Tags: Thiel | Google | Apple | EU

PayPal Co-Founder Thiel Would Rather Invest in Google Than Apple

By    |   Wednesday, 17 September 2014 01:22 PM

Google is under the gun from European Union regulators over antitrust issues, and Apple is benefiting from surging demand for its new iPhone 6.

But PayPal co-founder Peter Thiel tells CNBC that if he had to decide which of the two companies to invest in, he would "probably still go with Google."

The worry with Apple is that it will have to cut prices on its phones, he explains. And Apple's new smart watch and mobile payments system aren't big enough to make a significant contribution to the company's finances, says Thiel, founder of venture capital firm Founders Fund.

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"If you have $150 billion coming from phone revenues, it's really hard to have product lines that even come close to moving the dial. Even the iPad wasn't enough to move the dial." Perhaps reinventing TV sets could do the trick, Thiel notes, "which is a thing they've been talking about for a long time."

As for Google, "the risk is the EU antitrust stuff," he explains. The European Commission wants Google to make more concessions in a settlement over changes in its algorithm.

"Silicon Valley is oblivious to how this [antitrust issue] is building up, because there's been very little scrutiny from the U.S. on Silicon Valley," Thiel said. "The EU is quite hostile. It's in part because European companies have not been able to compete on the IT sector. So they are running to the regulators to shut down the U.S. businesses."

"There's probably more upside with Google over the next decade than with Apple."

Morningstar analyst Rick Summer offers praise for Google.

"As the pre-eminent leader in [Internet] search, Google maintains more than 60 percent of worldwide market share. No other competitor has even 10 percent," he writes on Morningstar.com.

"Although we expect small movements in market share, we believe Google's dominance will persist and not lose more than 3 to 5 points of share."

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Google is under the gun from European Union regulators over antitrust issues, and Apple is benefiting from surging demand for its new iPhone 6.
Thiel, Google, Apple, EU
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2014-22-17
Wednesday, 17 September 2014 01:22 PM
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