After announcements last year, this week saw the launch of the first Apple Watches, although they won’t go on sale until 24 April. The cutely named Spring Forward event saw the tech giant reveal all 38 models, which will range in price from £299 (for the sport model) to £8,000+, depending on screen size, design and whether you want it in 18 carat gold.
More importantly Apple showed a selection of the apps that it expects to drive demand for the device. You can make touchless payments, receive phone calls, open a compatible hotel room door (rather than using a keycard), and remotely open an internet-connected garage door (no, I don’t have one of those either). However for a large number of functions, such as messaging, GPS tracking and making phone calls you’ll need an iPhone 5 to run alongside your new watch.
Apple is not a stupid company and has grown to be the biggest quoted business in the world by revenues through reinventing the music and smartphone markets. It hired former Burberry chief executive Angela Ahrendts to head up its online and physical stores, partly to help its move from technology into fashion with watches. I remember loudly proclaiming that the iPad would never catch on due its innate pointlessness, and now I rely on it every day. But I still see some serious challenges to the Apple Watch attaining critical mass. Here are four of them:
The cost of the Sport model begins at £299, with prices for the mid-tier Watch version starting at £479. To me, this is a lot of money to spend on a watch, even one that looks as sleek as the
Apple device. And for £900+ you can buy a low-end TAG Heuer, that you know will last for a long time without needing to be upgraded as software advances. Yes, millions of people have iPhones, but the vast majority got them on subsidised deals that meant they didn’t have to fork out close to the real sales price. A better comparison is the similarly priced iPad, which has seen sales slow as the market becomes saturated over time. Therefore predictions of sales of 60 million seem excessive, with the market much more limited than that.
2. Does it do anything different?
Anyone of a certain age who saw or read Dick Tracy loves the idea of using their watch to make a call, even if it is to the office rather than for police back up. But Dick Tracy didn’t have a smartphone, which can do pretty much everything a watch can do – and more besides. And as Apple has said, you’ll need to retain your iPhone to provide many of the functions that can’t be squeezed into the watch. Admittedly the iPhone is getting bigger, making it more difficult to use for things such as contactless payments, but equally the watch could be seen as too small for many other activities.
3. A whole new market
Apple has always been known for its design excellence, and the Watch appears to be equally stunning, admittedly with a bulkier face than a traditional wristwatch. Hiring Ahrendts also points to a desire to bring in luxury marketing nous to help it move into a different sector, where factors outside technology excellence and cool apps could be more important. Can it become the fashion accessory that everyone wants? In the ultra-competitive watch market it will be difficult, though expect Apple to try to jump the chasm from geek to cool.
4. Battery life
Watch batteries traditionally last for years. In contrast iPhones provide just hours of charge, depending on how much Candy Crush you are actually playing. So the news that the Apple Watch will keep going for 18 hours is disappointing to say the least (although the company says that it will continue to show the time for up to 72 hours after that). Essentially consumers will need to charge the watch every night, plugging it in alongside their iPhone ready for the morning. It just reinforces that this is a technology product, rather than something you wear, and is bound to put some people off.
I could be as wrong about the Apple Watch as I was about the iPad, but to me, despite the hype, it won’t move beyond being a niche product for fanboys and girls who want to pair it with their latest iPhones. For me, if I had the spare cash I’d buy a TAG instead and leave technology to my phone……….
If you needed evidence of the growth of the smartphone market and its move into every part of our lives, then this week’s Mobile World Congress (MWC) provides it. It wasn’t that long ago that the event was dominated by network infrastructure companies, but now it is essentially a consumer electronics show in all but name. And one that looks far beyond the handset itself. Ford launched an electric bike, Ikea announced furniture that charged your smartphone and a crowdfunded startup showed a suitcase that knows where it is and how much it weighs.
Five years ago none of these companies would have even thought of attending MWC – and it is all down to the rise of the smartphone. It is difficult to comprehend that the first iPhone was only launched in 2007, at a time when Apple was a niche technology player. It is now worth more than any other company in the world and 2 billion people globally have an internet-connected smartphone. By 2020 analysts predict that 80% of the world’s adults will own a smartphone.
