How Apple May Be Thinking About AR Glasses

On numerous occasions, Apple CEO Tim Cook has stated that he is extremely excited about AR and believes it will usher in a new era in mobile computing. I have done many interviews on Cook’s comments with media and industry folks about Apple’s overall optimism about AR and I tell them that I believe Apple is moving in a very calculated manner when it comes to how their AR strategy plays out.

One big lesson we learned from Google Glasses is that you don’t just bring out a new technology like glasses without doing a lot of prep work in advance. Google Glasses was targeted at consumers and was a disaster that has tainted their position in this space since they were introduced.

I have always maintained that any new technology gets started at the high end and vertical segments of a market where it is flushed out and can find companies and customers who are willing to pay the early high prices because it meets a specific need. That should have been Google Glasses target market with their first generation of glasses. Only now, three years later, are they doing a new version of Google Glasses that are just targeted at vertical markets. How successful they will be is hard to tell as many other major glasses and goggle makers have been doing glasses for vertical markets for over 20 years and still less then 1-million of these are sold worldwide each year.

I believe Apple understands this market very well and knows that doing AR glasses now and even in the next two years would be folly without many years of getting people use to AR on their smartphones before even suggesting that there is another way to deliver AR that could be more optimal for any AR experience. Indeed, What Apple has done and continued to do so well is to enhance their hardware as they have with the iPhone X so that developers can create AR apps using the new cameras and sensors built into Apple’s top of the line smartphone.

While the optimal AR experience will be on an iPhone X, they have made AR apps work with iPhone 5’s and up. The heart of their strategy lies in the idea that with AR on the iPhone, they can introduce mainstream users to AR and use the iPhone as a way to make AR easily understandable to consumers and give them cool apps that are imaginative and useful for everyday activities.

A good example is of course the IKEA app that lets you place furniture in a blank room through their AR app on the iPhone and iPad so a person can virtually see how it would look in any room. Or the various ones that use AR to see the exact image of your face and then tells you the size of the glasses you should order online. You can keep track of new AR apps here.

Think of the next few years leading up to 2020 as the evangelistic period for Apple to get all of their users use to and engaged in AR apps on the iPhone and make these apps indispensable to them over this period. During this time we will see Apple enhance AR Kit, bring more AR technology to at least two new models of iPhones created during that period so that when they do introduce their AR glasses most likely in 2020, it will just be a natural evolution of their user interfaces.

From the time Steve Jobs introduced the Mac, Apple has been on the leading edge of user interfaces. With the Mac they gave us the graphical user interface and a mouse. With the iPhone they gave us touch screens, gestures, and most recently voice and Touch ID and Face ID as new elements of their user interface design and progress.

I believe from a hardware standpoint Apple could deliver glasses as early as 2019 but I don’t see that in the design plan. Rather, they are not here to beat anyone to market with AR glasses. Indeed, I suspect many AR glasses will come out from competitors between now and 2020. Instead, Apple will play to the big long-term win and only bring them to market when they are certain that their customers will be ready for what will be for most a radical addition to the Apple experience.

In the chart below, you see how the VC community has already decided that AR is where they should invest in a big way. Although VR came to market much earlier even they understand that VR will have its greatest impact in vertical markets and AR is the technology that will eventually have the biggest impact on the market.

Tim Cook and his team have a grand plan to make AR the heart of their future products and user interfaces. It is easy to see that using the plan I suggested above how they could achieve a strong position in AR and make it a mainstream technology in the next decade. That is why when you hear Tim Cook talk about AR, he does it with such confidence. He knows that if they do this right they could dominate this space and change mobile computing again in ways Steve Jobs perhaps did not even dream about when he was still here with us.

Can Social Media Combat Fake News?

Last week Google, Twitter and Facebook’s lawyers and executives faced Senate and House Hearings about the Russian Interference in our last election. Legislators put these companies through the ringer as they showed actual ads bought but Russian operatives that represented false news stories that intended to influence and sway the last presidential election. These legislators asked hard questions and wanted real answers from these social media representatives about how they will go about making sure this does not happen again in the upcoming 2018 mid-term elections.

While these company representatives said they were on top of the problem and shared how they were going to tweak their algorithms and take other measures to try and catch these false ads before they even make it to their sites, I got the impression from the hearing’s that these lawmakers were not convinced Google, Facebook and Twitter really had a handle on this and could deliver. Even worse for them, Sen Diane Feinstein scolded them for not catching this sooner and said that she does not believe that they understand the damage they have done to America’s democratic process. Also, while these companies may have felt they passed the test from these hearings, I think they will come under even greater governmental scrutiny in the next year and am not ruling out that they may all be deemed a media company and come under some regulations before the next election.

The day after the hearings, Apple CEO Tim Cook tweeted out that the issues are not just the Russian Interference but also the problem of Fake News in general. More specifically, the fake news created by normal citizens to push their personal beliefs or agenda or fake news based even on something interesting that someone might want to share with their friends.

In an interview with NBC He stated “”I don’t believe that the big issue is ads from a foreign government. I believe that’s like .1 percent of the issue,” Cook told NBC Nightly News anchor Lester Holt in an exclusive interview that aired Wednesday night.The bigger issue is that some of these tools are used to divide people, to manipulate people, to get fake news to people in broad numbers, and so, to influence their thinking,” Cook said. “And this, to me, is the No. 1 through 10 issue.”

I myself got caught up on sharing a fake news story during California’s heavy rains earlier this year. Someone posted a picture of that massive bridge collapse near Big Sur and the picture they showed was interesting and disturbing and I thought it was newsworthy. However, a really good friend of mine saw what I posted and quickly corrected me by saying that this was a picture of a bridge closure at a different area from 3 years back. I immediacy deleted my Facebook post and then sought out the real story about what was a serious road closure but the picture was completely different and much less dramatic.

On another occasion, I posted a political story that I thought was worth discussing but quickly found out it was a fake story and pulled it down immediately. However, I was duped as I suspect many people are, especially if the story or post comes from someone they know and/or respect. What troubled me once this happened to me twice was how easy it is for someone to share a fake news story and it being spread by a person they know and trust.

Remember that parlor game Gossip? I played it often when I was young. The idea is to whisper something to a person in a circle and see if the original message would be the same when it is shared by the last person in the circle. Very seldom was the original message the same once it got around the circle and shared by the last person in the link. This is not to say that social media is necessarily a gossip machine, but it’s clear it has become more of a gossip medium than just a pure vehicle for people to share there life stories and interests with their friends.

The other issue about fake news is the fact that there are image tools that make it easy to create fake images and tie them to a story. The one most used are Adobe’s Photoshop. I once took a serious photography class and was taught how to use Photoshop to alter, in this case, my photo. I have to admit that when I was done, I looked younger and much thinner and was tempted to save that image. However it was a fake image, and although I liked what I saw, I deleted it.

More than once I have fallen for a fake picture that used photoshop and been tempted to share it with friends. But given what happened with that fake bridge photo I mentioned above, I now take extra measures to check out my stories source before ever posting anything on social media.

While I do think that Facebook, Google, and Twitter will find ways to flush out false political ads over time, I am less convinced that they will ever be able to stop fake news. This is especially difficult to do if it is created by ordinary people for whatever reason and then shared by trusted friends who get duped based on any form of personal interest or persuasions.

Digital Transformation is Driving Record Earnings

Last week Microsoft, Amazon, Google, and Microsoft all announced last quarter earning’s that beat Wall Street’s expectations and had record earnings. Intel also saw 2% growth even though demand for PC’s was flat. Even Twitter saw their stock rebound even though they lost subscribers.

When I read these earning reports I got an image of Alfred E. Newman of Mad Magazine saying “What, Me Worry?” as these companies just keep plugging along and quarter after quarter show strong demand for their products and services and prove the naysayers wrong on a consistent basis. Sure, their increasing power is coming under all types of scrutiny from governments and consumer watchdogs, but I can’t see any anti-trust violations in any of their cases since the competition between them and others in products and services is a strong as ever. Even though it could be argued that they are too big and could keep out competitors, we have case after case over the years where innovation and creativity can take what might be perceived as an also-ran and move them to the front quickly.

Just look at Yahoo, who owned the search market until Google came in with a more innovative way to search and you get the idea. Same goes for Myspace-They owned social media at a time until Facebook came in with a better and broader solution. If you talk to VC’s who put big bucks into many of these companies and help them grow, they will all tell you that a company that really brings innovation to the area they are invested in could clearly be a threat and they watch for these types of competitive innovations like hawks because they know full well that someone is always nipping at the heals of their investments.

This is not to say that in this political climate that we are going to see more scrutiny and discussion on reeling in some of these big players’ influence and power, but even with that I just don’t see how they are going to do this under the current legal definition of anti-trust or even anti-competitive practices.

While I do think that these big companies who continue to have record earnings need to be aware of these threats from governments and watchdogs, the underlying reason they are growing and setting earnings records is that the big, mid-sized and even small businesses are in the early stages of what is called the Digital Transformation.

This is especially true for Fortune 1000 companies who still have many legacy systems in place that are still analog and realize that every part of their business has to move to digital to stay competitive and prosper. But even SMB’s are moving at a faster rate to bring their businesses into best digital practices.

Below are some charts that share both a roadmap for digital transformation as well as some of the major challenges.

If you review all three of these charts in light of your own company or business, you can get a sense of where you are today and perhaps get some clarity on where it needs to be in the future. But the big takeaway is that everything is moving digital and moving to the cloud. What is important to these businesses like Amazon, Google and Microsoft are that for most of the companies in the process of a major digital transition, they all want to off load the cloud part of the needs instead of building it and hosting it on their site.

Only the biggest companies, and especially ones with major government contracts where the data centers have to be inside a company to meet government security mandates, can manage a walled data center inside their firms. For the majority, that is now being outsourced to the major players mentioned above who are buying more and more data center equipment and charging significant monthly fees for their service. This guarantee’s a steady stream of income, and since in most of their customer cases they are in the early stages of this digital transformation, you can see why their earnings are strong now and look strong well into the future.

Are Glasses Needed for AR and Mixed Reality to take off?

Three very exciting new technologies on the horizon have much of the tech world buzzing about, and billions of dollars are being invested into this new area of tech.

The first technology that hit the scene about two years ago was VR or Virtual Reality when Oculus Rift introduced their VR Glasses at CES in 2015. This product was the big hit of that CES, and shortly after, Facebook bought Oculus For $2 Billion.

Shortly after, after that Microsoft introduced their HoloLen’s project. It was entirely different from Oculus Rift’s VR version in which you are enclosed in virtual worlds; whereas Microsoft’s glasses or goggles allowed you to see through the lenses and superimpose virtual images and objects onto any scene and called it Augmented Reality or AR.
Since then another termor third technology has come into the tech lexicon called Mixed-Reality that tries to bridge the gap between VR and AR and tie the VR and AR worlds together.

Most people got a glimpse of AR, with its virtual objects displayed on a smartphone, when Niantic introduced their Pokemon Go game to the world. This game allowed people to place virtual objects on any object or scene they are viewing as part of the game and made AR a household name.

Since then Apple has created a robust AR platform through its AR kit, and hundreds of AR apps are already available on iPhones and iPads. Google has also jumped into the AR game with ARCore, their AR developer tools for Android that lets Android developers create AR apps for the Android smartphone platform. But in both of their cases, these AR apps are all delivered to a smartphone or tablet. The big question in Silicon Valley these days is whether AR will ever gain a broad audience if it is only used on a smartphone, or will select AR or mixed reality glasses be a more natural way for people to view and interact with AR and mixed reality applications in the future?

At the recent Wall Street Journal Conference, John Hanke, chief executive of Niantic Inc. discussed the success of their Pokemon Go AR app and made a crucial prediction.

Speaking about glasses:

“He said he thought it would take “probably in the order of five years” before the technology is mainstream. Augmented reality technology debuted on the smartphone, Mr. Hanke said, “because you build it for the platform that exists.” AR will reach “full fruition when we get to the glasses,” Mr. Hanke said. With glasses, the potential for AR “is immense because it can be woven into your daily life.”

Over my 35 years in Silicon Valley I have learned that when pioneers of a technology weigh in on a subject, they are involved with, it is best to listen to what they say. Mr. Hanke is a pioneer in AR, and since millions of people have played Pokemon Go, he has the kind of knowledge and experience to predict where AR is headed. As he states in the WSJ article, he created Pokemon Go for the platform that was already there, in this case, the smartphone. But he does not believe AR or mixed reality will reach its real potential without some AR or mixed reality glasses or goggles.

