Another Remote Work Take Or Remote Work Does Not Suck

I am sure by now you had enough about people pitching remote work and how the future will change because of what we are all experiencing due to COVID-19. I already wrote about how frustrating it is that it takes a pandemic, now an official one, to look at how far tech has come to empower remote work. I also warned about the need for companies to take seriously the cultural change that needs to occur to leverage remote work after this crisis is over.

So why am I writing about this again? I read an article earlier this week that really struck a nerve for the many generalizations that the author made on who benefits from remote work and how remote work negatively impacts creativity.

In my career, I have worked both from an office and remotely. I have done so both in the UK and in the US. My experience is my own. We are all a little different, the work we do might be different and the companies we work for are also different making each situation almost unique. So I will try my best not to succumb to generalization just to prove a different point from that expressed in the article and that is remote work does not have to suck.

Who Can Benefit From Working Remotely?

The article calls out new parents as a group that can benefit from working remotely. When I had my daughter, I was still in the UK and I was already working remotely. Those first few months were the hardest I ever had as a remote worker, so I am not sure it was quite a benefit. If you are a mother and you are breastfeeding, working from home allows demand and supply to be in the same location, which certainly simplifies things. Yet, trying to adjust to being a new parent while working all under the same roof makes boundaries much harder. As breastfeeding did not last long for me, I opted to go into the office for a few hours a week as a way to create a separation between me as a mom and me as a business person. Generally, I would say it is not feasible to work from home while looking after a child of any age unless it is for a limited amount of time, like during an illness or a bad weather day when one can temporarily rearrange calls and deadlines.

The other group the article suggests could benefit from working from home are “people with disabilities or others who aren’t well-served by a traditional office set-up.” I would think the hardest part for many in this group is commuting rather than actually being in the office. There is no question that cities could make it much easier to support people with disabilities when it comes to commuting. Often as I battled through the London underground during rush hour I wonder how visually impaired people or people using a wheelchair dealt with the number of stairs and escalators let alone the number of people.

Commuting is also tasking, of course not to the same extent, for people who do not have disabilities. The level of stress that commuting adds to our life impacts both our physical and mental health. In 2017, a study developed by VitalityHealth, the University of Cambridge, RAND Europe and Mercer, examined the impact of commuting on employee health and productivity across more than 34,000 workers across all UK industries. Commutes longer than 30 minutes appeared to have a negative effect on mental wellbeing with 33% of longer commute workers more likely to suffer from depression, 12% more likely to report multiple aspects of work-related stress, 46% more likely to get less than the recommended seven hours of sleep each night and 21% more likely to be obese.

There are other groups who I think could take advantage of working remotely and those are people who do not live in areas where work opportunities are plentiful. For some of these people moving to look for a job might mean not being able to afford a decent home or leaving behind any family support which could help with caring for their kids. It could also mean they are the ones unable to do the caring for family members, for instance.

Remote working might also result in a more diverse workforce. Companies not limiting their talent sourcing to the cities and counties where they have offices might make it easier to attract talent from different ethnicities. Take the tech sector and San Francisco as an example where, in 1970, the Black population represented around 13% of the total population and by 2018, that number was down to less than 6%. How can tech improve diversity if it is fighting against decreasing numbers of available candidates? Also, how can these companies attract diverse employees when it often means not having a community they can belong to?

Productivity and Creativity

I am not sure one could ever settle the discussion on remote work productivity and the jokes I have seen on Twitter over the past week are really not helping. There is this fantasy that working from home means you are less productive because you are easily distracted by family, roommates, pets, delivery people, the TV and apparently whatever else is in your home. While a little self-discipline is required, the distractions are only different, not necessarily less than what an open office can offer. Those who argue for higher productivity often mention the lack of commute time, which can impact how present or more relaxed one is by the time they sit at their desk but might not necessarily result in more hours spent working.