As any honest iPhone owner will freely admit, they may be sleek, but they are actually rubbish for making and receiving calls. What they do provide is two things – a truly personal computer that fits in your pocket, and access to a global network of cloud-based apps. It is the mixture of the personal and the industrial that make smartphones central to our lives. We can monitor our own vital signs, and the environment around us through fitness and health trackers and mapping apps, and at the same time access any piece of information in the world and monitor and control devices hundreds or thousands of miles away. Provided you have a signal……….
So, based on what is on show at MWC, what are the next steps for the smartphone? So far it seems to split into two strands – virtual reality and the Internet of Things. HTC launched a new virtual reality headset, joining the likes of Sony, Microsoft, Samsung and Oculus Rift, promising a more immersive experience. Sensors to measure (and control) everything from bikes and cars to tennis racquets are also on show. The sole common denominator is that they rely on a smartphone and its connectivity to get information in and out quickly.
It is easy to look at some of the more outlandish predictions for connected technology and write them off as unlikely to make it into the mainstream. But then, back in 2007, when Steve Jobs unveiled the first iPhone, there were plenty of people who thought it would never take off. The smartphone revolution will continue to take over our lives – though I’m not looking forward to navigating streets full of people wearing virtual reality headsets who think they are on the beach, rather than on their way to work…………
Commentators are full of predictions that software will eat the world, with jobs, industries and traditional means to doing things swept away by the rise of technology. From automated journalism to connected cars, the claim is that we’re undergoing a transformation in how we work, live and play.
Software is revolutionising the world around us, but I’d contend that there’s a much more disruptive factor impacting our lives – the smartphone. It essentially provides an always-on, easy to use, ubiquitous interface with all of the software around us. Without it we wouldn’t be able to access the power of technology. So, rather than software eating the world, I’d pinpoint 9 ways that smartphones are making a meal of it:
Smartphones have the ability to monitor our vital signs and transmit information to doctors and medical staff in real-time. Whether it is using in-built or external, Bluetooth equipped sensors, smartphones will disrupt the health industry. Apple’s new focus on building a health ecosystem is just part of this trend, which can either be seen as a force for good or as allowing intrusive snooping on our most private moments. On the plus side patients can be monitored remotely, allowing them to remain at home rather than going into hospital for certain conditions, but confidentiality of data remains a worry. What if your insurance company could access your health data and amend your premiums accordingly?
2. Taxis and transport
Companies such as Uber and Lyft are radically changing the taxi market by removing the overhead (justified or otherwise) of traditional operators. Anyone can become a taxi driver – all they need is a car and a smartphone (which can also serve as your GPS, so you don’t need the Knowledge to direct you to the right place). This does raise potential issues about safety, vetting and insurance, hence the bitter battles being fought between traditional cab drivers and the new upstarts.
At no point in human history has so much data been available about individuals. The combination of ‘free’ services such as Google and Facebook that hoover up our personal information and preferences, with the geolocation data from a smartphone mean that companies have the ability to understand more about their consumers than ever before. The challenge for marketers is twofold – they need to ensure that they have real, informed consent from consumers when handling their private data, but at the same time have to evolve the skills to sift through this big data to deliver personalised marketing that drives engagement. The traditional model of campaigns that take months to plan and implement is rapidly going out of the window – if marketers can’t adapt they risk being sidelined by ever cleverer algorithms.
There is something impressive about a pile of cash – even if it is just one pence pieces. But carrying it around is another story. Replacing pounds and pence with the ability to tap to pay even the smallest amount with your phone promises to turn us into a cashless society. And it also removes the need for a wallet full of credit, debit or loyalty cards. All you’ll need to do is select how you want to pay on your phone and the software will handle the transfer. Could we see traditional banks and financial services companies replaced by Apple Money – or even currencies swept aside by electronic dosh? It is certainly possible, hence Apple’s move into the sector with the iPhone 6.
