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Apple, Google, Facebook, Amazon War Over $200B Market


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We just learned that Facebook (NASDAQ:FB) has plans to start its own competitor to Alphabet's (NASDAQ:GOOGL) YouTube. This news, of course, comes just days after we learned that (NASDAQ:AMZN) would be doing the same thing.

The acts are not coincidence, and the interest in online video is a hyper focused war on what appears to be the single largest change in advertising the world has seen since the advent of the Television.

But, this isn't about which mega cap tech is going to win the online video war. This is the opportunity so many investors say they welcome – say they search for. This is the opportunity to find the "Next Apple," or the "next Google." Friends, it's coming right now, and it lies in the depths of one of the great transformations we have seen in more than fifty years.

It's the guts behind online video ads, the enabler for the major advertisers to find a home for and monetize their ad dollars. And no matter which of the mega caps win, one firm will be there to power all of it.

We reported recently that advertising buying firm juggernaut Magna Global that is responsible for around $37 billion in marketing investments on behalf of clients like Johnson & Johnson and Coca-Cola just announced that it has moved $200 million in ad spends away from TV ads and to Google's YouTube for online video ads.

As we noted, this revealed a massive new windfall for the two giants of online video advertising, Facebook (NASDAQ:FB) and Google (NASDAQ:GOOGL). But, the news wasn't about a $200 million deal, it was about a $200 billion transformation. It turns out that Amazon (NASDAQ:AMZN) agrees -- and now it wants that market too.

For a bit of perspective, here's how large online video is, already:

YouTube on mobile alone now reaches more 18 to 34 and 18 to 49 year olds in the U.S. than any TV network, broadcast or cable.

If that wasn't impressive enough, try this: Facebook recently announced that it gets 10 billion video views a day. Further yet, Facebook, Alphabet and Twitter (NASDAQ:TWTR) all noted that online video was becoming the preferred outlet for advertisers across their various properties.

Twitter reported that 82 percent of its users watch video content on the platform and 90 percent of those came from mobile. Further, since August 12th, 2015, Twitter's live online video app Periscope has nearly tripled.

But that's not the news and this isn't only about online video.

There are 133 million households in the United States alone with a cable TV subscription (Source: AYTM). Check out how much is spent on standard Television advertisements:

In stark contrast to online video advertising, which is pegged at market size of less than $10 billion for 2016, TV advertising is pegged at around $200 billion -- or 20-fold larger. We can throw that 106% growth and $9.14 billion estimate for online video advertising in 2016 out the window. It's now plainly clear:

Online video advertising is going to be one of the largest advertising media in the world and there are just a few tech companies that will take all of it.

Now, if it seems like the cable companies have the power, they don't. Cable cord cutting is happening. This is a wonderful chart from our friends at Statista covering people aged 18-31:

Cord cutting will rise 50%. And, that is our foray into Apple (NASDAQ:AAPL) -- the company will not be out done. It has its sights set high with the Apple TV and original content as well as an ecosystem that controls all other video sources in one device:

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There's an investing philosophy we have at CML Pro and it goes something like this:

You can mine for gold hoping to be one of the lucky few to win the gold rush lottery, or you can sell pickaxes and shovels to the gold miners and guarantee you've won the lottery several times over.

Source: CML Pro

We don't care which mega cap wins and how the market share is distributed. That's hunting for gold. We want the pick-axe and the shovel.

It turns out there is a technology behind all of it that will serve as the hub for advertisers to distribute their video ads across the various platforms, to optimize the results and then to focus efforts on the best use case.

Too many tech giants in one area make the ad buying process difficult. Nobody in this value chain wants that to be the case. All parties can agree on perhaps just one thing: Make video advertising buys easy -- keep the money flowing.

In order for that to happen, there must be a backbone. It's this backbone that has the potential to be the "next Apple," or "next Google."

This is just the surface analysis. There's so much going on with technology it's impossible to cover in one report. But, to take it a step further and to actually find the 'next Apple’ or 'next FANG stock’ we have to get ahead of the curve. This is what CML Pro does. Our research sits side-by-side with Goldman Sachs, Morgan Stanley and the rest on professional terminals, but we are the anti-institution and break the information monopoly that the top .1% have.

Each company in our 'Top Picks' is the single winner in an exploding thematic shift like artificial intelligence, Internet of Things, drones, biotech and more. In fact, here are just two of the trends that will radically affect the future that we are ahead of:

That chart plots the growth in 4G usage worldwide and how it will grow from 330 million people today to nearly 2 billion in five years. This is the lifeblood fueling every IoT and mobile device on the planet and CML Pro has named the single winner that will power this transformation. Then there’s cyber security:

There's just no stopping the growth in the need for cyber security and we are right at the beginning. CML Pro has named the single best cyber security stock to benefit from this theme.

These are just two of the themes we have identified and this is just one of the fantastic reports CML Pro members get along with all the visual tools, the precious few thematic top picks for 2016, research dossiers and alerts. For a limited time we are offering CML Pro at a 90% discount for $10/mo. with a lifetime guaranteed rate. Join Us: Get the most advanced premium research delivered to your inbox along with access to visual tools and data that until now has only been made available to the top 1%.

Thanks for reading, friends.

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