Thursday, 23 January 2014

2014 Predictions Sandbox #4: the Year of Niche

As January draws to a close, I've nearly finished developing my predictions for what will happen in digital in 2014 and thought that I’d post them here to get some wisdom from my readers! Some of these will be positive, some might be busting some myths about categories that have captured the zeitgeist. Now, more than ever, comments will be greatly appreciated. This one is a bit light on numbers – I need to work on that...
 
My prediction
 
2014 will see the launch of at least 10 new high quality, economically viable TV and tablet channels aimed at specific ethnic and/ or national audiences.
 
Why I think this
 
This is a simple one! As tablets have become ubiquitous in middle class homes and the penetration of connected TVs has increased thanks to the natural replacement cycle and the availability of extremely cheap dongles, like Sky Now, the cost of providing a TV channel into a home has fallen by an order of magnitude. A channel on the Freeview terrestrial broadcast system costs about £10m a year (assuming you’re not trying to get into the top 20 channels). Satellite is more like £500,000 a year. The cost of the hardware and software for a streaming channel is more like £50,000. Content management technology has fallen by a similar amount, as has the cost of running a business, thanks to more flexible office space and improved productivity technology.
 
Add to that a growing population in the UK that were born outside, and you can see the opportunities for high quality (in picture terms, at least) content offers aimed at audiences that have hitherto been too costly to access. Services like IROKO TV, which offers Nollywood films on a streaming basis have even been able to move onto Sky. Al Jazeera have bought a Freeview channel, joining Russia Today. The last two services have ulterior motives, of course – they are attempting to promote the national interests of their parents. But there are plenty more that are aiming to make some money. ESPN offers college football from the US. The NBA has its own streaming channel for basketball. The list goes on, but is not universal.
 
In the very near future, I expect to see content services aimed at Indians, Poles, South Africans, Australians and the numerous other ethnic and national groups that reside in the UK. Many of these will likely be subscription-funded, taking advantage of people’s increasing comfort with paying relatively small subscription charges to access film and TV shows that match their interest. This behaviour is likely to be most prevalent in London and the South East, but doubtless will begin to creep into other regions as familiarity with digital continues to grow.

And remember: I'm running the London Marathon for the NSPCC this year and any donations would be greatly appreciated. http://www.justgiving.com/afroglives

Sunday, 19 January 2014

The quantified marathon, part 1

Wearables are one of the tech' trends of 2014, with the launch of Glass upon us and continued interest in life-logging activity bands. I've been messing around with this tech since early 2012, when I was one of the first UK buyers of the Nike FuelBand. That device had it's flaws, but certainly demonstrated the potential for gamifying the lifestyles of everyday consumers.

More recently, I've switched to a second generation device, Jawbone's Up. It's lighter, more comfortable and has better software than the Nike effort, although it lacks wireless connectivity. The second recent development is me training for the London marathon, which gives me the chance to try out the Up in a pretty in depth way.

6 weeks and 220km in, here are some early takeaways:


  1. It's more accurate than you'd think: +/- 5% or better in terms of distance travelled...
  2. ...but it has it's flaws: the lack of waterproofing is annoying for my swimming training (I'm doing triathlons as well as the marathon). It also has a habit of picking up mundane activities like typing as walking!
  3. Measurement exposes the dangers of our lifestyles: I've had to drive to a couple of off site meetings in the last couple of months. On those days, my basic activity level, which I try to keep to the recommended 10,000 steps, fell below 4,000. Urbanites like myself just naturally have active lifestyles, making persistent monitoring less valuable. Anyone who drives isn't so lucky - knowing how inactive you are might make you "top up" in the gym or make changes. Here's hoping.
    As an aside, I average about 18,000 steps a day. During my (luxurious) 3 week Christmas holiday, that jumped up to over 25,000, demonstrating the health value of a better work/ life balance!
  4. Social + life logging is an invasive experience... and it takes some getting used to! I have a couple of friends on UP's platform and to be frank it's a bit strange knowing when they sleep and how well, where they exercise and how much. One of them records his meals, so I know that information too. I'm not too fussed by it, but I could see that being a bit too revealing for many people.

So that's the upshot of about 3 months of UP and 6 weeks of marathon training. I'll be putting in another 200km in the next 4 weeks... then I'll do Part 2! Wish me luck!

