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Let me tell you about Frank Frankovsky.
As the hardware chief at Facebook Inc. (Nasdaq: FB), Frankovsky's team invented a way to use Blu-ray discs to save the oodles of photos that we all upload on that site every day. While Facebook still keeps its frequently accessed data on hard or flash drives, its deeper archives now reside on thousands of Blu-rays.
Frankovsky's system – which involves robotic arms, thousands of discs, and hundreds of racks – turned out to be tremendously successful for the social media giant. Facebook says the system cut costs by 50% and energy use by 80% compared to the hard disk drive system it was using.
So it's no surprise that Frankovsky broke off from his "corporate overlords" back in 2014, opened up his own shop – Optical Archive Inc. – and started selling his system to other companies with Big Data storage needs.
If you've never heard of Frankovsky, that's okay.
His beard may be a bit flamboyant, but he and Optical Archive operated in what I like to call "stealth mode"… quiet and under the radar.
But one once-struggling tech giant saw what was going on – and bought Frankovsky's company in 2015.
That company was also operating in stealth mode at the time. After years of decline, it needed to stay quiet in order to rebuild.
In fact, around that time, it made three big stealth moves that have now put it back on the map.
It's no longer in stealth mode… it's absolutely crushing the market… and it's just getting restarted.
Today I'll tell you about the three big moves it made.
And I'll show you how you can join in – and ride along as it reclaims its place as one of the world's preeminent technology companies.
Take a look…
Big Invention – Bigger Market
Here's why Frankovsky's innovation is so important.
He basically came up with a system that uses high-definition Blu-ray discs to replace hard drives or legacy tape systems.
His optical image discs can hold more than 300 gigabytes of data. That's roughly six times more than you have on a standard Blu-ray disc at home.
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Moreover, Optical Archive created a storage system that can pack one petabyte of data (that's 1 million GB) into a single cabinet filled with 10,000 Blu-ray discs.
This is a huge market.
Storage equipment, according to the analysts at IDC, accounts for 45% of the Big Data market, which they say will hit $17 billion by the end of this year. Moreover, within Big Data, infrastructure technology (including storage systems) ranks as the sector's biggest and fastest-growing segment.
So it's no wonder that Sony Corp. (NYSE ADR: SNE), the technology conglomerate best known for its consumer electronics, pounced on Optical Archive back in May 2015.
Here's the thing. The purchase was a key part of the Japanese giant's "One Sony" restructuring plan in which it's shedding low-margin units to focus instead on growth markets.
More than any sales it will get from this system, the purchase was heavily symbolic. It underscores just how serious Sony was about putting its troubled past behind it and focusing instead on cutting-edge tech once again.
And last week, we learned that Sony's restructuring plan is doing much better than anyone on Wall Street would have believed possible only a year ago…
"Unexpected"… a "Blowout"
On Oct. 31, Sony delivered a terrific earnings report – and raised guidance. Now it says fiscal 2017 earnings will likely be the best in its 71-year history.
And it caught Wall Street completely by surprise.
Atul Goyal, an analyst at Jefferies, summed it up best. He told The Wall Street Journal that the revised earnings forecast was "unexpected" and a "blowout."
Sony CEO Kazuo Hirai has done an outstanding job executing his turnaround plan. By shifting to new growth fields, he's made all of Sony's electronics businesses profitable – including the TV division that suffered a decade of losses.
I recently appeared on CNBC World to discuss Sony's impressive results. And today I'm following that up to talk with you about the two other stealth moves the firm made in creating what we can now safely call "The New Sony."
Let's start off with Sony's big jump into smartphones…
About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.