Marvell Technology's superb run shouldn't stop any time soon. The chipmaker has gained more than 120% in the last year and a half due to solid demand for its chips that are used in storage devices and smartphones. Going forward, Marvell should continue enjoying tailwinds from the roll out of LTE in China by China Mobile and rapid growth in data storage.

Let's take a look at the three key reasons why yinvestors should hold onto this outperforming tech stock.

LTE in China is big business
Since last year, LTE deployment in China has been moving at a solid pace, and Marvell seems to be making the most of it. In the first quarter, Marvell's mobile and wireless business grew 30% sequentially, driven by LTE ramps in China. The company saw a number of tier-one OEMs launch LTE smartphones based on its solutions as shipments exceeded expectations. 

In addition, Marvell claims that nearly half of the best-selling LTE phones in China are based on its platform. The company is slated to gain more traction in this market by powering multimode LTE devices from leading OEMs. 

The market for LTE handsets in China is huge. China Mobile is aggressively rolling out its TD-LTE network as it plans to build 500,000 base stations by the end of 2014. This is way above its earlier expectation of building 200,000 base stations this year. Also, China Mobile is spending significantly on smartphone subsidies in order to push the adoption of LTE handsets.

In fact, China Mobile expects to sell as many as 100 million LTE handsets this year. This number is expected to reach 300 million in 2017, according to research firm iSuppli. Hence, rapid growth is expected in the Chinese LTE handset market, which should continue driving Marvell's mobile business.

Storage prospects
Marvell counts the two biggest players in the storage market as clients -- Seagate and Western Digital . In fiscal 2014, these two customers together accounted for 36% of Marvell's overall revenue. The company is seeing an improvement in the storage business despite a slowdown in the PC market, primarily due to next-generation hard-disk drive technologies and solid-state drives.

Moreover, the enterprise storage space presents a big opportunity for Marvell to sustain its growth in storage. The company is gaining content at Western Digital, its top North America-based HDD customer, and this looks like a significant catalyst.

According to Jim Mueller of The Motley Fool, data storage is expected to grow to 6,000 exabytes in 2020 from just under 1,000 exabytes in 2014. This growth will be primarily driven by enterprise systems that Western Digital is trying to tap through product development moves and acquisitions. The company acquired Virident Systems and sTec last year to strengthen its enterprise portfolio. 

Moreover, Western Digital is also seeing opportunity in hybrid drives. According to Gartner, hybrid HDD shipments are projected to rise to 126.9 million units by 2018 from just 3.4 million units in 2013. Thus, Marvell seems to be in a solid position to benefit from the storage market as a result of its relationship with Western Digital.

Attractive fundamentals
Despite recording solid gains in the last 18 months, Marvell's valuation is still quite attractive. The stock trades at 22 times last year's earnings, and the multiple comes down to just 13 on a forward P/E basis. This is value territory for a company that recorded 20% year-over-year growth in revenue and a 94% jump in earnings in the previous quarter. 

Also, Marvell doesn't carry any debt and it has a strong cash position over $2 billion. Finally, Marvell pays out a dividend of 1.50% at a payout ratio of just 34%. As the company's revenue and earnings are growing at a rapid pace, I won't be surprised if it hikes the dividend going forward.

Final words
All in all, Marvell ticks all the right boxes from an investor's point of view. It is growing at a fast rate, has a strong balance sheet, and the prospects in its end-markets are bright. All this makes Marvell a company worth looking into.

During Fusion-IO's 66% stock price loss since its 2011 IPO, it has been the center of acquisition rumors. The seemingly continuous spending spree on flash storage product companies all but adds fuel to this fire. However, as we look at the latest acquisition by Seagate Technologies and look back to those by Western Digital , the inevitable outcome for Fusion-IO might not be what's expected.

A buying spree that creates logical speculation
Fusion-IO develops flash memory modules for high-performance applications, which is largely considered a growth industry given increased data and more advanced consumer and enterprise technology. Last year, hard disk drive (HDD) manufacturer Western Digital acquired Virident , which is nearly the equivalent of Fusion-IO, for $685 million.

The purpose of Western Digital's acquisition was widely believed to increase its visibility in the fast-growing solid state drive (SSD) market. In this memory market, HDDs are used in PCs and laptops while SSDs are often found in smartphones and tablets. Clearly, the latter is where growth exists. As a result, this acquisition is what really set Fusion-IO buyout talks in motion, or at least made the discussion serious.

Western Digital added fuel to this fire with the acquisition of sTec , a solid state drive maker, for $340 million cash. Afterwords, Western Digital acquired an SSD caching software company called VeloBit , all in the goal of making its SSD business sustainable. Since then, Western Digital's SSD sales have been explosive, albeit still roughly 5% of total revenue. Nonetheless, these acquisitions led many to think that Seagate, Western's HDD peer, would make a move to acquire Fusion-IO.

Latest buy creates substantial doubt
Since April, shares of Fusion-IO have fallen more than 25%. This fall was sparked when its most likely suitor, Seagate, acquired Xyratex . Granted, Xyratex has a smaller presence in storage, but this surprised Fusion-IO investors nonetheless. Perhaps the biggest blow to Fusion-IO investors came last week, when Seagate made an aggressive acquisition in the flash market by acquiring one of Fusion-IO's biggest competitors for $450 million, a segment of LSI .

When you connect all the dots, it doesn't appear than any of the likely suitors are looking to acquire Fusion-IO. Instead, they're poised to compete against it. This is a company that has attempted to be competitive in all avenues of its business, especially pricing and research, in order to grow and attract customers. The end result has been operating margins of negative 25% and growth rates that have fallen substantially in the last two years. This shows that its initiatives aren't paying off.

In fact, with $380 million in annual revenue, Fusion-IO appears by all measures to be a small competitor of Western Digital and Seagate Technologies, two companies with $15 billion and $14 billion in annual revenue, respectively. Both Western Digital and Seagate have great scale, and a market-leading presence in memory drives. This is likely to affect Fusion-IO in a negative way.

Final thoughts
Combined, Western Digital and Seagate Technologies own 85% of the HDD market. Both have become large through mergers and acquisitions. Clearly, both companies are implementing the same strategy with SSD, but so far are staying clear of Fusion-IO.

If you consider the Virident acquisition and others, Fusion-IO's takeout value is worth $22-$27 per share.. Therefore, at $8 you'd think someone would gobble it up as a value opportunity. However, for high-margin companies like Western Digital and Seagate, Fusion-IO's lack of efficiency creates many questions on the sustainability of its business model. This might be the driving force for why no such buyout has occurred.

As a result, potential acquirers have now become enormous competitors, which means that Fusion-IO's shares could suffer further. Looking far ahead, any acquisition will be at a significantly lower price when Fusion-IO's shares fall due to competition. Once they reach a level that is too attractive to pass up, the offers may come. Regardless, Fusion-IO doesn't look good right now.

Intel's recent introduction of a heartbeat-monitoring "smart shirt" underscores the importance the company is placing on the huge Internet of Things trend. (Related video: What is "The Internet of Things"? We Travelled 9,000 Miles to Find Out.)

The shirt contains conductive fibers and plugs into a small box powered by Intel's new SD-size Edison computer. This is just a part of Intel's Internet of Things initiative it showed off at CES in Las Vegas earlier this year.

Motley Fool analyst Rex Moore was in Vegas for CES, and spoke with Intel's Claudine Mangano about the company's IoT initiative, and the role Edison plays within it.