On the other hand, Apple’s Tim Cook is over the moon with AR for the iPhone. In multiple interviews, he has stated his excitement for AR and believes AR is a game changer for the iPhone and has committed to working closely with developers to create the most innovative AR apps possible using AR Kit for IOS.

Google seems to be equally excited about AR on Android smartphones although they have not been as vocal as Tim Cook has been about AR on the iPhone. The good news is that AR on a smartphone or tablet will become an essential step in getting people very familiar with the concept of AR and mixed reality and I believe it will play a prominent role in making AR glasses or goggles more acceptable once they do hit the market.

If Apple or Google had tried to push AR or mixed reality into the mainstream via glasses today, they would be a flop. Just look at the disaster Google had with their Google Glasses project a few years back, and you can see why glasses even today would be a hard sell. Getting people used to AR apps on smartphones and tablets will start the ball rolling. Once the technology is ready to create AR glasses that would work and be stylish and easily integrated into our daily lifestyles in 4 or 5 years as Mr. Hanke predicts, then glasses become the preferred way to work with and interact with AR or mixed reality apps in the future.

For their part, Apple, Google, Microsoft and many others are doing much R &D around AR, and mixed reality glasses that would be acceptable to mainstream users and all have filed multiple patents on various glasses designs already. But as Mr. Hanke of Niantic says, it could be at least another five years before the technology is here to make the kind of glasses that will bring AR to the masses in a more personal and interactive way.

I am excited about AR on smartphones but agree wholeheartedly with Mr. Hanke of Niantic that it will take some AR glasses or goggles to fulfill the promise of AR and mixed reality for the mass market. In the meantime, we should get some stunning AR apps for use on smartphones and tablets, but keep in mind that these are essential stepping stones that will eventually need AR glasses for AR and mixed reality to ever reach its full potential.

The Dawn of Folding Laptops and Smartphones

In a column I wrote recently on the 25th anniversary of IBM and Lenovo’s ThinkPad, I mentioned that I had a chance to interview Mr. Arimasa Natioh, who is considered the father of the Thinkpad. He created the special Yamato, Japan lab that designed this laptop and has shepherded its design and growth from the beginning.

At the end of the interview, I asked Naitoh-San what technology he has his eye on that he sees on the horizon that could impact future designs of the ThinkPad? He said that he believed that someday the technology would be available that would allow them to create a foldable laptop that perhaps could even fit in your pocket.

When he made this comment, I have to admit that my first reaction to this idea is that if this technology could ever become available, it would probably be at least another ten years into the future.

However, the idea of a foldable laptop or even a foldable smartphone intrigued me, and so I got on the phone last week with key suppliers I know in Asia and asked them about this idea and what their thoughts were on this concept. To my surprise, they told me that they are working on foldable OLED screens now and that they could have them ready for the market as early as early 2019.

This idea is not new and has been pretty much a vision for mobile manufacturers for some time. Indeed, Samsung has hinted that they could have a foldable smartphone on the market by late 2018. But when I heard these comments or rumors on this concept of foldable products I pretty much saw this as something much farther out in the future and not actually on the horizon.

It appears from talking to a couple of suppliers that indeed both smartphone and laptop computer makers are now seriously focused on finding ways to design new types of products that could take advantage of a foldable OLED screen. They even have a term of endearment to describe this kind of screen and call it FOLED.

Most smartphone and laptop vendors are feverishly trying to come up with multiple product ideas or concepts that could take advantage of this new component. Now I admit that I am still a bit skeptical that they can create a foldable OLED screen in this rumored time frame, but I no longer think that this is a pipe dream or that it is ten years out in the future.

At the laptop level I think Naitoh-San’s idea that a laptop could be designed to fit in your pocket could be highly futuristic, but I could imagine a laptop that today has a 13 inch screen being folded in half, which would make it much smaller to cart around and even be lighter and thinner in the not too distant future. And the idea of a foldable smartphone with as much as a 7” screen being folded and still fitting in a pocket now seems more feasible shortly.

What is most intriguing to me about the idea of a FOLED screen is that it gives laptop vendors and smartphone makers a utterly new component that they can let their imaginations run wild with and start a new round of innovation around mobile computing designs.
While a 7-8inch smartphone in its current format sounds ridiculous today, if it can be folded in half and fit comfortably in a pocket or purse and then unfolded so that it could turn into more of a tablet, it could move the smartphone into the realm of a serious productivity tool.

And if new laptops with FOLED screens could become smaller to carry around and made, even more, portable, especially in a 2-in-1 detachable format, it could change the way people work with their laptops in the future so that they become more versatile yet still deliver the kind of power needed for high-level productivity tasks.

Now I admit that while I do study design concepts for mobile as part of my research, I am pretty lousy at actually forecasting innovative designs. But I can imagine that if you give Jony Ive at Apple or the design gurus at most smartphone and PC makers a new palette of components to work with such as a folding OLED screen, they could turn out some pretty amazing new mobile products shortly.

Given the possible evolution, FOLED screens could deliver to mobile designers; I suspect that the current notion that tech companies are no longer innovating may fall by the wayside fast. And knowing that this type of component is just around the corner makes me even more excited about our mobile future and how these new products could impact our more mobile lifestyle.

The DUPING of America

By now I am sure you are all aware of the incredible story of Google, Facebook, and Twitter taking ads from Russian trolls with the intent to influence America’s last election. In essence, Russia has declared Cyberwar against America, and our social overlords at these three companies were asleep at the switch when this was done right in front of their faces. Even worse, it looks now like some Facebook ad salespeople even guided some of these trolls on how best to reach their intended targets with these “fake” ads.

Every day we awake to new news coming out about the depth of what Russia has taken to try and create a new type of civil war between not the North and South but the left and right. They have figured out that most American’s are easily duped along their partisan way of thinking and that during their election if a story helped give credence to their way of thinking, they embraced it as truth without even questioning its authenticity.

I admit that when it comes to reading any stories, my background in debate makes me question any story I read and try and check its authenticity. I got pretty high in State Debate tourneys and was actually good at debating both sides of the issue regardless if I believed the premise of the debate. But if you have ever debated any subject, especially at the high school or college level as part of your education, you know that facts are extremely important, and lies and conjecture could easily cause you to lose the argument when you were in front of debate judges.

But I am finding that not many people who read social media are willing to take the time and check out a story for its authenticity and instead are much more likely to take what they see as “gospel” especially if it underscores their opinions and beliefs. This is something that Russia knows all to well and has their “cyberwar” machine in high gear. Their goal is to try and divide us as much as possible and in the process sow seeds of destruction not only to our way of life, which they actually covet but our government that they, in their wildest dreams, would like to overthrow.

What worries me about this is that I don’t think that most people in the US understand the gravity of this situation. America’s Forefathers fought for the right of us to determine our leaders and have the freedom to vote our conscience. An outside force like Russia highjacking this the very heart of the US constitution should infuriate people. On my case, I want to be the last person ever to be duped by a foreign government whose attention is out in the open and yet many embraces these “fake” stories

Of course, outside sources trying to influence what our people think and how they vote is not new. The British tried desperately to reach the settlers and colonists in the “New World” to try and keep them in the British Kingdom. Some of the pamphlets they distributed were as much fake news then as recent fake news is today. I but have read how the Nazi’s tried to get their message to the US in the early 1930’s and lest we forget, some British Royalty and even some US leaders were Hitler sympathizers. Certainly “fake” news was deployed here too to cover the real vision Hitler had to wipe out all but an Arian race.

But there is one very big difference on how the Fake News of the past was spread to influence how people thought. In 1772-1776 it was done through pamphlets and very crude news gazettes. Before WW II it was done through newspaper and radio. But in both of these instances, the messages were very broad and not personalized. But this time around this level of fake news is distributed by a social network medium that is highly personal and can include very targeted ads or fake stories. As we see with the current reports from very credible sources, A foreign entity-Russia-has taken direct aim at trying to destroy America’s values, the way of life and pit bother against bother to sway the results in their favor.

Whether Facebook, Google or Twitter like it or not, they now have a major responsibility to be very clear about what “fake ads” were bought by which foreign entities and contrast them to the facts that are known so that the American Public can see how they have been duped. Just as importantly, any social network that helped spread fake stories needs to own up to this in a big way and start putting key measures in place to screen their ads in the future and make sure this does not happen again.

Of course, this gets right to the heart of each of these company’s business models, which is almost exclusively based on ad revenue. A recent Guardian story laid out Mark Zuckerberg and Facebook’s predicament given their business model and why they are under such serious scrutiny by US Govt. officials now. Taking Fake Ads may be profitable but not very responsible and that has to be corrected. For Zuckerberg and Facebook, along with Google and Twitter, ads are at the heart of these distribution mediums, and they need to get serious about educating people about what was said in these fake ads and identify who bought them in detail. Then put in safeguards to make sure this does not happen in the future.

“Fortunately, the top Democrat on the House Intelligence Committee, Adam Schiff, D-Burbank, has called for the ads to be released publicly. Schiff has been working with Facebook to find a way to make that happen.The American people deserve to see the ways that the Russian intelligence services manipulated and took advantage of online platforms to stoke and amplify social and political tensions,” Schiff said.”

These ads need to be released soon and with it very clear descriptions of who was behind them and where possible, tie their motives to the ad’s message. This needs to be done soon so that by the time our next election happens in 2018, this does not happen again.

The Tech Hubs vs. the Rest of the US-Earning Disparity Gap Widens

In a recent column, I wrote about how Silicon Valley Is becoming more vilified these days as the technology we create has increasingly been used to deliver both good and bad things to the market and that a pall has been cast on our tech region.

I pointed out that there have been dozens of media reports about Facebook’s role in allowing Russian ads on their site and its potential impact on our elections. And Silicon Valley is coming under attack over corporate tax issues, offshore holdings and how much of what they create doesn’t factor in their technology’s overall potential for evil as well as good. Even more troubling is that Russia and other nefarious actors have found ways to game our systems and tech sites like Facebook, Twitter and others have lost control of their sites and what is often posted, can’t even be trusted these days.

But there is another issue that I see that is going to be an even bigger problem for tech. That revolves around the disparity in the wage gap we see when it comes to earnings in tech hubs like Seattle, San Jose, Austin and other areas where tech helps drives the economy and jobs, vs. the rest of the country. This is especially pronounced the in midwest, rust belt and the south where many people feel left behind by the rapid rise and importance of tech and its impact on the job scene.

In so many of their cases people were trained to work in factories and industries tied more to vocational skills, and as the world moves to more tech-driven ways to do business and learn, it impacts their ability to get better-paying jobs, and they see their way of life taking a real hit. No wonder so many look at Silicon Valley in a more negative light these days instead of focusing on the incredible innovation that continues to come from our region, that ironically, they benefit from if they have a PC, smartphone or tablet air other tech-related products.

The chart below from the Economic Innovation Group Communities Index should be very troubling for our tech leaders and our government officials since it shows how widespread the distressed communities are in the US.

Data: Economic Innovation Group Distressed Communities Index; Map: Lazaro Gamio / Axios

Although I had lived in San Jose all of my life, except when I went to college in Switzerland and attended Southern Illinois and later in life, Oxford, my life has revolved around the work and benefits that came from being involved within the tech world. However, I have been aware of this issue of wage discrepancy for a long time, and as I have traveled to the midwest and the south, I started to hear inklings of a potential backlash to Silicon Valley about five years ago.

This issue started coming to the forefront after the last presidential election, and there is much more vocalization on this topic recently as a result of the role Facebook and Twitter are playing in impacting our national election and overall national mindset. As I stated in the article I mentioned above; we are even starting to hear calls for tech companies to be regulated or broken up to keep them from becoming monopolies and having, even more, control of our lives national psyche.

But let’s be clear that at the heart of this is an age-old question about sharing the wealth that is often at odds in a capitalist society. I grew up being pushed to excel and do my best and work hard and be rewarded for my efforts and that what I earn is mine. And for Most workers that is still their mantra. However, when they see bankers, tech leaders, and some politicians making billions or millions of dollars, sometimes at their expense, the question of spreading the wealth becomes a serious question.

I will let others debate the issue of capitalism vs. socialism vs. communism, but for us, in the tech world, we need to become more aware and sensitive to the fact that our earning potential has grown while most of those in the US see their wages stagnating. They see no hope, in most cases, of getting better jobs and being able to earn more given their current situations.

I have a real fear that if we are not careful, we will see an even greater level of disparity between have’s and have not’s. At some point, those who do not have a chance for a better life will either rebel at the election polls or even worse, get more vocal and perhaps even violent in their quest to see wealth distributed more fairly.

