innovation playground Idris Mootee

Millennials Are Disrupting Media Again. Media Companies Now Need To Play Catch-up.

Digital disruption to the media began early in the days of the Internet throwing every media company into a crisis mode. Now this is happening again - this time, even homepage viewership is on the decline. I am not saying this is the death of the webpage, having a webpage or content site is simply not enough.  Content is now distributed and stories are best shared and read through new platforms such as Facebook’s Instant Articles, Apple News, Buzzfeed, the Starbucks mobile app or through Reddit, a bulletin board platform that doesn’t sound like something new since the early days of the Internet. It is an entertainment, social network, and news website where registered community members can submit content, such as text posts or direct links, making it essentially a crowd sourced news channel.

Today all Millennials are gravitating to social networks and news media sites and assume everything is free. This generation, (confident, always connected, ramen-eating, ultra short attention span, impecunious, underemployed, some over-educated, gaming obsessed, and so forth) millennials are not only the largest generation in US and world history, they’re on the cusp of commanding the largest influence and voice of our consumer culture. They expect technology to work and simply-work and if it doesn’t, you will have a big problem. They are tech-loving consumers but have unrealistic expectations that technology needs to be seamless (thanks to Apple) with a new standard of intuitiveness. They align themselves with the latest technology and will try anything new and cool and quick to critic and quick to find workaround. Computers don't crash and smart phones should be able to handle everything.

Millennials don’t watch TV (and others are following) and they sleep with their cell phones next to them perhaps 9 out of 10. Probably 10 out of 10 have no landlines and no interest in watching TV. Smartphone is the most important tool in their lives and when people are saying the smartphone is becoming a commodity. It is not. How can it be when it is the most important tool or digital companion? Smartphones are not doing well because the expectation is rising and Smartphones have replaced the cigarette (good thing) as things to do in those odd moments, lonely moments or simply filling up every minute of downtime. It is replacing newspaper, cigarette, chewing gum, calculator, wallet and many other tools…. hookups, meet-ups or start-ups. 

There is no online or offline, social is social and other opinions matter. They get along well with their parents and even have friendship with parents, which didn’t happen in the older generation.  They actually influence what products their parents buy, what apps their parents use and where to travel. They have a  “we can fix it together” mindset and “we can change it all” attitude. That’s why they love working for start-ups and game changing companies with a purpose.

More millennials than non-millennials integrate their beliefs and causes into their choice of companies to support, their purchases, and their day-to-day interactions. They put the money where the mouth is. Millennials also care about what’s genuine and authentic. They are looking for somewhere between a retro aesthetic and a search for honesty and authenticity.  Something advertisers are still struggling with. For many millennials, they prefer to climb the Himalayas then corporate ladder. They are raised to believe they can do whatever they want and they are hitting the realities as they enter the society.  Millennials are hard to catch. Media companies are not getting it. You need to work harder.

 

 

The Most Successful Wearable Design Is All About Balance, Benefit, Beauty And Behavior.

This is the billion-dollar question: “How do we create the iPhone pr Walkman of wearables?” and “How do we create sub-ecosystems around these wearables?” At the CES who this year, you can still see everyone displaying their newest or not-so-new wearable ideas. No one can afford to miss the train but most of the wearables out there now are just toys and eventually will become thrown aways. I can't find a reason anyone would want to buy most these so called wearables. Google glass is officially a failed experiment, or at least for now. GoPro is a stellar success and Apple will enter that game soon. They have been granted a patent for a wearable camera that could possibly challenge action cameras leader GoPro.

The path to mass adoption of wearables will not be a straightforward one. There are numerous technology, user behavior and production economics barriers to cross. With all this buzz and emerging innovative conceptual designs competing for the dominance, there are still many questions to be asked about what the future holds and how consumers will adopt a different product paradigm. Even the smartphone is still shaping our behavior and we are still actively reprogramming ourselves. The smartphone is becoming the operating system of our professional and personal lives, our relationships with the outside world and emerging systems around it. When it comes to the operating system, the main battle will be an OS that will interoperate across all devices. This is the big play. The success of any dominant design for wearables will be based on successfully tackling of the 4Bs:

Balance, Benefit, Beauty and Behavior.

Balance: To design wearables, one must ensure that they are, indeed, wearable. That means comfortable and adaptable to the various places and spaces the body inhabits in the world. To do this, design needs to include studying the anthropometric measures of the human body and of the equilibrium between the various zones of the body. One key to success is ensuring that the form or shape of the wearable fits the body and its actions in the world. Nerdy high-tech designs will not cut it. Balance reflects the highest level of design excellence, seeking an unselfconsciousness in interactivity languages, adding a sense of space to that of place with engineering overtones that are human at the same time.

Benefit: Designers must first determine the real problem the wearable concept is trying to solve, needing to solve, able to solve. Focusing on needs means designers can concentrate on the things that deliver the highest value. The benefit doesn’t have to be a known benefit today and there could be some needs users don’t even know exist until they see them. Sometimes these benefits appear to be small but actually can make a big difference in behavioral change. Contained product moments and the tiniest interactions are important in designing the customer experience of wearables, and designers must try to transform them into opportunity.