Finally, as you'll know from my social media bombing, I'm running the marathon for the NSPCC - a brilliant charity that continues to fight child poverty, neglect and cruelty in the UK. Any donations would be greatly appreciated!

Thursday, 16 January 2014

Digital predictions sandbox #3: big businesses look east to kick start their digital transformations

I’m in the process of developing some predictions for what will happen in digital in 2014 and thought that I’d post them here to get some wisdom from my readers! Some of these will be positive, some might be busting some myths about categories that have captured the zeitgeist. Now, more than ever, comments will be greatly appreciated.
 
Last time out, I wrote about the evolution of the digital camera market in 2014. On a somewhat different tack, here’s some thoughts about how a growing need to take a holistic perspective on digital will lead to large organisations moving into Shoreditch this year.
My prediction

By the end of the year, more than a quarter of companies on the FTSE 100 will have started or announced a dedicated digital team, based in or around Shoreditch.

The digital journey

Most large organisations have been on a 10 to 15 year journey with digital. This journey started out in the late 1990s, when businesses started having websites for marketing and to a lesser extent, sales purposes. At the same sort of time, field force functions began to use mobile technology to improve the ways in which jobs were allocated.

Digital started to become an efficiency and revenue enhancer. Progress has been gradual ever since. Better mobile data speed, device sophistication and integration have improved field force efficiency. Increasing penetration of the internet amongst consumers, the rise of search and social networking have all boosted the importance of digital as a channel.

Just recently some more progressive organisations are using the unique measurability of the digital world and its ability to combine and make sense of chaotic data sets to look at enhancing productivity across all aspects of the organisation, fundamentally changing the way they operate so that they’re ready for the next decade.


The thing is that digital has been seen as an enhancer for too long now. Since about 2007, peoples’ expectations and outlook have changed fundamentally in terms of what they want from a company as a user and an employee. So digital is core to strategy: it should no longer be treated as an upside, but more as a core part.

By stealth, organisations have begun to spend a lot of money and employ a lot of people doing digital stuff, without central oversight as to whether the money is being spent in the right way from a corporate strategy perspective. How do decide the relative merits of improved routing for lorry drivers in supply chain, a new mobile website, putting virtual assistants into retail stores and investing in process analytics is a really tough challenge and requires specialist skills and ways of thinking.

The need for digital teams

Another piece of wisdom that has been debunked is that wisdom of crowds. Crowds can definitely tell you lots of interesting things if you ask the right questions, but they aren’t a solution to the digital transformation.

It’d be great if all of your people took responsibility for evolution, innovation and change; spent their time analysing performance data and experimenting to improve performance. Let’s be honest. They can’t do that right now. It’s culturally alien.

Digital needs to be a major consideration in every aspect of the business. It can’t be distributed today because organisations lack the cultural sophistication. It therefore needs to be centralised under a leader (I’m unconvinced about the need for a CDO, Head of Digital etc… but that’s a discussion for another day) and put at arms-length from the organisation so that it retains the cultural values of its parent, but can attract the right talent to work with the main business to evolve commercially and operationally.

Why East London is key

One word: talent. Digital is about experimentation with new ideas, building them and measuring their impact. Often that means building technology. So you need creative developers, typically with mobile app and HTML 5 skills. There are only two places replete with those skills – San Francisco and London, specifically around the area variously known as Silicon Roundabout, Digital Shoreditch (and so on…).

A fascinating aspect of this large community is that it formed because start-up businesses and entrepreneurs wanted to work with other start-ups and entrepreneurs. There was no super-sized organisation that they clustered around, but a natural network economy. So access the ideas and skills in that part of London, businesses need to move there. They can’t attract people (even across town) very easily because the professional and recreational social scene in the area is so good and the access routes into it are quite specific.

It’s not possible to move a corporate headquarters to the area because the real estate doesn’t exist. Part of the charm of that part of East London is the melange of housing, retail and warehouse infrastructure from 150 years of London’s history. There aren’t many buildings with large floor plates and even though nearly 2 million square feet of new commercial space will be released in the next 3 or 4 years, it’s served up in small chunks, suitable for teams of 50 or 100, but not really for much more.