These various attacks on Silicon Valley are not going to go away. Our tech leaders must start taking this attack seriously and start to find ways to deal with this problem. While I don’t have specific answers as to how they respond, I do think that they need to start acknowledging that this issue exists and start internally looking at ways to minimize the fact that the outside world is starting to view tech more negatively and find way’s to be more responsive to this issue.

Ray Kurzweil’s Predictions for the Next 25 Years

In late 2014, Ray Kurzweil, one of the most forward-thinking scientists alive today, published some of his predictions for the next 25 years.
SingularityHub wrote an excellent piece in January of 2015 outlining past predictions that came true as well as new predictions he sees coming in the near future.

If you have followed Kurzweil’s career, you know that he invented the flat panel scanner and the first text-to-speech synthesizer and many other inventions and is currently a director of Engineering at Google.

What Makes Kurzweil’s predictions of the future so important is the accuracy of the predictions he has made in the past. In 1990 he predicted that a computer would defeat a world chess champion and then in 1998, IBM’s Deep blue defeated Gary Kasparov. That year he also predicted that PC’s would be capable of answering queries by accessing information wirelessly via the Internet by 2010.

In 1999 he predicted that People would talk to the computers and give them commands by 2009. And in 2005 he predicted that by the 2010’s virtual solutions would be able to do real-time language translations in which words spoken in a foreign language could be translated into text that would appear as subtitles to users wearing glasses.

Peter Diamondis, who knows Kurzweil well, outlined some of his favorite Kurzweil predictions for the next 25 years. Here are a few that he called out in his 2015 SingularityHub article:

“By the late 2010s, glasses will beam images directly onto the retina. Ten terabytes of computing power (roughly the same as the human brain) will cost about $1,000. By the 2020s, most diseases will go away as nanobots become smarter than current medical technology. Normal human eating can be replaced by nanosystems. The Turing test begins to be passable. Self-driving cars begin to take over the roads, and people won’t be allowed to drive on highways.
By the 2030s, virtual reality will begin to feel 100% real. We will be able to upload our mind/consciousness by the end of the decade.
By the 2040s, non-biological intelligence will be a billion times more capable than biological intelligence (a.k.a. us). Nanotech foglets will be able to make food out of thin air and create any object in the physical world at a whim. By 2045, we will multiply our intelligence a billionfold by linking wirelessly from our neocortex to a synthetic neocortex in the cloud.”

I think that glasses beaming directly onto the retina by the end of the 2010’s are way too optimistic and perhaps at least 5-10 years still in the future. And I think that Virtual Reality may feel real well before 2030. But it is the last two predictions that both fascinate me and scare me at the same time.
Given my age, I won’t probably be around to see non-biological intelligence be billions of times more capable of biological intelligence but that concept is pretty frightening in itself.

The vision of robotic overlords being smarter than us could be problematic on their own but if their intelligence supersedes ours without tight controls and checks and balances, you can see why Gates, Musk, and Hawkings are deeply concerned with AI if left to its own devices. And as a serious foodie, I am not sure I like the idea of nanotech foglets creating food out of thin air although that sure could help solve the world’s food crisis.

Although the idea that by 2045 we will multiply our intelligence a billionfold by linking our neocortex to a synthetic neocortex in the cloud is something, I could use now. If this works, imagine what it could do for students and how it could impact their learning programs as well as its impact on all levels of business. The big question here is what competitive advantage this gives a person and at what costs? If this is an expensive technology, imagine the gulf between the haves and have-nots that would arise because it would give those who have access to this technology quite an advantage.

But again, if we don’t control this with serious oversight and ethics checks and balances built into to this or any technology of the future, we are inviting many unforeseen problems even if these technologies provide great value to all. As I have written here before, I am deeply concerned that our tech creators do not look hard enough at the possible downside their technology can have on humankind and stay too focused on its merits alone.

The result of this myopic thinking is that we now are seeing the serious governmental interest and legitimate queries into the impact of technology for good and evil. In talking with many major high-tech companies, they are not equipped to deal with any governmental intervention let alone the new level of scrutiny that they are starting to receive because the role of technology and its impact on all sectors of business and society is coming to a forefront now.

Kurzweil’s predictions are fascinating, and anytime Ray speaks one must listen and consider these types of predictions seriously. However, I would suggest that from now on when you view any tech prediction of the future, you do it through a prism of its impact for both good and evil and apply the ethical and societal questions to its role in the world. I think that for Silicon Valley to continue to drive our tech world, these types of deep thinking exercises must become part of their DNA. If not, our future might not be as bright as some think it will be.

A Pall is cast over Silicon Valley

I have often been called a Silicon Valley apologist, and I never deny that I am on the side of history that sees our area as being one of the most technologically creative areas of the world that have developed life, work, and changing educational products during the last 75 years.

I was born in San Jose and have witnessed it going from a sleepy fruit orchard when I was born in the early 50’s to a world-class tech center where hundred’s of companies are developing innovative technologies that they hope will be world changing. In most cases, the technology is used for good. But the recent developments coming from Facebook taking ad dollars from hate groups and fake Russian sites to Google’s business model that wants as many personal data from us to bomb us with adds and you can see why Silicon Valley is getting a lot of negative attention these days. Add to that the massive security breaches enabled by flawed software and it has cast a real pall over Silicon Valley lately.

While I am very bullish on Silicon Valley, I know that its past and present has many blemishes to deal with from our help in creating weapons of mass destruction to our current position of allowing social media to run amok. Because of lack of real innovation and outdated rules in tracking and blocking fake social sites from impacting everything from elections to bolstering hate groups, Facebook, Google and even Twitter are now the target of major governmental scrutiny around the world.

Silicon Valley is also coming under attack over corporate tax issues, and offshore holdings and in more and more articles I see Silicon Valley being painted as villains instead of the creative innovators who drive much of our tech breakthroughs as well as a significant part of the US and world economy.

I have been talking to some industry pioneers who, like myself, have been in Silicon Valley for decades and they are gravely concerned about the tone and attitude the outside press and social media are saying about the Valley and tech in general. And the recent disclosures of sexual harassment within the VC community and various tech companies as well as questions about diversity and Silicon Valley is coming under pressures they have never had to deal with in the past.

In fact, the San Jose Mercury News, our local Silicon Valley newspaper wrote a story last week entitled “Silicon Valley’s terrible, horrible, no-good, very bad week-ok month.”

It opened with this perspective:

“From Facebook’s advertising and fake-news issues to Google’s pay practices and antitrust woes, Silicon Valley’s biggest tech companies are feeling the heat lately.
The left, the right and those in between are slamming the tech giants, leading to headlines such as “Conservatives, liberals unite against Silicon Valley” and “There’s Blood in the Water in Silicon Valley.”

It goes on to quote Trever Potter, president of the Campaign Legal Center and a former chairman of the Federal Election committee who said in a letter he wrote to Mark Zuckerberg-

““[B]y hosting these secretly-sponsored Russian political ads, Facebook appears to have been used as an accomplice in a foreign government’s effort to undermine democratic self-governance in the United States,” Potter wrote, according to Yahoo News. “Therefore, we ask you, as the head of a company that has used its platform to promote democratic engagement, to be transparent about how foreign actors used that same platform to undermine our democracy.”

Then later in the week, ProPublica wrote a story saying ” Facebook’s self-serve ad platform was allowing advertisements that targeted groups such as “Jew haters.”

For a lot of us who have been part of Silicon Valley’s past and present, these recent developments are more than concerning. For decades our work and the work of Silicon Valley pioneers and its tech workers have toiled long hours to bring ground breaking technology to the world that has changed the lives and businesses in hundreds of ways. And for the most part, that change has been for good
.
Until recently even social media has had a mostly positive influence on people and even helped bring about the Arab Spring revolution a few years back and was instrumental in helping people rescue others during the recent hurricanes in Texas and Florida.

But now Russia and other trolls have learned how to game the systems and play into the overall profit motives of the Facebooks and Googles of the world who operate with minimal oversight lest it impacts their profits.

All of these things combined has painted a very different picture of Silicon Valley to many in the US and around the world. While I am troubled by the Valley’s image taking a major blow, I am more concerned that too often our engineering driven world has created products just to create them without really understanding the ramifications of what they have made. In many cases, I do not see any ethics checks, or even thought about the long term impact their technology may have when they start the creative process.

This is especially the case with Facebook, Google, and even Twitter. While all have primary virtues, they have all evolved to include serious flaws when it comes to privacy, allowing fraudulent accounts, etc. and have not come up with either the proper technology advances to control these problems or developed policies that keep them from happening in the first place. The Fake News issues in-itself is a Pandora’s box with world-changing ramifications.

This type of scrutiny could bring about more governmental oversight and perhaps these data behemoths might even come under anti-trust regulations if they don’t find a way to keep their sites in check and become more responsible for what is being posted or how the data is collected for their business gains.

Given what I see being written about the Valley lately and how governmental and social leaders are targeting many tech companies, I fear that a day of reckoning is about to be upon us. Most of the big tech companies are going to be challenged in ways they are not prepared for given the intense pressure that is building up in Washington, the EU and other parts of the world.

I don’t know how tech will find a way to get back into the graces of the public. But if they don’t find a way to self-regulate themselves and be more ethical in the way they run their businesses, I suspect we will see much more in the wave of governmental and regulatory oversight that we hoped would never happen to tech companies in general and especially the world-changing ones here in Silicon Valley.

Apple Watch Series 3: Observations

Rumors have been swirling for some time that Apple was about to add a cellular modem to their popular Apple Watch line and indeed, at yesterday’s event, that is exactly what Apple did. By adding a modem, users will be untethered from their iPhone’s and able to make and receive calls, get notifications, alerts, messages and various types of data that would be of interest even if the iPhone is back at home or at the office. For those who want to go for a run or a long walk, the Apple Watch Series 3 with the LTE modem allows this watch to stand on its own and gives people a new level of freedom from their smartphones yet still be connected if needed.

For smart watches, this is a game changer and a most important step in the evolution of wearable technology. To date, all wearables were either application specific such as ones dedicated to just tracking steps, heart rate, etc. Or they were tethered to a smartphone and got most of their real intelligence from the phone itself. For the first two generations of Apple Watch, the iPhone played a central role in its capabilities.
While Samsung did have one model of a smartwatch with a modem in it, I could never get it to work well, and this model never caught on.

With the inclusion of an LTE modem, the Apple Watch, which is now the #1 smartwatch on the market regarding units and revenue, Apple takes their wearable up a big notch and makes it even smarter in its right. It has a new dual core CPU that is 70% faster than the last series and Apple delivers an ingenious way to use the screen itself for the radio’s antenna, making it one of the most innovative smart watches on the market bar none.

While the iPhone X was the big story from the launch event since it represented the 10th anniversary of the iPhone and delivers the most power we have ever had in a smartphone to date, don’t underestimate the impact Apple’s new Series Watch 3 will have on Apple’s overall eco system. In fact, I believe Apple will double the sales of Apple Watches thanks to this new cellular feature in the next 18 months.

Although most of us have been conditioned to never let our smartphones out of our sight, there are many times it is not proper or even convenient to have them with us. When I go for my long walk each weekend, I have had to carry my iPhone 7 Plus with me as it is very important to be able to stay in touch with family and others even though I may be on a 2 or 3-hour walk. For me and many others who will use a cellular based Series 3 Apple Watch, this will be a freeing experience and allow us much more flexibility when doing something where carrying an iPhone with us is not optimal.

Apple also added features such as an altimeter and many new tweaks to the health related apps but only briefly mentioned a new feature in the works that may make the Apple Watch the most important wearable tool anyone can use on a daily basis. This new feature will be in conjunction with Stanford and will use the core technology of the heart rate monitor to look for irregular heartbeat patterns that could give hints of AFIB.

Kardia already has a third party hand held device where you have to put your two thumbs on it to get what is an EKG to look for signs of AFIB. Apple making this a standard feature on the Series 3 in the future will allow the watch to look for these irregular heartbeat rhythms all of the time and give all users early warning signals should it detect any form of AFIB in the heart. This is a big deal. High blood pressure is often called the silent killer, but AFIB untreated can lead to sudden cardiac death and if that feature is in the Apple smartwatch if could save lives. The project with Stanford is going strong now, and they hope to have a dedicated app that works with the Series 3 by early next year.