On creativity, the author is clear that working from home kills your creativity because of the lack of stimuli, he even quotes Steve Jobs about how staring at email does not help. But who stairs at email now? The reality is that with today’s technology, you can brainstorm, collaborate and connect in so many different ways and have a quality experience. Being in the office does not necessarily guarantee you are where your team members are, especially if you are working with international teams. The chances of those casual conversations by the micro-kitchen being always about work are also pretty slim. Not that my colleague Ben Bajarin and I should be used as an example, but we are rarely in the same place unless we are traveling. We both work from home and have our best brainstorming session over chat or iMessage. I am also more connected to Ben than I ever been to most of the people I saw every day at my old office.

Working Remotely Does Not Mean Being Alone

The current circumstances are, of course, very unique as we practice social distancing, but in general, working remotely does not mean being alone. The more people in the team are remote, the more the company will have a culture of inclusion and you will not feel like the odd one out. Just this past week seeing most of the people I had meetings with working from their home office rather than all being around one conference tablet and me dialing in from home made a big difference in how we all felt we belonged equally.

The more important point, though, is that remote work gives you the flexibility to include work out time, or running an errand over your lunch break, catching up with a colleague or a client over coffee, and the list goes on. Yes, the jokes about never taking your pajamas off might have some truth for the first couple of days and there are some people for whom remote work could lead to depression induced by isolation, which is no joking matter. Still, with a little proactiveness in setting up human contact and technology that improves telepresence, I think most people would find it quiet but not lonely.

 

So, do I think that remote work sucks? Absolutely not. Do I believe that remote work is for everybody? Of course not. If you are new to remote work and you want to see if it might be something you want to continue to do once the emergency is over, give it some thought. Evaluate the pros and cons, looks at the technology both devices and software that might help you improve the quality of your experience – this is the time to ask for what you need – and try to get into a routine.

Could Tech Actually Save Bricks and Mortar Retail?

There’s no question that e-commerce has changed the retail landscape forever. The hollowing out of physical stores started with books and Amazon and has now touched nearly every retail sector. In the latest wave, traditional malls, big box stores, and even grocery stores are feeling the effect.

But a recent trip down a storied Boston shopping street proffers hope that bricks and mortar retail might experience a sort of rebirth. And, ironically tech is playing a part.

Newbury Street in Boston’s tony Back Bay neighborhood has experienced all the familiar phases of retail over the past 30 years. For a long time, Newbury St., which runs for about 1 mile between Boston Public Garden and Kenmore Square was a high-end retail district, lined with boutique shops, galleries, and a few restaurants. That began to change in the 1990s, when the continued escalation in rents and the growth of big box stores resulted in the “mall-ification” of Newbury St. Even though the neighborhood remained delightful for walking,  Newbury St., which is populated by three to four story brownstones and mid-rise commercial buildings, started to look like the outdoor version of a typical American mall. Cue the Gap, Banana Republic, Victoria’s Secret, Urban Outfitters, and the like. A Tower Records store became a Best Buy.

But with the continued rise of Amazon and online shopping, and growing fatigue with the genericization of the retail shopping experience, business at many of these retail outlets started to fade. Vacancies, even in an otherwise healthy economic times, started to rise. And then, about three years ago when things were starting to look downright depressing, Newbury St. started to experience somewhat of a rebirth. Now, it’s still a work-in-progress, and there’s no doubt that retail remains a particular challenge…but the trendlines are cautiously encouraging. Ironically, e-commerce, tech, and big data have influenced or helped make this happen. How?

First, there’s the growth of what I call micro-segments, which are surely enabled by big data and social networking. For clothing, it used to be, there were men’s stores, women’s stores, and children’s stores. Now, these tend to be higher-end stores geared toward much more specific segments. The generic wedding shop is now Firas Yousif Originals Bridal, which makes custom gowns and women’s evening wear. There’s No Rest for Bridget, which has an ever-rotating line of trendy women’s clothing and accessories. Mulberry Rd. is the same idea, but for infant and kids clothing. The Fish & Bone, for pets. Allsaints has 200+ stores worldwide, catering to the ‘chic and edgy’ segment. There’s a block-long ‘athletic cluster’, consisting of Patagonia, Arc’teryx, North Face, and Fjällräven, all surrounded by yoga boutiques, a bike shop, a boxing club, and a Boston Sports Club.