Beauty: The consumer needs to love the design. It needs to have visual appeal so, to the user, it doesn’t look like something you see in a Sci-Fi movie. The design needs to be expressive and not only limit to the form factor, but the overall interactive experience. The connectivity piece is key – it needs to allow for seamless wireless connection. The interactions or interface design is the trickiest part. The designers must translate the mass into energy, form and relationship. This is about creating order out of chaos, to put order into things, to make things more simple, to give meaning to objects through the presence of a design language.

Behavior: This is the least predictable part. Just look at all those health tracking devices, there is a tremendous gap exists between collecting and reporting data and changing behavior, there are little evidence to suggest that these wearable is making people more healthier. But for sure, the most successful wearable would be those who can influence our behavior as a mechanism for human behavior change and reinforcement. The subconscious mechanisms by which a human brain forms habits are still a bit of a mystery, and this can let us down a path to come up with devising tools for changing them.  

In The Near Future, Instead of Choosing Between AT&T, Verizon, Sprint and T-Mobile, You Can Also Pick Google or Apple As Your Mobile Carriers

The US mobile industry has been in a clear state of duopoly with Verizon and AT&T occupying about 70-75% of both consumer and enterprise market. T-Mobile is attempting to disrupt the current status but the impact will not be sustainable although its Uncarrier attack effort is causing a lot of noise. To maintain competition and sustainability for all is a tricky balance and the key is to ensure it will not endanger the long-term ability for players reinvest in next generation networks. InterDigital, Qualcomm, Ericcson, and Samsung are actively involved in 5G wireless development and carriers need to be ready for the next upgrade cycle in 3 years.

Strategically speaking, an industry structure only becomes stable when three firms dominate a market or 90% of a market, when the market share ownership reaches a ratio of roughly 4:2:1. Simply, the number one provider has market share double that of number two and it doubles that of number three. With AT&T and Verizon roughly splitting the market, with Sprint and T-Mobile US struggling to grow their market share. This gridlock is not changing unless either AT&T or Verizon acquire Sprint or T-Mobile. Then there will be only two players left.

Duopoly may not be good idea for consumers. Although duopolies will eventually lower prices as much as perfect competition would. More than 270 million US customers (roughly 91.0% of the total US population) have the choice of three or more wireless providers, while 250 million (or 82.0%) can choose from among four wireless providers. For everyone, subscriber growth is slowing as we are near market saturation. This slowdown means acquisition costs will increase, as everyone is spending more to steal each others' customers. Spending to get new customers is not a way out. Carriers need to think how to reinvent their business models. That won't be possible unless they can a highly differentiated offering or customer experience. There are only two ways to do this. AT&T has been the most aggressive in expanding offering new services providing home security and automation services and providing cellular connections to non-smartphone devices or any IoT. It will pay off for them.

In the world of 4:2:1 market share structure, everyone is trying to invest on revenue growth through promoting churn. And the shifts in market share at similar prices for similar products depend upon the relative willingness or desperation of any one plater to invest at rates higher than the sum of market growth rates and the inflation rate. If markets are growing at1.5 %, and the inflation rate is 1.5%, than a leading contestant has to invest at rates greater than 3% annually. Any firm not willing to do so loses share.

If every player is willing to do so, then prices and margins will be pushed down until at least one or all stops investing. That is the case for Verizon and AT&T, and underpins the argument advanced by Sprint and T-Mobile that they cannot prosper in the long term unless they are allowed to merge. For Sprint, they are taking customer away from T-Mobile with trade-in program, as part of its "Uncarrier" program, T-Mobile will match trade-in pricing from other carriers. So, it's possible that the company could match whatever deal Sprint offers. And Sprint also has a matching program, so it goes on and on unitl one of them cannot afford it anymore.

Now if Google is starting its own cellular service (very likely) by buying capacity on T-Mobile and Sprint networks in the US. That would essentially create a disruptive scenario. Although for the last few years the competitive threat from the mobile virtual network operator (MVNO) looks to be subsiding; but by buying capacity on the networks of T-mobile and Sprint, the company will come into cellular business directly and it will offer Google phone and data plans to customers.

The question remains if Google’s intent is to create a limited market roll out or a full-scale national share grab. The word out there is Google is launching the service later this year. It will for sure be a very affordable package. And will Apple follow and buying capacity from T-Mobile and allow services for Apple devices? Apple’s entry will create the “The Prisoner’s Dilemma” for carriers. The carrier’s biggest fear is that if it says “no”, the business and growth would go to a competing carrier and yes they are fueling Apple’s market power. iPhone customers typically spend as much as twice or more the U.S. national average monthly wireless bill. So with Google entering the game and speculating Apple might do the same, the industry structure would definitely be destabilized. It is not reasonable to think Google might be able to take up to 2-3% share from AT&T and Verizon. The carriers won't be too happy. But the threat to carriers is small and mostly in the long term.

The “Internet of Useless Things” or IuT Is Everywhere. Not Every Player Has A Plan.

The CES is a good one this year. Everywhere is IoT. And honestly I am little tired of hearing IoT or “Internet of Things” which is estimated to become a $7 trillion industry where thermometers, clocks, garbage cans, toilets, washing machines, watches, smartphones, fridges, baby monitors, garage doors and coffee makers are all connected digitally, allowing seamless interactions and smart living for us. Sensors are cheap and can be deployed everywhere collecting data, unnoticed. Data on how you move around in your home or office, in the gymn, on bike around your community, in a car, in public transit etc. How much water and electricity you use, and when; how much garbage you produce and dispose. And these reams and reams of information will make everyone of us overloaded with big data.

