The Wall Street Journal has a report out this morning titled "Smartphone Upgrades Slow as 'Wow' Factor Fades." The report states that "the rates at which American cellphone users have traded in their devices for more advanced models have declined over the last few years. Last year the decline was 9% and industry analysts see this trend continuing this year. The report goes on to state that consumers are looking for 'Wow' features to motivate them to upgrade. The PC sector is likewise under the same pressure with sales rapidly in decline. In the bigger picture, the tech industry as a whole is in the middle of a massive shift from a central home computer to the ubiquitous computer era. While change of this magnitude takes time to work its way to market, it seems that we're about to see yet another wave of exciting innovation come our way in 2014.
A telecom industry veteran quoted by the Wall Street Journal stated that "There is a whole new generation of wearable devices coming that are going to have some impact on the industry." In a new analytical report by Canalys this morning they forecast wearable computers to explode from 5 million users today to 50 million by the end of 2014 as Apple, Google, Microsoft and Samsung launch new products into this new computer category. The topic of wearables is one of the hottest in the industry today and will be one of the hot topics discussed at this year's Emerging Display Technologies Conference in San Jose in August.
While the mobile industry leaders prepare for the coming wearable computer revolution, the smaller players are happy to do their part in chipping away at Apple's future iPhone buzz in the hopes of gaining a little market share.
Every tech company worth their salt today is looking for ways of differentiating their products from Apple's in any way possible. Currently there's been an effort by some to kill the traditional Apple buzz that is created every fall with the release of new products. Last week we reported that LG may be trying to steal Apple's next iPhone thunder by introducing a fingerprint scanner on a new smartphone scheduled to launch next month in a special New York event.
Today we've learned that Sony is going to launch a new smartphone days ahead of the next iPhone release that will pack a 20MP camera in order to out-gun Apple's next iPhone upgrade which is likely to offer a lesser 12MP camera. Others are trying to beat Apple in the higher-end hybrid smartphone trend to cut Apple off at the pass.
On the Traditional Computer Front
On the traditional computer front, the industry is equally in search for the next "Wow" features to stimulate sales. Yesterday's buzz was about Apple possibly acquiring an Israeli company for their advanced 3D depth camera technology. The Israeli company's next technology advancements reportedly cover new innovative ways of identifying small and subtle movements of fingers which could help to advance Apple's many in-air motion gesturing projects.
In yesterday's revelations I was equally surprised to learn about Apple's Tel Aviv research center that is reportedly working on sensing technologies specializing in 3D analysis of body and facial movements and conversion of computer activity. That supports Apple's granted patent for an advanced imaging system that presented a rather wild patent figure as we note above. It also supports Apple's motion tracking patent which covers facial tracking specifically. This is noted as another project now in progress at Apple's Tel Aviv Research Center.
Apple's motion technology is earmarked in-part for iOS 7 as was first reported on by Mac 9to5. And while it looked a little gimmicky at first glance, one of our fans pointed out that Apple may initiate this technology initially in context with those with disabilities. Yet in the bigger picture, it now appears that this is how Apple intends to tippy toe into that market while building it out extensively over time.
We also noted in yesterday's report that Intel announced that they'll have their new breakthrough 3D depth cameras debuting on Ultrabooks and all-in-one desktop computers as early as Q4 2014. So this isn't theoretical, it's coming to market within the next 18 months.
Next Generation Finger Tracking Technology
To further support Intel's resolve of delivering their new 3D camera to market on time and with purpose, they've reportedly acquiring Omek. Omek specializes in breakthrough finger tracking and gestures technology designed for close-range environments in the 10cm range. The Israeli company that Apple is interested in acquiring holds similar technology as we noted earlier.
The noted video below from Omek provides us with a wide overview of their technology that's coming to the PC and possibly the Mac late next year.