In my case, the new Watch OS 4 and Watch Series 3 will also help me manage my diabetes much better. I use the Dexcom Continuous Glucose Monitor that I attach to my stomach and by using a special sensor and a wireless transmitter I can get a blood sugar reading on my Apple Watch all of the time. However, the actual app resides on the iPhone, so when I am not near my iPhone, I don’t have that blood sugar reading on the watch. With Watch OS 4, Dexcom has worked with Apple to allow the Watch to now talk directly to the wireless Bluetooth sensor I wear and even if I am not near my iPhone, my blood glucose reading on the watch will always be live. My eventual wish is that Apple finds away to integrate that blood glucose sensor into the Watch itself and allows me to just use the Apple Watch to read my blood sugars all of the time. There are rumors that Apple is working on something like this but even if they do perfect the technology it needs FDA approvals, and that could take years. In the meantime, I am very grateful that shortly I will be able to get my blood sugar readings with or without an iPhone being anywhere near me.

The Apple Watch Series 3 base model cost $325 but the one with a Cellular modem is just $399, and it is easy to justify the added cost given the significant new benefits it delivers for the user.

My only hangup with this is the pricing the carriers want to put on this eSIM even though it uses your same phone number. In their current pricing model, you can get a new number and add that to your family or business data plan for $10. But ATT wants to charge $10 a month for the Watch eSIM connection even though it uses the same number. I think the carriers will get some stiff resistance to this pricing and would hope that they change it to something like $5.00 a month to be more reasonably priced given it uses the same phone number.

The Apple Watch Series 3 will is an important evolution to the Apple Watch platform, and both models should do very well in the coming year. As I stated earlier, it is with in reason that Apple doubles the Apple Watch sales by this time next year as more and more people discover the value of the Apple Watch Series 3 and Apple Watch OS 4.

10th Anniversary iPhone May be Apple’s Biggest Seller to Date

Next week Apple will release their 10th anniversary iPhone line, which is a huge milestone for this Silicon Valley giant.
To date, Apple has sold well over 1 billion iPhones since its launch in 2007.

Apple accelerated the growth of iPhones by close to 1/2 billion from 2014 to 2016 or in just two years and given what we know from the last three Apple earnings reports Apple’s sales of iPhones to date are around 1.3 billion to date.

With the new iPhones about to be launched and given that Apple has interest in using this 10th-anniversary model to move the design and features of any new iPhones to a new level, I expect that Apple could have its best year of iPhone sales in its history over the next 12 months.

A recent CNET story titled “70 percent of iPhone buyers won’t even consider another brand” shared a report from marketing platform Fluent that gives us a hint of what iPhones sales could be once the new iPhones get to market later this month. From the article:

“A survey published Friday offers a grim picture for the company’s rivals.
The research, performed earlier this month by marketing platform Fluent, asked 2,117 adult smartphone users about their phone feelings.
Feelings on the Apple side appear strong.

80 percent of iPhone owners said they planned to stay faithful. Another 47 percent stated that they’d owned at least four iPhones. It’s not clear whether these were four different iPhone models or whether the people kept buying the same model because it kept breaking.
Here is perhaps the most remarkable number: 70 percent of those who said their next phone would be another iPhone stated that they wouldn’t even consider another brand.

You might think this is a deep level of love. Indeed, 67 percent said they simply believed that the iPhone was the best phone one can buy.
Another clue, though, was offered by 41 percent of these loyalists. They admitted that they’re so used to iOS that the idea of switching would just be too painful.”

This study aligns with much of our own research at Creative Strategies around smartphone brand and mobile OS retention rates. In every major market like US, much of Europe, and China, Apple enjoys the highest retention rates of any brand. Digging into this further, Carolina Milanesi published some details of a recent iPhone 8 interest study we conducted of ~1000 US adults.

From our study, overall 26% of all US consumers surveyed said they are extremely likely or very likely to buy the upcoming iPhone 8. That number goes up sharply when just looking at iPhone owners, and even higher when just looking at iPhone owners intending to upgrade their smartphone in the next six months. Nearly all data points we see from our research and others are showing positive signs for Apple over the next year.

But what is important with this trend and one key reason most financial analysts keep moving Apple’s buy target up is that it could cause a new super cycle of sales, revenue and earnings records for Apple that could last at least another two-to-three years.

We saw the last super cycle when Apple introduced the iPhone 6 with its larger screen, and from that point, Apple’’s iPhones sales began to rise exponentially. With a new design and new features, along with a better camera on the high end that most likely will make AR Kit based apps work even better, these new iPhones could push the newest super cycle of sales and, if some estimates are right, could make them the first trillion dollar company we have seen in the world of business.

So next week’s introduction of a new iPhone is not just another upgrade event. This one has a lot riding on it and could drive sales of iPhones in new ways as AR Kit and IOS 11 is also expected to help boost sales of these phones and earlier models still for sale on the market today.

Keys to Driving Adoption of AR Glasses

One of the modern day debacles coming from any tech company was Google’s Glasses. I was quoted in the WSJ saying that buying Google Glasses for $1500 was one of the worst purchases I have ever made in my life. Although in my case it was for research purposes, I am sure that any prosumer or consumers who bought Google Glasses had the same feelings about spending any amount for these worthless prototypes. I also chided Google at the time for even offering prototypes to the broad market at any price as they were not even close to being ready for prime time.

These glasses proved to us researchers that glasses of this type, even with dedicated software available for them, had little value for consumers and for many, the fact that they made them look like a geek, made the situation even worse. They were banned in movies theaters, bars, and most public places and were pretty much shamed by the broader public and Google was forced to take off the market altogether after slightly a year of their availability.

But to me, Google’s biggest sin is that they did not understand that technology in almost all cases starts at the top of the user’s pyramid, and it takes years to trickle down to a broader consumer market. If there were any real interest in Google glasses, it came from the top of that pyramid, which mostly represents what we call vertical markets or markets in business and industrial programs where one could create custom applications to solve real world problems for them.

Four years later the demand for glasses today come from only these vertical markets, and I do not see any glasses gaining any interest by consumers for many years into the future. The good news is that some great glasses are being designed for use in these vertical markets now, coming from companies like Vuzix, Epson, Meta, and others. I am also seeing serious software created to support them from companies like Atheer, who’s Air Enterprise software delivers a set of applications that can be customized for use with these glasses even today.

Today, I still have many reservations about Glasses becoming a mainstream product. We do not have the technology or even the right UI today to even make glasses that I believe could entice a consumer to use them anytime soon. There are also challenges of depth perception of our eyes, adding gestures, voice, etc., all things that will take a long time to perfect in a small form factor. However, I do think that sometime in the next ten years glasses of some type will become an extension of our digital user interfaces.

But for that to happen I believe some important things have to happen for these glasses to be accepted by consumers and become useful beyond the vertical markets where they will become relevant in the next 2-5 years. Here are some ways watch for which could help drive adoption:

  • The first thing we need is technology that delivers the video screens built into ordinary looking glasses that are acceptable to the public and won’t make them look like geeks. They have to be invisible in the sense that they look like regular glasses but on digital steroids. We just don’t have the optics and types of displays that would work in this form factor now, and I do not know when we will see these types of digital displays that would work in normal looking glasses.

  • The second thing we need will be a set of software tools to create applications optimized for glasses and hands-free gestures and voice actions to control them. The public will not accept having to navigate a digital glasses world if there is a touch pad on the glasses that they need to use just to navigate the content they will want to access through these glasses. We will need significant hardware and software advances in voice, gestures and other hands-free UI’s if glasses are ever to be accepted by a broad market of users.

  • The third thing we will need is for the consumers to not only want to use glasses as part of their digital experience, but they will have to have compelling reasons and applications for them even to be interested in any glasses. This is where Apple may have a real effect on this market over the next 2-5 years. Apple’s introduction of ARKit and its AR platform is set to revolutionize the user experience on the iPhone and the iPad. ARKit and the applications that will be generated by it will begin to get Apple’s customers familiar with this significant experience and start to introduce a new user interface that includes voice and gestures to the AR experience delivered on their mobile devices.

In the next 2-3 years, I expect Apple to evangelize the idea of AR and mixed reality and get their customers not only used to using these apps on an iPhone and iPad but will want some additional ways to have even better ways to view AR and mixed reality content beyond the iPhone and iPad. We know that Apple has two or three glasses patents in the works and if Apple can use these next three to five years to get their customers familiar with AR and mixed reality it will be much easier to transition them to some glasses that would serve as an extension of Apple’s UI prowess. ARkit will certainly help emphasize the pain point of holding your phone up out in front of your body while walking around the world using AR applications. After a few years of these experiences, glasses will be a no brainer.

Google, of course, has not given up on glasses and their newest versions are focused on vertical markets today. But they too want to use AR on Android phones to start getting their customers more familiar with AR and mixed reality applications. This too will help make people more familiar with these types of apps and eventually more receptive to some glasses Google may bring to market for consumers in the future.

I do not doubt that someday glasses will become an extension of the broader consumer digital experience but much must happen before that ever becomes a reality. Just don’t expect to see them anytime soon.

Rethinking the Role of Smartphones

Each fall, some of the major smartphone companies release their latest and greatest phones in time to take advantage of the holiday season where as much as 40-45% of all smartphones are sold each year are during Oct through Dec.

This is especially the case for smartphone behemoths Apple and Samsung. Samsung tends to try and get their “newest” smartphone to the market slightly ahead of Apple which is why Samsung recently held a major event in NYC to launch their new Samsung Note 8 with new cameras and new features that make it their best Note smartphone to date. Samsung used this same time frame last year to launch the Note 7 that unfortunately for them turned out to be a real disaster since over 100 units caught fire and they had to recall all Note 7’s and discontinue this product completely.

The good news for them is that they owned up to battery fires and did the right thing and they have not been negatively impacted regarding people willing to want to buy the new Note 8, which should be a big seller for them throughout the next 12 months.

Shortly, Apple is expected to introduce their newest iPhone, a 10th-anniversary edition that many have been calling the iPhone 8. We won’t know its official name until Apple announces it sometime in September, but it too is expected to have some major new features and be a huge draw for millions of people around the world who want to own Apple’s latest and greatest iPhone when it to comes to market.

Both phones compete in what we call the “premium” market for smartphones and are priced at the top of the line. Samsung’s new Note 8 will be around $989 while Apple’s iPhone is rumored to be priced somewhere between $999 and $1099 depending on configurations purchased.
While people may flinch at these higher price points, I think we need to start looking at these premium smartphones in a different light than the earlier models represented in the early days of the smartphone.

Since 2007, when Apple first introduced the first iPhone 3G, the technology they use inside the iPhone has evolved dramatically. The CPU’s are more than 10-15X the speeds of the first smartphone processors, and the GPU’s have improved by as much as 15X during these ten years. The displays on these smartphones are larger with greater resolution, and color depth and Corning’s Gorilla Glass 5 screen covers that are used newer smartphones is 8-10 X more durable and scratch proof than what was used in the first iPhones and Samsung Galaxy smartphones.

This same technology evolution can be said of the cameras used in these phones with megapixels going from 2 megapixels in the original iPhone 3G in 2007 to 12 megapixels today.
All premium smartphones also include a second front facing the camera with high megapixel counts as well. These premium phones also include much better speakers, WIFI and Bluetooth radios and of course, higher speed LTE modems. We are at 4G speeds today, but within the next three years, we will move to 5G that will allow for speeds up to 1 GPS while mobile. Add finger print sensors, other new biometrics like face and eye scanning, longer battery life and more memory, and you can see why prices for these premium smartphones have increased and not decreased over the last ten years.

But what really helps me see these premium smartphones in a new light is that what we now have is a full-fledged personal computer that fits in our pockets and gives us much more power to do almost everything we can do on a laptop or PC, minus the heavy lifting productivity and extended graphic editing you still want to use a PC or laptop due to its bigger screen and keyboard. Just as important is the fact that smartphones put the personal in personal computing. PC’s and laptops can be shared with others, but our smartphones are our personal computing devices that in almost all instances are used only by us individually. That makes it the most important personal computing tool we have and one that we become tied or attached to all of the time.

When someone asks me what smartphone they should buy, I always tell them to buy the one they can afford that has the most power and memory possible. People use their smartphones for a variety of reasons, and so you want one that can do as much as you want it to do at the price you can afford.

While the idea of buying a smartphone at $1000 or more may be too much for most, the buy/leasing plans that the carriers offer to make the price points for most within their reach. It would probably add only $10-$15 to the monthly bill. The good news is that even mid-range smartphones with lower prices have advanced processors, cameras, and radios too, but the premiums ones that Apple and Samsung will have this holiday season are the best we have ever seen available.

These new premium smartphones are full functioning PCs with almost all the functions and versatility one needs to handle almost anything they want to do with a digital device. While price still matters, when one sees them as a real PC in their pocket, the idea of paying as much as $1000 for these new premium smartphones might make more sense.

What Should Apple’s Priority be for its $1 Billion Media Budget?