The biggest opportunity is Data Spam Management (just invented an industry). These data streams will drive us crazy eventually if we don’t know how to use them. Might as well turn all of them off. For those who are afraid of cookies that track them on line, it is going to get worse and much worse. When it comes to monitoring individuals and collecting details about their lives, privacy is over. Many people are still uncomfortable and remain to having their data tracked and analyzed. It is hard to define what privacy means in the world of big data. Imagine how much one can find out about you by going through you trash, in this case, your digital trash from sensors and devices that surround you 24 hours.

The world of hyper-connectivity is creating man opportunities for us and also is close achieving the top of a hype cycle. Perhaps itself is a recycled product of formerly known as the Smart Home or Smart Appliances. 90% of new products are merely solutions looking for problems and there are no unmet needs. Nest is a lucky case and there are not that many lucky cases for people to hit the Jackpot. When people enter this industry, they first need to understand the emerging behavior as a result of big data and what does it mean to have them.  And how it can shape our behavior? And what is the behavioral economics at work? What industry will it power up and who will benefit from it? Who owns the data gateway? I can go on and on for a day.

I am not an early adopter but I buy all these tech junks for my friends to try. I am really not interested in the thermostat. I am not interested in an Internet enabled door lock and for this one, I am sure I will be the last adopter. To create devices that can connect is easy and anyone can enable any objects with some kind of connectivity be it Bluetooth or Wi-Fi. But it takes some strategy to make sure you have a real customer value proposition.

The business opportunities for IoT are undeniable, but most of the visions out there were either overly simplistic or flawed and ultimately unworkable. The number of connected devices is expected to grow 18% each year for the next seven years and people couldn’t wait to have their “things” get connected. Beyond the hype, most will question the value and will understand the total costs of ownership. Buying an old fashion clock, toilet or door lock is easy. We can be sure that they will not break (most of the time) and needs very little maintenance. But when these become electronics, it will be a very different game. There is a cost to maintain (making sure they remain connected and receive update etc.) and needs to be replaced in a shorter period as technology moves fast. Way faster than they redesign your toilet or old fashion thermostat. The true value comes from larger companies designing integrated architecture so the orchestration of these appliances large and small can create a new level of convenience and delight. The oppotunties are not for everyone. The rest are just playing in the IuT game.

Action Cam King GoPro Is Turning Our Life Into A Movie. HTC and Others Also See The Opportunity.

When I was at a GoPro event earlier this year I saw how the crowd reacted to it and it is more than a product, it is now a movement. The little mountable camera is a brilliant example of how innovation can shape the industry structure of digital imaging and created a new path of growth under the radar screen of all big players from Canon, Nikon, Sony, Lumix and others for cameras and the Logitech, Microsoft, HP and others for video cam.

This little wearable camera company did an amazing job (now a US$10 Billion market cap company) invented a completely new category. The digital camera business is in decline while smartphone replacing low end cameras and more affordable DSLR and micro-four-thirds are driving margin out of the industry. GoPro managed to innovate based on a simple unmet needs. A perfect example of taking advantage of a corporate blindspot.

GoPro has been developing wearable technology devices "before they were cool." Nick Woodman developed the first GoPro camera in 2004; it was a film camera that could conveniently be strapped to a person's wrist, allowing users to easily snap a photo of memorable moments in action. So people don’ t need to put their cameras inside a waterproof bag. It’s the age of the selfie, GoPro are enabling video and action selfies. They are the best (and until recently the only) tools to be used to bring authentic and extreme actions to share with everyone. It is an answer to our needs to share moments and capture experiences. It is the defacto adventure broadcast system. The accessories system is impressive and that is part of the reason for their success.

GoPro's success stems from its ability to use consumer experience as advertisement. Customers are basically marketing their products. Otherwise it cost tens of millions to produce those. Now the National Football League is launching a digital streaming network, called NFL Now using GoPro. This NHL season, you'll be able to experience hockey from a whole new perspective -- the players'. The NHL is teaming up with GoPro to provide footage of certain plays from the perspective of goalies and stick handlers. Now you'll be able to experience hockey from a whole new perspective - the players'. Yes, they've just reinvented sports broadcast. Think about it, it is more than a hardware company selling a commoditized product (video camera) that can be easily produced at half the price, and GoPro is not just a sports cam anymore.

GoPro is as much a content and media company as it is a hardware company. GoPro's lightweight HD devices and content management/sharing platform - through GoPro Studio and the GoPro App - enables users to capture, edit, manage, and share. So it is offering a full solution. The barriers for entry to compete with them is very high, it is not just hardware anymore but also brand, content and full suite of editing software. It is in fact in the business of content capture and delivery. In addition to the Xbox, new platforms have enabled GoPro to stream its videos on airline Virgin America through a dedicated channel.

Companies including Garmin, Polaroid, Sony and HTC are all joining game. Their products would have to be overwhelmingly better than GoPro’s for GoPro users to abandon their brand loyalty, which is hard. HTC is playing a different game and the product is uniquely different targeted for the non-consumers. This is a way smarter strategy than Sony and Garmin who try to compete head on. Panasonic's 4K solution was a joke.

