Trend Report Digital 2012 by Shelly Palmer
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Trend Report Digital 2012 by Shelly Palmer Trend Report Digital 2012 by Shelly Palmer Document Transcript

  • www.shellypalmer.com
  • 2013 Consumer Electronics Trend ReportTable of ContentsIntroduction .................................................................................................. 3Screen Ubiquity and Diversity ...................................................................... 5Video Viewing Continues to Evolve Rapidly................................................ 9The Smartphone as Your Personal Control Center .................................... 13Digital Health Comes On Strong ............................................................... 15Connected and Smart Homes Get Closer to a Tipping Point .................... 16Cars Get Smarter ........................................................................................ 18Trending Tech You Should Watch ............................................................ 20Conclusion .................................................................................................. 22BY: SHELLY PALMER, JIM TURNER & JARED PALMERCOPYRIGHT © 2013 ADVANCED MEDIA VENTURES GROUP LLCALL RIGHTS RESERVEDSHELLYPALMER.COM © 2013 PAGE 2 OF 23
  • 2013 Consumer Electronics Trend ReportIntroductionWelcome to the Shelly Palmer 2013 These are big numbers and they are onlyConsumer Electronics Trend Report. In going to get bigger — but what do theythe next few pages we offer a brief over- mean?view of the consumer electronics trendsthat will have the biggest near-term im- In my new book, Digital Wisdom:pact on consumer behavior. Thought Leadership for a Connected World, I examine how three interesting ob-Thinner, More Powerful & Higher served laws converge to offer meaning toRes statistics like these:For everything with a screen, the trend 1) Moore’s Law proposes that the num-will continue to be be thinner, more ber of transistors on integrated circuitspowerful and higher resolution. But that doubles approximately every two years.2doesn’t mean that it’s business as usual. This isn’t accurate, it’s more like one year, and the rate of change is accelerat-According to research by the Consumer ing. But it does speak to the idea of ex-Electronics Association (CEA), the or- ponential growth.ganization that stages the ConsumerElectronics Show (CES) smartphones 2) Metcalfe’s Law posits that the valuesales will see continued growth in 2013 of a telecommunications network is pro-and will remain the primary revenue portional to the square of the number ofdriver for the industry. connected users of the system (n2). The math here is debatable too, but it is veryShipment revenues for smartphones are obvious that the value of a network in-expected to reach $37 billion in 2013, creases with the addition of each addi-with more than 125.8 million units tional user, the only question is, by howshipping to dealers, up 16 percent from much?2012. Tablet computers also are ex-pected to see phenomenal growth. In 3) Kurzweil’s Law of Accelerating Re-2013, unit sales of tablets are projected turns is the thesis of his book The Singu-to surpass 105 million (up 54 percent), larity is Near and he observes that theresulting in $35.6 billion in shipment rate of change in a wide variety of evolu-revenue, up 22 percent year-over-year.1 tionary systems tends to increase expo- nentially. This is the least obvious of the 2 Gordon E. Moore, "Cramming More Components onto Integrated Circuits," Electronics 38.8 (April 19, 1965: 114- 171 CEA Press Release. ftp://download.intel.com/research/silicon/moorespaper.pdf.SHELLYPALMER.COM © 2013 PAGE 3 OF 23
  • 2013 Consumer Electronics Trend Reportthree laws, but understanding the expo-nential rate of technological progress iscritical to understanding how consumerbehavior will evolve.When taken together, these three laws,which are not really laws, but rather ide-as — help add context to the CEA’s re-search. You can intuit that rapid andremarkable socioeconomic change willstart happening faster than we can planfor it. The speed will continue to accel-erate, and the “network effect,”(Metcalfe’s Law) will empower consum-ers in ways that will stretch the limits ofour imaginations.While reading this report, try to keepthese three conceptual laws in mind andthink about how, when taken in context,technologically empowered consumerswill impact your business.SHELLYPALMER.COM © 2013 PAGE 4 OF 23