Implications

Large organisations need to centralise digital. They need to access the culture and talent that is common in London but best exemplified around Old Street. They can’t move in wholesale, so they’ll get leases for 100 or 200 seat offices that they’ll customise to look and feel recognisably like them, but with a touch of West Coast tech.

Last year, William Hill and Tesco both moved into the area. Sainsbury’s, through their Anobii acquisition have people there too, although not strictly as a digital team. Even Deloitte and KPMG have offices in Clerkenwell and Old Street, respectively. Unilever and other major international businesses are due to launch their own operations in 2014 and in my opinion, many others will follow suit over the next year to 18 months.

This is the start of a new phase of business in which the hubbing of skills in the right place and the right environment to make best use of their unique talents become the norm. Within 20 years the white collar workhouses of the late 20th Century will hopefully be consigned to the past. Businesses will be more distributed and the working environment will be infinitely more pleasant and human. Thank god for technology.

An appeal

Next April I’ll be running the London Marathon to raise money for the NSPCC. This is a great charity that does phenomenal work for children all over the world, so if you enjoy this blog, please make a donation here: http://www.justgiving.com/afroglives

Monday, 13 January 2014

2014 predictions sandbox #2: point-and-shoot declines, but it’s not yet time to shutter the camera market

I’m in the process of developing some predictions for what will happen in digital in 2014 and thought that I’d post them here to get some wisdom from my readers! Some of these will be positive, some might be busting some myths about categories that have captured the zeitgeist. Now, more than ever, comments will be greatly appreciated.

Last time out, I focused on personal health monitoring. On a somewhat different tack, here’s some thoughts about the camera market in 2014.

My prediction

Unit sales of ‘point and shoot’ digital cameras will fall by around 25% in 2014; however sales of specialist camera devices such as interchangeable lens (for example, SLR) and wearable cameras will offset this decline, meaning that although shipments will fall, the decline will not be catastrophic and the total standalone camera market will by around 80m units.


Why do I think this?

It’s no secret that the smartphone has reduced the need for point and shoot cameras in the last two or three years. Cameras remain a key selling point of smartphones to mass market consumers. Now that the novelty of application stores has worn off, I expect the majority of consumers to default to a fairly conservative range of uses for their smartphone. If I was guessing, I’d expect that about seven activities will be the norm: browsing, instant messaging, two social networks, one game (played obsessively for about a month and then replaced), a news application and taking photographs.

Although point-and-shoot (or ‘fixed lens’) cameras remain superior for taking photographs by a considerable margin, I’d guess that the vast majority of photos taken today are incidental snaps that are designed for immediate posting on a social network, sending to a friend or to record information for later use. So the reason for taking the majority of low-to-medium quality photos that point and shoot cameras were designed for has changed in a way that makes smartphones a disruptor.

Even so, about 60 million point-and-shoot cameras were sold in 2013. I wouldn’t expect precipitous decline in this number as there will always be a substantial base of consumers who have habitually used these cameras and will replace them periodically. The trouble for camera makers is that outside of these developed market, middle class consumers, the new middle class in developing markets are unlikely to see a camera as an aspirational purchase in the same vein as a tablet, large screen TV or PC.

Where’s the upside?

There is some good news for camera-makers in that as tablet and smartphone sales plateau, consumers are looking for new places to spend on tech. Smartphones have definitely reinforced the meaning of photographs to consumers and a subset of them may yearn for a more specialised device.

Last year, sales of ‘mirrorless’ cameras with interchangeable lenses, which cost less and are physically smaller than professional SLRs, but offer 90% of their functionality, grew 100% YoY to 4.6m units. Their manufacturers have done an excellent job in harnessing some of their current trend for retro design and materials to make them desirable to affluent tech’ addicts, so I expect continued growth next year.

At the opposite end of the market, compact, resilient cameras designed for sports or specialised applications like life monitoring will show strong growth. Available for $100 or less, these devices are the perfect source of narcissistic supply for the ‘check this out’ generation. A 5m unit market in 2013, I expect demand to double in 2014.

Saturday, 11 January 2014

What I've been reading this week

Digital’s a broad church and I think you need to read widely to get a sense of the changes it’s bringing. To that end, this blog summarises some of the stories that have caught my eye this week.