HTC’s strategy is like Nintendo’s strategy with Wii in the early days (huge success unfortuantely they couldn't sustain) competing for the non-consumers. They opened up new markets not targeting extreme gamers but for family and casual gamers. HTC RE is playing a similar game and stands a good stance to carve out their niche. Or perhaps that niche is 80% of the market that are non-consumers. How many people actually do extreme sports? 10% or 20%? HTC RE will need to compete on a different model.

The HTC RE is a clean and simple product which is the opposite of GoPro. HTC's design philosophy is that users are all trapped behind the screens of our smartphones when we capture important moments in our lives, whether that's a sports game or a fashion show. HTC RE is lightweight, simple, and out of the way so that allegedly, documenting your life doesn't stop you from missing the experience. It is still very early stage in the game and whether GoPro will continue to dominate the category or it will fade away like the first MP3 player Creative Technology Ltd., we will have to wait and see.

Porductwsie GoPro range has a fixed f/2.8 aperture, the same as the HTC RE Camera, which should good enough in most lowe light conditions. Both feature an ultra-wide angle lens to capture a broader view than point and click cameras or smartphones. Both are supported by a good range of accessories. Both pair up with apps that can be used as remote control and viewfinders. In terms of look... that depends on what you wear. If you wear Roxy, Nike or Columbia you most likely will buy a GoPro. If you wear Y3, G-Star, Converse, Anthropologie or AX, you will most likely buy a HTC RE. Or you can have both.

Will 2014 Be A More Exciting Year For Consumer Electronics? Consider 2013 Was A Disappointing One. More Next Week.

2013 was a disappointing year for consumer technologies. The 3D television push was as I've expected a disaster and who on earth would walk around at home with 3D glasses and the lack of 3D programming etc. created all barriers necessariy for mass adoption. And for smartphones as there were lack of any real innovation from the industries.

Perhaps the dominant design pioneered by Apple is really reaching the end of its S-curve, even the iPhone 5S has only incremental changes (ok a better processor) in design and software. I am ready to bet that the fingerprint sensor will be dropped within 3 years. What is so great about a fingerprint sensor? It is so old school whether it is finger print or facial recognition. The iOS still remains the most polished, stable, and well-designed operating system for smartphone. May be people aren’t even expecting more from smartphones at all. The camera needs some improvement for sure. And the screen size is an interesting discussion.

China is watching and Lenovo is gearing up for the next game or the world game. Lenovo, currently the second largest smartphone vendor in China and aspire to become market leader. Apple is at threat and at this point they may not be afraid of any. They are at its peak. And they are busy with the new headquarters, refreshing the retail experience, designing the iWatch and finding the next color for iPhone whether it is blue silver or rose gold.

Android now accounts for more than 80 percent of smartphone sales, while iOS is down in the mid-teens. Apple need to change the game or someone will. Smartwatches is still a toy category. But that could change when Apple fixes many of the challenges. They will and can. And it will cost $300-$350 and people will buy. It is easy one from a strategy perspectives but also a lazy one. Have they run out of industries to reinvent? At the Consumer Electronics Show this week, I think Samsung will have the biggest, most new products and most populated booth. Apple’s main threat is Samsung, Microsoft, Google and Lenovo are all attacking Apple from behind. The whole wearables will be driving the new game and 2014 will be a more excited here. I do believe that we will see wearables showing signs of becoming mainstream this year, and we've been monitoring and prototyping all kind of ideas for 20 months. 2014 I expect te see different dominant designs emerging, there will be no winners anouncement this year, not until 2016 earliest. But I already know who definitely won't work.

What Is Happening To Sony? Can Sony Be Saved?

2013 was a good year and a very busy one for me. Having been on the road for over 120 days; delivered some great projects and worked with some of the smartest and most creative people around the world was all fun and also exhausted. Now is the time to think about what the future holds?

I really don’t know what to write these days, I want to write about a lot of things from economics to politics and from luxury brands to consumer electronics and from rethinking management to education, so much to do and so little time. I hardly find time to write for my own magazine these days.

2014 will be a year of big change or beginning of one for many.. We’re seeing most dominant designs of our everyday technologies reaching the end of the S-curve and it will hard to see any breakthrough unless we change the way to look at the industries. Some big innovation is needed to create demand. Not speakers and headphones and other accessories although it helps retailers a bit.

Innovation is hard to come these days and most innovations today are mostly incremental in nature. In the world of consumer technologies, from smartphones to tablets and PCs or digital cameras to TVs, everyone one of them is facing serious challenges whether you’re the market leaders (defenders) or followers (attackers). It is hard to drive new behavior and predict on their adoption rate and the low end is flooed with commodty players. On the other side of the coins, opportunities are plentiful. Microsoft, Sony, HP are all in the process of rethinking their business strategies.

Sony was once the most loved and most innovative company. The company is both strategically vertically and horizontally integrated; once designed and produced the best TVs, video cameras, music players, home audio systems and game console, today they are struggling on all fronts. Sony was my no. 1 brand for a long time. For many, Sony is already dead or what turned into I call a zombie brand. It might seems like an overly pessimistic view given the size of the company and they still have a lot of good products, strong brand (in some markets) and a lot of technological innovation, but then what went wrong?