The Dow Jones Industrials had fallen 10.6 points as of 11 a.m. EDT Wednesday as investors responded to uncertainty about the future direction of the market and the global economy. Although some economic reports this morning shed light on conditions in the U.S., market, participants are focusing on two key events later this week that have direct ramifications for Dow components General Electric and Wal-Mart , as well as collateral impacts throughout the stock market.

Source: UpstateNYer.

This morning, investors got the latest figures on the trade deficit, service-sector strength, and the state of private employment. The ADP jobs report showed a jump of 179,000 private-sector employment last month, a figure that was more than 30,000 jobs less than most economists had expected. Moreover, the trade deficit hit its highest level since 2012, pointing to higher demand for imported goods. But stronger readings for the health of service-providing businesses helped limit the Dow's loss.

Yet most market watchers are waiting for two key events. First, the European Central Bank is expected tomorrow to announce whether it will take further action to try to stimulate the continent's economy, which has struggled to emerge from recession. The consensus is that ECB President Mario Draghi will reduce the ECB's benchmark and deposit rates, reflecting the threat of deflation and its potential negative impact on the sluggish recovery that Europe has seen. Still, the real key is whether the ECB will add any other weapons to its arsenal in fighting for stronger growth, perhaps coming up with innovations like the Federal Reserve's quantitative easing program in efforts to broaden the ECB's influence over the financial markets in the eurozone.

The second key event is the U.S. Labor Department's nonfarm payroll jobs report on Friday. Today's private-sector report painted a less than perfect picture of the employment market, and although the two metrics don't track each other perfectly, many of the same factors come into play across the ADP and Labor Department reports. Investors are walking a fine line, as they want to see continued strength in the economy but worry that the Fed might raise interest rates sooner rather than later if figures are too strong.

Source: Wal-Mart.

For General Electric and Wal-Mart, the stakes are high. General Electric is trying to acquire the energy business of French giant Alstom, but concerns in France about the economic impact of the acquisition on the labor force have led officials to consider alternatives to a GE buyout. The weaker Europe's economy grows, the more protectionist General Electric can expect French officials to become as companies on the continent circle the wagons and defend their home economy. By contrast, if the ECB can support the economy, then reduced fears could make a General Electric-Alstom deal more likely to go forward.

Meanwhile, on the jobs front, Wal-Mart is the largest private employer in the nation, and it has faced concerns recently about pressure for a minimum wage hike that would increase the retailer's labor costs. Given that Wal-Mart has already struggled to grow, adding further cost increases could only further hurt profitability for the Dow's biggest retail component, raising new questions about long-term growth.

For now, the Dow Jones Industrials are playing a waiting game. But by later this week, investors should have a better sense of what's in store for the index and the U.S. economy more broadly.

Back in 2005, two brothers set out on a journey to democratize access to professional quality 3-D printing for a fraction of the operating cost. The end result became Mcor Technologies, an Ireland-based 3-D printing company that uses standard copier paper you'd find in any office around the world as its primary material. What makes Mcor unique is that it doesn't try to lock customers into buying proprietary materials at a considerable markup throughout the printer's life. 3D Systems and Stratasys both generate a significant portion of their revenue from the sale of highly profitable recurring consumable sales. In other words, Mcor is essentially threatening to disrupt the glorified razor-and-blade model that 3D Systems, Stratasys, and many other industry players have grown to enjoy.

A full-color 3-D printed model made from a Mcor 3-D paper printer. Source: Mcor Technologies.

Mcor's paper-based 3-D printing technology, selective deposition lamination, or SDL, involves a water-based adhesive and a tungsten carbide blade to precisely adhere and cut paper one sheet at a time to create a 3-D dimensional object after many repetitions. Mcor offers both full-color and monochrome 3-D printers that use standard A4 office paper, boasting an operating cost of 5%-20% of competing technologies from 3D Systems and Stratasys. To be clear, Mcor's 3-D printing technology is really only intended for prototyping and modeling applications for professionals seeking quick, affordable, high-quality prints. It is not nearly as versatile as 3D Systems' and Stratasys' professional 3-D printing technologies, but in return for the lower versatility are significant cost savings.

Although Mcor's total market opportunity may currently be more limited than 3D Systems and Stratasys, which offer 3-D printing technologies for a host of different applications beyond prototyping, the truth is that virtually every marketed product starts as an original prototype or model. In other words, the need for quick, high-quality, and affordable prototypes and models will likely remain strong for the foreseeable future, and a company like Mcor hopes it can make a meaningful impact in the space.

In the following video, 3-D printing specialist Steve Heller asks Mcor CEO Conor MacCormack about the company's competitive positioning. Going forward, 3D Systems and Stratasys investors should monitor the reception of Mcor's products to get a better sense of whether or not it will negatively affect their respective material sales businesses.

A transcript follows the video.

Steve Heller: Hey Fools, Steve Heller here. I'm joined today with Conor MacCormack, CEO of Mcor Technologies. Mcor is a very exciting company in the space; they are disrupting 3-D printing materials in particular.

I wanted to ask you, Conor, about your position in the marketplace compared to the competition, and what makes your product so unique.

Conor MacCormack: Thank you for the opportunity to speak here. Effectively, we have a very differentiated product. We looked at the industry almost 10 years ago, and we felt it was one thing that the price of the machines was coming down a little bit -- the capex -- but the running costs were going in the opposite direction.

Almost like, 10 years ago, you needed the same price per volume as gold; ridiculous things were going on then. So, we felt if we could build a machine that was really, really accessible, that anybody could load the material into the machine and almost have a zero running cost, that that's what everybody would want.

That was a challenge. We decided to build a machine that was very accessible, that was going to upset the status quo. We said, "What's the most readily available material, that anybody could get their hands on?"

We said, paper. Everybody can go to the photocopier or go to the printer, pull out a couple of reams of paper, and load it into a 3D printer, so we said, "Let's start at that point, build a paper-based 3D printer that ran on a water-based adhesive," because in time we could always see these machines in schools and in universities, and maybe in time, even homes -- but we're not there yet.

We felt it couldn't have extraction fans, powders, really complicated chemicals. We just wanted to really keep it simple, but really build a machine that was going to upset everybody -- and that's what we did.

At the very basic level, you take three reams of standard photocopier paper, you add it to our Mcor IRIS printer, and you get full-color, robust and durable, eco-friendly 3-D printed parts.

We're very different from everybody else. Everybody else has a traditional razor-and-blade model. We almost have an inverted model -- which can be a challenge because in the investor community they say, "These companies are making 40%-50% of their revenue on the consumables."

But the way we looked at it was, the penetration was so low, the problem why we're not getting bigger penetration is because the running cost was so high. We just really made a very strong statement that said, "Let's have a very low running cost, and let's try and get more penetration of the machine into the industry."

Seadrill West Freedom Jack-Up. Source: seadrill.com 

Seadrill  provided a shock when it released its first-quarter earnings report last month. Many analysts expect a near-term slowdown in global oil drilling activity, based on the fact that major oil and gas producers are cutting back on capital expenditures due to falling returns on new projects. Conceivably, this would put a dent in demand for offshore rigs.

But Seadrill managed to increase its dividend after posting first-quarter earnings, despite previously warning investors not to expect a dividend increase. This raised some concerns that perhaps management is getting ahead of itself. Seadrill was already the highest-yielding in its peer group, so there was little urgency to raise the dividend.

With underlying financial results that were less-than-impressive, perhaps it's time for Seadrill to get a little more conservative with its financial management practices.