  • 2013 Consumer Electronics Trend ReportScreen Ubiquity and DiversityOnly a few short years ago, conventional Tablets and smartphones together nowwisdom held that people preferred to out-ship computers; over two thirds ofwatch long content on big screens and Americans plan to buy a tablet, most ofshort content on small screens. Today, them in the next two years.3viewer data confirms that people willwatch content of any length on the best We will look at the devices and exploreavailable screen. Manufacturers are now the implications of this ubiquity and di-using a "Goldilocks Strategy" searching versity.for screen sizes that are, "just right" fortargeted user cohorts. Screen size gives Televisioncontext to the user experience allowingusers to choose how, when and where The business is in transition. Shipmentsthey want to watch, play and interact in were down 7% in Q3 2012 and the trenda connected world. continues. Average screen size increased 5% to 35” with larger screens steadilyCognizant of this shift, flat screens are increasing in market share.4 This reflectsgetting smarter, and content and appli- just how fast manufacturing technologycations are getting delivered on a dra- is developing and how quickly prices arematic range of screen sizes and device deflating—bigger, slimmer, cheaper isfeature sets. We are beginning to see de- what you need to remember.vice convergence—smart TVs are be-coming more and more like tablets and Major topics of discussion for 2013 in-smartphones, and tablets and clude: OLED, Ultra HD (a.k.a. 4K),smartphones are becoming more like Smart TVs and, of course, the new com-televisions, thanks to TV Everywhere. petitive landscape.However, this doesn’t tell the whole sto- Organic LED (OLED)ry. Second screen experiences (i.e. usinga secondary connected device while us- With respect to resolution, Organicing another) are redefining content con- LED (OLED) TVs have been the "nextsumption and interaction. big thing" for over two years, but the technology is still on the distant horizon.Television devices will continue to see To understand the clarity and contrastsignificant increases in size and resolu- ratio of an OLED screen, imagine antion along with subsequent technologi- extremely thin, flexible, bendable, verycally-driven price deflation. 3 CEA Survey. 4 NPD DisplaySearch Advanced Quarterly Global TV Shipment and Forecast Report.SHELLYPALMER.COM © 2013 PAGE 5 OF 23
  • 2013 Consumer Electronics Trend Reportlow power LED screen with the absolute resolution of currently deployed HDbest display quality available today— sets.that’s OLED. 5 Although a technologi-cally imperfect example, just imagine a Size Mattersreally big Apple Retina Display.6 OLEDis even better! With respect to resolution and screen size, industry logic suggests 25” is ap-OLED smartphone displays are already propriate for standard definition, 50” foron the market on many Android and HD and now 84”, or larger for UHD.Windows phones, but sizing up the LG, Sony, Sharpe and Samsung are alltechnology to create OLED TVs has offering UHD sets ranging 60-85” cost-proved difficult because pixel defects are ing between $15,000 and $25,000 USD.common and current yield rates are still Westinghouse is touting a 110” 4K setbelow 10%. for Q1 2013 as well as 50”, 55” and 60” models. Massive 4K sets will make forOLED might launch in a meaningful an incredible home theatre experienceway in 2013 (Samsung is rumored to for those trying to keep up with thehave a 55” model in the works). When Jones’.manufacturers eventually get this right,you’ll see flexible OLED screens But what does one do with a 4K set?wrapped around products everywhere— Not a whole lot as of now. Unfortunate-Times Square meets your local grocery ly, right now, there is almost no nativestore! 4K content, so practically everything you watch on a 4K set will be upconvertedUltraHD (4K) from HDTV (a.k.a. 2K).TVs may finally be catching up to video Analysts believe that content deliverycamera technology with the advent of will be via blu-ray-like discs or over theUltra HD (a.k.a. 4K or UHD). Internet. Prices will drop dramatically and more 4K content will surely be cre-4K is shorthand for 4000, which repre- ated in the future. Right now, however,sents the order of magnitude of the reso- 4K is just a very cool technology thatlution 3840 x 2160 pixels (8.3 megapix- offers a glimpse into the future.els). This is approximately four times thenumber of pixels and therefore twice the 4K May Be Bad For 2K One immediate impact of Ultra HD5 may be to scare high-end buyers away You may hear the technology referred to as “SuperAMOLED,” but this is just Samsung’s proprietary name for from purchasing very large (70" – 90")its OLED displays.6 2K HDTV sets. Why spend $9,000 The “Retina Display” found in many Apple products is notOLED. It is IPS, which stands for “In Plane Switching,"and USD on an 80" 2K set when an 84" 4Kis actually a premium LCD technology that’s known for set is only a few thousand more? Its ahaving a wide viewing angle and clear picture.SHELLYPALMER.COM © 2013 PAGE 6 OF 23