As the video indicated, this type of 3D interaction between the user and their display opens the door to the possibility of seeing new interactive user interfaces emerging in the coming years. This is something that's been in the works for years now and first initiated by MIT's John Underkoffler, the designer of the interfaces created that were created for the movie Minority Report.
Apple Gearing Up for Wearable Computer Market
While many of the noted technologies related to the 3D space will be aimed at PC's, they're likely to expand though to future televisions, gaming consoles and beyond. But until they arrive and have a meaningful impact, the industry's more immediate focus is now on advancing mobile devices like tablets and smartphones. Leading Industry players like Apple, Google and Samsung are hard at work on wearable centric computers.
At the top of the month we noted that Apple had filed for the iWatch trademark in Japan and since then have filed for that trademark in several other countries; a sign that they're securing the brand name for future use.
In that same time frame Apple hired Paul Deneve, head of the Yves Saint Laurent fashion house, to work on unspecified "special projects" for Apple Chief Executive Officer Tim Cook. Apple has a lot of projects on the go in this area that they'll try to keep secret as long as they can so as to not give the psychopathic copycats time to prepare similar products. The only wearable computer product noted in public to date is the iWatch (or computer bracelet) besides those related to sports gear.
Next generation wearable computers, in their initial phases, will be closer in nature to peripherals of smart devices such as the iPhone and iPad. Some will view these kinds of "accessories" like the iWatch to be considered "Appcessories," a term found in Canalys' latest report.
What I appreciated in the latest Canalys report is that they acknowledge that wearable computers in the form of such things as a smart watch or Google Glass will need to provide consumers with more sophisticated software and more elegant hardware.
Chris Jones, Canalys VP and Principal Analyst in this report states that "'Glanceable' information, integration across sensors and hooks into web services will be key features to make these new products successful. These companion devices will not replace smartphones, but rather complement them as 'Appcessories'. Smart watches will be the most important new product category in consumer electronics since the iPad defined the market for tablets."
The report further claims that "hardware design will be critical for smart watches, as consumers will only want to wear fashionable products. The market for traditional watches will quickly be disrupted once consumers determine that smart watches add sufficiently valuable functionality to their lives while being stylish enough."
Canalys estimates that "over a billion watches were shipped in 2012." This is a huge market today's mobile leaders are aiming for and the battle is going to be fierce. Yet there will be some drawbacks in the first generations of this product. The report notes that "Device vendors of smart watches will face a number of tough challenges. Strict power constraints will prohibit cellular technology, limit the number of sensors and necessitate communication with smartphones over Bluetooth Low Energy."
Apple Eyes Supplemental Energy Sources
Interestingly enough Apple addressed this very power issue in their iWatch patent application. In one segment, Apple states that "The operating time of a built in battery can be augmented by the addition of an auxiliary power supply such as a solar panel array to the accessory. A solar panel array spread across a surface of the accessory device can lengthen the amount of time the accessory device could be operated between recharging."
In a second segment of the patent, Apple states that "Having the accessory device on an extremity is an ideal location for gathering kinetic energy. The simple motion of a user's arm or leg allows the accessory device to harness some of that energy for charging battery." Whether either of their supplementary energy solutions are close to reality is unknown at this time.
Where Apple Could Really Shine
Where the Canalys report really hits home on the front of true innovation is when their analyst Daniel Matte notes that "the ARM architecture licensees that design custom silicon will enjoy significant hardware advantages in this space. Smart watches will also require custom software."
Canalys Analyst James Wang added that "An effective smart watch won't just be a second screen for a smartphone. Creating a competent developer platform specifically for this form factor will be an enormous challenge."
Furthermore, the Canalys report states that "Innovative companies that create compelling apps will be best poised to capitalize on this major market opportunity."
Apple is a master on every point made. They design their own ARM based processors, have the best software via iOS and the ability to design custom software like no other in the industry, consistently.
