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December 30, 2014
Top 5 Tech Predictions for 2015

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TECHnalysis Research Blog

January 6, 2015
More Tech Predictions for 2015

By Bob O'Donnell

In last week’s column, I provided my top 5 predictions for the new year. What follows are 5 more predictions around key themes, technologies and product categories I believe will also be important this year.

Prediction 6: Wearables Will Make Advances, But Remain a Modest Market
The wearable market will undoubtedly make big advances in 2015, but I still believe the overall size of the market will remain relatively modest at around 40 million units. The Apple Watch will likely sell reasonably well (in the 10-12 million unit range), but I don’t expect it to have the same kind of market-making impact as the iPad did in its first year.

The fundamental concerns regarding the wearable market still remain: duplication of smartphone functionality, unproven form factors, small screen sizes, battery life, reliability and accuracy of sensors, and much more. In addition, as I’ve discussed in the past, wearables are significantly more intimate devices than anything we’ve used previously. As a result, there are important personal questions that remain about fashion and taste, as well as privacy and security.

Over the long run, I do believe there is a much larger opportunity for wearables, but we need to get past thinking of them as simply the next device evolution from smartphones. Ultimately, trying to apply smartphone-like analogies to wearables—for example, focusing on platforms, app stores (or even the app model)—will prove to be flawed as these devices need to offer their own unique form of value. As the next iteration of a smartphone-like mobile device, they’re a solution in search of a problem. But, as uniquely defined devices that offer unparalleled access to real-world data from our bodies and environments around us, they represent an intriguing glimpse into the technology of tomorrow.

Prediction 7: Following Tablets, Smartphone Shipments in Developed Markets Will Decline
Though it likely eked out some modest unit shipment gains in 2014 on a worldwide basis, the tablet market really hit the brakes in the US and other developed countries last year. For 2015, I expect to see a relatively similar phenomenon for smartphones. Smartphone growth was robust in 2014 all over the world, just as tablet growth was in 2013. Now, however, much of the US market has already upgraded to bigger phones like the iPhone 6 and 6 Plus, as well as the Galaxy Note and other phablet-style phones. As a result, the need/desire to upgrade is likely to be relatively modest this coming year.

In addition, I believe the growth in larger-screen phone sales, in conjunction with many of the new pricing plans offered by US carriers, will also end up leading to longer lifetimes for many smartphones. Given how mature and relatively saturated developed markets already are, these long lifetimes will also act as a deterrent to new phone sales in 2015.

Prediction 8: The Next Version of Big Data Will Be All About You
One of the most interesting outcomes of the new wearables market is the amount of information being generated by and about individuals. Health and fitness-based wearables, in particular, can spew out thousands of data points a day for your viewing pleasure (or sharing pleasure, if you so choose). Combine that with the amount of personal tracking of web browsing, online purchases, document creation and editing, social media interactions, and more that’s already going on, and you end up with an enormous set of personalized data that will either make you shudder in fear or giddy with self-realization potential.

Either way, it’s unquestionably fodder for data mining, classification, comparison and more—exactly the realm of traditional enterprise big data. Of course, as with many big data efforts, the analysis results may not always prove to be that useful. Regardless, that’s not going to stop companies from trying to paint interesting new perspectives about you based on all the data that’s now available.

Prediction 9: Biometric Sensors Will Make Passwords Start to Go Away
The security hacks and blunders of 2014 have proven without a doubt that basic password protection is well past its prime. The challenge now is to find the right kind of solution that’s both secure and relatively straightforward to use. The obvious answer comes via biometric sensors, which offer uniquely identifiable, effortlessly created bits of digital identification that everyone should be able to comfortably use on a regular basis.

There are still some cost and accuracy issues that need to be addressed, as well as tradeoff questions about what types of biometric sensors offer the greatest security versus those that offer the greatest convenience. Nevertheless, I expect to see wide adoption of fingerprint readers, iris scanners, palm vein readers, facial recognition-enabled 3D cameras, and more in a significant percentage of the new devices shipped in 2015. This, in turn, will allow passwords to start fading as our primary means of secure access to our devices and our data, and enable multi-factor authentication methods that use biometrics as at least one of those factors to start rising this year.

Prediction 10: Instant Gratification Web-Based Services Will Consolidate (and Possibly Implode)
Given the apparent “Uber-ization” of the entire world, it may seem ridiculously naïve to question the “sharing economy” and all the other instant-gratification services that the venture capital world seems so obsessed with right now, but I can’t help feel that this emperor has no clothes. Sure, there’s an opportunity to create new 1:1 markets where people can leverage certain assets that they own (like cars and homes) and mobile services can bring buyer and seller together quickly and conveniently. However, that doesn’t mean it’s going to radically change everything; especially when some of these services flaunt well-established laws and regulations all around the world.

Are there some old-school businesses in dramatic need of a refresh? Heck, yes, and there’s no question that the taxi business should take some serious lessons from the likes of Uber and Lyft and build an app of their own. But the potential for existing industries to “re-disrupt” the disruptive business models currently being deployed by these hot new startups seems very real. Plus, looking back at something like eBay, which offered similarly disruptive business models about a decade ago (and arguably was, and is, the first “Market 2.0” company), it’s easy to see that one of these instant-gratification “sharing economy” companies could survive, but it will likely need to swallow up many competitors in order to do so.

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