  • 2013 Consumer Electronics Trend Reportquestion every high-end flat screen buyer This past year, Samsung established it-will be asking themselves in 2013. self as the new market leader in flat screen TVs with a near-record 26%3D TV global market share.For all the hype, 3D never happened. With the top five consumer electronicsWith limited 3D content available, ex- manufacturers viciously competing forpensive glasses needed and oh yeah, an every market share point, this is going tooptimal perpendicular viewing set up, be a great year for consumers.consumers have spoken with their wal-lets about the technology and sales are Tablets and Smartphonesfading. 3D is a passing fad -- don’t letanyone tell you otherwise. All the hype about the mobile revolution is probably warranted. 821 millionSmart TV (Connected TV) smartphones and tablets were sold glob- ally in 2012 and 1.2 billion are expectedIn contrast to 3D, TVs featuring Inter- to be sold in 2013. 10 Smartphone andnet connectivity (Smart TVs) are grow- tablet shipments also exceeded PCing in popularity. Out of 114 million shipments in Q4 and the combined in-homes, 25 million have Smart TVs, and stalled base of smartphones and tabletswhile only half are actually connected to are expected to exceed PCs in mid-the Internet, 7 fewer still are regularly 2013.11used for OTT viewing. Although someheadwinds exist because of a lack of in- Where’s all the growth coming from?dustry standardization, the real problem Not the just the US and China. Viceis content acquisition and audience George Ferreira, President and Chiefmeasurement. Operating Officer of Samsung Electron- ics Africa, announced that with an esti-Remarkable Competition mated 450 million smartphone users in 2012 that Africa is now the second larg-The competitive landscape is in transi- est and fastest mobile phone market intion. Because of global geo-politicalheadwinds and Japan’s stagnating econ- enters recession before election - FT.com." FT.com. Theomy, the major Japanese manufacturers Financial Times, 10 Dec. 2012. Web. 6 Jan. 2013. <http://www.ft.com/intl/cms/s/0/dd3dd156-4278-11e2-Panasonic, Sharp and Sony are in finan- 979e-00144feabdc0.html#axzz2HA3a9NJ2>.cial trouble. According to Bloomberg, 9 Yasu, Mariko. "James Bond Can’t Fix Sony as Japan Elec- tronics Scrape Lows." Bloomberg Technology. Bloombergthe trio collectively lost $15 billion in LP, 20 Dec. 2012. Web. 3 Jan. 2013.market capitalization and will be elimi- <http://www.bloomberg.com/news/2012-12-19/james-bond- can-t-fix-sony-as-japan-electronics-scrape-lows-tech.html>.nating 29,000 jobs.8,9 10 Gartner Inc.. "Gartner Says 821 Million Smart Devices Will Be Purchased Worldwide in 2012; Sales to Rise to 1.2 Billion in 2013." Gartner Technology Research. N.p., n.d.7 NPD Group.   Web. 29 Nov. 2012.8 Japan has had two consecutive quarters of negative GDP http://www.gartner.com/it/page.jsp?id=2227215. 11growth. McLannahan, Ben, and Simon Rabinovitch. "Japan Mary Meeker. 2012 KPCB Internet Trend Report.SHELLYPALMER.COM © 2013 PAGE 7 OF 23
  • 2013 Consumer Electronics Trend Reportthe world after China.12 Price deflation think about this new set of consumeris driving penetration rates. For example, behaviors is simply, "people are takingChinese manufacturer Huawei is now their TVs with them."offering a $50 Android-powered 3Gsmartphone.13 Don’t be surprised if yousee a $20 smartphone on the market by2015.The tablet market is exploding too.Two-thirds of online consumers expectto purchase a tablet eventually, with 45%in the next two years. 31% of Americansown them, twice as many as last year.14Tablets are disrupting common practicesin business, education, gaming and me-dia consumption.Tablets and smartphones are changingthe way we create and consume contentand our relationship with information.Even though a video may be seen bymillions of people, you are still watchingit up close (maybe with headphones) andhaving an intensely personal experience.This new intimate relationship withcontent is literally is redefining massmedia.Tablets and smartphones are also chang-ing the relationship that gamers havewith game consoles. One good way to12 Biodun Coker. "Nigeria Ahead Smartphone Penetration inAfrica." Business Day. N.p., 27 Nov. 2012. Web. 31 Dec.2012.<htttp://www.businessdayonline.com/NG/index.php/markets/companies-and-market/48068-nigeria-ahead-smartphones-penetration-in-african>.13 Lomas, Natasha. "$50 Android Smartphones Are Disrupt-ing Africa Much Faster Than You Think, Says Wikipedia’sJimmy Wales | TechCrunch." TechCrunch. Aol Tech, 10Dec. 2012. Web. 31 Dec. 2012.<http://techcrunch.com/2012/12/10/50-android-smartphones-are-disrupting-africa-much-faster-than-you-think-says-wikipedias-jimmy-wales/>14 CEA.  SHELLYPALMER.COM © 2013 PAGE 8 OF 23
  • 2013 Consumer Electronics Trend ReportVideo Viewing Continues to Evolve RapidlyCombined with the explosion of screens, Monthly mobile video consumption inbig shifts are taking place as consumers bytes is expected to increase 1000% overmove more fully into on-demand the next three years (See Figs. 2 &3).streaming consumption of video andother content. Subscription services are Some key questions for 2013:growing and also facing new challengesand competition. Furthermore, new • Will all of this additional videoviewing habits make measurement and viewing burden infrastructure?monetization of content more complex.Advertising and marketing opportunities • What will happen to bandwidthhave expanded, but knowing what mes- costs?sages are effective and