola MMI.
  • If you expect Zynga to die off (or at the very least dwindle) in the coming year, consider more stable game companies like Activision ATVI.
Follow me @LouisBedigianNeither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.Sign up for a free subscription to the Weekly Radar - Benzinga's weekly newsletter highlighting technical levels and analysis for major markets for the week ahead.
Loading...
Loading...
Market News and Data brought to you by Benzinga APIs
Posted In: Long IdeasShort IdeasTechTrading IdeasAppleApple TelevisionApple TViPadiPod Touchmacbook airMacBook ProMark TurmellNBA JamNFL BlitzNintendo 3DSPS VitaSmash TVSonyZynga
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...