The U.S. Supreme Court ruled Monday in Alphabet(GOOGL)’s favor in a copyright dispute with Oracle (ORCL), which includes Android software, in a decision that could have broader consequences for technology developers. Google shares climbed into a buying zone.
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The Supreme Court ruled 6 to 2 in favor of Google in the long-running case. Android-based phones are used worldwide.
Google has argued that Sun Microsystems, the Java software developer acquired by Oracle in 2010, had no problem with Google developing its Android mobile operating system using Java APIs, or application program interfaces.
In its ruling, the Supreme Court said Google’s copying of the API was a ‘fair use of the material’. Google used the API to get Java programmers to build Android applications.
The Silicon Valley software industry applauded the ruling. Technical industry groups have said that Oracle’s copyright infringement threatens to suppress widely used practices in the creation of many types of software.
“After more than a decade of litigation, this ruling is a victory for interoperability, copyright principles and the future of innovation,” Matt Schruers, president of the Computer and Communications Industries Association, said in a press release. “The Supreme Court’s ruling that fair use extends to the functional principles of computer code means that companies can offer competitive, interoperable products.”
Google Stock: Waymo’s CEO Departs
Alphabet plans to pay Oracle nearly $ 9 billion in damages and possible royalties.
Google shares rose 4.2% in the stock market today to 2,218.96, an all-time high.
From a weekly chart perspective, GOOGL shares have forged a flat base. It offers a new entry point of 2 145.24.
With the gain, GOOGL shares moved to a 5% buying zone extending to 2,252.50, according to IBD MarketSmith analysis.
In addition, investors picked up the surprise exit of Waymo CEO John Krafcik on Monday
Alphabet said on Friday that Krafcik, head of the autonomous vehicle unit since 2015, would be replaced by two co-CEOs – Tekedra Mawakana and Dmitri Dolgov. Mawakana was Waymo’s chief operating officer, while Dolgov was Waymo’s chief technology officer.
Meanwhile, Google’s relative strength rating is only 68 out of a possible 99, according to IBD Stock Checkup. The best stocks have an RS rating of 80 or better.
Waymo valuation is the most important question
An important question for GOOGL stock investors was the valuation of the Waymo self-management project and other commitments such as Google’s Verily Life Sciences unit.
In early 2018, some analysts projected Waymo’s long-term valuation between $ 75 billion and $ 125 billion. However, expectations for autonomous vehicles have been lowered.
In March 2020, Waymo raised $ 2.25 billion in financing from outside investors, including private equity firm Silver Lake, the Canada Board Plan Investment Board and the investment arm of Mubadala in Abu Dhabi.
While Google did not disclose Waymo’s valuation in the funding round, there was only $ 30 billion at the time.
In addition, Google shares have an accumulation / distribution rating of B. The rating analyzes price and volume changes in a stock during the past 13 weeks of trading.
The rating, on an A + to E scale, measures institutional buying and selling in a stock. A + means heavy institutional purchases; E means heavy selling. Consider the C-grade to be neutral.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cyber security and cloud computing.
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