Yes, yes, I am (as usual) exaggerating and simplifying in order to make a point. (And maybe I am just speaking my position too).
Let's say that, instead of spending an hour a day posting on SI, I change my behavior, so I spend two hours a day typing my wit and nonsense. If that is the only thing that changes, more data will move through core networks (that was what the study measured). But nothing much else has changed. I don't need a new PC, my local service provider doesn't upgrade the network, the long-haul network reduces it's overcapacity by a very tiny amount, SI probably doesn't need more servers (maybe they need more storage, though). AMAT doesn't make much more profits.
OTOH, if I decide my posts have to include streaming video and high-quality graphics and audio (so I can add Beethoven or Shania Twain as background music to my posts, depending on my mood), then my PC, and the network, and the servers, probably do have to be upgraded. If I decide that, next time I'm kayacking in Prince William Sound, I need to be able to post to you, using my (waterproof) Palm Pilot (the one with perfect Voice-to-Text translation, and a 3G wireless, no, better be satellite, modem), then the infrastructure needs to be upgraded a lot to accomodate that "need". The thing is, I don't see the above as "needs" I am ever likely to have.
So, growth in data traffic does not automatically translate into higher AMAT stock price. And, even if there is a connection (yes, you're right, there probably is one), I think it's a connection impossible to quantify. A doubling of data traffic (every 6 months in core networks) translates into what % increase in AMAT profits and stock price? You'd be lucky to guess the correct order of magnitude. And what's the time lag on that relationship? Could be years. |