Look beyond the headline figures
Seadrill's earnings release looked like a whopper of a report. It posted $6.54 in earnings per share, which appears to be a huge performance, especially since the company generated $5.52 in EPS all of last year. But there are several one-time items that boosted Seadrill's earnings in the first quarter that need to be stripped out for a clearer understanding of its true performance.

First and foremost was a $2.3 billion one-time gain from a deconsolidation of Seadrill Partners . Seadrill Partners is a growth-oriented company formed by Seadrill to acquire and operate rigs, which are secured under long-term contracts with oil and gas giants like Chevron and ExxonMobil. Seadrill holds a majority stake in Seadrill Partners, roughly 53% of the company.

In addition, Seadrill got a boost from asset disposals. The company realized a gain on the sale of the West Auriga. These disposals boosted operating profit by $316 million. On a consolidated basis, Seadrill's operating profit would have been $547 million in the first quarter, which would have actually represented a decline year over year.

Seadrill's core metrics didn't look outstanding in the first quarter. Several rigs suffered prolonged downtime. Seadrill's floaters posted a three percentage-point decrease in utilization versus the prior quarter. Utilization of jack-ups was flat.

Still, management was confident enough in the company's performance to raise its dividend to $4 per share annualized.

Confusing dividend increase
Seadrill already provided a nearly double-digit yield, which is way ahead of the industry average. And yet, the company increased its dividend again after first-quarter earnings, despite its underlying results coming in fairly soft. Even more confusing is that just three months ago, management made it clear to investors that its dividend was likely at its ceiling.

In Seadrill's fourth-quarter report, it stated: "Seadrill is currently trading at a yield of 10.4% based on an annual future dividend of $3.92 per share. In the current market, the Board sees limited value in increasing the current quarterly distribution beyond $0.98 per share."

Based on the company's true first-quarter performance, it doesn't seem like the company had the financial success that would warrant a dividend increase. This begs the question whether Seadrill is perhaps getting too aggressive with its dividend policy.

What concerns me is that Seadrill may not have enough financial cushion to sustain such a massive dividend if business conditions take a turn for the worse. Its balance sheet is fairly bloated. The company holds $10.7 billion in interest-bearing long term debt, which results in a long term debt to equity ratio greater than 100%. That's problematic, particularly if we are in a rising rate environment.

The bottom line is that Seadrill's dividend may prove to be too great of an anchor for the company. At $4 per share annualized, Seadrill's dividend is going to cost the company more than $1.8 billion per year. A 10% yield is great, but Seadrill is left with very little wiggle room. I think the company should focus on whether it generates enough cash flow to fund its newbuild program and keep its already huge dividend intact.

Japanese automaker Honda reported respectable numbers in the fiscal year ended March, with both revenue and profit thriving from the weak yen. But as its effect wanes, how's the company placed to perform over the coming quarters? True, Honda is working hard to control cost and also planning new vehicle launches to maintain its sales momentum, but is that enough?

Takeaways from the yearly performance
Honda reported revenue of 11.8 trillion yen ($116 billion at current exchange rates) for the fiscal year ended March 2014, up 19.9% from last year. The automobile and motorcycle segments posted unit sales growth of 7.7% and 9.9%, respectively, while the power products business dipped 0.6%. 

Auto sales got a boost from Asia, with volumes rising 18.2% year over year to 818,000 units in Japan and 14.6% to 1.2 million units elsewhere. In Japan, buyers lapped up the remodeled Fit that was launched in September, while the N-series' N-WGN, the compact SUV Vezel, and the fully refurbished Odyssey found takers as well. Sales also leaped as customers hurriedly bought vehicles in March to dodge an 8% sales tax that began in April. 

Honda Odyssey. Source: Honda Motor Co.

India was the other bright spot, with volumes up 83% to 134,339 units, owing to the popularity of the compact sedans, the Amaze and the City. In North America sales grew 1.5% to 1.8 million units, and Europe remained flat at 169,000 units.

Asia dominated the motorcycle segment with 14% year-over-year volume growth during the fiscal year. The CB Shine and Active models sold big in India, and the former became the best-selling 125cc motorcycle in the world, recording 3 million units sold.

Japanese Prime Minister Shinzo Abe's economic policies paid off as a weaker yen brought home a net profit of 574.1 billion yen ($5.65 billion), up 56.4% from previous year. Operating income of 750.2 billion yen ($7.38 billion) was 37.7% higher than fiscal 2013 driven by the higher sales and favorable currency. Though operating expenses rose during the year, it was more than compensated by the increased sales volume and favorable model mix.

Cash from operating activities was 1.2 trillion yen ($11.8 billion), an improvement from the previous fiscal year's 800.7 billion yen. But free cash flow generation plunged further to 479.5 billion yen ($4.72 billion) as the company spent heavily on capex.

Headwinds
Fiscal year 2014 was good for Japanese carmakers primarily due to the benefits available to them thanks to currency exchange rates. Honda's average conversion rate was 100 yen per dollar compared with 83 yen per dollar in fiscal year 2013, which increased the amount of overseas profits when converted to yen. But in fiscal 2015, the company expects the yen to remain stable. Without factoring in the benefits from the currency exchange rates, it has forecast only a modest 3.6% growth in net income to 595 billion yen for fiscal year 2015, no match for this year's bumper profits.

The company's also facing stiff competition in the U.S. auto industry -- its largest market accounting for 40% of total sales. In the last four months, sales of Honda vehicles in the U.S. were down 3.3% to 405,740 units despite the heavy incentives that it's offering. Bloomberg reports that Honda's incentives increased 42% year over year to $2,010 in the first quarter of 2014, way ahead of the 7.4% increase recorded by the industry. 

Honda expects its sales volume to remain flat at 1.8 million units in North America in fiscal year 2015. It's hoping that sales in Japan (172,000 units) and the rest of Asia (304,000 units) will compensate for this weakness in its largest market. This could take Honda's overall sales to 4.8 million units from the current level of 4.3 million units; yet its target of 6 million vehicle sales by 2016-2017 still remains a distant dream. 

Time-tested strategies
On a positive note, Honda understands that unveiling fresh cars is crucial for pushing sales, while keeping costs under control is essential for boosting profitability, and it's working hard on both of these factors.

In fiscal year 2014, it successfully launched the third-generation Honda Fit in Japan and China (in India it is labeled the Jazz). Soon the new Fit will make its appearance in North America together with the compact SUV -- the HR-V -- that sells as the Vezel in Japan. In China, Honda also launched the Crider and Jade models, and plans to roll out nine new or remodeled cars over the next two years to bolster sales and increase market share. 

Honda Fit. Source: Honda Motor Co.

Also, the carmaker has deployed several methods on the cost reduction front. These include sharing platforms among models to improve efficiency and lower development costs, and reducing the production cost of hybrids, which are generally higher than costs associated with producing conventional cars. The company also reduced its pension benefit from January, and has even implemented lean production in its manufacturing processes.

It achieved cost savings of 15 billion yen ($147.5 million) in fiscal year 2014 and is trying to continue the momentum. While cost savings will not give a similar boost to earnings as the currency exchange rate benefits, it will definitely aid profitability in the future.

Foolish takeaway
Honda did well in fiscal year 2014, but sustaining its growth rate could be difficult once the benefits from currency exchange rates moderate. It's also in bit of a rut in the U.S. and needs to accelerate sales. But management is aware of the challenges, and is aggressively cutting costs and bringing out new models to generate sustainable growth.

