The iPhone Effect

When Steven P. Jobs announced the iPhone early 2007 he started by saying that every now and then a revolutionary product comes a along that changes everything. Having been part of two such products, the Macintosh and the iPod, he boldly announced that Apple would bring to the world three new revolutionary products. First one was a wide screen iPod with touch controls, second was a revolutionary mobile phone, and the third was a breakthrough internet communicator. Of course these were all the same product and the product was the iPhone. That day, Apple changed the mobile industry and this is know as the iPhone Effect.

Barcelona, Spain in February is all about mobile phones. The city hosts the annual Mobile World Congress.  The 2007 congress was in shock. With their usual mobile offering the move by Apple caught the mobile industry by surprise. That year, a lot of touch screen phones were introduced but mysteriously enough few prototypes and mostly pictures. As it takes the telecom industry 12-18 months to generate a new product, the mobile handset makers didn’t have time to respond.

What Apple did was a classic new disruption business move. The focus of handset makers was always on the hardware and the design of the phone itself. Software and the user experience was important but secondary. The mobile operating systems (OS) were old primitive system that were developed during an era of limitation, both of the hardware and the bandwidth. Coming from a computer hardware and software company, maybe the iPhone should be called a handheld computer with voice as one feature.

The first important thing about the iPhone is the touch screen interface. Previous business class phones like the Blackberry had a full qwerty keyboard and this was considered very important in the industry. Steve Ballmer, CEO of Microsoft responded when asked about the iPhone, by saying that “… it doesn’t appeal to business customers because it doesn’t have a keyboard which makes it not a very good email machine.” Classical Prevailing Technology Trap. What Ballmer failed to recognize was that touch interfaces had become so good that they could actually work as keyboard.

Another important thing about the iPhone is the software. Apple introduced real operating system into the mobile phone. They took an industrial strength OS, the MacOS, and adapted it to a smaller device. Then with really elegant user interface the iPhone is super easy to use. Compare that to Nokia’s menu system which were at the time probably designed by engineers who put more emphasis on ordering features in a logical tree hierarchy than what is important to users.

With an industrial strength software like the MacOS software, the iPhone had the potential of becoming an application platform. This was something the old handset makers were not capable of doing so easily since their OSs were built with totally different requirements. Apple started the mobile App revolution and lunched the successful App Store.

Another  things with the iPhone is the use of the Internet. The mobile phones up to this time focused on mobile browsing and using simpler and lighter versions of HTML. The iPhone completely changed this by simply using the web as it was and provided an excellent browser that was easy to use with touch input. The mobile web became obsolete as there was not mobile web, it was only web. Early 2008 Google reported that iPhone users searched the site 50 times more than other mobile phone users. Vic Gundotra, head of mobile operations at Google was quoted saying “We thought it was a mistake and made our engineers check the logs again.”

The iPhone is a very good business case study. It offered new value to customers, namely giving them powerful handheld computers with voice functionality. This is an example if of new market disruption by offering functionality to customers that was not in the market before.

The iPhone story is also an example of how the adjacent possible concept works. Given technology development, each cycle will open new possibilities. The iPhone came when when it was possible to put a real computer OS in a small device. It was also possible to build touch screen technologies and use touch as input.

When Apple started to offer phones many people were surprised. What is a computer company doing offering phones? These markets were totally separteded. But as technologies improves, new possibilities open up. Long has it been predicted that mobile phones and computers would merge. Apple made good on the bold statement. The iPhone was a revolutionary product in three ways: wide-screen with touch, computer as a phone and a new way to browse the web.

Technology in 2011

Steve Breen

This is the time of year when prediction articles for the new year flood the web. What will be the major trends for 2011? Here is my version:

In 2010 we got a new type of device, the tablet. This market was defined by Apple and currently the iPad dominates. This will not change much in 2011 but it will still be the year of iPad clones. Much similar as the PC clones of the 80s. One player that might be interesting to watch is HP. The company acquired Palm last year. Plam had already developed the WebOS mobile OS. With Palm’s OS and HP hardware we might see some interesting tablets and even phones.

The iPad made an interesting impact last year, namely making the computer an consumer device. This trend of consumerization will likely contine in 2011. Devices that are simpler, more content focused and with better usability to use that content. Let me give one example of usability. I have an iPad and use it as an e-book reader. I use the Kindle app. To buy a book I go to the Amazon web site and, after selecting a Kindle book, I press a button called Buy now with 1-Click and the book appears in my Kindle app loading. Buying a book thus only takes few seconds. We will see this usability migrate to laptops and netbooks. As an indicator, Steve Jobs announced the Mac App Store last year.

The e-reader was a success in 2010. Amazon now sells more Kindle books than books. In 2011 we might see a new and interesting trend become important: the self-publishing e-book. Amazon already offers this. The idea is that you can upload your brand new novel and make it available as a Kindle book. Like the Apple App Store, Amazon take 30%. We can expect wannabe novelists flocking to Amazon with their potential bestsellers.

Another interesting thing that could happen is video phone calls. If Apple releases iPad 2 with front cameras for FaceTime, it could create a new and interesting use of video phone calls. Currently people video call using laptops, but not so much phones, even if they can. The tablet might be the form-factor that works for video calls. The iPad already has 3G support, why not make it a video phone device.

Google will release it’s ChromeOS in 2011 and we will see netbooks running this OS. Analysts will compare these new generation of operating systems with current Windows and MacOS based labtops and dismiss it as inferior. That is usually the case with low-end disruptive technology. If these simple, low-end operating systems, positioned between Mobile/Tablet OS and Desktop OS, are useable it will be the start of the era of simpler operating systems for computers. I would not be surprised that these web-based operating systems on simple consumer devices will find its market in 2011.