understanding thenew currency of engagement is, at best, a • Will limited data plans stunt thischallenge. growth? EO VIDThe Internet is for Porn! • How will the "network effect" impact consumer behavior?So what are people doing with all thesedifferent screens? Mostly watching vid-eo. (See Fig. 1) On any given night,Netflix accounts for about one-third ofprimetime Internet traffic. Overall videotraffic is expected to grow 26% next year,and by 2016, it will account for 86% ofall global consumer IP traffic.15 (See Fig.2) In other words, in about three yearsthere will be more than 1.2 millionminutes of video content crossing globalIP networks each second. Video con-sumption is exploding across all plat-forms, especially in the mobile space.15 Cisco VNI, 2012.SHELLYPALMER.COM © 2013 PAGE 9 OF 23
  • 2013 Consumer Electronics Trend Report Global Consumer Internet Video Growth of Global Consumer 2012 by Category Internet Video by Category (PB per month) 50 4.5% 3.6% 1.0% Exabytes per month 40 9.8% 30 10.3% 20 60.5% 10 10.3% 0 2012 2013 2014 2015 2016Figure 1 Figure 2 Global Consumer Internet Video US New Media Set-top Box 2016 by Category Distribution (PB per month) Game Consoles 11% 5.3% 2.8% 14% DVR 17.8% 56% Smart TVs & Blu 40.4% 22% Ray Players Tablets 8.4% 44% OTT Boxes 12.8% 12.4%Figure 3 Figure 4 Rationale for TV Content Weekly Video Consumption Streaming by Device 92% 100% % of Consumers Cancelled cable 5% 75% 41% Cut back on cable 6% 50% 25% 12% 10% Catch up on shows 40% discovers after 0% Catch up on missed 73% episodes of TV 0% 25% 50% 75% 100%Figure 5 Figure 6Source: CEA Research, Cisco, VNI 2012.SHELLYPALMER.COM © 2013 PAGE 10 OF 23
  • 2013 Consumer Electronics Trend ReportContent Ownership in an On- Microsoft has the unique opportunity ofDemand World establishing itself as the central home media platform for the next five years.The traditional concept of owning con-tent is shifting as we move toward a fully Content Dealson-demand world. Subscription servicesfrom Netflix, Amazon, and HuluPlus As good as this all sounds, the elephantare reshaping behavior (See Figs. 5 & 6). in the room has several file cabinets ofWhereas physical media sales are down existing content deals on its back. The4%, continuing a longer trend, rentals cost of creating a virtual MSO is astro-and video-on-demand Multi-systems nomical. Very few companies have theOperator (MSO) are down 18% and funds to replicate a cable operator or, tosubscriptions and streaming are up realistically provide the fantasy tech-25%.16 panacea... a la carte cable content. It may happen, but it is going to take anConsumers are becoming more com- astonishingly large sum of money to ac-fortable with less ownership and more complish the task. Yes, the technologystreaming. exists. No, the deals have not been done. Just because something is techno-Content costs are rising and so expand- logically possible does not mean that it ising streaming libraries is proving to be guaranteed to happen in a reasonablequite expensive. When consumers can time frame.access content on a What I want, WhereI want, When I want (WiwWiwWiw), New Measurement Headwinds,basis filters become paramount, especial- Advertising and Monetizationly when there are mutually exclusivecontent libraries available. The rapid growth of second screen and borderless viewing is going to require aOTT & Xbox complete overhaul of measurement technology and a revision on generallyWe will see new services that bundle and accepted content release windows. 17filter OTT services and content very Managing release windows will continuesoon (See Fig. 4). These services could to be the best way to maximize profita-find themselves as smart TV apps, set- bility.top-boxes, media centers or most likely,game consoles. Out of 70 million Xbox 17360 units, 40 million have Xbox Live Windowing is a term-of-art that content publishers use tosubscriptions. With a new Xbox unit describe the act of delaying distribution of content on various channels until the previous distribution channel is properlylikely to ship by YE2013. yield managed. Although, there are many, many variations, a typical widowing schema for a major motion picture might be: Theatrical release => DVD (home entertainment) => Hotel => Pay Per View => Premium Cable => Broadcast Television => Online.16 CEA Research.  SHELLYPALMER.COM © 2013 PAGE 11 OF 23