Sony used to be the synonymous with Japan and innovative products. They even considered buying Apple at one point and decided it not worth acquiring (Can't imagine if they've done that and there would be no Apple today). In 2012, Sony’s net loss of almost US$6 billion mainly came from heavy losses in its TV business. Of all eight divisions, only music and financial services units managed to boost a little profit from a year ago.

When I visited Sony stores the last time a few weeks ago, they were so 1990s even though some of the products are pretty impressive. In fact, I was very impressed with the latest camera line-up and I use a RX100 along my Leica M. I am not sure if good products are enough these days.

Sony have made a lot of mistake including alienated smaller retailers, limit itself to internal innovation capability insteadn of using outside consultants to come up with new ideas and heavily rely on local markets (30% of their sales) and as a result ignore what’s going on out there. Sony CEO Kaz Hirai has proclamed that Sony must chart a new course, his quote: "I believe Sony can change." So far it is not happening.

This Japan's technological prowess, wowed the world with the Walkman and Trinitron TV and PS2 and PSP is now struggling to stay relevant. Is it just Sony or "Japan Inc." that is in trouble?  They missed the while digital music wave, missed the smarphone wave, missed the tablet wave, missed the social face and now probably will miss the next whatever wave. Even Google missed the social wave and left the door opened for Facebook and Twitter, but they do have a few wins such as Android.

And for Sony, my advise for you is to stop behaving like a Japanese company. Adopt new practices and move fast. Speed kills. The world has changed and you need to wake-up. Play catching up is not enough and you’ve been doing a good job producing a decent tablet, a nice phone and a set-top box, a not so smart smart watch and whatever, does it matter?

You don’t have a strategy. You want to win in every product category and that's impossible. You should get rid of at least 50% of your product lines. And at least make 10% of your product spectacular ones - iconic. Rethink if you want to play in the smartphone game, may be you should exit it for now.  Your strategy of “One Sony,” will not work, it is an ideal strategy only on power point or paper. Apple works with “One Apple,” but if you consider the context of Sony's situation, it may not be the best move for now. Sony needs to think different and should not make the mistake of try to replicate Samsung or Apple, those two companies are unique in their own ways. The two will own the market (already did) and eat you dinner, since they already took your breakfast and lunch. 2014 is a critical year for Sony.

The Bionic Man/Woman Is Now Possible! It Gives New Meanings To Wearables!

Remember that Six Million Dollar Man TV Series? When ace test-pilot Steve Austin's crashed, he ended up in a poor shape that his only chance of survival was to replace human spare parts with technologies. That was the beginning of “wearables” I supposed. The government decided to invest millions to use the latest technology to rebuild him with cybernetic parts which gave him superhuman speed, response and strength and the superagent.

Thirty-five years later, DARPA's Reliable Neural-Interface Technology (RE-NET) is working on it and  trying to improve the speed and accuracy of neural interfaces. Such interfaces can happen in the brain, as in the case of Hemmes, or someplace else farther down the line, closer to the missing limb. It is a highly complicated task to try to translate these commands to muscles that drives the myoelectric arm. Most important is that any of these won’t need a brain surgery or implant. The challenges include weather change and other external factors can affect the myoelectric arm and there is the issue of electrodes slipping on the skin.

The idea of implanted electrodes is very attractive with the goal to provide near-natural hand movement. Another sign og progress is FDA just approved the world’s first approved bionic eye. The Argus II, which treats patients with the rare genetic condition known as retinitis pigmentosa was approved by the FDA after twenty years of research and $200mm of investments. The Argus II Retinal Prosthesis System, which was approved to treat people with severe to profound retinitis pigmentosa, doesn't actually restore vision or allowing them to see, just enough to detect light and dark and the contrast can identify the movement or location of objects. Almost like the first generation of cell phones. We are a few years away before they have advance features. When the photoreceptor cells in the eye's retina are damaged, people can tell the difference between light and dark.

To restore light and dark vision, a tiny chip containing many electrodes is implanted on the patient's retina. The patient wears a pair of glasses with a video cam attached to it. The camera sends the recorded image wirelessly to the electrodes in the chip, which then turns the information into a signal that the brain can understand. It will be a low-resolution 60-pixel image only and enough to give people a sense of what’s in front of them.

The breakthrough in nanochip will open up tons of opportunities to improve our senses or replace in medical cases or enhance in other cases. In less than ten years, those who can afford to spend $25,000 can get a bionic eye to capture wider light spectrum or advanced your visual search functions through Google. I won’t be an early adopter for sure.

Can't Wait For The Day That We Can Make Calls On A Flight. But Don't Want To See Everyone Doing That. Perhaps A 5-Minute Rule Should Apply.

The job of the air-stewards will be tougher as the Federal Communications Commission considers give a green light for the use of smartphones on airplanes above 10,000 feet. They are now seeking public opinion but will likely to be welcomed by most. The agency has already lifted restrictions for devices, such as e-readers and tablets to be used during take-off and landing. Next you can make calls and check emails as long as the plane is above 10,000 ft. I can’t imagine 50% of people talking and shouting into their phones and suddenly the cabin will be turned into stock market trading floor.