Word came out last week that Apple had earmarked $1 billion towards creating or acquiring new media content shortly. Like other big companies such as Netflix, Amazon, and HBO, the race is on to either create original content or acquire content that would help them boost their offerings to their customers and in turn, increase their subscriptions and services revenue.

When I saw that Apple was only committing $1 billion to this venture (Netflix’s budget is $6 Billion, Amazon’s is about $4 billion, and HBO’s is $ 2 billion) it got me wondering why Apple is spending so little on the kind of content their competitors are rushing to create.

Philip Elmer-Dewitt publishes the best newsletter about Apple called Apple 3.0. He shared a note from Royal Canadian Bank analyst Amit Daryani about Apple’s $1 Billion Media fund. If you are a serious Apple follower, I highly recommend you subscribe to this newsletter-Worth every penny if not more.

Here is a highlight of the note Amit Daryani sent to his clients and Mr. Elmer Dewitt shared in his newsletter

If AAPL can get an additional 7-8MM paid Apple Music subscribers, it would recoup the $1B investment (after paying record labels’ share of subscription) in three years. Given the double digit growth in music streaming subscribers and a 20-25 million paid subscriber gap between Spotify and Apple Music, upside to market share gains could be significant. We think this itself provides AAPL sufficient incentive to sustain the level of these investments.

Also, over the longer term, content investments open multiple possibilities including:

• strengthening iTunes media sale/rental business,
• launching an Apple TV exclusive streaming service,
• leverage in negotiating with media companies, and
• driving M&A strategy.

Ultimately, we think the investments fit well with AAPL’s goal of doubling Services business by 2020.

I believe that Mr. Daryani’s view is the correct way to view what Apple will do with a big part of this $1 billion fund. Although they may earmark a portion of this for some original content or licensed video programming, I agree that the bigger priority is to invest this in an area that would pretty much guarantee they grow their services business via their music subscriptions faster.

Today, Spotify has 140 million users while Apple has 27 million as of June of 2017. While Apple still has high aspirations around Apple TV, I just don’t sense it has the same priority that Apple Music has in Apple’s short term strategy. More importantly, music is an area that Apple knows and understands while creating original content for Apple TV has a deep learning curve and would require budgets north of $5 billion just to compete with today’s leaders in streaming video.

Apple’s streaming music service is getting better and has been a big part of their growth in services revenue. However, given the world wide audience, they have to IOS devices, innovating around their music service and bulking up on special deals with artists would help them make a real return on the $1 billion being invested in media shortly than they would if they used that money specifically for original video content.

That said, I believe this $1 billion media fund is probably the tip of the iceberg when it comes to Apple eventually opening up the purse strings and investing billions more in both music and video content over time. But this first $ 1 billion gets them on the road to eventually being more aggressive in both mediums that can help them get to their goal of doubling service revenue by 2020.

Could Technology create an Arab Spring in North Korea?

Last April, I wrote a piece for Fast Company in which I shared why tech companies should be concerned about the situation in N. Korea.

In this article I stated:

“Some years back, on a trip to South Korea, I asked a top tech official what concerns him the most about tech business in Asia. He told me one of his greatest concerns is the collapse of North Korea, which might result in millions of North Koreans rushing over the border, which he said could destabilize or paralyze South Korea’s social structures and economy. Many people in North Korea have relatives in South Korea, and they would almost certainly seek refuge with them. And many of those relatives likely work in the companies and factories that turn out the tech products we use. This personal, political, and economic disruption could have a major impact on South Korea’s tech companies.

If it happened, South Korean companies might lose their ability to supply parts to other tech companies around the world, not to mention the disruption in the flow of completed products that come from the country. The official felt it could take many months for South Korean officials to re-stabilize the region. And it could take years for tech companies to get back to producing and delivering their products on time.

Of course, the damage would be far greater than just shipping delays and business disruptions. The human toll could be devastating for the country. We may see a major humanitarian crisis if South Korea has trouble absorbing the inflow of North Koreans, most of whom would need assistance to stay alive.”

With all the current saber rattling going on between our president and the leaders in N. Korea, this area of the world has become much more unstable and world leaders and seasoned diplomats are urging restraint and intensified diplomacy to try and diffuse the current war cries that could have devastating realities for both countries if a safer diplomatic solution cannot be found.

While my warning to tech companies about being prepared for what could happen is still relevant, I have also been thinking about ways that technology could bring change to N. Korea. As I thought about this, what came to mind was something that has happened in the past in countries like the Soviet Union and the Middle East where the role of technology played a part in the collapse of these totalitarian governments.

I have personal experience with being under the rule of totalitarian leaders and saw first-hand how their iron fisted leadership had kept their countries from seeing what was going on outside their borders and used their control of information to keep their people enslaved to their ideologies.

Back in 1973, I was with a group of 51 international youth who traveled to Moscow with the purpose of holding a protest rally about the lack of religious and personal freedoms in Red Square during their May Day celebration that year. We went in on a tourist visa and drove the route from Helsinki to Moscow with stops in Kalinin and what is now St. Petersburg. We entered on tourist visas and did not declare what our real intentions were. During the first part of the trip, we saw how depressed the country was and how downtrodden its people had become. All they knew is what their leadership had told them, and these leaders created fear by fabricating how evil the outside world was. Consequently, we from the west were under suspicion from the time we entered the Soviet Union. The trip went smoothly during our stay in Kalinin but by the time we got to St Petersburg they had concluded we had other intentions and we were arrested, roughed up and put under house arrest and kicked out of the country within two days.

This experience of seeing how totalitarian leadership can enslave an entire country played into another key decision I made in the mid-1980’s. By then I was entrenched in the PC industry and started to think about ways of getting information from the outside world into the Soviet Union. In the 1985, about two years before President Reagan spoke to the crowd in Berlin at the Brandenburg Gate and told the Mr. Gorbachev to “tear down this wall” I hooked up with some folks in Hamburg, Germany whose goal was to try and smuggle fax machines into the Soviet Union. The idea was to write newsletters about what was going on outside of Russia to get people more aware of the lies of communism. By the time I linked up with these folks they already had great success in finding ways to bring fax machines into the Soviet Union. Using acoustic couplers tied to these fax machines to get info from the outside, they would create these newsletters that spread like wildfire. The telephone lines in the Soviet Union were not great but were operational enough for use by these text-only fax machines, and the Soviet leadership had no clue how to stop this flow of information in those days.

While I mainly provided support for these fax machine clandestine operations, one can look back in history and see that it was the flow of information that played a key role in the breakup and collapse of the Soviet Union. In fact, Michal Gorbachev, when asked at a major policy event in NYC in the mid 1990’s about what forced the collapse of the Soviet Union, he specifically called out the lack of their ability to control information from the outside and he mentioned the “fax” machine as playing a key role in making that happen.
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I had read that quote at the time in some paper and at an event where Mr. Gorbachev spoke at Stanford a year later, I had a chance to briefly interview him and asked him about that statement. He told me that once their people got more information about the free world and the Politburo could not control this flow of information, things began to change rapidly. One of the great ironies of this is that many of the Soviet people found out about the ouster of Gorbachev via fax machines since it took days for the official government statement to confirm the change in Kremlin leadership.

If you look at what happened with the Arab Spring, again the role of technology was quite significant given the growth of smartphones there and social media which was used to not only inform people in Egypt about what was happening around the world but also harness their energy via social media to create the protests that took down the Egyptian rulers. This, combined with many other factors began to open the door for more freedoms for this country and others who have toppled their police state leadership and officials.

Given the role tech had in opening up the Soviet Union and areas in the Middle East, it is at least feasible that technology could play a role in peacefully bringing real change to N. Korea. People could use things like smart phones and the Internet to gain more understanding of what the outside world beyond N. Korea is like. They need to learn that they are being enslaved by ruthless leaders who use propaganda and fake news to control them and using technology there is a possibility that this could influence their views of the Kim regime and over time cause him to loosen his grip on the people of this Hermit Kingdom.

In an important piece in Politico by former State Department official Tom Malinowski, he too sees the potential role of technology helping to bring change to N. Korea in a more peaceful way.

Here is a key passage related to the tech connection:

“Virtually all recent North Korean defectors say that despite the risks, they consumed these media before leaving their country; usage by the general population may be lower, but is growing each year. In a recent survey, 87 percent of defectors say they purchased media devices and other consumer goods, including food and clothes, using money earned outside their official occupation—a sign of how ubiquitous black markets now are in North Korea. As a result, the regime has shifted its strategy from trying to deny its people access to information technologies to controlling and monitoring their use. But the more people use these devices, the harder it becomes for the state to spy on everyone.

At the State Department, I oversaw the U.S. government’s efforts to get information into North Korea. We funded defector-run radio stations, which had the added benefit of training North Koreans to be journalists. We saw an increase in North Koreans watching Chinese and South Korean TV, and support groups producing shows North Koreans would find interesting (like reality shows about the daily experiences—good and bad—of defectors in the South). We helped non-governmental organizations that send in foreign movies and TV shows through the market trade, including one group that made cross-border deliveries by drone of specific films that North Koreans requested (we used to joke that we were running a peculiar version of Netflix for North Korea). A big priority was educating North Koreans on how to protect themselves from surveillance, and staying ahead of regime efforts to turn technology against its people”

In no way do I suggest that technology would be “the” savior that frees the North Korean’s from being enslaved by the Kim Regime. However, given my own experience with the Soviet Union and seeing how technology impacted the Arab Spring, I do hold out hope that it could play a role in giving people more information about things outside of North Korea and in turn, help them have greater freedoms of speech and expression and perhaps be used to topple the current leadership someday.

Why Face and Eye Scanning Will Replace Passwords

Apple’s upcoming iPhone 8, or whatever they will call it, has been in the news a lot lately. Reports suggest that the company has had trouble getting Touch ID on the glass screen to work and instead may be moving to using the camera for ID and eye scans to replace the using a fingerprint for Touch ID.

I hope this is true because this is by far the easiest and, what I consider the best way, to authenticate a person when accessing their iPhone. Samsung has this feature on the new Samsung 8S, and it is a dream to use instead of the fingerprint reader on the back that is very awkward.

I have recently been using the newest version of Windows 10’s Hello feature that gives a person the option of using face scanning technology to open their PC’s or laptops or a numerical code instead.
While I have entered a numerical code as a back up for access, I authorized it to scan my face and use face recognition as the primary means to allow me to secure access to the three Windows laptops I use at any given time. What is interesting to me is how seamless and fast this type of access delivers and reminds me of the days when I opened up a laptop to start working albeit without any form of access security.

That is the real objective of using face scanning as a password and makes the process so easy that a person hardly even knows they are on a protected device. While using a thumbprint or even a password is not a big obstacle in accessing a secure device, it still adds at least one or two steps to the sign in process as opposed to what is delivered by a secure face or eye scan.

Historically I go back to the earliest days when fingerprint readers were being evaluated for use in PC’s and especially laptops. Over time many of the PC vendors, especially Lenovo, added the fingerprint scanner/reader to some of their laptops and it became a design feature that all laptop makers either considered or implemented in at least some models. However, the uptake or use of these fingerprint readers were slow to be adopted, and even today, less than 50% of people even use them for secure access and defer to log in passwords or numerical codes instead.

But I see Face recognition and eye scanning for secure login as being the next really big technology that will adopt en masse and should Apple add this feature to the newest iPhone models, its adoption rate across all devices will accelerate.

In fact, Interest in eye and face scanning for secure login is on the rise from many of the big companies. EyeVerify, whose investors include Sprint and Wells Fargo that participated in a $6 million round, suggests that eye authentication is now of real interest to both telcos and banks. EyeVerify was recently acquired for reportedly $100M in cash by Alibaba’s payments arm, Ant Financial, to increase user trust and safety in financial transactions.

But Face recognition and eye scanning have much broader uses as well. Walmart is testing facial recognition technology in its stores, aimed at improving the customer experience (CX) by better understanding and responding to in-store customer sentiment. And if you are a fan of CSI or many of the spy thrillers in the movie theaters you know that eye scanning is used all the time to let people get into highly secure areas.

Although Samsung and Microsoft have been using eye scanning for secure access for some time, Apple doing so would move this into the much broader mainstream market. Given Apple’s customer reach and impact, it would make eye scanning a much more important means for people to use to open their secure iPhones and perhaps some day very soon, the iPads and Mac’s too.

Why Tech Execs are Eyeing a Run for Political Office

There have been many stories written recently about Facebook’s CEO Mark Zuckerberg doing a tour of America to try and find out what people all over the US are thinking and are concerned with these days. He called it a fact finding trip and stated it had no political focus. But according to an article in Politico, Zuckerberg recently “hired a Democratic pollster, Joel Benenson, a former top adviser to President Barack Obama and the chief strategist for Hillary Clinton’s failed 2016 presidential campaign, as a consultant, according to a person familiar with the hire. Benenson’s company, Benenson Strategy Group, will be conducting research for the Chan Zuckerberg Initiative, the couple’s philanthropy.”