It may be difficult to remember, but when they began, mobile phones were for making phone calls or sending text messages (and playing Snake if you had a Nokia). Now the number of calls made and received is a fraction of before, as people move to messaging, email and free voice over IP services such as Skype. Many of us already pay more for our smartphone data plans than for calls and texts – meaning that mobile phone (and landline) operators will need to evolve new services if they are to be part of the smartphone future.
Growing up in an analogue world, toys and games were very straightforward. Now traditional toys are evolving to embrace both full on mobile gaming (think Angry Birds) and half way houses where the physical meets the virtual. Software such as Skylanders combines playing pieces containing electronic chips with fully fledged games to give a radically new experience. And this is just the beginning. As immersive technologies such as Google Glass and Oculus Rift gain traction we’ll find it difficult to tell reality and gaming apart. How long before people embed chips in themselves to become part of the latest smartphone game?
Buying power is a necessary evil – and the battery life of smartphones does mean we’ll always need electricity to recharge them. Mobile devices, combined with sensors and the Internet of Things provide the ability to monitor and adjust how we use power. From turning smart thermostats up or down, to only switching on lights when the smartphone user is in the vicinity, they can change energy use. Taken a step further, consumers could cut out the energy company and use their smartphone to buy power directly from smaller producers, adding flexibility and potentially bringing down prices.
The problem with insurance premiums is that they are based on averages, rather than knowledge of your individual circumstances. The data within a smartphone, either directly monitoring your movements, or linked to a sensor in your car, provides a deeper context around your behaviour and habits. Used properly this can help better judge the risks of insuring individuals – but again used incorrectly it will cause a privacy backlash.
9. Pub quizzes
As a Trivial Pursuit expert (and part of the reigning village quiz team champions) there’s nothing I like better than the chance to show off my knowledge. But how can pub quizzes survive in an era when Wikipedia can be accessed from your smartphone in milliseconds? Short of holding quizzes in exam conditions, with no toilet breaks where people can sneak off to check answers on the internet, cheating is going to become rife, making my carefully assembled general knowledge useless.
Research shows that the majority of us access the internet more through mobile devices than traditional PCs. And 20 per cent of young American adults admit to using their smartphones during sex. We look at our phones constantly, panic if they are out of sight for a minute and feel bereaved if they are lost or stolen. If it is true that software is eating the world, the smartphone is the knife, fork and plate responsible for the repast.
It seems like 1994 was a busy year – not only did it see the first ecommerce transaction (a foolish purchase of an overpriced and overrated Sting album), but also the launch of the very first smartphone. And interestingly it wasn’t produced by a traditional handset vendor, but created by IBM, thus adding to the long list of inventions, such as the PC, that it pioneered but then failed to commercialise.
The oddly named Simon went on sale to the US public on 16 August 1994, and had a calendar, could take notes and send emails and messages as well as make and receive calls. Aimed at the busy executive it could be linked to a fax machine in order to handle all your communication needs. However it failed to take off, only selling 50,000 units. As curator of the Science Museum’s Information Age gallery, Charlotte Connelly, drily puts its “It only had an hour’s battery, it was $899 and there was no mobile internet at the time. So it wasn’t very successful.” Personally I’m not convinced the name helped either – “Sent from my Simon” doesn’t have the same kudos as “Sent from my iPhone” at the bottom of an email.
We’re now seeing mobile and ecommerce (as opposed to Sting and Simon) converging, and driving innovation in technology. As this nifty but messy Google Public Data graphic shows, the majority of us now use smartphones as our primary method of internet access, and, aside from reading this blog, watching cute kittens and moaning on Facebook, one of our primary occupations is buying stuff. According to Goldman Sachs, global mobile commerce will hit $638 billion by 2018 – the same amount spent via PCs in 2013. While the majority will be on tablets, smartphones are an integral part of the customer journey and will make up a direct $20-30 billion of the total.
The smartphone has changed how we interact, shop and spend our free time. We are no longer ever idle – why gaze into space at the bus stop and notice the world around you when you can play Candy Crush instead? In many ways mobile technology has outstripped our capacity to adapt, leaving humans scrambling to change their behaviour to fit in with their apps, rather than the other way around. 20 per cent of young American adults (and 10 per cent of the total population) use smartphones during sex, though mercifully the research doesn’t go into any more detail than that.