This week: apps flop at Christmas, Polaroid launch tiny and huge imaging products, PC on the slide, super-tech on the rise

Media

Sony announce the streamed games service that was presumably the idea behind their acquisition of Gaikai in 2011. In summary, from the summer, PS3 games can be streamed to Sony Playstations and TVs. An interesting idea, but I’m not sure how the games themselves will compare to those already available on tablets, smartphones and even smart TVs. http://www.mcvuk.com/news/read/playstation-now-lets-gamers-stream-ps3-games-to-ps4-vita-and-tvs/0126467

Ace Metrix ranks the most effective TV adverts in the US last year – Google #1 - I include it here because I’m not sure how it works! I’ll try to find out… http://www.acemetrix.com/news/press-releases/the-search-is-over-google-wins-both-brand-of-the-year-and-ad-of-the-year-according-to-ace-metrix/

Technology

App downloads bounced up 90% over Christmas 2012; Christmas 2013 that bounce was only 11%. Further confirmation that the technology industry needs to find another champion now that phones and tablets have become (dare I say it) boring and mainstream. http://bgr.com/2013/12/31/2014-smartphone-sales-projection/

Steam is Valve’s open source take on the console gaming format. CES saw the announcement of 13 Steam consoles… here’s a rundown.
http://www.pcadvisor.co.uk/features/game/3496291/13-steam-machines-unveiled-at-ces-2014/

Polaroid have recently ridden on the retro revival (check out that alliteration!). This 1” cube digital camera is an awesome little gismo. Is the future of the digital camera in these little niches? http://www.wired.co.uk/news/archive/2014-01/07/polaroid

On a more modern note, Polaroid have also launched a sub-$1,000 4K screen. Going mainstream. http://advanced-television.com/2014/01/03/sub-1000-u-hd-tv-from-polaroid/

After a fortune in venture money and years of hype, I’m beginning to see the point of the Oculus Rift virtual reality headset. Some of the demos on show in this article show how it could create a totally different gaming experience. Relatively niche, but very cool. http://www.techradar.com/reviews/gaming/gaming-accessories/oculus-rift-1123963/review

It was overshadowed by Michael Bay’s autocue fail, but the 105” Samsung Ultra HD screen that Samsung were trying to launch is still an unreal piece of tech’. So much want! http://www.wired.co.uk/news/archive/2014-01/07/samsung-105-curved

Although 2014 won’t be the year of self-driving cars, they’re really not far off. As regular readers will know, I’m massively bullish on this technology to save lives and the environment. Here’s a tiny report that forecasts how self driving will penetrate the market over the next few decades. The numbers are probably pulled out of thin air, but hey ho. http://www.autoblog.com/2014/01/02/all-cars-autonomous-self-driving-by-2050-study/

Digital

Facebook acquires its first Indian technology asset, a small developer in Bangalore that specialises in mobile app optimisation. http://www.bbc.co.uk/news/business-25648118

PC shipments fell 6.9% in Q4, their worst decline in history… which leads the writer of this article to suggest that developing market consumers are skipping the PC in favour of tablets. I disagree with the use of ‘skipping’. Ultimately the PC form factor is the best one for working in the information economy. It is, however, a relatively expensive one and therefore the natural first entertainment computing device after the smart phone is the tablet. Tablets are below $50 in most markets, so they are very accessible to the emerging middle classes. http://www.mobile-ent.biz/industry/market-data/pc-shipments-drop-6-9-per-cent-suffering-worst-decline-in-history/042672

Typically insightful analysis of Pew’s latest Internet report on social networks. 73% of online adults use at least one; Facebook remains the most popular, with Linkedin a distant #2. Zuck’s not had it yet! http://www.marketingcharts.com/wp/online/majority-of-twitter-users-also-use-instagram-38941/
http://www.marketingcharts.com/wp/online/user-demographic-highlights-from-5-major-and-growing-social-networks-38939/

A third of Americans are ‘super tech’ adopters, owning devices in the majority of tech categories available. Just goes to show how addicted we are. http://www.gallup.com/poll/166760/three-own-array-consumer-electronics.aspx

This is a transcript of a superb speech on leadership. The reduction in the time that leaders have to think about problems is an increasing issue – we’re all expected to do more things, more of the time; always on, always connected. And yet the evidence is that we’re less effective when we do so. Something to think about… slowly! http://theamericanscholar.org/solitude-and-leadership/#.UsVTxdJdXVV