While Zuckerberg denies political ambition, the belief here in Silicon Valley is that he is thinking more seriously of some type of political run or campaign that he could launch in the near future or at least understand how he can be more influential in guiding US policy when it comes to the potential impact that technology will play in America’s future over the next 30 years.

There is some interesting history of this type of Silicon Valley political activity and I wrote about this for Fast Company last fall.
Here is a passage that explains the Valley’s early interest and influence on Washington:

“During my 35 years of covering the technology industry, I have seen firsthand how companies have tried to keep an arm’s-length relationship with the government. With some rare exceptions—the Pentagon’s cooperation and collaboration with industry brought us the internet—Silicon Valley has generally tried to avoid federal and state bureaucrats. After all, the less the government knew about what tech companies were doing, the fewer legal and legislative issues the industry would have to deal with. This dynamic no longer works.

In the mid 1990s, a group of technology heavyweights led by Cisco’s then-CEO, John Chambers, and Kleiner Perkins venture capital firm partner John Doerr, along with various other tech leaders, began to realize the Valley would need the partnership of government and politicians for their vision of the future to be realized to the fullest.

Chambers and Doerr et al also foresaw the dramatic impact that the internet and mobile technologies would have on the U.S. and the world. Already back then, Chambers was percolating his ideas of connected cities and the Internet of Things (IoT).

These executives began evangelizing these concepts within the Clinton administration and at the federal agency level. They made an effort to educate elected officials on how technology would impact every level of government, and how it would transform our cities, businesses, and system of education.

To their credit, Clinton and Vice President Al Gore understood what Chambers and Doerr were saying. Clinton and Gore opened lots of doors for the tech leaders in Washington, giving them a chance to share their vision of the future.

At the end of the Clinton era, when Al Gore battled George W. Bush for the presidency, Chambers, Doerr, and other Silicon Valley leaders wisely kept up their efforts to influence both candidates. It became clear that whoever became president would follow President Clinton’s lead and allow Silicon Valley leaders to continue pushing the tech agenda.”

The heart of this recent interest in the tech world getting more involved in politics by either running for office or finding new ways to influence our politicians is the even greater understanding today of the impact of tech on our worlds future and how it could dramatically change American education, jobs, businesses and our personal lives over the next 30+ years.

In a separate piece I did for Time Magazine before the last election entitled “Why Our President needs to take Tech Seriously” I wrote the the following:

“With 5G, it will begin connecting people to devices, and devices to other devices. The latter is called the Internet of Things, and it’s primed to profoundly change our lives, much the way the regular Internet has. It’s also a potentially huge source of growth — Cisco estimates IoT gear and software will become a $14 trillion market over the next decade.

5G isn’t the only innovation on the horizon. Connected and autonomous cars will hit the streets in the next decade. In combination with the IoT, they’ll “speak” to one another and to public infrastructure, helping us build smarter cities. Tech companies will roll out new ways to track our health, connecting us to our doctors to help us stay healthy. Artificial intelligence will be applied to just about everything that technology already touches. Digital security will become an even more vital issue, as businesses and individuals will be increasingly targeted by hackers. The very nature of computers will change, too, as virtual and augmented reality will be established as the new interface of computing, delivering new forms of utility and entertainment.”

I also add to this AR, VR, Machine Learning, Robotics in manufacturing and new advances in medical science and you see that technology is on course to disrupt just about everything that is around us today and well into our future.

“However, for all these innovations to thrive — and deliver potentially huge economic benefits — they will need the help of our elected officials. Lawmakers need to understand these technologies, as they will be called upon to craft new laws and regulations to bring these technologies about smartly and safely.

Therein lies a problem. If you look at our lawmakers across the country, I would venture to guess that most are not very technologically savvy. For our country to truly enjoy the benefits of these new technologies, we’ll need politicians and officials who understand how these innovations work, and how they stand to change our lives.”

Tech execs who understand the role of technology on our future as well as its impact on things like education, the future of manufacturing, world of finance, etc look at our current president and some members of congress and see almost no understanding or vision of what a crucial time we are in our history. When it comes to the role technology will play in impacting every aspect of our business and personal lives and our culture going forward, their lack of tech savviness that will keep America from advancing and allow countries like China, Canada and France and others, who’s leaders embrace technology rather then dismiss it, from potentially leaving us in the dust. Even worse, some of congressional leaders sees tech and science as a detriment to their political goals and have become obstructors instead of visionary backers.

That is why some high powered tech leaders are thinking the unthinkable these days. Many tech execs that I know hate and do not trust our government but are starting to come to the conclusion that a President, Senator and Congressmen and Congresswomen needs to have a greater grasp of how technology will shape our world and country and be tech savvy enough to keep America moving forward now. I am told behind the scenes that some very high powered, forward thinking tech execs who really understand how technology is going to drive so many major things tied to America’s growth and world position are starting to contemplate running for office in many states around America. Their goal would be to gain a stronger position of influence when it comes to the role government must play in guiding how technology is applied and integrated into all of our business and personal lives fairly and equally.

I have no clue whether Zuckerberg will or will not eventually move into politics but I am willing to bet that as more and more tech execs understand the magnitude of what has to be called the great tech revolution of this century, we will see some of them trying to find a greater way to influence our current politicians and even see some begin to run for office in order to influence our government from within as much as possible.

AI, Machine Learning and the Anticipation Engine

Two of the big buzzwords in tech these days are Artificial Intelligence and Machine Learning. Those who understand these technologies know that together they will have a dramatic impact on pretty much everything it is applied to in the future.
But for consumers, AI and ML are still a real mystery. Because of various movies that highlight AI like characters who are mostly villains, the broad consumer top-of-mind paints AI in a very negative light. And with Elon Musk and Bill Gates warning us that AI could be very dangerous in the future, you can see why consumers are confused and even scared of this type of technology today.

I am not an expert in AI or machine learning by any means but I have worked on various projects that use AI and ML and understand why these technologies are important and how, when used properly, the will be transformational to every industry and every individual in the future.

Perhaps the most important application that AI and ML are being applied to today is in the field of medical research. Late last year I was at an Intel event on AI, and they shared how they were partnering with multiple cancer research centers to use AI and ML to search through billions of data related to cancer research in the quest to find a cure for cancer. And in talking with multiple people in the field of medical research lately, they too are using AI and ML in their quest to find better ways to treat diseases like diabetes, MS, blindness just to name a few.

AI and ML will also be critical when it comes to delivering on the promise of self-driving cars. These technologies will be used for crash avoidance, predictive analysis of road and weather conditions and a whole host of other functions that will be needed for an autonomous vehicle to operate properly and safely.

I could spend a lot of time detailing AI and ML’s use in industry and business, but as a consumer, I am highly interested in what AI and ML can do for me today and in the future. This is where the concept of an ‘anticipation engine’ comes in and helps me explain how AI and ML can be used in practical ways today and in the future.

One of the simplest examples of AI and ML comes in the way my calendar and mapping software work together now. When I put an appointment in my calendar and add a location address, as soon as I get in the car and start to go to that appointment, it tells me how long it will take and then displays the directions on my in car mapping system. This AI function is anticipating where I am going and automatically feeding me the details relevant to my driving to that meeting.

The Nest Thermostat uses AI to anticipate the proper temperature settings based on your schedule. It can keep the temperature at a set neutral range when not at home and then if it knows the time you get home, either raise or lower the temperature so that it either is warmer or cooler depending on the outside temperature.

In fact, most of the smart home controls are moving to use AI and ML too, over time, learn a person’s needs and preferences and apply their function ahead of a person needing it. Amazon and Netflix use AI and ML to make recommendations on what to by or what to watch in each of their services.

Using this anticipation engine concept, you can imagine a lot of interesting and very helpful consumer applications. For example, one app I would like would be if I put into the calendar a restaurant name and location and before I even head off to that meeting I get an alert that gives me reviews on that restaurant and suggests alternatives should I find the reviews of that chosen restaurant not to my liking.

Or if I had been searching for a new car (which I am doing now) it could collate all of my searches I have done so far and brought back to me a report on the best vs. worst options I would have based on the models I have been looking at.

These consumer examples are relatively basic but when I use these examples to explain AI and ML to friends they can see that AI and ML can be much more relevant to them than they had thought or considered.

But as I stated initially, AI and ML will be highly transformational, and one of the more interesting speeches on AI comes from a Kevin Kelly Ted Talk entitled “How AI can bring on a second industrial revolution.” There have been many who have postulated on the concept of the next industrial revolution, but Mr. Kelly’s presentation on the role AI will play is both a critical consideration on this topic as well as fascinating in its scope.

The Ted Intro describes Kevin Kelly’s Ted Talk this way:

“The actual path of a raindrop as it goes down the valley is unpredictable, but the general direction is inevitable,” says digital visionary Kevin Kelly — and technology is much the same, driven by patterns that are surprising but inevitable. Over the next 20 years, he says, our penchant for making things smarter and smarter will have a profound impact on nearly everything we do. Kelly explores three trends in AI we need to understand to embrace it and steer its development. “The most popular AI product 20 years from now that everyone uses has not been invented yet,” Kelly says. “That means that you’re not late.”

If you want to get a better handle on AI and its transformational value, watch this Ted Talk.I believe it will help put AI in a new light and make it even more relevant to business and consumers.

The Economic Laws driving Apple’s new OLED iPhone

Over the last few weeks, I have had to field numerous calls from various people in the media asking me to respond to the rumors suggesting that Apple’s new iPhone with an OLED screen could cost well over $1000 dollars.

While a $1000.00 plus cost of an iPhone may be shocking to many, the reason behind it is basic economics of supply and demand. And given the questions I have gotten from many of the media who have asked me about this, it seems that they either did not take economics in school or are just not seeing the big picture around this important economic principle.

We have known for some time that OLED screens are in high demand and short supply. That means that the cost of an OLED screen, if Apple can get them, will be priced at the high-end today until supply can increase, which in turn will eventually bring OLED screen prices down. The suppliers I have talked to in Asia say that actual cost of a 5.7” OLED screen today is somewhere between $230 and $280 depending on quantity and availability.

I saw my first OLED screen over 18 years ago when I was in Japan and visited a display factory in Osaka. It was a very early prototype and they explained the technology behind it and, more importantly, the challenges of making them in the future.

Even then they knew that besides being able to make them in large quantities, they would have yield problems for many years and costs would be very high. Once they were able to start making them in even small quantities, the first yields were something like only 1 or 2 in 10 were usable. Even though the manufacturing process has matured, they still have yield problems and as predicted, the prices are still high.

At last Winters CES show in Las Vegas, much of the industry got a really good look at the incredible quality and resolution that comes with an OLED screen. Many TV Vendors were showing off their early models of large screen OLED TV’s with prices tags over $10K depending on the size of the screen. One key thing about OLED screens is that the blacks are blacker and the whites are whiter and every pixel is illuminated so that the color depth and concentration are amazing. But when I talked these vendors they told me not to expect them to make them in any large quantities yet as yields are still a problem and prices for these screens are still astronomical.

This is why if Apple, as rumors suggest, bring out what perhaps would be called a 10th-anniversary edition iPhone in the fall and that model would use an OLED screen, its initial price would be so high. The irony of this, of course, is that Apple will sell every OLED phone they can make at any price it comes out at and there will be a serious backlog for it for at least 6-9 months if not more.

Apple’s move to OLED in an iPhone will start a stampede from other smartphone vendors, at least at the high end, to follow suit and the demand and scarcity of OLED screens in this size range will skyrocket and the laws of supply and demand will only be more exacerbated.

But Apple’s move to OLED will have one key positive effect almost immediately. The various maker’s of OLED screens will be incentivized to invest more aggressively in their manufacturing lines as they will see demand for small screen increasing as well as making their larger OLED screens for TVs.

And the Foxconn/Sharp display factory in the works will most likely be focused on making OLED screens too when it comes online later this decade.

When this happens the laws of supply and demand kick in again and by nature of these laws, prices for OLED screen will eventually come down.

I am convinced that Apple has every intention to move all of their iPhone models to have OLED screens over the next 2-3 years as supply increases and they can do it so that the prices of these OLED models are more in line with the prices of iPhones today. But thanks to basic economics principles in play, any OLED smartphone introduced today will be very high priced until supply increased and can bring the prices down to more normal level across the board.