Gogo Text & Talk will launch early next year and Gogo is working hard testing the applications before its first major release next year. This service is not likely to be cheap. For 24 hours of continuous access on the same airline, Gogo charges $14 per passenger. For unlimited monthly use of Gogo Wi-Fi on any Gogo-equipped flight, Gogo charges $50. If initial access costs $14, Gogo will likely to charge those users an extra $10 or more to annoy their fellow passengers by talking and texting. It can make travelling very productive and honestly no one wants to be off the grid especially for long flights. But no one wants to listen to other speaking while you try to get some sleep. It is the traveller's dilemma. We need something like a 5-minute rule for each call. Social etiquette needs to be developed and adopted, otherwise flight experience will be far worse than today's.

In Europe, the European Commission last week adopted new rules to allow people to use devices with 3G and 4G data connections. Previously, the agency only allowed 2G wireless services to be used aboard flights above 3000 meters. They will next decide whether talking on your smartphones will be allowed. It won’t stop here. We will have people walking around with googleglass, go-pro cams and all kind of wearables and suddenly flying is never the same again. I can’t wait to see that.

Here’s an innovation opportunity for this unmet needs, design a head-set with microphone that works like a helmet and once you put it on no one can hears you talk. It is kind of a like wearable personal phone-booth like the one below. We've been working on one for years.

What's Next BlackBerry? You Need A Plan. You Can Have A Future. But You Need To Think Radical.

I am a BlackBerry Fan. Or I was. Big one too! It is one of the best innovations for the working professional. I missed the old flywheel BlackBerry that I can throw it across the room and it survives. I was really hoping they could turn the company around and have a real strategy. The problem remains that the management is so disconnected with the real world and the engineering focus overshadowed the needs to create something beyond just a good user experience. The BlackBerry Z10 is a beauty. But that's not enough.

I don’t think the Fairfax deal is a good one. Fairfax, which already owns 10% of BlackBerry, plans to pay $9 per share for the company, about 3% more than its closing price which I think is way undervalue. So what does the company worth? There is no right answer.

Blackberry assets include 1/cash 2/patent portfolio 3/real estate and jet 4/software all add together and then minus any long-term debt and liability. Their hardware business pretty much worths nothing. The math is not hard. 1,2 and 3 are easy to value. Software is not so simple. WhatsApp claims to have 250 million active users, and they are now a paid application. BBM, on the other hand, is free and have more compelling features. BBM can make money from this if they know how to play the game. It is not the BBM customers that they used to know. I think they have good chance to play in the OTT communication game on cross-platform devices.

The radical rethink of BBM can create a survival plan and could easily bring in $350-400mm a year and would contribute about $0.50 in earnings per share (EPS) and be worth roughly $6 per share (using 12x earnings).

Patent is a secret treasure chest. In addition to patenting their won technologies, BlackBerry has also bought tons of patents from the bankrupt Nortel and other stast-ups and spend time developing a whole new operating system. Typically patents last 20 years from the date of their application, making BlackBerry’s 3.6 year average very attractive. BlackBerry’s 9,268 granted patents could worth between $3 to $4 per share depending how intense the bidding and that makes already $10. Now add roughly $1.5 billion plus in cash (after write-down) and the sale of building and the jet. The very minimum the company is worth $13 a share. Lenovo is happy to pay that but Canadian goverment might not like the idea.

China cellphone maker/start-up Xiaomi latest funding round values it at $10 billion. That’s nearly two times BlackBerry’s current value. It is currently the sixth-biggest smartphone producer in China. Clearly, its strategy of selling high-spec smartphones at low-spec smartphone prices is paying off quite well. Blackberry has a lot to learn from other companies. Blackberry were distracted by Apple and being dragged into a no-win game. The company was operating with yesterday’s operating system in terms of strategy and don't understand how fast the world is moving. It was destined to fail. There is still a slim hope. You need to think radical.

For Disclosure. I personally hold BlackBerry shares and Blackberry bought research services from Idea Couture at one time.

What Do You Want A Smart Watch To Do For You? Or Do You Really Need One?

So you’ve bought yourself a Pebble and you're showing off to your friends. May be you’re even one of those thousands of people who crowd funded them for over $10m in pre-orders last year. In that case you will be among the first to receive $150 slim devices that you can read e-mail, text and Facebook messages that sent from your Smartphone.  I really can’t think of a good reason to get one.

I’ve seen dozens of different smart watches and most of them are cool at a glance, but very limited in function and I can’t see them becoming mainstream. There are others playing the game including Apple’s iWatch, ConnecteDevice (Cookoo watch), I’m Watch, and Sony’s SmartWatch and many others. I’m pretty sure, though, that people saying smart watches will replace smart phones at some point are way too optimistic, it is hard to predict the technology dynamics and how our behavior will evolve, but I am quite confident that it won't be a watch. Sorry Apple.

Apple probably have over 150 engineers and designers working on the development and hopefully to bring something to the market in 12-16 months. It will be the first post-Jobs product/platform and everyone is watching. People will buy because it is an Apple, but can it sustain itself and becoming a success is indeed a big question? I don’t like the watch idea for a number of reasons. First it is purely a novelty and too gimmicky. It is a totally new behavior to read text messages or email from your watch and no reason I need to alter my current behavior. Ok it has a touch screen, big deal. My smartphone is just fine. The smartwatch is at best a niche category.