  • 2013 Consumer Electronics Trend ReportSecond screen viewing has the capability Borderless Viewingto amplify or dampen viewer engage-ment. But remember, unlike television Borderless viewing, the ability to watchratings and share, engagement is a con- the same video on multiple devices, is ancept, not a metric. There are no gener- emerging trend and a disruptive behaviorally accepted measurement practices or that is complicating pricing models andpricing models for engagement. contextualization.Multi-Tasking How should ads be priced when the two viewing devices have different interac-A recent study by Google, Ipsos and tive, technological and location-trackingSterling suggested that viewers watch capabilities and traditionally differentTV with another device in hand 77% of advertising metrics? That is "the" ques-the time 34% with a PC/Laptop and tion. Without better metrics, we will see49% with a smartphone or tablet.18 Apps more and more legal bouts over contentlike GetGlue and Viggle attempt to cap- rights.italize on this multi-tasking behavior,but they lag far behind Twitter.The Social Media WildcardEven as Twitter ups its efforts to inte-grate with live network TV content,there is still an unanswered question ofcausation vs. correlation. Which phraseis true "I Tweet, therefore I watch." or,"I watch, therefore I Tweet." So far, theanswer is elusive and the relationship ofTwitter mass and velocity on TV ratings,advertising and product sales has yet tobe determined or fully understood.People have clearly demonstrated thatyou can use Twitter to overthrow gov-ernments – it is unclear if tweets canhelp sell toothpaste.18 Google Research. "The New Multi-screen World: Under-standing Cross-Platform Consumer Behavior." August2012.SHELLYPALMER.COM © 2013 PAGE 12 OF 23
  • 2013 Consumer Electronics Trend ReportThe Smartphone as Your Personal ControlCenter    Smartphones are intensely personal de- Global socioeconomic and cultural adap-vices. They are always on, they live in tation is the major catalyst for the mo-our pockets and purses, they even come bile revolution. It is a joint effort be-to bed with us. Because we are insanely tween manufacturers, society and politi-attached to our smartphones, our cal institutions.smartphones are very "smart" about us. Ubiquitous Access to The NetworkSo, when are we likely to see thesmartphone evolve into a true personal If you watch television, you are sure todigital assistant? When will it become a have noticed that both Verizon andcontrol surface for our other digital de- AT&T claim 4G network dominance invices? When will privacy laws, cyber- the United States. Carriers and cablerssecurity and business rules allow us to alike are offering free Wi-Fi in publictruly enjoy the benefits of connected liv- spaces. Retailers, advertisers and pro-ing? The answer is: now. moters of all kinds are offering free WiFi in retail stores, coffee shops, concertsExo-digitally Enhanced Humans and wherever practical.It’s curious and misleading that we still The statistics are not important becauserefer to these devices as phones since the trend is clear – we are heading to athey have evolved into something so time of ubiquitous network access.much more powerful. Coupled withNear Field Communication (NFC) Geeky Stuff Going Mainstreamchips, GPS and Bluetooth connectivity,they are personal electronic command Use of QR codes has increased 350%centers used for digital communication, since 2011 for “frequent scanners” (thosenavigation, commerce, Internet access, who have scanned at least 20 QRsocial networking, photography, video, codes). 19 This trend will continue as,security, music, TV, health monitoring what was once considered "geeky" be-and gaming. (See Verizons advertising comes mainstream. Access to technologycampaign for HTCs Droid DNA.) As will continue to alter consumer behav-our central communication and enter- ior. More people will Tweet tomorrow,tainment hub, they are truly an exo- than Tweeted today. More people willdigital extension of us; they are the hu- manipulate images tomorrow, than ma-man body’s first external digital organ. 19 CEA Research.SHELLYPALMER.COM © 2013 PAGE 13 OF 23
  • 2013 Consumer Electronics Trend Reportnipulate them today. More people will fined as "access" to content stored in ause their connected devices to control remote location. But, it is important totheir thermostats tomorrow, than do so keep in mind that there is a remarkabletoday – and on, and on and on. amount of computational power that is being accessed remotely – this trend willHyper-personal Experiences continue.Although smartphones let us share in- In a very short time, smartdevices (notformation, connect and collaborate with necessarily smartphones) are going tothe rest of the connected world, more create a new class of smarter, better,and more consumers are demanding hy- faster, more powerfully competitive hu-per-personalized experiences with their mans. If you outsource your memory (todevices. Google or Wikipedia), outsource your way-finding (to GPS), outsource yourThanks to innovations in big data ana- healthcare (to connected monitoring de-lytics, our smartphones are getting vices), etc. You are guaranteed to besmarter every day; they are adapting to better at the doing of life than someoneour own unique behaviors, interests and who is not "exo-digitally enhanced."preferences across the entire scope of ourdigital (and even analog) activities. Our tools are evolving exponentially faster than our ability to interpret howThe Cloud Changes Everything the tools will impact our world. This may be the most important trend of all.Cloud storage, the ability to seamlesslyand remotely access and share files acrossplatforms and devices, is altering the waywe think about and do business. Theother half of the equation, and often lessdiscussed, is Cloud computing, which isthe ability to remotely process infor-mation.Taken together, virtually unlimited stor-age and unlimited computational powerwill significantly change the form andfunctionality of our devices in the nearterm.Now, practically every connected devicecan access audio, video and data fromanywhere in the Cloud. The concept ofcontent ownership in 2013 is being rede-SHELLYPALMER.COM © 2013 PAGE 14 OF 23