The Tech industry’s Miniaturization Conundrum

Last month I wrote a piece in the Think.tank stating that I believed Apple was going to be doing major work in AR to advance the personal user interface by mixing virtual and real worlds into their mobile platforms. We are already seeing some fascinating AR examples coming out of early developers who have been using AR kit to create early AR applications for IOS 11. (Check out @madeforarkit on Twitter to see many of these early examples.) In this article, I also stated that while I believe the iPhone is the best vehicle for Apple to deliver AR at first, I also suggested, based on some patents that eventually Apple will add some form of eyewear tied to AR and MR to their portfolio. These new products will offer an even new way to interact with mixed reality in the real world.

But I do not see that coming for at least another 3-5 years since at the moment the technology is just not here to deliver a set of glasses or goggles that can work without the iPhone and could be even fashionable enough to gain serious market acceptance. It is possible that the first version of Apple’s glasses or goggles will need to be connected to the iPhone to work, but the Holy Grail would be to make them work on their own and without wireless tethering to the iPhone.

If there is a company that could eventually bring smart glasses to the masses in the future, I believe it will be Apple for one major reason. That reason lies in the work they are doing now with Apple Watch. Apple Watch is an important product in its own right. Apple’s has used Apple Watch in their quest to deliver a whole host of wearable health, medical tracking, information and services, it is also serving as an important development project to create an extremely small PC motherboard that I believe will eventually be used to power their glasses or goggles.

If you look at the major VR glasses or goggles today, they are all very bulky and in the case of Sony’s PlayStation VR, HTC’s Vive and Oculus Rift, these need to be tethered to a powerful PC with high powered graphic chips to work. And even with Intel’s project Alloy, which is un-tethered, it too is heavy and bulky as it uses a rather large mobile motherboard inside to power it. And even if you were going to try and deliver some glasses or goggles that were usable today it would need to be wirelessly connected to a smartphone and not work without this type of mobile connection.

Today, Apple is the only one that has created the equivalency of a personal computer motherboard that will fit in a smart watch. Yes, Samsung and others also have smart watches, but at the motherboard level, Apple appears to be cramming much more in the way of CPU’s, graphics and wireless radios in it to power the thousands of Apps available now for Apple Watch. And given this power, Apple can advance the OS quickly as they will do with Watch OS 3 and I suspect that Version 4 of Apple Watch will be even more powerful and more capable when it finally comes out in the very near future.

What I see happening is Apple using the Apple Watch as a major R&D project that they can then transfer/use in smart glasses once they have the right optics, right design and more importantly, fulfills some type of pain point that one has after 3 or 4 years using AR on a smartphone. While I don’t ever see people walking around with smart glasses all of the time, if they had these types of mixed reality glasses that fit a need or pain point at their disposal they would be more likely to use them often when that need arises.

Apple never works on products with short term goals. I am convinced that while the Apple Watch stands on its own in its role as part of Apple’s hardware, software, and services approach to the market. I can see how the miniaturization of a PC motherboard could morph into the type of PC motherboard that could eventually power a set of mixed reality glasses or goggles. If And if anyone is going to get this right, I suspect it will be Apple.

Has Technology created the Age of Distraction?

If you talk to a lot of the engineers and dreamers in Silicon Valley, especially ones over 35, they will most likely tell you that they are fans of science fiction. This genre of movies, comic books and books were huge in the first half of the last century and remained somewhat steady in the latter part of the last century when most of the engineers of today were born.

That is not to say that science fiction has gone away, but only to point out that it had a significant influence on those creating much of today’s technology. 

I was born in the latter part of the last century, and like many of my geek friends back then we were all into science fiction at all levels. We loved the futuristic ideas presented and reveled in the good vs. evil that permeates the science fiction realm. 

Science Fiction and Real Life

But there is one theme in science fiction that always troubled me, and that is when technology runs amok and gets out of the control of its creators or masters. I had nightmares for months after I read Frankenstein. Often when this happens, it sets up the drama behind the science fiction story line and the main characters who have to spend tons of creative energy to try and either reverse the out of control technology or at least contain it.

I have been involved in dozens of technology projects, programs and ideas I have to admit that very seldom in our design or business process discussions do we spend much time or energy on what the negative impact the technology we were and are creating would have on our world or lives.

Instead, we mostly live by an engineering mantra that is often embodied in the concept that we create it because we can. 
Indeed, in most cases, we create technology because we see a need or to fill a gap or function that needs to be solved but too often we create something that may not have any commercial value or needs to exist at all.

I have recently spent time with the major execs in the security and cyber security space, and perhaps no other area in our digital world underlines the negative nature of what technology hath wrought. IT execs tell me that security is now about 25% of their IT budget spend. Each day we hear of hackers taking aim at our identities, financial networks, power grids, etc. and in a most recent development, malware designed to taking our PC’s, laptops and smartphone’s hostage till we pay a ransom fee to get our data back.

When the folks at DARPA and other agencies created the Internet backbone, the idea was to have a medium for them to share scientific data and information around the world in a timely way. But as the Internet has evolved it has become the medium for just about any communication, commerce and yes, hacking that impacts us in both good and bad ways.

Living in the Age of Distraction

But it has also created what I believe has become the age of distraction. I was recently in New York and had to drive from Northern NY to the Elmira area on New York Freeways. For the first time, I saw signs that said “Next texting stop is 3 miles ahead. Don’t text and drive.”

Most states have already outlawed texting while driving and yet we hear almost weekly of traffic accidents caused by drivers distracted while texting and driving.

The level of distraction caused by technology is at an all -time high. While on vacation in Maui last month I was stunned to see people everywhere pulling out their smartphones and checking them while walking around beautiful Lahaina and other areas of this island. Then during a dinner with my wife, my son and his wife and our two granddaughters at Kimo’s beachside restaurant in Lahaina, I caught all of us looking at our phones at the same time as we waited for our food even though we had a gorgeous scenery right in front of us.

I don’t believe Steve Jobs and Apple ever dreamed that the iPhone and smartphones could cause us to have some much distraction while using them. I don’t think Mark Zuckerberg when he created Facebook, foresaw how distracting and addictive Facebook would become. I don’t think Niantic, the creators of Pokemon Go fully thought out the ramifications of their app that caused two people who were playing Pokemon walk off a cliff or for that matter, my wife who has become addicted to this game, walking into a tree or light post when chasing down some Pokemon Go character. 

The current engineering generation has been so focused on creating new technology and does not truly think through the potential consequences of what they are creating. While some companies like Intel are very forward thinking and have multiple anthropologists and ethics professionals on their staff, they are the exception. But all serious tech companies need to be hiring folks with a humanities background too, especially in ethics, anthropology, humanities, psychology, etc.

In the July-August issue of Harvard Business Review, Author JM Olejarz writes about “Liberal Arts in the Data Age.” 
He shares some important points about the importance of adding the disciplines of liberal arts and the humanities to the technical curriculum that today’s engineers are only focused on.  This is a very important perspective, and I encourage you to read this article to get another view of how our educational leaders need to think about teaching the engineers of tomorrow. 

Of course, the cat is out of the bag when it comes to how technology causes the distraction, and as a parent and grandparent, I need to be more proactive in my own family to reign in the excesses of distraction caused by the tech in our lives.
My hope is that given what we now know about the potential impact technology can have that we as an industry become more responsible in not only what we create but also thinking through the impact of our technology on our lives and our world. 

My Test Drive in a Self-Driving Car

One of the most fascinating areas of research we get to do these days is to look at the technology behind self-driving cars and try and make sense of this new thrust in automated vehicles.

Like most of us researching this field, we now believe that self-driving cars will, over time, drastically reshape the way we use automobiles and move more and more people to either some type of ride-hailing transportation model or actual ownership of a self-driving car themselves.

Although this transition may take as many as 20-25 years to move the majority of people to using these types automated vehicles for their personal transportation, it really is just a matter of time before this happens.

At the moment, this concept is pretty radical to most people and most are highly reluctant to turn over the driving of a car they are in to an automated robot driver today. Of course, self-driving cars are not actually ready for prime time even if the technology to deliver a self-driving car is on the horizon. Most car companies believe they can have fleets of vehicles ready for many major cities to use in an on-call fleet model by 2020-2021 in which a person can just call up a self-driving car at will and it picks them up and takes them to their destination. The reality is this is only 3-4 years away. And they also tell me that people will be able to buy fully automated vehicles for their own use by as early as 2022-2024.

Like most people who have had control of the wheel of a car all of their lives, I too was reluctant to go on a test drive in a self-driving car to experience what it is like to understand not only how this works but also to get a grasp of its ultimate potential. The opportunity recently came up for me to do this type of test drive as part of my work with the State of Hawaii and their current Governor, David Ige. I first got involved with helping Hawaii in the late 1990’s when then Governor, Benjamin Cayateno, asked me to help work on a program to entice tech companies to Hawaii. Under his leadership, Hawaii passed a special law to give tax incentives to tech companies who would set up offices in the Islands with the hope of getting more IT students from the islands employed at home instead of having them go to the mainland for jobs. The program was only mildly successful but unfortunately did not meet the real objectives they had hoped for it.

During that time I got to meet and work with David Ige, who was a State Senator at the time and as an electrical engineer, was very helpful in getting this bill passed. He is now the Governor of Hawaii and over the years he and I have had various conversations about what is hot in tech and Silicon Valley. Since he has become governor, at least once a year I visit him at his office to talk about the world of technology and things that I believe will impact the State of Hawaii. In my meeting with him last March, I shared with him what was happening in the area of self-driving cars, something that he and his transportation folks were already looking at closely. During our talk I suggested that the next time he came out to Silicon Valley he and I visit some of the major players creating the brains behind self-driving cars as well as Google, who is a major player in promoting and creating self-driving car technology and designs.

So in early April, during a scheduled trip to San Francisco, he carved out an afternoon and he and I went to visit Nvidia and Google to get an update on where things are in automated vehicles. My key objective for the Governor was to give him a better idea of what was happening now in this area and get him thinking about creating a plan for the State of Hawaii to allow for testing of self-driving cars soon as well as start to work on what will eventually be state and local laws needed to govern self-driving cars in the Hawaiian Islands.

It was during our visit with Google’s Waymo group that he and I were given a test drive in a Waymo vehicle and got a chance to experience a self-driving car in action. This was fascinating and enlightening and made it clear to us that the technology to deliver automated vehicles is much closer to reality than many believe. In our test drive, there was a person in the driver’s seat who just pushed the button to start the car and set it in motion. They had put in all of the driving details before we got to the car and once started, the car took off on the designated route. During that time the driver never touched the steering wheel, brakes or accelerator and the car drove and navigated every street light accurately, stopped for pedestrians in cross walks automatically and even stopped quickly when a cyclist cut in front of us.

In the right seat was another person who had a laptop that was showing us what the car was seeing. The view they showed us was what the cameras and sensors saw, how the car was using these tools to navigate the road ahead and made it clear that this vehicle was pretty much all seeing and all knowledgable, sensing every line, stoplight and moving object in a 360 degree radius as we cruised the streets of Mt. View, CA.

Taking a test drive in a self-driving vehicle and seeing not only how it works but also how flawless the technology behind it performed, more than convinced me that the technology itself is ready to deliver on the promise of an automated vehicle sooner than later.

But it also made me understand that besides the regulatory issues that have to be solved on Federal, State and city level, as well as many other things that have to be done at the technology level before we get these types of self-driving vehicles on our streets, convincing people to trust a self-driving car to ferry them around may be a tough sell. I received my license when I was 16 years old and have driven cars and motorcycles since then. They present a very familiar way of transportation for me, and after decades of practice, I consider my self an accomplished driver. I suspect that for most people over 30, driving has become second nature and being in control is something that we like from our driving experience.

Of course, the fact that we can’t control the actions of others is why self-driving vehicles make so much sense. As I saw in the Waymo example, the technology employed in an automated vehicle has 360 degrees of sight as well as sensors that could anticipate the cyclist I mentioned above and stop way in advance before hitting this person. In essence, this automated car is much smarter than a driver and can act even faster with greater knowledge of the cars surroundings and respond quickly to almost all situations it encounters.

I still believe that it will take a lot of convincing before most drivers are willing to give up control of their vehicles and fully trust a self-driving car. If you are a technology, early adopter, as I am then perhaps you will be willing to jump in a self-driving vehicle and let it take you away. In fact, it will be the early adopters who will be the first to let a self-driving car serve as their robot chauffeur initially. For some seniors and those with issues that keep them from driving, a self-driving car would be a godsend at any age to give them the flexibility to go anywhere they want once these types of cars hit the road.