Any innovation needs to anchor on unmet needs, not cool technology. Apple needs to decide what problem it is trying to solve. It might need to switch to a new interaction paradigm to see the opportunity differently. Apple is too stuck with the world of Apple. I believe there’s no stopping the trend of wearables and but don’t expect to see a clear winner anytime soon. The market potential is huge.

While analysts are expecting people to purchase about 15 million wearable devices this year and growing year after year, but they can’t tell you what that device looks like. We need to examine different adoption barriers and drivers that impact how wearables could bring along next platform wars. It goes beyond sensor and interactions into voice play. Mobile voice recognition, one of the thousands of artificial-intelligence applications, could reach one billion in 2017 from $73 million today, according to ABI Research. AT&T has devoted more than 1 million hours of research to develop AmI technology that can convert speech into text, and deliver responses to spoken questions. The future is exciting. And the future is here. And the future is unknown.

Media Disruption Is Not Slowing Down. Mobile Is Now The Center Of A New Ecosystem.

The media business is not seeing the light at the end of the tunnel yet. When people asked me about my magazine and the economics of that, they were saying why am I in publishing business. Well that is not my core business, just a hobby. It has been almost three years since the first publication of MISC and readership is growing nicely. We're now in 28 countries and we have have the digital version. I am getting a lot of positive feedback from readers from all over the world. Perhaps I should make the next issue the thickest one. This is the first cover that was shot in Milan. And the next cover will be shot in Shanghai.

The media business is certainly not easy with the never-ending technological disruptions we are experiencing and new behaviors keep evolving, we are nowhere near the end of it. The word social media makes no sense anymore as it is already main stream doesn’t matter how you look at it. Many traditional media types continue to cling to an old way of doing things, based largely on making minor adaptation to existing approaches and some are relentlessly experimenting with finding new revenue stream, largely still through advertising or sponsorship.

There aren’t many new opportunities for business model innovation if you take a strategic view, people are still thinking about advertising or sponsorship. Yahoo and Google are the same. The hybrid model of readers’ empowerment and buttoned-down professional journalism is already fullyoptimized. Media executives are spending a lot of time thinking about the future of their industry and what it will look like in 2020. 

Five years ago everyone is thinking about the online model and suddenly the tablets came and changed everything. And what’s next? Multiple screens device, new interactivity through voice, gestures and more external data sources, and glasses and watches etc. No one knows how content discovery and consumption model will evolve given the abundance of choice consumers have today. Neutrality is probably not the best interest for the media industry.

Media business is still suffering from an identity crisis, at least for another decade. The business model will not change, we will still end up paying for content through transactional, subscription or advertising models although there will be more flexibility on how we purchase them. With every person with a smart phone also has a video camera that can turn them into amateur journalists, news will become real-time and shows us different views of any event. And contextual bits will be consistently updated and events unfold. The Twitters of the world are the instant updates and these short bursts will create more noises than news value and readers need someone to break them down into manageable pieces.

Audience now lives in a multi-screens world. They can choose between raw news and organized news. The three key drivers of mobile disruption are hyper-local (geolocation), integration with home appliances and digital payments. The three together can put mobile at the center of an entirely new ecosystem. It is not merely another form factor. It is the biggest leap forward since writing first arrived about 7,000 years ago, which only impacted a tiny percentage of our population. Word of mouth was the only “information system” for most of humanity and now that will be turbo-charged by mobile as it unlocks an incredibly deep desire and capacity among us (humans) to share personally relevant information and feelings such as “I am waking up happy to a sunny morning” etc. These personal information is competing for attention with other news. And for me, I'd rather be reading what my friends are saying than the news. CNN is depressing.

With Our Increasingly Reliance On Smart Devices And Gadgets, And We Are Becoming More And More Vulnerable.

You’ve seen all the time in movies when the bad guys hacked into public surveillance cameras and could see what’s going on out there. It is actually not difficult to hack into most security surveillance systems for commercial or residential buildings and particularly those wireless ones. Theses cameras that are used by retailers, hotels, and elevators, are often configured insecurely. Many are preconfigured with simple to access passwords and you can try as many times as you wish to attempt to guess it. Start with “1111”, “1010”, “1234” or “1001” or try “admin”.

And the same problem exists for video conferencing systems, imagine you’re on a conference call with your team on developing the next secret product. Sometimes you can random call in and get access to these conference calls where VCs are talking to start-ups or people are pitching their latest ideas. .

What about all those smart gadgets or devices that we increasing rely on in our everyday's work.  Not only do we store a large amount of information on our gadgets, they are increasingly becoming our gateway to online services. Our smartphones stay with us 24 hours a day, giving us ample opportunity to leave them behind in a gym, taxi or bar. If the device is lost our information is vulnerable. Most smart device users aren't prepared to handle the multitude of technical and security challenges that come with carrying one.

Smartphones that aren’t properly decommissioned also leave us vulnerable. As smartphone use becomes even more prevalent, we can expect to see more malware and other viruses targeting both Android and Apple devices. A serious security flaw was recently uncovered, affecting some Samsung Android smartphones. The flaw allowed hackers to erase the device remotely, simply by sending an SMS or getting the user to click on a URL. How many employees have personal phones on the corporate network that you don't know about? While the use of smart devices may keep employees connected, efficient and, in most cases, productive, allowing a personal device to connect to the corporate network without vetting could compromise your business.

