As in the 20th century, horses and buggy whips gave way to the automobile, in the 21st century, what comes after the smartphone? Smartphones have come a long way since the original Apple iPhone. Each version seemed to have more and more features that customers wanted. But more recently each version is giving you less and less new features and functionality, rather giving you just mere improvements on existing features and functionality. In addition, the competition has gotten fierce. There are many good smartphones from new technology companies that rival the traditional name brand technology companies at a much lower price point.
The smartphone industry is maturing and is being commoditized. Worldwide smartphone shipments fell 2.3% in 2Q19 YoY. Samsung ranked No.1 with 75.5 million shipments in 2Q19, a 5.5% YoY increase. Huawei was No.2 with 58.7 million shipments in 2Q19, a 8.3% YoY jump. Apple was No.3 with 33.8 million shipments in 2Q19, a -18.2% YoY plunge. An escalating trade war between the US and China contributed to sharp declines in shipments in both China and the U.S. over the last year.
As occurred in the PC industry, the same thing will happen in the smartphone industry. That is to say, it’s not about the hardware rather the software. Once again Apple, though an original innovator, maintains a closed architecture, at a higher cost. Android, on the other hand, maintains an open architecture allowing many technology companies to build their smartphones upon. Microsoft because it could not keep up technically, gave way to Google to replace them as the software platform of choice. This was Bill Gates biggest regret with Microsoft.
So where do we go from here with smartphones? Are there no improvements envisioned? To answer these questions let’s think about what the current problems are with smartphones today. Smartphones are a gadget that you must carry around with you always. Kind of a pain to always be searching for them, you lose them, they always need to be recharged, constant swiping, they break, the screens are kind of hard to see and endless hours of configuration. With this in mind, News Forecasters sees three major technologies converging that may replace the smartphone.
Cloud computing. Similar to PCs why is it necessary to have all this computing power in the palm of your hand? Why not place this in the cloud, where technology synergies can be gained at a reduced cost. Bandwidth, connectivity and security issues will need to be addressed, but much of the cloud computing infrastructure is already in place.
Neuralink user interface. The current user interface with smartphones is clunky. User input could be done via voice, hand and eye movement, or even thought. User output of sound, visual, and motion could be done with brain implants. This is bleeding-edge technology, but some companies are already attempting to tackle the problem. Elon Musk is just one of many new tech startups.
The smart personal assistant. The smart personal assistant is the glue that makes it all work and will take the drudgery out of operating a smartphone. The current players in this market, Amazon, Google, Apple and more recently Samsung are well underway to creating good platforms for the future in this technology space.
Once these three technologies get fully develop and converge, it will be the death of the smartphone. News Forecasters believes this is still 5 to 10 years away, but the path forward is clear.