Microsegments also include niches, such as Barbour, the British brand of cotton waxed jackets English country apparel, Akris, which features a Swiss line of womenswear and accessories, and Alps and Meters for luxury alpine sportswear.

Then there’s a group of stores that the increasingly sophisticated supply chain at least partially enables. Ministry of Supply is a men’s clothing shop whose main appeal is affordable custom-made wear. You stop in, are offered a coffee, and then get measured for an item that you actually have to pick up two weeks later…all while buying a sweater or some accessory that sits on their rather sparse shelves.

Third, are the types of stores that e-commerce can’t replace. Goorin Brothers Hat Shop still survives, since hats are probably something you don’t really buy online. Or the more modern Topdrawer, which sells pens, pencils, stationery, and travel type gifts – the whimsical sort of thing you wouldn’t know to even look for on the Internet. Muji is a Japanese retailer that sells a large range of clothing and household knickknacks. There are at least 15 shoe stores on Newbury St., since that’s a type of product that’s harder to buy on-line. And, high-end designer boutiques that have made somewhat of a comeback. Sure, this is a function of an affluent city/neighborhood and a strong economy, but also type of product/experience for which there is less of an online substitute.

Fourth is a group of stores I term ‘Born in Silicon Valley’: AllBirds (the shoe version of Lululemon), and Warby Parker (the Apple store of eyeglasses). You also see where Apple has had an outsized influence on design, such as at the sleekly decorated LIT Boutique, and numerous other stores along Newbury.

Yet another category is stores that started in direct-to-consumer online but are now adding a bricks and mortar presence. The above-named Allbirds is an example. Another example on Newbury St. is Tracksmith, which sells running clothing online for the prep school/Strava crowd but has opened the Trackhouse, which looks like a mix of Augusta’s 19th Hole and the Harvard Club. All that’s missing is the Winkelvi. Related, are stores influenced by online sites. So, the online StitchFix and Rent the Runway beget several high-end consignment shops on Newbury St., such as Castanet Designer Consignment and Revolve.

Finally, and this has nothing to with tech, is what I call ‘trend of the month’. Bagel shops became cupcake shops, which became frozen yogurt shops, and are now…smoke and CBD shops. Which will run through their cycle and yield to…anybody’s guess.

To conclude with a twist of irony, I should mention that one block over, running parallel to Newbury St., is Boylston St. It’s a wider street, home to the Boston Public Library and Trinity Church, but also a much larger population of chain type stores and restaurants than Newbury St. And the largest employer on Boylston St.: Boston-based Wayfair, which at least for household goods has mounted an impressive online challenge to Amazon.

Magic Leap Explores Sale, A Global Recession Looms

Magic Leap Explores Sale
Yesterday Bloomberg posted a story that Magic Leap is exploring options which include a sale. This is not surprising to many since the company raised way too much money to be sustainable and the market adoption for this technology is simply too far off.

I have always had my concerns for Magic Leap. I knew the solution was incredibly early and the technical problems they were trying to solve were not easy ones. The massive amounts of venture money they raised was necessary to try and solve these technical problems and they simply could not raise enough to solve those problems and play a patient capital game and wait for the market to develop. We honestly may still be 5+ years away from any reasonable AR solution and a decade or longer away from the mass adoption of AR head-mounted solutions. Magic Leap simply can’t wait for the market.

What gets tricky in the analysis of this market and Magic Leap’s role, is historically we have needed companies to try and fail in order to pave the way for an upcoming market. If you look at the history of any major technology going back to shipping and railways, perhaps farther, early entrants learned the hard lessons and paved the way for future companies to succeed. It’s unfortunate it took a tremendous amount of capital, that won’t likely be returned for a dividend, but hopefully, Magic Leap is purchased and the tech and IP used at a larger company who has a better chance at future success.