Threats to mobile security aren’t always obvious. It’s surprisingly easy to hack a smart device. Easier still for users to download a game or another similarly innocuous app that, once installed, turns that phone into a bug. PlaceRaider, a malware created by the United States Navy to showcase Android vulnerabilities, does just that. The app activates the phone's camera and other sensors, collects data to create a 3D image of the phone's physical location including sensitive data that may be visible on computer monitors or desks.

And we all use some Bluebooth enabled accessories. Bluetooth is a key vulnerability, there is a hack called Blue Scanner that searches out for the Bluetooth enabled devices and then  extract as the much information as possible for a each newly discovered device. It is easy to do.

We love our gadgets but, at the risk of sounding dramatic, they have the potential to turn against us. Your smart phone probbaly knows more about your than Google. So from now on, just assume that everything is hackable. So when you need to be in secretive meeting, put all your electornics in a bag and make sure the room has not video confenecing or security cameras installed.

Will The Facebook Phone works? And For Microsoft and Samsung, The Future Of Smartphones Is Dual-Screen.

The Facebook phone is here.The Facebook phone rumor has been around for a while and it is a matter of time it becomes real. I think they should have done it earlier and should have larger ambition other than just trying to design a ‘home’ for Android.  Home sounds like a PaaS personalization tool and not sure how many FB users will want this. FB see the potential for them but it is hardly a threat for others but Android might modify their terms so this won’t happen again in the future.

With FB already commands more than 20% share of people's time on mobile devices (excluding Instagram), it can further boost FB mobile usage particular for younger users. Will FB take over 20% of all Android phones, we have yet to find out. For now, FB is pretty convinced that people will want a phone designed around it and perhaps with additional hardware feature that is uniquely FB. 

FB should really be making its own phone, it is reported that they are working with mobile chipmaker Spreadtrum to pre-optimize its software for the cheapest Android handsets. It is hard to compete on the high end with Samsung and Apple, if Facebook prodcued its own low end phone, though, it could create a new business model in the mobile market and FB could negotiate better data plans for their members or partially subsidize them with advertising. This is not easy for Facebook to jump in and get carriers to agree to sell its phone.  For me, I see no reason to have a FB phone.

For Microsoft, they are waiting to see how well Nokia's Lumia phones Windows Phone 8x and 8s sell before making a strategic decision to enter the smartphone market on its own. I think it makes perfect sense for them to decide to play in the hardware space. They have made that decision with  Surface tablets. It is a matter of time that they will play in this smartphone market, they risk becoming irrelevant as market is switching into different computing format.

Microsoft is thinking dual-screen and has applied to patent a dual-screen phone interface. One screen for device interface and the other as a monitor and is detachable. NEC is making one and is marketing them as the "best cloud device," the dual-screen Android from NEC handset also has a super powered battery to keep both displays running.

It will be interesting to see what can we do with two screens. We're already designing dualscreen user experience models and I think this is catch on. The mobile industry is changing faster than anyone could have imagined and the interface paradigms there have been static. Here is the opportunity for us to introduce new ways of interacting with others and new ways these machines can understand what we need.

 

This Is Just The Begining Of The Mobile OS Battle. Plenty Of New Players Will Join The Game.

The mobile OS war is getting more interesting and the current market share battle is between iOS and Android will go on for a while. Will there be a breakout of it will be more like a Pepsi vs. Coca Cola market share battle that has been lasting for decades? Android is getting better momentum the last two years and I expect that to continue. I think the overall market share is stabilizing and the other two Windows and Blackberry will remain niche players. Newcomers will join the game and there are three in the US and they are Mozilla, Tizen and Canonical. There are a few emerging ones in Asia and they all worth keeping a close watch, especially those up and coming companies in China.

In China Android accounts for 86% of all new smartphones sales and there are three times as many Android users than the US. The business model is basically freemium, developers hoping to make money from in-app purchase. The Android ecosystem is growing like crazy as people find iPhone is getting a little boring and may be too restricted.  

There will be surprises that in the next 12 months perhaps cool smart phones from China that came from nowhere selling for half the price and have even better performance.  There was a private lab test done on the top 10 most popular smartphone in China a few months back and the result was 5 of the 10 most popular Android devices from local Chinese manufacturers perform better than the imports. They include the Lenovo A750 and the XIAOMI MI 1S.  

Apple is watching the market closely and also struggling whether to add a stylus for the next iPhone,  it will be a tough one as they have always been strongly against it and the Samsung Galazy stylus is nicely designed. There are no definite right or wrong in this business and the behavior changes so quickly.

Expect some big design shift for the next iteration of Android that leverages more of the Hybrid Card layout.  Android needs to jump into the next game in terms of user experience and it demands a shift in overall visual language from current Jelly Bean paradigms to something really different. The jump from Gingerbread to Ice Cream Sandwich was a big jump. I believe Android will be looking at gestures control beyond the screen, perhaps the back and even the side. Apple already has a patent filed 2006 relating to using gestures on its back and a recent Google patent might bring that concept to next generation of Android phones. The principle is as easy as touching the back casing of the Android device in order to interact with the gadget and that can drastically improve the user experience. Imagine back tapping to change page or call list etc. It will be powerful when combined with acoustic feedback. The battle of mobile interfaces design has barely begun. And Facebook is joining the party.