With all these devices and consumerization, one technology that might hit a turning point is the solid-state drive. 2011 might be the year where SSD takes over and becomes the default persistance technology in computers.

On the mobile side, Android will continue to get much focus in 2011. If Nokia decides to throw out Symbian and adopt Android as a base it will have huge impact on the mobile landscape. And there has been rumors on Sony PSP Phone.

One of the things I predicted last year was the rise of the home entertainment boxes. We did not quite get there although Apple updated its TV box and Google released their version. The TV market is fairly closed and in some ways similar as the telecom market before the iPhone. Difference is that the big networks, particularly in the US, dominante the content and control where it goes. The search giant is not welcome in the club – not yet. This closed model will break eventually, 2011 or beyond (depends on how fast the lawyers work). TV experience will be like computer experience. You buy your hardware and subscribe to the services you want. The set-top box (STB) is just the computer you use for viewing. You don’t even need an STB. Boxee, for example offers download version to be installed on your computer.

Another service is UK based YouView which offers developers program. You can download the technical specs and APIs and develop TV apps for the YouView box. So we are starting to see the STB model become open where developers can add new experience. This trends will only continue and with it we will see new and unexpected uses of TV.

One of these new experiences is social viewing. Imagine watching a football game at your home. You’re alone but you know that your buddies are also watching at their home, so why not join them. We could be seeing TVs with cameras where you can see your buddy and even talk. Xbox already has some feature for sharing videos.

These are some of the developments I see upcoming 2011 in technology. In fact, given how many disruptive technologies have entered the market in recent months, like Android, iPad and the tablet revolution, e-books and Amzaon’s self-publishing, and Microsoft’s Kinect to name few, I feel that we will see lots of innovations and new ideas coming in the next few years. With the tools in hand, people will invent new ways to use them.

Technology in 2010 – Year in Review

It was the year of the iPad, social networks, Farmville, Android, and Wikileaks

Word cloud created by using all the articles on this site in 2010

Social was the term to describe 2010. Social networking, social media, social gaming, social everything. As usual Hollywood moved with the time to release a movie on social networking. The year 2010 was interesting in technology. In January,  I wrote about what interesting things we could see in 2010.

Here is a list of some of the interesting trends for the year.

First, the year 2010 was the year of the tablet device. Apple announced the iPad device in January and generated lots of hype. Many people in the tech industry were very sceptic about this device. Why would people use this? And when the iPad came out, reviews were polarized, some liked it and others saw no use for this type of device. Many people looked at the iPad and while seeing no reason to buy it they still did. Apple sold 2 million iPads in the first 59 days. The verdict is in by now and it is now clear that there was a room in the market for a “third device”. The iPad Effect has changed how software developers create applications, design webs and how we use computers. The iPad has also disrupted netbook and laptop sales. Some 32% of iPad owners say they don’t need a laptop or netbook.

The year was also good for e-readers. In fact, 2010 was the year e-readers and ebook sales took off. Amazon’s Kindle is reported to have sold in 8 million units, and some estimate that Barnes and Noble’s Nook is selling more devices. The companies don’t disclose sales numbers, but it is clear that 2010 was the year the general public adopted e-books. Amazon sells 180 kindle books for every 100 books it sells. E-books are now 25% of Amazon’s revenue. What is interesting is that according to the Association of American Publishers, e-books make up 9% of the total consumer book sales (AAP Reports Publisher Book Sales for August).

2010 was also interesting in mobile phones. This was the year of Android, antennagate and finally Microsoft came out with a good mobile OS. Android is the mobile success of the year. It is outselling the iPhone in the US. Apple released the iPhone 4 but had problems both with lost prototype and the famous antennagate. Steve Jobs comment that people are holding the phone wrong did not help. Nevertheless, the iPhone 4 was successful. Just over the first weekend some 1.7 million phones were sold. Microsoft finally got their mobile OS right and released Windows Phone 7. While the reviews were good, the sales have been slow. Microsoft reported in December that they sold 1.5 million devices since launched, which is less than sales of iPhone 4 just over the weekend.

Facebook added its 500 millionth member during the year. The network is so powerful that half of Facebook users log onto it everyday. More than 35 million update their statuses at least once a day. The average user spends 55 minutes per day on Facebook and has 130 friends (The Facebook Blog, July 2010). The company generated 2 billion dollars in revenues. No surprise that Time magazine chose Mark Elliot Zuckerberg as the person of the year.

Facebook has created a platform for social games. 2010 was the year of Farmville. This social game, developed by Zynga, attracted some 80 million players when it peaked, causing it to become one of the most played games in 2010.

The year 2010 was also a year the Internet started to change. The network we once knew is now gone. As content owners and rights-holders fight to restrict access to their content using outdated laws and ignorant politicians, the network is geting fragmented. Indeed, the fragmentation period of the Internet has begun.

Wikileaks did not did not help. The release of the US diplomatic cables brought on criticism from many politicians. It was also the first time that the network is used in war with DDOS attacks.

One interesting trend was the living room, the battle for the TV. Apple released a new version of Apple TV, Google released Android powered Google TV, Boxee and Roku continued to improve their products. We still have a lot of improvement in the TV experience as the major networks particularly in the US, are reluctant to open their closed wall garden.

So how did I do on my predictions from a year ago? I talked about the cloud and APIs. Sure, they were important but are becoming more ubiqutues and thus did not generate much hype during the year. I predicted that content management would be important. However, it was not so much, except for books. I got that one right. Home entertainment boxes came as predicted with both Apple and Google releasing their TV offerings. We still have to wait for the impact on these. Tablets and e-readers I got but that was easy. I predicted that augmented reality would be important, but it was not. I also predicted significant improvements in battery technology. Fail there. Overall, not bad, maybe enough to predict for 2011.