A Global Recession Looms
It seems like COVID-19 and its impacts are completely dominating the conversation right now, but for good reason, we need to be well informed and wisely charting a path forward. It seems ever likely things are going to get worse before they get better and while we will likely get past this virus, the impact from it is looking more likely to linger much longer.

The economic impact and fallout are looking to be significant and government involvement seems absolutely necessary at this point to help aid in the situation. Countries leadership is going through a scenario we have never seen before, and for which there is no manual. It will be a defining point, or a crumbling point, for many governments.

For China, even the quick action they took as a nation will see prolonged pain. Even though they seem to have contained the virus and are now starting to return factories to full capacity, the markets in which they export are being hit and likely going into financial/economic distress. So while China was hit economically as they dealt with the virus, they are now going to be hit a second time as nations whose markets they rely on could go into recession and possibly a prolonged one.

While the Chinese government puts on a posture of affluence, those who study the reason know they are leveraged beyond what is economically viable as they overinvested in their growth, real-estate, and to some degree economy, and could be strained to figure out how to support their people if a prolonged recession hits and many people lose their jobs, even if temporarily.

Even as we hear in the US work to contain the virus the government is already trying to propose an economic stimulus package. We are starting to see the job losses in retail, food, travel, entertainment, and while small for the moment we should expect this to grow. This is not just happening in the US but those workers impacted when people stay home in mass is inevitable. Bigger companies are at least still paying their hourly workers even if they can’t come in but not every local or small business has that capability.

My personal view on the matter is that if nations can not contain COVID-19 quickly, and by quickly I mean in the next month or two at most, then we face the reality a deep recession is likely and it will take years to recover. This scenario impacts everyone, not just a few.

Smartphone Market Pain, Throw Recovery Assumptions Out the Window

Smartphone Market Pain
I have been following the smartphone market as it relates to COVID-19 impact since if smartphones get hit bad, other categories could be worse. Basically, the smartphone market is the canary in the coal mine.

Looking at the smartphone market the past few months a few things stand out as micro and macro observations. The first one being the whole market is off, likely around 50%. China was hit the hardest as the country was ground zero for the virus and went into lock-down relatively quickly. Country data on smartphone sales show most vendors having their historical monthly sales halved, Apple included.

All investor notes I’ve read on the subject have cut estimates for vendor sales anywhere between 2-5m units. For Apple, most are cutting roughly 2-3 million off their sales numbers for iPhones, which could put Apple into the 38-39m iPhones sales figure, a number that has not been this low in quite some time. If you recall, there was a time Apple sold north of 60m iPhones in the March quarter. Yes, those days have been gone for a while but mid to high 40m units was where iPhone sales normalized in the March quarter. I share that number to highlight how impactful COVID-19 has been to Apple in terms of iPhone sales in March.

Apple is not alone, and again I use them as an indicator to gauge how hard Apple is hit because other smartphone vendors will be hit even harder. Apple, Samsung, and Huawei all are impacted but these three companies are in the best position to absorb the hit. Where companies like Vivo and Oppo (all owned by BBK) are not in as strong of a position, despite being owned by a larger company, and the impact to these brands could be greater. Outside of those five, most other smartphone brands could be hit even worse with potentially devastating financial impact.

The broader point here is the smartphone is arguable the most important piece of technology most humans on the planet own. If this market is hit and seeing potential declines of 50% or more in certain regions, then what about other hardware categories like PCs, TVs, even accessories, etc? My gut is these other categories are seeing even greater impact and may be off even more than 50% for the foreseeable future.

Throw Recovery Assumptions Out the Window
I personally do not believe demand has gone away. I don’t think any smart folks actually believe that. However, demand will be delayed is the right perspective. The problem is most assumptions believe the virus will be contained around summer and that the second half of the year, even going into 2021 should see recovery. That is a fine theory but I don’t think we can make any bets on it at this point in time.

