Apple to drop out of top three by 2020: VC Fred Wilson

Apple's strong Q2 results apart, the Cupertino company may drop off from being the most valuable company and may not be able to stay even among the top three, says a venture capitalist.

Fred Wilson, one of the top investors of New York's Union Square Ventures  sees Apple sliding from its current exalted position, and not even being among the top three by 2020, technology website TechCrunch reported

At TC Disrupt Conference held in New York, Wilson predicted that Google and Facebook along with some new, unheard company could be among the top three companies by 2020 and also that Facebook's competitor, Twitter, would take a spot somewhere between four and seven in the pecking order.

The projections according Wilson were based on the fact that Apple lacked cloud integration and it was 'rooted to hardware' which could hamper the company's chances of evolving in the future.

He further believed that Apple's stock had risen due to the increasing sale of iPhones and iPads, but at the same time, Android had taken over iOS as a platform. While Apple had a loyal fan following, devices built using Android had been successfully attracting newer users.

''The ongoing trope that ''software will eat the world,'' championed by other investors like Marc Andreessen, will actually hold true for years to come, with no one able to take hardware beyond the point of commodity status, '' points out TechCrunch.

In a book, Haunted Empire: Apple after Steve Jobs, released recently, The Wall Street Journal's technology reporter Yukari Iwatani Kane talks about the downfall of Apple in the past two years, ever since the passing away of Steve Jobs.

The book points out that Jobs' successors were trapped in confusion and had been unsuccessful in bringing in fresh new innovation. They were bound by the way things were always done and ignoring all warning signs, it said.

According to Wilson, Apple was  ''too rooted to hardware,'' with not much presence in the cloud and that would make it too much of a challenge for it to evolve going forward.

''I think hardware is increasingly becoming a commodity,'' he said. ''Their stuff in the cloud is largely not good. I don't think they think about data and the cloud.''

Wilson's thoughts on Apple, however, run counter to the rise and rise of Apple's stock in the past 12 months, where it had gone up by 31 per cent as the company continued to grow sales of its iPhone smartphones and iPad tablets.

According to commentators it still seemed quite unlikely that tables could turn so dramatically in six years.

However they point out it would not be the first tech company to drop out in value even if it held mindshare, saying Yahoo, was expected to drop out of the Fortune 500 for the first time with the publication of the annual listing in June this year.