  • 2013 Consumer Electronics Trend ReportDigital Health Comes On StrongThe recent explosion of interest in Another awesome use of mobile tech-healthy living, wellness, fitness and bet- nology is remote diagnostics, whichter disease management is finding its connect you to your doctor without away into consumer electronics. This ar- physical visit. Continua Health Allianceea has grown 25% at CES since last year is an industry organization with morewith over 210 booths dedicated to this than 220 members that enables end-to-market.20 end plug-and-play connectivity of devic- es based on existing communication andAlliances Taking Shape data platforms for personal health man- agement and healthcare. The industryNew industry alliances are creating group also certifies services and publishesstandards that enable biometric sensors, standards; with 70 devices certified sodiagnostic devices, health data and rec- far, it is a huge success.ords and healthcare professionals to allcommunicate easily. Dr. McCoys Medical Tricorder is Almost HereEverything Has A Companion App Digital health and wellness is nascent,Once again, smartphones are at the cen- but the technology promises remarkableter of it all receiving the information outcomes in our connected world. Thefrom wearable devices and tracking, trend is clear and the progress is obvious.communicating and managing your digi- Within three to five years, we will seetal health. this technology enhance the work of physicians and health professionals on aBiometrics and sensors plus a wide range global basis and, more importantly, offerof apps connect your health profile to basic health and wellness services to anyour smartphone. ANT+ is an emerging explosively large patient population.standard for the interoperability of sen-sors, primarily for fitness. Organized bya subsidiary of Garmin, it has more than300 members including Adidas, Mi-crosoft, Sony Ericsson and Trek. Withover 320 products, it is an example ofhow industry standardization can benefitconsumers.20 CEA Research.SHELLYPALMER.COM © 2013 PAGE 15 OF 23
  • 2013 Consumer Electronics Trend ReportConnected and Smart Homes Get Closer toa Tipping Point  Capabilities are increasing, major players smartphone, but it won’t give you up-are entering the market and costs are dates you on your Samsung washer andfalling for systems that provide security dryer. Expect this trend to continue asfor your home, monitor your energy us- manufacturers try to build brand loyaltyage, control your lighting and media in a highly competitive market.consumption, monitor activities in yourhome, provide remote control of locks In practice, this makes sense. Manufac-and systems and much more. turer X wants to sell as many Manufac- turer Xs products as possible, but con-Standards Are Emerging sumers dont want to download and use a different app for every different deviceSeveral interoperability standards are in their home. Third parties are alreadysimplifying the systems, and with the starting to create universal control appsability to use your smartphone as the and unless the manufacturers changecontrol center, as well as having it “tell” their strategic direction, this trend willyour home when you arrive and what continue. Expect a great business foryou want, these systems are growing in third party developers and a missed op-popularity. portunity for appliance and CE manu- facturers. Historically, the biggest man-Smart Appliances ufacturers do not cooperate with each other -- this is a trend that will probablyRemember George Jetson’s apartment in continue.Orbit City? Well, we aren’t quite thereyet, but we are certainly on our way. EntertainmentConnected appliances are penetratingthe home. Conversely, much like in home monitor- ing, smartphones and remotes are con-Not Smart Manufacturers verging on the entertainment side of the business. Apps like Roomie and iRuleAkin to what we are seeing in the are IP controllers that, along with Glob-smartphone, tablet and computer mar- al Cache hardware, transform yourket, appliance manufacturers are keeping smartphone into a universal remote. Ontheir platforms and ecosystems separate. the other hand, remotes are getting smarter. Many now have touch screensLG’s THiNQ app will work on any and smartphone-like interfaces, such as Logitech’s new Harmony Touch. AlsoSHELLYPALMER.COM © 2013 PAGE 16 OF 23
