Bottom Line: Netflix (Nasdaq: NFLX) has a big lead over incoming rivals Disney (NYSE: DIS) and Apple (NASDAQ: AAPL) in the streaming wars and it’ll potentially take them years to catch up. Disney hasn’t yet proven its ability to deliver an online platform at scale, while Apple hasn’t yet proven it can create or attract content audiences are looking for. The real question is whether the two deep-pocketed rivals will take users away from Netflix or whether additional options will pull users away from illegal sources of content as has happened in the music industry.
Bottom Line: Apple’s latest software updates contain several issues that may mean it’s worth waiting some time before updating the operating system on an iPhone, iPad or Mac. The iPadOS and macOS Catalina updates drop support for older 32-bit apps and the transitions from iTunes to Apple Music breaks some music-related apps dependent on a no longer supported file format. On the Mac side of things, Catalina, the latest version of the OS has restricted parts of the computer and so may require a significant amount of time to approve apps’ access. While on the iOS side for iPhones there have been reports that the system felt ‘buggy and unfinished’ initially and though Apple has fixed many issues in subsequent updates there is still a ways to go.
Bottom Line: After Schwab, E*Trade, and AmeriTrade all matched Robinhood’s zero fee stock trading, the popular app is launching a Cash Management feature to help try to keep its estimated 6 million users. Cash Management will let users earn interest on cash in their account and spend that cash with a special Mastercard debit card. While Robinhood initially announced a Cash Management feature last year with an above market 3% interest rate, it had to cancel those plans as it didn’t have the proper insurance for the accounts. This time around the accounts will be insured by the Federal Deposit Insurance Corporation (FDIC) up to $1.25 million but have a lower 2.05% rate. The lower interest rate puts Robinhood in line but not above other top offerings according to Bankrate.
|Interest Rate (annual percentage yield)||Minimum Balance|
|Wealthfront Cash (no debit/ATM)||2.07%||–|
|Robinhood Cash Management||2.05%||–|
|State Farm Bank||2.0%||–|
Bottom Line: Boeing (NYSE: BA) has agreed to invest $20 million into Virgin Galactic as part of a partnership to develop hypersonic point-to-point air travel. Virgin Galactic will be the first publicly traded human spaceflight company once the merger between it and Social Capital Hedosophia Holdings (NYSE: IPOA) is completed, which is expected sometime this year. Boeing, in addition to it’s well-documented issues with the 737MAX has been struggling to keep up on innovation having also been beaten to the punch in single-aisle jets that rival Airbus (EPA: AIR) accomplished through investment in Bombardier’s (TSE: BBD) C-Series.
Tesla’s Got Enough Supply Chain Problems, Just Imagine if it Lost its Battery Manufacturing Partner Panasonic
Bottom Line: The partnership between Tesla (NASDAQ: TSLA) and Panasonic (TYO: 6752, OTC: PCRFY), the electric car company’s primary battery supplier is being tested. Several key executives on both sides left which helped support the partnership between the two companies. Add to that ongoing pressure from Tesla on cost and speed of production, the relationship is starting to fray. With rumours that Tesla has restarted a program to manufacture their own batteries and a recent acquisition of a company specializing in battery manufacturing, perhaps Tesla is preparing to take on the Gigafactory production on its own. The importance of battery technology used by our consumer electronics and many electric vehicles was underscored recently as scientists who helped pioneer the lithium-ion battery being honoured with the Nobel Prize in Chemistry.
Tech Investing Chart of the Week
More signs of how U.S. companies are being impacted by the ongoing protests in Hong Kong are starting to show. Popular video game publisher, Activision Blizzard (NASDAQ: ATVI) has been feeling the heat after they suspended a game player for making a pro Hong Kong statement on a live stream last weekend. The move has caused serious backlash from the gamer community and a boycott movement looks to be starting to impact the company’s stock price.