Obviously, if we do not contain this virus globally by at least July then I think there is a chance the whole of 2020 is shot. Even if we do contain this virus by July, and that is probably optimistic from what I’ve read, we may see a recession follow as countries recover and how long a post virus recession could last is entirely unknown. In many ways, we are in uncharted territory and do not have much historical information to compare. We are literally learning in real-time about how humans are behaving and will behave when it comes to a global epidemic.

The main point about recovery, for smartphones, in particular, is the last big recession we had in the smartphone market, and Apple specifically did quite well. But those were different times. The smartphone market was just starting to scale and masses of consumers were still getting their first smartphones. Their realization of how important and central to their life a smartphone was caused them to prioritize it as a purchase even in the midst of economic hard times. That is not the market where are in today where most consumers are not buying the first time but are replacing older smartphones. During this period of economic hard times, it is extremely likely consumers put off replacing their smartphone even longer than they may have intended.

What 2020 becomes is manage through the hard-times situation for tech companies executives. Managing demand with your supply chain is going to be extremely hard, and my gut is most companies will be conservative in their build estimates for the quarter. Which in turn, could make supply more scarce.

Should the market pain, and situation worsen, and lead to a deeper recession, you can also expect then a less than ideal launch for fall device, and what could have been a strong 5G launch this fall. Which brings me to an interesting point to watch.

It was rumored Apple was going to release an updated iPhone SE, and some new accessories this Spring perhaps in March. I’d argue it is likely Apple will, or should, delay this launch because any new product launch this Spring is launching into nearly zero demand due to the uncertainty of both the virus and potential economic hard times. Regardless of people’s overall concern about the situation, their money is being held tightly for more critical basic needs than a new smartphone. It is simply unwise to launch anything new at the moment by any company.

We do believe a recovery will come. Whether it comes quickly or is drawn out and gradually ramps is the central question no one knows the answer to or has any good historical comparatives to build a defendable thesis. From a macro view, I think we have a lot of important market observations and learnings happening right now at every level from human behavior, government protocol, science, and society at large.

The Social Impact on Remote Work, Learning, and Play

There is no question that the Covid-19 virus is causing a lot of disruption in our world today. Business is asking people to work from home; Schools are closing campuses and moving to virtual classes. Sporting events are being canceled or going on without audiences and only telecasted instead.

And amid this health crisis, technology is taking a central role in helping people cope with this disruption. It makes it possible for them to work, learn, and even watch sporting events, even if they are not allowed to go to the arena where the games are played.

I am glad that at this time in history, the tech world has the technical tools in place to allow people the option to use these advanced technologies to meet these new needs, especially in times of a health crisis.

However, the idea of working, learning, and even playing in isolation is problematic in that people, by nature, are social creatures. More importantly, adapting and getting used to working from home, learning while not in a classroom, and even enjoying sporting events virtually, may not be a smooth transition for many.

I realize that people have been working from home for centuries. Yet, over the last 25 years, especially, we have seen an expansion in demand for office spaces and places where people can go to work and collaborate face-to-face. The inter-communication dynamics of working together is valuable enough that companies are spending billions on new office complexes. Companies like Apple, Google, Facebook, as well as other major companies in growing industries, continue to build new complexes to house their employees.

Major trade shows have also expanded. At the end of the last decade, CES drew about 100,000 attendees. This year they had 175,000 make the trek to Vegas for this year’s show. Three years ago, after attending CES and returning home ill and exhausted, I wrote a piece suggesting that CES should go virtual. I got some interesting comments from CES officials who said this would never happen as people like to touch, feel, and discover tech in person and that the social and networking aspect would keep them coming.

Virtual learning experiences are also challenging for many. Thanks to many online specialty learning programs, we are seeing a lot of people use these online courses to expand their knowledge base. But on-campus classes are still so valuable that college enrollment has continued to be in demand and continuing education courses that require in-class attendance is on the rise.

This winter and spring semester, I have had the privilege of going back to Stanford and taking some classes of real interest to me. While some of them gave me the option of taking them online, I purposely decided to do the on-campus courses, as I find that I learn more by sitting in the class and the interaction I have with the professors and other students. (Due to the Covid-19 virus and Stanford closing al campus classes through March, my AI class is virtual at the moment, though.) The social aspect of the learning process, at least for me, is valuable, and I suspect it is for many of any age group.