Coal is the ugly stepchild of the energy world. And, right now, natural gas, the pretty child, is increasingly taking coal's place. However, both are still the children of carbon, which is at its base a dirty fuel choice. Carbon dioxide is the big boogeyman for coal right now, but U.S. Energy Secretary Ernest Moniz is already warning that natural gas is next in line for a scare.

You're next!
During recent written testimony before the House Committee on Appropriations Subcommittee on Energy and Water Development and Related Agencies (say that five times fast), Energy Secretary Ernest Moniz included one line that should send shivers up the spine of every utility: "Looking into the future, CCS [carbon capture] technologies will be required for natural gas, as with coal, to be a major player in a low-carbon world."

(Source: Department of Energy, via Wikimedia Commons)

Right now, natural gas is being viewed as a way to reduce carbon emissions. But Moniz is warning that this positive view is temporary, at best. He's requesting $25 million for, the "Natural Gas Carbon Capture and Storage" demonstration program. That's a tiny sum, particularly when compared to what Southern Company is spending to build the first large-scale coal carbon capture facility.

The plant was originally expected to cost around $1.8 billion, but because of cost overruns and construction delays it will now cost more than $5 billion. The Energy Department chipped in a $270 million grant, and Southern could earn a similar amount in tax credits if it reaches certain carbon capture milestones. But, clearly, the cost Southern has taken on has been huge.

And, according to environmentalists, that price tag will make Southern's Kemper plant even more costly than nuclear plants. Putting numbers on that, the Sierra Club estimates Kemper will cost about $6,800 per kilowatt to complete, while a nuclear plant costs $5,500 per kilowatt. A natural gas plant can cost as little as $1,000 a kilowatt.

What was Southern thinking?
On one level you might ask yourself what Southern was thinking building such an expensive plant. However, proving this technology will be a boon for coal and natural gas. Indeed, Moniz recently said that, "We're going to need not 10 maybe 100 more of these plants across the country in the future." He may have been talking about a coal plant, but it was the future of carbon capture technology that he was thinking about.

(Source: XTUV0010, via Wikimedia Commons)

And this could be a bigger problem than you think. For example, power companies around the country are increasingly shifting toward natural gas. That includes Southern and fellow giants like American Electric Power . Southern generated about half of its power from natural gas in the first quarter of 2013, though rising gas prices dropped that to around a third in the first quarter this year.

AEP, meanwhile, has been shifting hard toward gas for years. Using 2005 as a baseline, it plans to increase the size of its natural gas fleet by 65% by 2016. Coal, meanwhile, is set to see a decline of over 30%. That said, coal still makes up the lion's share of AEP's generation, at about 75% of the total. This, of course, means that it just has more near-term issues to tackle with regard to carbon emissions.

The shot across the bow
The trend toward natural gas is obvious, with some regions relying on the fuel for over half of their energy needs. And this shift is likely to continue, particularly since the U.S. government is pushing even more stringent emissions rules. The easy, near-term fix is to build natural gas. However, that may not be the best long-term answer.

Moniz is already telegraphing that carbon capture will eventually hit natural gas facilities. That would cause more pain down the line for Southern, AEP, and others that are shifting to the fuel. Keep an eye on carbon capture and don't be lulled into believing that natural gas is the answer because it, too, will be in the carbon crosshairs some day. We had all better hope there's a second act to Kemper.

Source: apple.com. 

Apple  released a smorgasbord of new information Monday during WWDC 2014, the company's annual developer conference. CEO Tim Cook made passing criticisms of competitors and hit the nail on the head with his comments on Microsoft .  

WWDC focused on a wide range of Apple products, but the Microsoft slam came shortly into Cook's keynote address, which led to the Yosemite OS announcement due this fall. Yosemite was designed to appeal to a broader audience in an effort to snatch away market share from Windows PCs. And Cook made sure to mention Microsoft's recent OS problems. 

So what did Tim Cook say -- and why was he right? 

Microsoft's Windows 8 failure 
Cook brought up the adoption rate (or lack thereof) for Microsoft's Windows 8 operating system. While discussing the fact that Apple's newer OS Mavericks was installed by over half of Mac users, Cook displayed a chart showing Windows 8 with a 14% adoption. 

While Windows 8 hasn't received a warm welcome, Microsoft still owns the largest share of the desktop market. According to Net Applications, Microsoft's Windows 7 held over half of the market in May compared to nearly 6.3% for Windows 8, and 6.35% for the freshly launched Windows 8.1 update. 

The only Apple OS to make the Net Application list was Mavericks, which held over 4% of the market. So that suggests that Mac users did largely upgrade when the choice became available. 

Source: Net Applications. 

So Cook was right that Mac users took to Mavericks much faster than PC users took to Windows 8. But there are a couple of key differences.

Apple offered the Mavericks update for free to compatible systems, while Windows 8 upgrades started at about $100. And some users of older Mac systems were forced to upgrade when support was discontinued for the four-year-old Snow Leopard, which occurred around the same time as an important security update. Microsoft also retired an OS from support this year -- the 12-year-old Windows XP. 

Why Tim Cook was right 
Windows 8 has a larger desktop market share than Mavericks. But a new update that featured a Start button, but not a widely desired Start menu, has already surpassed Windows 8. ZDNet reported Monday that the promised Start menu might not make it to PCs until next year. And Microsoft is thought to have cut Windows 8.1 licensing prices by 70% for low-end manufacturers simply to keep some degree of momentum behind the operating system.

Mavericks has the smaller market share, but unlike Windows 8 doesn't have enough egg on its face to make an omelet. And Yosemite OS X could attract more users to Macs due to the furthered iPhone integration. Windows 8 boasted a similar cross-platform nature, but sales of iPhones trounce sales of Windows Phones. According to Gartner, iOS devices held nearly 16% of the worldwide smartphone market in 2013. Microsoft's share came in a bit over 3%.

Foolish final thoughts 
Apple still lags behind Microsoft in desktop market share, but Microsoft has entered an odd era where innovation has been replaced with late-to-the-game reactions. Microsoft needs more improvement updates or Yosemite could take a bite out of its market. 

Source:  Wikimedia Commons

Yesterday I strolled over to Red Robin Gourmet Burgers for the first time in nearly several months. As I was walking up to the entrance, I noticed a large sidewalk sign promoting Sam Adams from Boston Beer . I had to chuckle. I eat out several times a week, and (somewhat anecdotally speaking) I keep running into promotions, menu inserts, table tents, and chalkboard specials for Sam Adams at chains and independent restaurants alike.

And it works
I couldn't resist ordering a tall Sam Adams to go with my Banzai burger. What a good pairing -- the restaurant that seems immune to winter and the beer company that has a craft brew for every season.

Clearly I'm not alone. On May 20, Red Robin Gourmet Burgers reported fiscal first- quarter results. Revenue jumped 11.1% to $340.5 million. Same-store sales popped 5.4%. Net income soared 26% to $11.9 million, or $0.82 per diluted share. Red Robin Gourmet Burgers previously stated on its prior earnings conference call that any negative effects from winter storms tend to have a "cabin fever" effect, whereas sales jump up and offset the shortfall once the weather clears.

Source: Red Robin Gourmet Burgers

The point here is that with a restaurant like Red Robin Gourmet Burgers pushing Sam Adams for Boston Beer, it is essentially doing the work for the beer company. Maybe Boston Beer is providing incentives such as marketing materials, discounts, or whatever else on these restaurants, but it's hard to imagine they'd be willing to do it for any incentive if the beer itself quite frankly wasn't very good. Sam Adams excels quite nicely in taste tests, so it's a win-win for everybody.