So, what does this mean for startups and marketers? The smartphone is essentially our most relied upon device, and the one we keep closest to us at all times. You can link it to sensors, watches and the world around us, through Bluetooth and technology such as beacons. It really does provide a window into our lives, which has both a positive and negative impact. Speaking personally spam text messages or calls annoy me more on my mobile than their equivalents on landline or email. It is a delicate balancing act, with the consequences for misjudging privacy or security potentially extremely damaging. But get it right with your app and you can generate big profits or deliver your message right to the heart of your target markets.
The last twenty years has seen the smartphone change the world – as well as the wider device market. It has shrunk from the 500g brick sized Simon to thinner, more pocket sized smartphones (though ironically the trend is now for larger and larger devices), with increased usability and a wider range of apps aimed at consumers as well as businesses. One thing hasn’t changed though – the Simon’s battery lasted an hour, and while I get a bit longer from my iPhone, it still can’t survive a busy day without needing a recharge……..
The industrial revolution mechanised previously craft-based activities, and since then machines have become more and more involved in creating the world around us. But until a few years ago, this mechanisation didn’t affect those of us in the creative industries – after all, our imagination and skills couldn’t be replicated by a machine.
The internet has changed all of that. In some cases it has allowed computers to take on tasks that were previously only done by humans, by applying artificial intelligence and machine learning and breaking them into discrete tasks. You can now get computer-written journalism, which use algorithms to bring together data and organise it into a rudimentary article. In the US, stories about minor earthquake reports are now routinely created and published, based on information supplied by the US Geological Survey. It isn’t much of a stretch to see short sports reports written based on player data and profiles, avoiding the need to send a reporter out to lower league matches.
However the biggest threat or opportunity to the creative industries is that the internet and digital technology has broken down the barriers around previously specialist occupations. Take photography. In the past only professional photographers could afford the equipment needed to create (and manually develop) arresting images. Now, similar levels of performance are available in a smartphone, and PhotoShop can do the rest. News stories frequently use amateur shots from bystanders who happened to be in the right place at the right time, adding extra depth to articles. Design and PR are both equally affected. Anyone can set up as a web designer or copywriter, without necessarily needing to undergo lengthy training.
In many ways this is a good thing – the internet has democratised creative industries that were previously off limits to most of us and enables more people to share their thoughts, feelings and ideas. It uncovers real talents who never previously would have been spotted, whether that is musicians on YouTube or specialist bloggers with a passion for their subject. But what it also does is amateurise previously professional occupations. How can a portrait photographer compete on cost with a bloke and an iPhone? Again, a copywriter on eLance charges much less than a professional. And the overall effect is that there is more stuff out there (words, pictures, videos of cute cats), but quality is far more hit or miss.
Before people start complaining, as someone that makes a living through PR and copywriting I obviously do have a vested interest here. But that doesn’t mean I don’t welcome more competition and the chance for more people to be creative. Far from it. However businesses need to understand that you get what you pay for – in the same way that fixing your car yourself is inherently riskier than going to a garage (unless you are a mechanic), working with amateurs opens you up to potential issues. Do they have insurance if something goes wrong, do they understand copyright, are they using legal images on your new website? There are 101 questions that you need to be sure of, before handing over your money. And it can be pretty obvious when a website has been put together by the managing director’s teenage son or daughter. Businesses therefore need to strike a balance between democratisation and working with amateurs if they are to stand out in an increasingly crowded global market.
I’ve talked before about the new ways marketers are trying to engage with consumers. This ranges from QR codes to augmented reality and relies on using the one device we always have with us – the smartphone. Being able to pinpoint exactly where someone is, for example the specific aisle of a shop, means they can serve up relevant marketing material that could turn a browser into a buyer. It is no wonder that the likes of Apple and Google are investing in technology that can help make indoor mapping more granular and detailed.