Apple did it Once, Twice, Thrice
And this is where true innovators like Apple come in to play. Apple's iPhone took the lead in the smartphone arena because of the notable advances that Apple brought to this product category including multitouch, simplistic "apps" designed for touch along with an "App Store" that ignited a revolution in itself. Apple's advanced mobile internet browser is another feature that just worked better than any before it.
Apple's entire product from its unique hardware through to its intelligent software connected perfectly and stormed the market who voted with their wallets that the iPhone was in fact a revolutionary product - a true must-have product.
Apple also intelligently integrated iTunes to work seamlessly on the iPhone and it went on to crush all smartphones of that time. Today, Apple's iPad is still the number tablet on the market because of its apps, a srong app ecosystem and quality hardware features like the Retina Display. Yes, Apple pays attention to every detail.
In the end, Apple created three products that exploded on the market: The iPod, the iPhone and the iPad. Some companies never enjoy one major hit in the league of Apple's iDevices. Can they do it again?
Apple Could do It Again
This next phase of the internet revolution is once again going to require tremendous innovation that will drive these new wearable computers. Many in the media once thought that the iPod was just stupid or that the iPad was just a bigger iPod. This is where Apple sweats the details to get a new product right, even if you don't get it at first. They may not be perfect devices, but new-to-market products seldom are. And let's face it; to date Apple has been the one leading the mobile user interface revolution with the rest of the industry, for the most part, slavishly copying their every move.The question now is, can Apple introduce yet another killer product like the iPhone that could take us to that next level of exhilaration? I think they can.
The One Competing Product to Watch for in 2014
While Apple has a number of new to market products in the pipeline for 2014, so do their competitors. Make no mistake about it – Apple's competitors aren't as blind as they were back in 2007 when the late great Apple CEO Steve Jobs first introduced the iPhone to the world. The industry players at that time were literally like deer caught in Apple's headlights. They were like battery powered toys that went haywire bumping into each other completely lost as to how to compete with Apple. Microsoft's answer was to bury their head in the sand and silently weep. But times change.
In 2014 Google will launch Google Glass which is going to rock the market in one way or another. Last year we asked the question: Will Apple Lead or Follow in the Future Glass Projects Market? Glass could very well end up being a killer category.
Yes it's true that Apple filed for a video glasses patent as far back as 2008 but have done little else since that surfaced to truly advance it. Well, at least on paper. If you happen to read tea leaves, then you should know that one of Apple's ex-engineers who specialized in wearable computers moved to Google to work on the Google Glass project and has a number of patents on this to his credit. However, did he bring this project to Google? Did Apple drop that project for lack of interest? Did they just drop the ball? At the moment there are more questions about Apple's Glass based project than there are answers. So only time will tell which of the above it really was.
For now, Google Glass is going to be the one competing device that we think is going to shake up the market outside of a new Apple entry. Google is hoping to work with Apple so it works with a future iPhone. If Google Glass for prescription glasses actually pans out as their patent suggests, then I'll even be tempted to try it out as a slick wearable camera. I don't have to hate competing technology if it serves a unique application that an Apple product doesn't happen to fill.
At the End of the Day
At the end of the day, Apple's CEO Tim Cook stated during his D11 Conference interview with Walt Mossberg that Apple had new product categories in the pipeline for 2014. Is there another killer iDevice coming our way?
What we do know for sure is that Apple is about to take a huge leap into the in-vehicle infotainment services business in 2014 with iOS for the Car. Some analysts have already deemed it a real threat to the status quo. Yes, Apple's original Think Different campaign marked the spirit of the coming mobile revolution by making that very point. Something tells me that in 2014 we're going to see the spirit of Apple's revolutionary mantra rise once again.
It's never been about cool hardware alone, it's been about the perfect marriage between hardware and software. And to date, there's simply no mobile platform equal to Apple's that marks true innovation that has the power to inspire many generations. Consumers are searching for the next "Wow" features states The Wall Street Journal – and I think that Apple's next revolutionary wave of products coming our way in 2014 will go a long way in answering that call.