Beer overboard
While Red Robin Gourmet Burgers and others are busy selling burgers and Sam Adams, Boston Beer continues to have trouble keeping up with demand. On April 30, Boston Beer reported its fiscal first-quarter results. Depletions exploded 34%, even while prices were raised 2%. It was a record quarter of depletions. Net income leaped 20% to $8.3 million, or $0.62 per diluted share.

Part of the reason for the gains was a 41% jump in advertising, promotional, and selling expenses from "increased investments in media advertising, point of sale and local marketing." You've got to figure part of that was from what I saw at Red Robin Gourmet Burgers and seemingly every other restaurant.

It also probably didn't hurt that Boston Beer rolled out a number of new beers nationally during the quarter as well. In the name of journalism, of course, I had to sample them all and confirm that they were of excellent quality. There was the Samuel Adams Cold Snap and the Samuel Adams Rebel IPA. On top of the excellent flavor, the marketing in terms of the names, labels, and descriptions are nothing short of genius, with the Rebel IPA "brewed with hops from the Pacific Northwest." Doesn't that just sound instantly tasty for some reason?

Source: Wikimedia Commons

Conference me in
During the conference call, there was some interesting information revealed. Martin Roper, CEO of Boston Beer, stated,

"Our brands also benefited from increased brand support, including increased media spend, expansion of our sales force, and other brand support investments."

Does brand support refer to initiatives with bars and restaurant chains like Red Robin Gourmet Burgers? As an example, recall back in 2012 Boston Beer and Red Robin Gourmet Burgers partnered to introduce a beer milkshake to the restaurants.

On the more cautious side, Roper warned that Boston Beer doesn't have any other seasonal beers planned for the rest of the year, so the company isn't sure it will "maintain its momentum." And given the popularity of many of Boston Beer's individual brands, Roper said there is some cannibalization going on. This makes sense. No doubt new Sam Adams brews will encourage Sam Adams fans to give them a try instead of ordering the regular brand. Roper still believes the entire portfolio of beer could see momentum for the rest of the year as the new brands gain popularity, but he couldn't make any promises.

Foolish final thoughts
It will be interesting to see how the summer months unfold. Boston Beer's signature Samuel Adams brew has been running strong and getting stronger for more than 30 years. It's hard to imagine the new introductions and national rollouts are running out of steam already. Roper was likely being conservative. I hate to give analysis that I can't back with hard evidence, but as a Samuel Adams beer fan myself for more than a decade I say with confidence that Boston Beer still has a long way to go. Each new beer it introduces seems to outdo the last. The flavors are unparalleled.

The solar trade war between the U.S. and China escalated yesterday, and now the debate is starting to hit installers and investors where it hurts. When the U.S. first imposed tariffs on imports from China in 2012, it left a huge loophole by limiting the scope of the case to Chinese solar cells, which rendered them almost useless.

Residential solar installations like these by SolarCity may see costs go up slightly short-term because of solar tariffs. Source: SolarCity. 

The loophole allowed Chinese solar companies to buy cells from Taiwanese suppliers or elsewhere even if ingots or wafers, which are the first two steps in making cells, came from China. By what's called "tolling" in Taiwan, the Chinese suppliers who were found to have received government subsidies and were dumping products at a loss were able to avoid tariffs that ranged from 34% to 254%.  

SolarWorld, who brought the original case, brought a new trade case last year that intended to close that loophole, and the Department of Commerce ruled yesterday in favor of SolarWorld. Most solar companies will have to pay a 26.89% tariff, except Suntech Power and Trina Solar , who got 35.21% and 18.56% tariffs, respectively.

Solar farms like this one still account for most of the solar installed in the U.S., and SunPower and First Solar, who are unaffected by the tariff, dominate this part of the industry. Source: SunPower.

Who this affects
Every Chinese solar manufacturer will be affected, but some will be hurt more than others. Yingli Green Energy is highly leveraged with $2.4 billion in debt and is still losing money. Even Trina Solar, who has the lowest tariff, will be negatively affected because it increases the cost to buy panels for U.S. buyers. 

What investors should keep in mind is that the solar market is now global, and Yingli and Trina have been diversifying their customer base to reduce risk. So, while this is an incremental negative for them, it's not a deal-breaker for them as countries. In 2013, the U.S. only installed 4.8 GW of solar to 37 GW worldwide, so there are large opportunities elsewhere. 

One of the key buyers of Chinese solar panels that will be negatively affected is SolarCity , who has benefited from low-cost Chinese panels since prices plummeted in 2012. Management has addressed this in previous conference calls and has suppliers from outside of China that can fill the gap. But it will likely lead to higher costs, which is significant even if it's only a few pennies per watt.

On the flip side, a company that should benefit is SunPower , who manufactures in Malaysia and is currently known as one of the highest-cost suppliers on a per watt basis. SunPower was already competitive with Chinese panels in the solar market, but this will either bring its costs more in line with competitors, or increase margins, both of which would help the company.

SunPower may parlay this ruling into a bigger market share in residential solar. Source: SunPower.

Is this a game changer?
What investors should understand is that this is more of an incremental impact on the solar industry rather than a major shift, despite the violent reaction solar stocks are having today. Trina Solar or Yingli Green Energy may shift sales from the U.S. to Japan, Europe, or Africa, but it isn't as if they're going to go out of business because of these tariffs alone. SolarCity may have to get panels from suppliers like Kyocera or Sharp, and costs could go up slightly, but the impact will be measured in pennies per watt, so it's only incrementally negative. Even SunPower, who is a beneficiary, won't see a major impact because of the tariffs.

Assuming they stand, beefed-up solar tariffs on Chinese imports will be a slight negative for the solar industry, but solar panels themselves are now only about 25% of the cost of a typical residential solar installations, so a few extra pennies won't fundamentally change the industry's trajectory. The media may have a field day with this, but investors can view it as noise in the great long-term investment thesis for solar stocks.

If it wasn't for the PC, it's likely that neither Microsoft nor Intel would be in the Dow Jones Industrial Average . The once-dominant "Wintel" paradigm elevated both tech giants, as Intel's chips and Microsoft's operating system combined to dominate the computing market.

But the rise of mobile devices has hit both companies hard. Although Intel and Microsoft are working to gain footholds in the tablet and smartphone markets, they remain far behind their rivals in terms of market share.

But a new concept, unveiled this week, could change that.

Intel's 2-in-1 reference design
On Tuesday, at Computex in Taiwan, Intel unveiled a reference 2-in-1 design -- a sort of concept PC that Intel hopes OEMs will use as inspiration for future devices. The 2-in-1 is composed of a thin, lightweight, yet large (12.5-inch) tablet powered by Intel's latest processor and running Microsoft's full Windows 8.1. That tablet can dock to a keyboard, transforming it into a midsize Ultrabook in the process.

The design is remarkably similar to Microsoft's own recently unveiled Surface Pro 3, though rather than rely on a foldable cover, Intel has proposed a hard keyboard dock. Some Windows OEMs have begun to run with this idea: Hewlett-Packard today announced the Pro Tablet 612, a 12.5-inch Windows tablet that docks to a standard keyboard.

Source: Wikimedia Commons.

Windows 8 finally gets a chance to shine
PC shipments suffered a record decline last year, and market intelligence firm IDC expects the market to contract another 6% in 2014. Mobile devices have eaten away at sales of traditional Wintel devices, with some users in emerging markets forgoing the platform entirely. Technology research firm Gartner has gone so far as to predict the demise of Windows within the next three years.