  • 2013 Consumer Electronics Trend Reportworth noting is Xbox SmartGlass, whichturns your smartphone (and its key-board) into an Xbox remote and withsome apps, into an interactive secondscreen too.Security and ControlHello SkyNet. Of those consumers in-terested in home automation systems,62% said it was motivated by security,including fire and smoke monitoring.21There are a few home automation stand-ards (Z-Wave, ZigBee, etc.) emergingthat are promoting a lot of co-opitition,which is great for homeowners.Connected consumer products for homesecurity, lighting and energy (by timeand activity), temperature control, videosurveillance, baby monitoring, motionsensors, garden irrigation and lockingdoors are all on the market now -- andnot only is there an app for that -- mostare controllable across platforms.Although not at CES, Lixil has asmartphone-controlled toilet (lid up anddown, flushing, even monitoring andrecording of bowel movements). Werehoping this is not a trend.21 CEA Survey.SHELLYPALMER.COM © 2013 PAGE 17 OF 23
  • 2013 Consumer Electronics Trend ReportCars Get SmarterNew systems to “mirror” your systems based on traffic patterns in thesmartphone onto your car’s dashboard near-term.along with biometric sensors that moni-tor your stress, drowsiness, and driving The trend is clear. Your smartphoneneeds are bringing new intelligence to and your car are both in the Cloud – theautomotive systems. auto industry is committed having the technology work together to enhanceGM is adding “Siri” to its lowest end your experience.cars and Ford is expanding its electronicservices across its models. Expect great strides in the follow- ing areas over the next few years:These two along with Audi, Mercedes,and others all are adding systems that • Access and Egress to the vehiclelink to your smartphone to adjust the (Seats, mirrors, heat, door locks,car’s settings and services to your needs trunk)as well as your specific location. • Way-finding (Enhanced GPS,144 million Americans spend approxi- cartography and mapping)mately fifty-two minutes driving eachday, and 76% of them drive alone. The • Vehicle service (needs analysis,car is quickly becoming a member of our appointments, locations)personal digital ecosystem in a safe,smart and enjoyable way. • Relevant, contextual location- based advertisingTouch screens and voice recognition arehelping our car computers feel more like • MoSoLo (Mobile/Social/Local)our smartphones. featuresThere are also improvements in safety in • Personal preferences (memory,the works. Mercedes Benz already has intelligence, learning)Attention Assist, which monitors a driv-er’s drowsiness. Toyota is testing ges- • Enhanced entertainment (music,ture-based controls and face recognition games, video)systems. Ford is rumored to be testingseat-belt respiration sensors and steering • Connected living features (socialwheel heart rate sensors. In addition, networks, email, txt, apps)Ford will be rolling out phone-disablingSHELLYPALMER.COM © 2013 PAGE 18 OF 23
  • 2013 Consumer Electronics Trend Report • Driver safety (inter-vehicle communication) • Vehicle movement (traffic Jam avoidance, parking space reserva- tions) • Interfaces with other modes of transportation (railroads, airline schedules)And, expect the entire industry to workhard to figure out how it can do all ofthis while complying with new NationalHighway Traffic Safety Administra-tion guidelines around distracted driv-ing.Paul Mascarenas, Chief Technical Of-ficer at The Ford Motor Company says,"Eyes on the road, hands on the wheel,is our first priority." On this issue, he isclearly speaking for the entire automo-tive industry.SHELLYPALMER.COM © 2013 PAGE 19 OF 23
  • 2013 Consumer Electronics Trend ReportTrending Tech You Should WatchThere are several interesting technolo- Payment Systemsgies that you should pay attention to thisyear. Some are already very mature, oth- The mobile payment system market isers are nascent, but topics listed here are booming. 1 in 5 mobile users purchasednewly relevant in the context of how something on their smartphone inthey will impact consumer behavior and 2012.22 Square Inc. tripled its user basethe doing of business in 2013 and be- last year. With 3 million users, 7000 newyond. Starbucks locations and 250,000 mer- chants using Square Wallet, the compa-Robotics ny is processing over $10 billion in transactions annually. Square is currentlyConsumer Electronics robotics is still experimenting with taxis and will be in-mostly about robopets and automatic troducing gift cards too.23vacuum cleaners, but it wont be forlong. Anthropomorphic robots have Gesture and Face Recognitionbeen popularized by science fiction mov-ies, but robotic helpers do not need to be Now that practically every device in-in human form to be useful. cludes a camera, gesture control and face recognition software is starting to im- prove. While still more of a parlor trick3D Printing than a paradigm shift, the trend is clear – our tools are going to know how weAs it becomes more user-friendly and move and react to our movements. Thischeaper, 3D printing has the potential to will change research, as well as gaming,upend traditional