Monday, January 1, 2018

Is there anything on the horizon that will challenge the dominance of smartphones?

I was born in the late sixties in India. In the early seventies, our home had only a few appliances that used electricity – a couple of fans, few light bulbs, and a radio. As the middle class in India started catching up to the western standards of living, by late nineties my family in India had acquired televisions, video cassette players, audio cassette players, refrigerators, phones, washing machines, food processors, evaporative coolers, water heaters, etc. Our family was not an early adaptor of technology. By the time my family was ready to buy a new gadget, there were at least another hundred million families in developing economies that were acquiring the same gadget. Each new gadget had a market size of few tens of billions of US dollars and its wide-scale adoption added hundreds of thousands of jobs to the manufacturing sector worldwide. The growth in the sale of the manufactured products was a proven strategy to grow the economy.
I came to the US in nineteen ninety. We acquired a large number of electronic gadgets over the twenty year period including camcorders, digital cameras, navigation systems, cell phones, personal digital assistants, voice recorders, CD players, MP3 Players, handheld game consoles, alarm clocks, digital wrist watches, pedometers, televisions, DVD players, cordless phones, etc. Every year there was a new and exciting electronic gadget on the market that was on our wish list. The list of must-have products was growing and new hardware companies were springing everywhere to offer new products. Middle-class consumers have been fueling the economic growth and raising the standards of living for people through expansion of the global manufacturing sector.
The consumer electronic landscape started changing with the arrival of iPhone in 2007. My wife was an early adopter. She was using her iPhone to play music and get driving directions. She did not need her navigation system or her MP3 player. Soon the camera on her upgraded iPhone was quite decent and she abandoned her digital camera. Her wrist watch and the alarm clock on her nightstand were the next items to disappear.
Products made obsolete by smartphones (Cordless Phone Image Source:; Pedometer Image Source:; Digital Alarm Clock Image Source:; Hand held Game Consoles Image Source:; MP3 Players Image Source:; GPS Navigation System Image Source:; Digital Camera Image Source:; Camcorder Image Source:; Electronic Voice Recorder Image Source; Personal Digital Assistant Image Source:; Scanner Image Source:; Radio Image Source:

The list of products impacted by smartphones includes: (1) digital cameras, (2) video cameras, (3) navigation systems, (4) personal digital assistants, (5) MP3 Players, (6) voice recorders, (7) handheld game consoles, (8) alarm clocks, (9) pedometers, (10) cordless phones, (11) radio, and (12) scanners. Some people are also using smartphones as calculators, barcode readers, searchlights, mirrors, remote controls, keys, translators, wallets, and paperweights. All signs indicate that smartphones will make many more products vanish from the market over the next few years. Recent media reports are touting the ability of smartphones to function as metal detectors, digital projectors, and mosquito repellents! This phenomenon has never been seen before. Usually, a new product made a product with similar functionality obsolete. For example, DVD players made video cassette players obsolete. Smartphones are simply absorbing the functionality found in other products and altering the consumer electronic product landscape.
So far large screen TVs, high-quality headphones, and health monitoring systems (e.g., fit bits) appear to be immune from smartphones’ takeover. As I am writing this blog post, I am realizing that with the exception of a TV, a couple of headphones, and few fit bits, we have not bought any new electronic gadget in the last three years. Every few weeks, we get excited about new apps for our smartphones and we are constantly discussing which smartphone to get next. However, we are simply not keeping up with our previous pace of consumer-electronic hardware purchase. Smartphones have altered consumer behaviors and expectations and have ushered in the era of the app-based economy. 

Cars and homes depicted in sci-fi movies have not yet materialized. However, smartphones have fundamentally changed the way humans communicate, commute, shop, and bank. They have also opened up new channels for news delivery, advertisement and entertainment. Many people are now attached to their smartphones and cannot imagine life without them. The fear of not being to check one’s smartphone is now a recognized phobia. Twenty-four seven connectivity makes is difficult for people to disengage from work and induces a high level of stress. Smartphones are being blamed to cause several different kinds of sleep disorders. Smartphones have had the biggest impact on daily lives of humans since the advent of personal computers and fundamentally changed the cultural norms and human behaviors.

A reasonably good quality smartphone costs between $500 and $1000. Most people look forward to upgrading their smartphones to newer models in two (or fewer) years. Many previous electronic products such as digital cameras were shared by members of the family. Smartphones are not meant to be shared. Everyone needs to have their own smartphone. This is fueling growth in smartphone sale. Annual smartphone sales volume has already crossed the one billion mark. Soon revenues generated from smartphone sale will be more than one trillion US dollars. Smartphones have fundamentally altered the consumer electronics landscape and had a profound impact on the industry. Most high technology companies want to a part of this action and are launching their own smartphones. If this trend were to continue and the popularity of ride-sharing apps slow down the sale of automobiles, then smartphones might take over the automotive industry in terms of worldwide sales revenues. Smartphones currently appear indispensable and imagining life without them is not possible.
Heraclitus, a Greek philosopher said that change is the only constant in our lives. I am sure that dominance of smartphones (at least in the current form) won’t last forever. I am beginning to wonder what will replace smartphones. With easy access to the cloud, we don’t need to do any serious computing on the handheld devices. Miniaturizing is creating powerful sensors that can be easily integrated into other items carried by people. The key innovation offered by smartphones was the touchscreen-based user interface. The next generation brain-machine interfaces might reduce reliance on touchscreen interfaces. If augmented reality-based glasses become popular and everyone starts wearing them, then it will be easy to simply add smartphone functionalities to them. They will certainly provide a better display and sound quality than smartphones. People have been talking about smart clothing for a while. Would smartphones survive in the current form if smart clothing idea takes off?
Is there anything on the horizon that will challenge the dominance of smartphones?

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