The latest technology to be touted to drive engagement is the beacon. Essentially a small, low cost, Bluetooth-enabled box that can be quickly fitted inside a building, it enables companies to send messages to suitably equipped smartphones in the near vicinity. As beacon technology is built into the latest Apple products, there are already over 200 million iOS devices out there that can act as both receivers and transmitters.
The possibilities are getting marketers, particularly in the US, extremely excited. Companies can automatically send relevant offers if you are in particular areas of a shop, such as in front of their products (or, if you’re being sneaky, in front of your rivals’ products). Airports or train stations could send automatic updates on delays or gate/platforms changes. Beacons can be used to measure dwell time in specific areas and provide offers of help. William Hill is planning to use beacons to send in-app betting messages at the forthcoming Cheltenham Festival, while outdoor advertising companies are looking at how it can drive engagement with adverts. Mobile phone networks EE, O2 and Vodafone have invested to create a joint venture – Weve, to target the space, with Eat trialling their technology. The reason for the interest is that essentially beacons promise the same digital tracking possibilities as online, but in the physical world.
However there are a still a couple of elephants in the room when it comes to mass market adoption. Consumers need to switch on Bluetooth, download an app, enable location services for the app and opt-in to receive notifications. So, even though iPhones now come with Bluetooth on as standard you still need to jump through a lot of hoops to be beacon ready.
And then there’s privacy. Perhaps you don’t want marketers to know whereabouts in the shop you were loitering or what you are buying at a detailed level. As the success of social media and loyalty cards have shown, people are willing to give up some of their privacy in return for a better experience and targeted offers, but none of these are as instant and real-world as beacons zapping a message straight onto your screen in real-time. At the moment all the advantages seem to be skewed towards retailers, with very little concrete benefit for consumers that will make them want to go through the rigmarole of making their phones ‘beaconable’.
At a time when consumers are just about getting their heads round paying for things by swiping cards rather than laboriously typing their PIN, I think beacons have a big job ahead to accelerate consumer adoption. The whole process needs to be made seamless and simple, with a focus on the benefits, rather than looking like another way to invade privacy and sell you more stuff. Only then will beacons deliver the insight that marketers and businesses are looking for.
This week’s takeover of Nokia’s handset division by Microsoft is easy to see as a marriage of desperation, or as Robert Peston put it, “two drunks supporting each other at the end of the party.”
Wind the clock back 10 years and the picture was very different. Nokia was dominant in the phone market and Microsoft held a similar position in the desktop/laptop market. The first Windows-powered smartphones were being released, but they were incredibly complex (I know, I had an Orange SPV), essentially transferring the desktop Windows experience to the mobile world. There were a whole raft of other mobile handset providers that have since disappeared or lost their independence – Motorola (now owned by Google), Ericsson, and Siemens.
Two things changed all this – Apple came along and made smartphones easy to use without losing their power and in a linked move, the world embraced mobile with the growth of 3G and wifi. As the existing market titans, with enormous user bases, Microsoft and Nokia couldn’t evolve fast enough to change their business models. The same process happened in previous waves of computing as the world moved from mainframes to mini computers and then PCs; few CEOs have the guts to bin their existing cash cow and launch a radically different business.
So could either of them have done things differently? I’ve talked before about Microsoft’s disastrous attempt to innovate with Windows 8 but you can argue that it didn’t invest enough in mobile early on. If it had combined ease of use and access to compelling content with the power of the SPV (which was heavily subsidised) and made it less ugly it could have had a chance of pre-empting Apple’s rise. But it never seemed to be a priority. And Nokia again seemed to view smartphones as a niche market until very late in the day, focusing on the Communicator which was a high end business tool rather than a consumer-friendly device.
All this means the combined unit has a tough job on its hands and is going to have to focus heavily on innovation and marketing to succeed. Ironically given Apple’s perceived lack of innovation and BlackBerry’s woes there is chance to seize the challenger position and become the quirky, cool alternative to Samsung and the iPhone. This does mean being brave and creating something radical that shakes up the market. Microsoft couldn’t do it with Windows 8 – so can an injection of Finnish thinking make the difference?