However, even with these cars being able to be on the road and in fleet service by 2020 and available to purchase by 2022-2024, I think it may take as many as another 10-20+ years before we see what we call a more mass market for self-driving vehicles. Even though the technology will be ready, I sense that it is going to take the public much more time to come to trust these automated vehicles before they take what will be a leap of faith and trust them to cart them around safely.

The iPhone and its Truly Disruptive Nature

Late last month I wrote about the 5 major industries impacted by the iPhone. I listed the PC, Telecom, Music, TV and Health industries that the iPhone helped change and in almost all of these cases it even forced them to change their business models.

While the iPhone impacted the industries above it also had a major impact on some specific products. As the chart below shows, in 2007, the digital camera market was about $6.5 billion. In 2014, it was about $2 billion. MP3 players represented just under $6 billion in 2007, today it is about an $800 million market. Portable navigation systems were hot in 2007 and were just over a $2 billion market; Today it is around $600 million. And Camcorders are all but gone these days. In 2007, they were a $ 2 billion market, and today it is barely an $80 million market segment.

It is remarkable how much the iPhone and smartphones, in general, have changed our world and markets over the last ten years.

But I am also struck by how much it has influenced the distribution of media platforms. As you can see from the chart below, Radio at 93% still has the largest reach when it comes to media distribution, followed by the TV at 89% and then the smartphone at 83%.

To be honest, given how much we look at our phones each day (on average of 80 times) and how central it has become to how we receive and consume information and media, I am surprised that radio and TV are as high as it regards media consumption.

I suspect that if Statista had done this chart based on age demographics, the smartphone would be # 1 regarding media consumption followed by radio and TV.

Another way to look at media consumption, especially news by demographics, comes from my friend Gary Arlen writing for MultiChannel.

In his article, he has this chart above from a Reuters Digital News Report that shares the main source of news by age. But his commentary on this chart is important-

“The infographic (pictured) from the Reuters Institute for the Study of Journalism is intuitive and simplistic. You can easily see that older people prefer TV news, while young audiences go for online and social media. No surprise there. But it’s misleading! True, the “Reuters Institute Digital News Report 2017” (unveiled this week) confirms that the screens-of-preference for younger audiences are mobile and dynamic. But identifying the platform does not necessarily tell you the source of the news. Consumers may look at an online or social media site to find reporting from established journalism sources (e.g., CNN, The New York Times, Fox News Channel) or just as easily from ersatz self-proclaimed bloggers or alt-news sources. The 136-page report delves more deeply into the distinction between the reception platforms and the actual content of the news.”

Both of these reports about media consumption underlines how important the smartphone has become regarding it serving as a media distribution medium. And I don’t see that changing anytime soon, especially with a younger generation who daily activities are driven by and centered around their smartphones.

I don’t think I can overstate how smartphones and technology, in general, have really impacted the lives of people of all ages but especially Millennials and the generation of them.
I recently attended a memorial service for a dear family friend who was a pastor-elder in my father’s religious organization and whom my father had become close to when this person was younger. He had influenced thousands of people’s lives, and at his memorial, there were many eulogies celebrating his life.

But what struck me was that almost every one of those under 30 who gave a eulogy read them directly from an iPhone or an iPad. There were no paper notes and there they read the eulogy right from their devices. Now I admit that I too have used my iPad with the teleprompter app when I have done structured speeches in the past but to see this as the main mode for these younger folks to use to deliver their eulogies was really striking for me.

While the iPhone has been a serious disruptor to many industries and changed our culture in many ways, it has only been on the market ten years. With Apple adding AR and eventually VR to their ecosystem portfolio and things like AI, machine learning, IOT and advancements in CPU’s, GPU’s, Batteries and other core technologies driving our digital revelation, I suspect the next 10 years will be even wilder in terms of the role technology plays in disrupting more industries and influencing our culture. Get ready for an even wilder ride over the next ten years.

Apple, AR, and The Potential for an Apple AR Headset

One of the things Apple does well is to use a platform approach to anything they bring to market. The Mac OS is a platform for hardware, software, and services. IOS is a platform for hardware, software and services and TVOS and Watch OS are also platforms in their own right.

By doing this, Apple can riff on these platforms and innovate at the hardware, OS and services level.

We are about to witness one of their most impressive riffs soon in the form of AR and how IOS 11 brings a whole new and exciting way to merge our physical world with our digital world. What is important about this initial foray into AR is that Apple is mainly using dedicated hardware in the form of the iPhone and iPad to deliver their first generation of AR solutions.

At the moment, a smartphone or tablet is the best way to deliver AR and the apps being developed will have a real augmented reality focus. In yesterday’s Think.tank column, Ben states very well that the path to AR for the masses will go through the smartphone and underlines the point I make above.

But if you follow this market you know that a there is another way being proposed to deliver AR as well, this one being pushed by Microsoft in the form of HoloLens and in a category they call mixed reality. This form of mixed reality uses a set of goggles that allows a person to see the real world around them and then superimposes virtual objects or information on top of these goggles.

This is an important distinction since Microsoft is not pushing VR in the similar way that Oculus or Vibe does in that these are closed systems, and you are actually in virtual worlds and cannot see the real world around you when in their VR applications.

While I like what Microsoft is doing with Hololens and Intel’s version of this called Project Alloy, they still use very clunky looking goggles that are heavy on the head and a lot of processing power. They get this from either a tethered solution or in Intel’s Project Alloy’s case, serious CPU’s and GPU’s embedded in their headset that is power hungry with relatively low battery life.

However, for goggles to be accepted by the mainstream public, they must be more like the glasses we have today and not int heir current form of heads up displays that make a person look like a science fiction character.

I have had the chance to see many goggles or glasses in the works, and I still don’t see either the breakthrough technology or designs that would be acceptable for consumers coming anytime soon. My sense is that they need to be more like our current sunglasses or reading glasses before the main consumer audience will every adopt them broadly. At the moment I just don’t see the technology ready to deliver on this type of glasses, which is why I believe that the smartphone and tablet will be the dominant AR delivery platform for at least another 3-4 years or even longer.

However, I do believe that Apple has designs in the works around some AR or mixed reality glasses and that these represent their natural evolution of their mobile IOS UI. While this may be quite a few years in the future, they have filed patents on a couple of glasses design, and the most recent one has an AR twist to it. http://www.techradar.com/news/apple-patent-paints-a-future-of-ar-glasses-and-gestural-controls#

Another hint that Apple is serious about some AR glasses comes with news that they recently acquired SensoMotoric Instruments. This is a company that has eye tracking technology that can be used for things like gesture controls and other AR like functions.

Here are some YouTube videos that show what this eye tracking solution from SensoMotoric can do

Here’s how SMI has presented itself at technology conferences over the past five years:
2013 – https://youtu.be/kiFpMbfj_08
2014 – https://youtu.be/sNomkPAovUE
2015 – https://youtu.be/PONJIXPJMek
2016 – https://www.youtube.com/watch?v=2HS2p2BmVsk
2017 – https://youtu.be/HtU-Y9g6Trw

David Goldman, VP of Marketing at Lumus states:

“Apple’s recent acquisition of eye tracking company SensoMotoric Instruments (SMI) is another indication that companies with plans to build head mounted AR systems would consider eyesight as the universal interface. We can expect to see tier-1 companies in the race for AR technology to either create similar homegrown solutions or to make similar acquisitions like this – in eye tracking, gesture recognition, voice recognition, and display technology companies so that another tech giant doesn’t corner the market.”

If and When Apple delivers some glasses it would be a significant extension of their platform and in this case, would most likely be the next major step in their evolution of their mobile UI that will be embedded into future versions of iOS. The big question is not if Apple will do this but when. While it is difficult to predict, I think that this is a 2020 product. Given what I know about the tech available today to deliver the kind of glasses that would deliver this new UI and be an important extension of the mobile experience in glasses that would be acceptable for the masses, I just don’t see it anytime soon. You can expect Apple and others to continue to acquire the proper technology to eventually deliver AR glasses that everyone will want to use. If I read the tea leaves right, this would allow Apple to reinvent the user interface again just as they did with the Mac and iPhone’ UI’s in the past.

How the iPhone impacted Five Major Industries

On June 29th, Apple will celebrate the 10th anniversary of shipping the iPhone. Although the iPhone was introduced at MacWorld in January of 2007, the iPhone did not actually ship until the latter part of June of that year. I was lucky enough to get a preview of the iPhone the day before it was introduced at MacWorld and Apple SR VP of Marketing Phill Schiller put the iPhone on a coffee table and asked me what I saw.
I told him I saw a piece of glass in a metal case. He told me that is what Apple’s wants you to see. In off mode that is exactly what it is. But once turned on, that is where the magic is. Apple sees themselves as a software company first and creates devices, like Mac’s, MacBooks, iPods, iPhones, Apple TV and Apple Watch to run their innovative software.

Before the iPhone was released there was a lot of hype around the iPhone; It was even nicknamed the “Jesus” phone as some felt it would be miraculous. At the time none of us believed it could live up to the hype but to our surprise this time the hype was correct and indeed the iPhone turned out to be a new powerful technology that has impacted the lives of hundreds of millions of people around the world. For almost all, it has changed the way they communicate, work, learn and play.

But perhaps the most surprising thing about the iPhone, besides how it has become the most important technology most of us have with us all of the time, is the impact it has had on five major industries.

The first industry it has upended is the PC market. Until the iPhone shipped, we were selling around 400 million PC’s a year. But as the iPhone and, smartphone’s in general, have become critical tools for information and used for both productivity, voice, texting, and pleasure, the PC has become less important to many people. Until the mobile revolution that came with the iPhone, the only way people could get onto the Internet was from a PC or laptop. Today, thanks to the iPhone, iPad and the Android equivalents that basically copied Apple’s designs, people have much more options to make the connections they need no matter where they are. Consequently, the PC industry is now shipping only about 275-290 million PC’s a year and this has caused a level of industry consolidation that is now concentrated around mainly Lenovo, HP, Dell, Acer, and Apple. What Apple did that really impacted the PC market is it put a PC in your pocket.

The second industry that was impacted was Telecom. Before the iPhone, ATT, Verizon and most of the original telco’s business models were around voice. Yes, VOIP became popular by 2000 and had already started pushing them to move to digital voice instead of traditional land-line voice delivery methods, but with the iPhone, it pretty much forced them out of the traditional voice business altogether. Just try and find a pay phone today compared to the millions of payphone’s that were in place in 2007.

Now, all of the telco’s are data communications companies who have a totally different business models compared to what they had in 2007. And all of them have added to their digital communications business things like information services, entertainment services etc and all are now a conduit for supplying data services of various types to their customers.

The third industry the iPhone turned on its heels is the movie and TV industry. For most of my life in order to watch a movie I had to go to a movie theater and to watch a TV show I had to sit in front of my television at home. But the iPhone created a mobile platform for video delivery and since 2007, every major movie and TV studio has been forced to expand their distribution methods to include streaming services to both fixed devices like a TV and mobile devices. However, it was the millions of iPhones out in the field that was capable of letting people watch video anytime and anywhere that forced these studios to move in this direction. It also spawned new types of video services like Youtube and even Netflix, Hulu and others have become video powerhouses in which at least 50% of their content is viewed on some type of mobile device.

The fourth industry the iPhone impacted has been the gaming industry. Before 2007 most games were either delivered on a game console, a PC or a dedicated handheld device like the Nintendo and handheld game players. But the iPhone expanded the market for games and now almost every game, unless it is highly video driven or maximized for use on dedicated consoles or high-end PC gaming systems, are now available on the iPhone or some type of mobile platform like a tablet.

As a result, the gaming market, which in 2007 was a rather narrow market, has now expanded to one that allows hundreds of millions to play games on their iPhone or smartphone equivalent, something that was not possible in 2007.

It has also impacted the health industry. Today one can use an iPhone to monitor various health issues as well as giving people ways to get access to their health information, make a connection with their health professionals and even get health advice anytime and anywhere they happen to be. Only recently have we started to see how a smartphone impacts the health industry and we will see its role expand as this industry embraces the smartphone for outpatient care.

But perhaps the biggest impact it has had is on Apple itself. Before the iPhone, Apple was known as Apple Computer. Today it is Apple Inc, a company that makes much more than a computer. And the iPhone accounts for over 60% of Apple’s total revenue now and is bringing in record revenue each year. Apple is on track to potentially be the first trillion dollar company and is already the most valuable company on the planet.

Looking back over these 10 years, the hype before the launch of the iPhone underestimated what the iPhone could do and its eventual impact on industries and individuals. And with Apple on track to define and grow AR in Mobile, the iPhone and Apple seems to be ready to make the iPhone even more important to our digital lifestyles and most likely will impact other industries in ways we have not even thought of today.