Apple Inc. (AAPL) HomeKit Paves Way for Battle Vs Google Inc (GOOGL): Colin McKerracher

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Apple Inc. (NASDAQ:AAPL) has made a big announcement with HomeKit at the Worldwide Developers Conference (WWDC) and it paves the way for a battle against Google Inc (NASDAQ:GOOGL) for the automated home, Colin McKerracher told Bloomberg in a recent discussion.

According to the BNEF senior analyst, the arrival of HomeKit, a new platform for the automated home, from Apple Inc. (NASDAQ:AAPL) “is big news in the connected home world.” The analyst said that what the Cupertino, California-based giant is doing is making a play at owning the whole home ecosystem.

The team at Bloomberg then implied that this is the industry where Nest is already in. Google Inc (NASDAQ:GOOGL) recently bought the company that was founded by a former Apple Inc. (NASDAQ:AAPL) employee for over $3 billion. The company makes smart thermostats and smoke alarms.

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McKerracher said that the Google Inc (NASDAQ:GOOGL) company already has a play in the home but it’s sort of just an individual piece of hardware. On the other hand, Apple Inc. (NASDAQ:AAPL) is trying to is to integrate devices, machines and appliances that makes up the whole ecosystem. That includes things like security, lighting, and energy, the analyst said.

If the iPhone maker is making a bigger push into the home, what implications are there for companies like Nest, the analyst was asked.

According to him, people will see Google Inc. (NASDAQ:GOOGL) make a competitive play in this industry because they recognize that the home is a new battlefront. Asked whether he sees the online search and advertising giant debut a new home automation platform, McKerracher said, “yes, exactly.”

As for energy suppliers, McKerracher said that HomeKit affects them too. This is an area people are not usually thinking of, he said, “but energy suppliers have been trying to push into services within the home.” They are looking at more than just selling people electricity, he added, because revenues are falling in the wholesale sector and these firms need to find other ways to boost earnings. According to the analyst, he sees energy companies also compete in the industry.

“There will be a real battle,” McKerracher said, adding that whoever will control this industry will be a very important firm in the future.

Shareholders of Apple Inc. (AAPL) includes Jim Simons’ Renaissance Technologies which added 821,362 shares just this first quarter of the year. Another notable new investor is Tony Chedraoui’s Tyrus Capital which has 75,972 shares in the technology giant, added to the portfolio during the first quarter.

Meanwhile, Thomas E. Claugus’ Gmt Capital owns 168,735 Google Inc. (NASDAQ:GOOG) stock which it added to its portfolio at the end of March. During the first quarter, Ken Heebner’s Capital Growth Management also added 118,600 shares in the company to its portfolio.

 

Disclosure: None

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