“‘Sky-Fi’ — Silicon Valley’s $2.2 Trillion Breakthrough Bigger Than The Internet As We Know It”

What's Street Authority's "little-known company" with a "near monopoly" on the next internet?

By Travis Johnson, Stock Gumshoe, February 2, 2016

This ad has been running again and generating a lot of questions from Gumshoe readers, so we’re re-posting the answer here. The article below has not been updated or revised since it was published on July 20, 2015, other than an update to the Irregulars “Quick Take” box and an updated disclosure at the bottom — the stock is down by a little over 25% since the ad started running a little over six months ago. The original reader comments have been left appended to this article.

— from 7/20/15 —

The latest pitch for a “forever” stock from the Street Authority folks is all about how the next wave of internet adoption is going to make us all filthy, stinkin’ rich — and we don’t even have to buy an iffy little small cap wonder stock to bet on it. Sounds good, right?

Well, plenty of Gumshoe readers agree with you — I got a lot of questions about this over the weekend, so we’re going to dig in, check out the clues, and see which stock it is that they think will be making huge long-term gains for investors.

The intro to the ad is enough to make you drool — plenty of future promise, leavened with a heaping dollop of name-dropping. Here’s a taste, just to get you in the mood:

“Much like the railroad, the automobile, and the airplane transformed past centuries, a new technological breakthrough is poised to transform the 21st century…

“And generate trillions of dollars of wealth in the process.

The Economist calls this breakthrough ‘Sky-Fi.’ And as we speak, the wheels have been set in motion by some of the world’s most powerful people to make it a reality.

“Eccentric billionaire Elon Musk just pledged to spend billions of dollars on this epic innovation.

“Google and Fidelity have kicked in nearly $1 billion.

“Barack Obama has made it one of his top priorities before leaving office.

“And Facebook CEO Mark Zuckerberg is circling the globe meeting with foreign dignitaries about it. He calls it ‘the greatest revolution yet.'”

Sounds pretty cool, right? What they’re hinting at here is really just the push to bring the internet to more people — Google and Facebook have a huge monetary incentive to increase both the speed and reach of the internet (more people online means they can serve more ads to them, among other things), so they’re investing heavily in both mainstream and “moon shot” activities to extend the internet to remote, poor, and otherwise “challenging” parts of the globe, whether it’s by using balloon-based networks like Google or providing streamlined free internet over cell networks like Facebook’s two-year-old Internet.org (those are just a couple of the dozens of projects those two are working on, and other companies are certainly involved as well).

But how does it make us rich? After all, if it was easy to see how extending 4G/LTE data service to all of India to get those billion folks online at an affordable price, someone would have already made a fortune at it, no? In many ways, Facebook and Google are using their massive cash hoards to indulge in a little combination of future hubris and humanitarianism — they’re imagining that investments they make in improving the internet today will bneefit their shareholders in a decade or more, since presumably they’ll still sit atop the global internet…

… and they also, since both companies are run with some level of idealism and social motivation, are really trying to help bring the gift of the internet to more of the world. Where you assign the weights to those motivations probably reflects your own opinion and level of cynicism as much as anything else, and it doesn’t really matter — the fact is, the companies who benefit most from increasing speed and traffic on the internet are investing in enhancing both of those aspects of the world’s most important communications network.

And the money? Well, now we get to the “secret” company and some specific hints — and, it turns out, the fact that both Google and Facebook are pursuing at least some “internet expansion” ideas (like balloons and low-flying airplanes) that use existing LTE wireless technologies is a key part of the argument:

“One little-known company has a near-monopoly on the key technology making this breakthrough possible… and this firm’s shares could skyrocket 1,000% because of the event I’m about to share with you.

“This firm has locked down the crucial patents. And it’s already seen huge share price gains as events have unfolded to this point.

“You see, this firm is not some small, new, fly-by-bight player.

“In fact, it played a key role in the first two phases of this breakthrough. Each phase caused the company’s share price to soar triple-digits.

“But as this breakthrough begins its third and final phase – by far the largest of the three – this company’s stock is likely to see its biggest jump yet.”

Sounds a little more appealing, right? Some sort of big company that owns some key enabling technologies?

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Some of you may have a pretty good notion of where this is going already, but just to make sure let’s check out some more of the clues:

“… there’s one company perfectly positioned to profit from this mega-trend.

“It’s in an incredibly unique position. It’s spent the past 20 years developing over 21,000 patents and locking up not one… but two monopolistic positions.

“In short, its technology is the cornerstone of this new Internet age…..

“This company went public in 1991. It was one of the founding companies of the Internet. Its founder rubbed shoulders with the likes of Steve Jobs and Bill Gates, and he’s now a billionaire himself.

“Back in the 90s, the company made a forward-thinking decisi