£1.2trillion tech bonanza
How the Silicon Valley titans soared in value in the past 12 months
AMERiCA’s technology titans added £1.2trillion to their market values in 2019 as their seemingly unstoppable rise continued.
Facebook, Apple, Amazon, netflix, google owner Alphabet and Microsoft saw their combined worth jump to £3.8trillion last year – the same as the gross domestic product of Japan.
And the rise in value was equivalent to the size of the spanish economy, which is the fifth biggest in Europe and 14th in the world.
The surge capped an extraordinary decade that saw the silicon Valley giants increase their values by nearly £3trillion.
And it has enriched their billionaire founders, from Microsoft’s Bill gates to Amazon’s Jeff Bezos and Facebook’s Mark Zuckerberg, and rewarded British savers who have invested in these firms.
it has also prompted searching questions about how much power they wield and whether they pay enough tax.
But despite fears that tougher regulation is on the way, analysts are forecasting more gains in 2020 as the firms expand further into 5g mobile services, video streaming, driverless cars, cloud computing, banking and healthcare.
Daniel ives, a tech analyst at los Angeles-based wedbush securities, said popular consumer gadgets face ‘ transformational’ upgrades. ‘There is clear momentum for the tech stocks,’ he added in a note to clients.
Apple gained the most in value during 2019, at £450bn, followed by Microsoft at £318bn, Facebook at £157bn, Amazon at £128bn, google parent Alphabet at £76bn and netflix at £18bn.
The companies were aided by the rise of the smartphone, which has put a high-powered computer in most consumers’ pockets.
since the start of the decade, uK smartphone ownership has risen from about 24pc of the population to nearly 80pc, according to media regulator ofcom.
That was the main driver behind Apple’s phenomenal success, with the company’s iPhone still bringing in more than half of its £196.5bn in annual revenues 13 years on from its launch.
But Apple boss Tim Cook is shifting focus to subscriptionbased music and video streaming services, and wearables such as headphones and the Apple watch. its shares have touched nearly $294, compared to $30 at the end of 2009, and it is valued at around $1.3trillion, or £980bn.
But analysts are divided on whether the upward march will continue. Paul Meeks, a us tech analyst, claims a sharp fall in tech shares is inevitable. he suggested that investors have not fully grasped Apple’s reliance on the declining smartphone marke, saying: ‘it is not a growth market.’
however others suggested that the boom in sales of its wearables, and the prospect of a 5g-enabled iPhone, could still help Apple deliver stellar results in 2020.
The tech company founders are some of the richest individuals on the planet. Bezos, 55, who founded Amazon, is the world’s richest man with a fortune of £87bn, according to the Bloomberg Billionaires
index. his ex-wife MacKenzie, given shares in a divorce deal this year, is worth £28bn.
Bezos’ net worth stood at about £15bn in 2012, with his company’s expansion from online retail into areas such as grocery delivery, video streaming and cloud computing fuelling a £600bn rise in its valuation to £690bn.
Microsoft’s Bill gates, 64, has also seen his fortune rocket from £48bn to £85bn since 2012.
in a recovery that critics once saw as impossible, Microsoft has climbed in value by more than £700bn to £905bn, after focusing on cloud computer services. Zuckerberg is worth £59bn.