economic concepts of and almost every field where trackingsupply and demand. Users will be able to movement makes sense.create just about anything as long as theyhave the designs and composite material. Connectivity Expansion: NFC andThe "maker movement" is just begin- WiFining.Spare parts will give way to printed re-placement parts, and piracy will take on 22 CEA Survey.a whole new meaning when someone 23 Rao, Leena. "Square Now Processing $10B In Annualsteals your CAD/CAM file and prints Payments; Added $2B Over Past Month (And That Doesn’t Include Starbucks) | TechCrunch." TechCrunch. Aol, 14the necklace it took you two years to de- Sept. 2012. Web. 6 Jan. 2013.sign. <http://techcrunch.com/2012/11/14/square-now-seeing-10- billion-in-annual-payments/>.SHELLYPALMER.COM © 2013 PAGE 20 OF 23
  • 2013 Consumer Electronics Trend ReportA fascinating use of NFC is Samsungs UnGamingTecTiles, which allow users to createtheir own NFC Tags. These stickers Handheld games have come along waywhen tapped by an Android powered since the original Nintendo GameBoy.Samsung smartphone execute a pre- Apps have replaced cartridges and withdetermined task on the device. Users can better and better screens and graphicscreate TecTiles to launch an app, make a cards, come better and more fun games.phone call, send a text message, check in Smartphones and tablets have all buton Foursquare, update a Facebook sta- turned the stand-alone hand-held gametus, play a song and a whole lot more. market into a super low budget kids-onlyTecTiles are a great example of how our business.mobile devices are letting us interactwith our physical environment in new The Fading Camera and Stand-and unique ways. alone Navigation MarketsWiFi’s growth has been extraordinary Phones are replacing both point andwith 1.5 billion devices shipped globally shoot cameras and GPS devices. Againin 2012 (up 5x in just 4 years), and it is we are seeing functionality convergencestill getting better. 802.11ac (a.k.a. “5G on both sides. Android-powered camer-WiFi”) is now the fastest WiFi ever, but as with WiFi are hitting the market andso far there are no hardware devices to camcorders aren’t dead yet. However,use it yet. WiGig is on the horizon. It’s manufacturers are focusing on mainly7 times as fast as wired Gigabit Stand- the enthusiast and professional market.ard. Remember, the speed of infor- The days of the dedicated point-and-mation is directly equated to economic shoot camera are numbered. As forsuccess. stand-alone GPS units, and even factory installed GPS, the clock is ticking. It isWirelessHD (a communications proto- just a matter of time before these devicescol that uses a 7 GHz channel in the 60 are replaced by the GPS function in yourGHz Extremely High Frequency radio mobile device. The timing will be fasterband) is also trying to become a stand- than the demise of the dealer-installedard. Several major manufacturers are cell phone.promoting the technology so, it is worthkeeping an eye on.Bluetooth may seem like old hat, butpeople are actually starting to use it now.Bluetooth-Enabled Device ShipmentsExpected to Exceed 2 Billion in 2013.24 kets: Bluetooth 2011: Rapid Growth for Established Interface.24 Wood, Laura. "Research and Markets: Bluetooth 2011: N.p., n.d. Web.Rapid Growth for Established Interface." Research and Mar-  SHELLYPALMER.COM © 2013 PAGE 21 OF 23
  • 2013 Consumer Electronics Trend ReportConclusion  The story of humankind is segmented by In practice: There will be more connect-our tools -- from the Stone Age to the ed devices tomorrow than there are to-Bronze Age to the Iron Age to the In- day. Networks will be more powerfuldustrial Age through the Space Age and tomorrow than they are today.into the Information Age, we have al-ways described and defined ourselves by More people will have access to contentour technology. and to each other tomorrow than they have today.The trends outlined here should beviewed through a single filter, Technol- Every industry expert can tell you "what"ogy is meaningless unless it changes the is eventually going to happen, the hardway be behave. part is telling you "when."If you understand a how a technological If you apply Moores Law, Metcalfestrend will change how we do life, then Law and the Law of Accelerating Re-the technology matters. If it doesnt turns to what weve covered here, youseem life changing to you, make sure you should be able to gain some insighttruly understand how it will be used be- about "when" this technology will trulyfore you dismiss it. change the world.ShellyPalmer is an industry-leading advisory and business development firm that of-fers deep-knowledge subject matter expertise and strategic counsel to brands, media, ad-vertising, entertainment and technology companies with a special emphasis on digitalmedia, social media and empowered consumers. Our mission is to help you succeed in aconnected world. For more information, please visit shellypalmer.comSHELLYPALMER.COM © 2013 PAGE 22 OF 23
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