These 2-in-1 devices could be the best hope to avert that looming disaster for Microsoft and Intel, though their success remains far from certain.

Early reviews of Microsoft's Surface Pro 3 have been generally positive, with many commentators remarking that the system is the first device that finally showcases the true hybrid potential of Windows 8. Although prior Surface Pro models attempted something similar, they were hindered by a relatively small screen, poor battery life, and heavy body, making them ill-suited to productive work and difficult to carry around.

Like Microsoft's Surface Pro 3, devices built with Intel's reference model in mind could garner positive reviews, as the larger screen combined with the traditional keyboard allows the Windows tablet to act as a true laptop replacement.

Buyers have rejected Windows tablets
Yet the odds are still stacked against mobile Wintel devices. Gartner reported that Microsoft's Windows powered just 2.1% of the tablets sold in 2013, while Windows tablets accounted for just 5.8% of the global tablet OS market in the first quarter of this year, according to Strategy Analytics. Mobile developers have largely shunned Microsoft's app store, leaving Windows tablets far behind in terms of mobile app availability.

Of course, these numbers don't include sales of the Surface Pro 3 or any of the upcoming devices that will use Intel's reference design. As more of those devices hit the market, consumers could embrace Microsoft's original vision: a single device that serves as both a laptop and a tablet.

If that happens, both Intel and Microsoft, should benefit tremendously, though the probability of these new, hybrid mobile devices really taking off still appears remote. Nevertheless, this new PC concept seems to be the best chance at keeping the at Wintel platform alive.

SUVs may once again be hot, but VW's Touareg is not: VW sold just 552 in the U.S. last month. Source: VW Group

U.S. auto sales rose 11% in May -- better than expected -- and most automakers reported results that beat analyst estimates.

Coming after a very slow start to 2014, those results gave investors a boost of confidence. While automakers had blamed slow sales in January and February on the harsher than usual winter weather, some analysts had expressed concern: Was consumer confidence waning?

Happily for most automakers, that doesn't seem to be the case. But there's one big-name automaker that missed out on last month's surge in sales: Volkswagen .

A massive global growth push that is going the wrong way here
VW is on a massive global push to become the world's largest-selling automaker by 2018. It might well happen: The company has gained a lot of ground in Europe and China over the last couple of years.

But that push isn't going so well here: U.S. sales of VW-brand vehicles were down 15.4% last month. That's not just a one-month fluke, either. Year-to-date, VW-brand sales in the U.S. are down 11.5%. And that follows a 7% drop in 2013. Things have been going the wrong way for a while.

What's the deal?

Part of the deal is that VW is lacking strong products in the U.S.'s hottest market segments -- namely, SUVs and crossovers. New, fuel-efficient SUVs have been luring more and more buyers out of their cars. Most automakers are making hay from that trend: SUVs are generally more profitable than similarly sized cars. 

But it's not working out like that for VW.

The big SUV-sized holes in VW's lineup
VW's U.S. lineup does include two SUVs, the Tiguan and the Touareg. But both sell in very small numbers, and few shoppers seem to even consider them.

Why? Because they aren't competitive. The Tiguan is an old model that first came to market way back in 2007. It's outclassed by much newer and fresher entries from the likes of Honda and Toyota and Ford , and buyers just aren't giving it a look. Honda's CR-V and Ford's Escape are priced similarly to the VW, but each outsold the Tiguan by over 10 to one last month. Toyota's RAV4 beat it by almost nine to one.

VW's Tiguan is a dated model that doesn't compare well with rivals from Detroit and Japan. Source: VW Group

VW's other SUV is the Touareg. It's a close mechanical sibling of the Audi Q7 and Porsche Cayenne -- but both luxury models handily outsell the Touareg in the U.S. by wide margins. Why? Price and features: The Touareg starts at $44,570, and can quickly be optioned up well over $50,000. That's uncomfortably close to the (much nicer) Q7's starting price of $47,700. 

Meanwhile, a Ford Explorer starts at $30,600, with a lavishly loaded top of the line model coming in around $47,000. Maybe that's why Ford sold over 20,000 Explorers in the U.S. last month, while VW sold just 552 Touaregs. (No, that's not a misprint.) 

Sales at other VW Group brands have been strong
At the corporate level, it's not all bad news for the Volkswagen Group in the U.S. Sales at VW's Audi luxury brand are up over 11% so far this year. 

Of course, Audi's U.S. lineup has two well-regarded SUVs, the Q5 and Q7 -- and the Q5 is the brand's best-seller here. 

Another VW Group brand, Porsche, has also seen strong sales this year. About half of Porsche's sales come from the Cayenne -- which might be the world's most profitable SUV. And Porsche just rolled out a new smaller SUV called the Macan, which is based on Audi's Q5. 

The Touareg doesn't sell very well, but its plusher and sportier corporate sibling, the Porsche Cayenne, accounts for about half of Porsche's global sales and a lot of its huge profits. Source: Porsche

Audi and Porsche together account for the vast majority of VW Group's automotive profits. In the first quarter, the two brands represented about 17% of the Group's worldwide vehicle sales, but contributed over 90% of its operating profits from passenger cars. 

The profits from Audi and Porsche allow the VW Group sell its mass-market VW-brand cars with razor-thin margins. That's a big part of why VW has gained market share in Europe and China recently. 

But it's not working here in the U.S. And it may not work until VW gets its American dealers the products that buyers want.

The greatest businesses and the best investments have one thing in common, competitive advantage. Whether it's a strong brand name, a vast network, or cost advantages, every great company needs something to ward off competition. 

As a whole, however, the mREIT sector doesn't have a ton of competitive advantage. Strong management can be an edge, and better relationships with lenders can help secure financing -- but, neither has that "wide moat" feel. 

This is why Annaly Capital Management's  position in commercial real estate is critical. Despite its relatively small investment size, the portfolio should work as a hedge to the company's residential mortgage-backed securities, or RMBS, drive greater asset yields, and allow for opportunities unavailable to smaller companies. All these factors give Annaly an edge over American Capital Agency . 

Hedge 
In the first quarter, American Capital Agency used what's called a "natural hedge" establishing a $6.5 billion dollar short position on U.S. Treasuries. This way, if interest rates rose (decreasing the value of the company's bond portfolio) the short position would increase in value, and cover some of its losses. 

Annaly's investment in commercial real estate has a similar effect, but works quite differently. Both Annaly's triple net lease portfolio of physical properties, and its investments in mezzanine loans (low-grade commercial loans), are both cash-flow positions. Meaning, the investments will not lose value to the same extent as RMBS's based on interest rate fluctuations. 

More importantly, while commercial loans do come with the risk of default, unlike U.S. Treasuries, they allow Annaly to create additional cash-flow, rather than cancelling it out.

The yield
As Annaly's CEO Wellington Denahan noted in the company's most recent conference call, "Our commercial investment portfolio yields approximately... 9.18%."  For some perspective, Annaly and American Capital Agency's first quarter yield on RMBS's was less than 3%. 

How Annaly is earning this incredible yield is a little trickier. After acquiring a commercial loan, Annaly securitizes it, and then breaks it into pieces by investment "grade." Higher grades get paid back first in case of borrower default, so they're considered safer and receive lower yields, while lower grades have more risk, but have greater yields. 

According Annaly's head of commercial business, Bob Restrick, Annaly leaves the high grade loans for investors, and holds the mezzanine loans -- which are lower grade. 

Currently, Annaly allocates 12% of its equity toward commercial real estate, though, Denahan has mentioned the company is attempting to go as high as 25%. Giving the portfolio -- and more importantly the yield -- a more meaningful impact on bottom line results. 

Size 
Unlike other sectors, Annaly and American Capital Agency's shear size doesn't carve the same type of competitive advantage as it does for, a Wal-Mart or Google. 

In the commercial real estate market, however, Annaly has the opportunity to flex its muscles. According to Annaly's CFO Glenn Votek, "[Annaly's] capital position is three times the size of the largest commercial REIT."

Though the company will continue to allocation a majority of its equity toward RMBS's, Votek suggested, "we're unearthing... bigger opportunities, more unique pricing and structures because of that capital base." 

The last word 
No investing criteria is more important than competitive advantage. And up until recently it was hard to tell what Annaly did that American Capital Agency or any other mREIT couldn't do. 

However, for another company to exploit similar opportunities it would need a capital base that exceeds any currently competing commercial REIT, a pipeline to acquire and securitize the mortgages, and a completely new team with experience in the sector -- all pretty sizable hurdles. 

Looking forward, I think commercial real estate is expanding Annaly's competitive advantage, and it's, perhaps, the best reason to favor Annaly over American Capital Agency.

Editor's note: A previous version of this article referenced the "Buy American" program rather than "Buy America." The Fool regrets the error.

AK Steel CEO James Wainscott defends his company's push against foreign steel by saying, "we simply couldn't stand by and watch America our great country become the dumping ground for these products." While the financial reality of this anti-dumping crusade may be more about money than American pride, it brings up a touchy question: What is American steel?

Building a bridge
When looking for a company to supply the steel needed for the Verrazano Bridge, the Metropolitan Transportation Authority of New York (MTA) went with Chinese steel. The MTA said it, "could not find an American fabricator." That didn't go over well in the U.S. steel industry or in the press.

The MTA shifted to a claim that no U.S. steel company could meet its specifications and timeline for the Verrazano project. It was, however, able to find a U.S. steel mill for the Tappan Zee bridge project. The Tappan Zee is being built with steel from ArcelorMittal's U.S. mills.

(Source: Patrice78500, via Wikimedia Commons)

Both AK Steel and ArcelorMittal make heavy use of blast furnaces, which is a more costly process than mini-mills, which use electric arc furnaces and scrap steel. That's put AK and Arcelor in a bad position profitwise because oversupply has pushed steel prices down. AK Steel has fared worse, posting losses in each of the last five years. Its cumulative loss over that span was more than $12 a share.

ArcelorMittal has posted losses in each of the last two years, and its first-quarter loss of $0.12 a share continues the streak into this year.

However, ArcelorMittal is, technically, a European company with deep roots in India. The mill being tapped is in the U.S., but the company that owns the mill is anything but. This subtle distinction doesn't seem to be too much of a concern to anyone.

What is U.S. steel?
The reason is that the steel is still being made in the United States. That's a more important part of the equation than who owns the mill. It is, in the end, about U.S. jobs. So why is there a push-back against Novolipetsk Steel, a foreign steel company with an American subsidiary that has steel plants in Pennsylvania and Indiana?

As long as it comes out of the U.S. plants, it's U.S. steel, right? Not quite -- Novolipetsk Steel is a Russian company. That makes it a prime target, especially right now. U.S. steel proponents are making hay of the Crimea situation. The issue being addressed is deeper, however. 

(Source: CIA)

AK Steel and ArcelorMittal make steel in the United States. Novolipetsk imports giant steel slabs that it then uses to fabricate steel products. California Steel Industries, jointly owned by a Japanese company and Brazil's Vale, does the same thing—but its steel comes from Japan and South America, among other regions. 

Right now, Novolipetsk and California Steel can't compete for projects with "buy America" rules. Because they make steel in the United States, however, ArcelorMittal and AK Steel can. Novolipetsk and California Steel are trying to get that rule changed. The U.S. steel industry isn't pleased with the idea.

Not make or break
This isn't a make-or-break issue for U.S. steel companies like AK Steel or foreign ones with U.S. operations like ArcelorMittal. Far more important is steel pricing. However, it plays an important part, because foreign companies selling steel at low prices in the U.S. market (the aforementioned "dumping"), allows uncompetitive industry practices to continue.

If unprofitable steel companies are allowed to keep making steel, the oversupply currently facing the industry won't resolve itself naturally or in a timely fashion. Until the industry clears out the extra capacity, ArcelorMittal and AK Steel are going to have a hard time turning a profit. That's also true of companies that may be dumping steel. Keep an eye on the "buy America" clause, and if you own steel companies, wherever they call home, hope the current limits stay in place.

Nintendo recently signed a deal with Google 's YouTube to allow players to directly upload gameplay videos from their Wii U consoles, as long as they split their ad revenues with Nintendo and YouTube through an affiliate program.

While that sounds like an innovative move for Nintendo, it's actually a forced compromise. Last year, Nintendo flagged thousands of "Let's Play" clips on YouTube featuring gameplay from its games, claiming that it was entitled to a cut of the ad revenue due to copyright claims. Nintendo then required content creators to place ads at the beginning and end of their videos, with that revenue being split between Nintendo and YouTube rather than the creator of the video.

Source: Wikimedia Commons, Nintendo, Author's edits.

Locking "Let's Play" streamers out of their ad revenue sparked a fierce backlash against Nintendo, since many content creators considered gameplay videos to be free advertisements for Nintendo's games. Many players also criticized Nintendo's plan as a desperate tax on a dwindling customer base.

That criticism might not be too far off the mark -- Nintendo reported its third consecutive annual operating loss in May, and only sold 310,000 Wii Us during the fourth quarter. By comparison, Sony was selling an average of a million PS4s per month during those three months.

Should Nintendo just let Wii U owners upload content for free?
As I discussed in a previous article, Nintendo often makes business decisions based on copyright and piracy concerns. In the past, Nintendo prosecuted programmers for developing emulators for its discontinued consoles and intentionally used hard-to-copy proprietary media formats such as cartridges (N64) and mini-DVDs (GameCube).

Yet it's hard to understand why Nintendo doesn't just let Wii U owners -- all 6.2 million of them -- upload their gameplay videos to YouTube and let them retain their ad revenues. It seems like the perfect setup for a positive feedback loop -- Nintendo gets plenty of free advertising, while gamers are rewarded for streaming Wii U games on YouTube.

However, Nintendo has noticed that there's money to be made in that loop. Last March, All Things D reported that YouTube usually takes a 45% cut of the ad revenue generated by content creators, which leaves the creator with an average of $2.50 per 1,000 views.

A popular gameplay video featuring New Super Mario Bros. Wii U on YouTube channel Rooster Teeth has racked up nearly 2 million views since last March. According to All Things D's calculation, the video could have generated $5,000 for the content creator over a period of 15 months -- not bad passive income for 25 minutes of streaming gameplay. Spitting that revenue again with Nintendo, however, could easily cut those earnings by half.

Do content creators have the right to stream Nintendo games?
The key point of contention between Nintendo and some "Let's Play" creators is whether or not gameplay videos should be subject to copyright restrictions.

On one hand, Nintendo believes that it is being much more lenient than film and record studios, which have repeatedly forced content creators to remove TV shows, films, and music videos from YouTube. Nintendo is actually allowing gamers to profit from simply streaming their games to YouTube -- certainly not as much as other original content creators, but still better than its original plan of only splitting the ad revenue with YouTube. Moreover, streaming games from a Wii U doesn't require the purchase of additional props or the use of fancy video editing software -- it's a low-cost setup that anyone can use.

On the other hand, video games are not like TV shows, films, or music videos for one simple reason -- they serve a different purpose from the original product. Pirated versions of TV shows, films, or music videos on YouTube threaten the original creators, since they are digitally identical to the legitimate versions. People who watch "Let's Play" videos can't play the games they are watching -- it's like watching someone cook food that you can never eat. Therefore, "Let's Play" videos are really more like extended ads than pirated content.

Stop hitting that brick, Mario -- there aren't any coins left!
Nintendo's recent moves -- a focus on Skylanders-like figurines, an out-of-character Mercedes ad campaign, and now a "tax" on YouTube fans -- reveal a company that is desperately seeking new ways to generate revenue to avoid a fourth consecutive year of operating losses.

Yet Nintendo has repeatedly failed to address the three real problems with the Wii U -- the lack of robust first- and third-party support, an absence of attractive new IPs, and a weak and confusing marketing campaign. It has also refused to heed the advice of investors and analysts, who have tried to persuade the company to sell mobile games, add more in-game microtransactions to its games, or sell its flagship titles on rival consoles.

Nintendo President Satoru Iwata has called many of these suggestions "short-sighted." But it's difficult to see how Iwata's own solutions -- like having Mario drive a Mercedes SUV and "taxing" its YouTube gamers -- are any more focused on the long game than those ideas.

At 19 years of age, Brian Wong was one of the youngest people to ever receive venture capital funding. With the money, he co-founded Kiip -- and mobile advertising was changed forever.

Just ask Verizon , which is both an investor in Kiip and a client.

Why are Verizon and other biggies excited about this platform? Kiip rewards people when they've achieved certain milestones in games, fitness apps, or even mundane tasks like driving a car. The reward comes at a moment when the user is feeling exultant and, presumably, more likely to feel positively about some sort of branding.

Our roving reporter talked with Brian at the 2014 International CES in Las Vegas. In this video, Brian explains more about how Kiip works.

A full transcript follows the video.

Rex Moore: We're at the 2014 International CES, right outside the convention center, and a great sunset behind us. It's my pleasure to be speaking with Brian Wong, the owner/founder of Kiip, a mobile advertising network. Brian, explain -- you were one of the youngest ever to receive venture funding?

Brian Wong: Yes, I was. I was 19 when I raised my first round.

Moore: Now you're an old man of 22?

Wong: Absolutely -- and legal to gamble now!

Moore: Awesome -- we'll go out afterward!

Brian, tell us a little bit about Kiip. It seems to me to be a unique and actually an engaging way to advertise, [for mobile].

Wong: Kiip is very simple. It takes moments of achievement in apps and games that people use already -- think leveling up in a game, finishing a to-do on a to-do list, logging a run. What we realized is these moments are all comprised of significant emotions. Instead of socking people in the face with an ad, we said, why not actually reward you and acknowledge what you had done?

Our rewards are very unique in that they are serendipitous. People don't know when they're going to get them. Just do the thing you're doing already, and we're there to reward and delight you.

Moore: Tell me a little bit about some of the companies that are involved with this.

Wong: Yes, a few of our investors are publicly traded, like American Express and Interpublic Group, which is an advertising holding company, and Verizon. Luckily, those three are our customers as well -- it's good to have both.

But it really is a combination of both app developers and the brands, that are our customers. The app developers are the ones that integrate us into their apps -- think an exercise app like a Nexercise, or a game like Cut the Rope. Basically, when you hit those moments, then a brand can be there.

You could have Starbucks reward you with a free latte. You could have Sour Patch Kids reward you with a free bag of candy. There are many different ways to acknowledge those achievements.

Source: General Mills

You just knew General Mills'  support for GMO-free cereals was simply a thin veneer, a sop to activists agitating for removing genetically modified ingredients instead of a deep-rooted conviction its cereals would actually be better. It became particularly clear after its CEO said its GMO-free original Cheerios failed to move the needle, which was just what he expected, and he had no intention of removing them from any other cereal.

But the introduction of a new Cheerios Protein line underscores where his loyalties really lie, and it's not with the clean-foods crowd.

While it's understandable why the cereal maker would contribute millions of dollars to defeat state GMO labeling laws, since dealing with a patchwork quilt of competing standards makes operating a company with a national footprint challenging to say the least -- although simply removing GMOs from cereals wherever they're sold would largely solve that problem -- it's not so intuitive why it would wholly endorse making its best-selling brand even more GM dependent.

Cheerios Protein comes with 11 grams of protein, four more than the original, and with protein among the biggest, fastest growing trends among consumers, General Mills is hoping that by packing more protein into its cereal will help offset the general decline cereal makers have experienced.

Source: Janney Capital Markets, "Closing in on the Cereal-Killer," Oct. 18, 2013 

To infuse the new cereal with more protein, General Mills is making them with soy, which it says gives it the benefit of being compatible with vegetarian diets, but also has a better taste profile.

The problem is, virtually all soy grown in the U.S. today is genetically modified. According to the U.S. Department of Agriculture, some 93% of the soybeans grown on U.S. farms are herbicide tolerant, meaning they've been genetically engineered to withstand herbicides, mostly Monsanto's  Roundup brand. That percentage is up from 68% in 2001 and from just 17% in 1997, making it the second largest GM crop in the country behind corn, but also the most widely planted GMO crop ("only" 85% of U.S. corn is genetically modified). 

Source: U.S. Dept. of Agriculture

It's also Monsanto's second biggest profit center behind corn, generating over 15% of the company's sales and gross profits in 2013.

That means Cheerios Protein is likely made with GMOs. Of course, sourcing organically grown soy might be problematic as less than 1% is grown that way (0.2%, actually), and the remaining 7% or so is grown traditionally, without being genetically modified.

One of the problems with GM soy is that residue from glyphosate, which is the active ingredient in Monsanto's herbicide, remains with the plant more so than it does in other crops grown with the trait. According to a study published in this month's issue of Food Chemistry, on average GM soy had total residue equaling 11.9 parts per million. Although that's below the 20 ppm threshold set by both the U.S. and the EU, the study goes on to note the threshold was raised from 10 ppm not because of greater safety or efficacy, but merely because the glyphosate was so prevalent in our foods.

It may be true that sourcing GM soy is easier than organic or even traditionally grown soy, but if delivering protein is General Mill's true goal then it might want to take the pains to do so as the study also found the organic soy (and to a slightly lesser extent, conventional soy) packed more protein than did its genetically modified counterpart. Yet because soy also contains both linoleic acid and palmitic acid, a saturated fatty acid, if they're not consumed in balance it becomes a bigger risk factor for developing obesity. Organic soy had substantially lower levels of both kinds of acid while and GM soy contains palmitic acid levels that are significantly out of whack with the linoleic acid counterparts.

The $9 billion ready-to-eat breakfast cereal business is coming under pressure from the changing tastes of consumers who are looking at both convenience and foods they can eat on the go. Yogurt has specifically grown in popularity, as have breakfast bars, with Kellogg saying it's necessary to look "beyond the bowl" for new growth opportunities.

General Mills attempt to meld this interest in protein to its leading cereal brand may be a worthy effort, but seemingly doing so by pursuing the GMO route suggests its previous efforts at going GMO-free were merely paying lip service without having commitment.