The idea of virtual play is interesting too. Gamers for years have been into multi-user games and have mastered virtual gameplay. However, the idea of holding a sporting contest with no people in attendance is a stretch. We will soon see how this works as Santa Clara County, has banned any public event that has over 100 people for the next two weeks, which means that San Jose Sharks will be forced to play their next two home games in San Jose in an empty arena.

Can you imagine an NFL game played in an empty stadium? No tailgates, no cheerleaders, and no yelling and screaming for the local team? Sports is perhaps the ultimate social experience, and technology cannot replace this experience by just moving it to a virtual event.

I do believe that we could see an upswing in people working from home and using video conferencing more aggressively for virtual meetings. But in the future, I sense that once this Covid-19 virus is conquered, we will see people go back to their offices and only use working from home on an as-needed basis. I also suspect that trade shows and developer’s conferences will be back in the future, and going strong once the threat of this virus passes.

The same goes for college and other schools that have been temporarily closed down. And sporting events will go back to normal with thousands going to arenas and stadiums.

I know that there are a lot of people who believe that this virus will cause transformational changes in the way we work, learn, and play. I do think we will learn a lot from the experience, but in the end, I think it will reinforce the fact that people are social and as disruptive as Covid-19 is at the moment, once it is in our hindsight, the social pull will bring people back to the offices, schools and sporting events and things will be back to normal again.

AMD Highlights Path to the Future

After a gangbuster performance on the stock market for the last several years, AMD, its CEO Dr. Lisa Su, and its executive leadership team have been under the glare of a lot of media attention recently. Despite the apparent pressure, however, the company keeps coming out swinging and the announcements from last week’s Financial Analyst Day indicate that AMD is showing no signs of letting up.

In fact, the key takeaway from the event was that the company leadership—and apparently many of the financial analysts who attended—now have even more confidence in the business’ future. (The company was even willing to reiterate its guidance for the first quarter, which, given the impact of the coronavirus on many its customers and the tech industry as a whole, was an impressively optimistic statement.)

As a long-time company observer, what particularly stood out to me was that the company has now built up a several-year history of achieving some fairly grand plans based on big decisions it made 4-5 years back. In the past, previous AMD leadership has also talked about big ideas, but frankly, they weren’t able to deliver on them. The key difference with the current leadership team is that they are now able to execute on those ideas. As a result, the credibility of their forward-looking plans has gone up significantly.

And what plans they are. The company made a number of important announcements about its future product strategies and roadmaps at the event, most all of which were targeted around high-performance computing, both for CPUs and GPUs. On the GPU roadmap, a particularly noteworthy development was the introduction of a new datacenter-focused GPU architecture named CDNA (“C” for Compute)—an obvious link to the RDNA architecture currently used for PC and gaming-consoled focused GPU designs. Full details around CDNA and specific Radeon Instinct GPUs based on it are still to come, but the company is clearly focusing on the machine learning, AI, and other datacenter-focused workloads that its primary competitor Nvidia has been targeting for the last several years. One key point the company made is that the second and third generation CDNA-based GPUs would leverage the company’s Infinity interconnect architecture, allowing future CPUs and GPUs to share memory in a truly heterogenous computing environment, as well as providing a way for multiple GPU “chiplets” to connect with one another. The company even talked about offering software that would convert existing CUDA code (which Nvidia uses for its data center GPUs) into platform-agnostic HIP code that would run on these new CDNA-based GPUs.

AMD also talked about plans for future consumer-focused GPUs and discussed its next-generation RDNA2 technology and its Navi 2X chips, which are expected to offer hardware-accelerated support for ray tracing, as well as improvements in variable rate shading and overall performance per watt. Notably, the hardware ray tracing support is expected to be a common architecture between both PCs and gaming consoles (both the PlayStation 5 and next-generation Xbox are based on custom AMD GPU designs), so that should be an important advancement for game developers. The company also mentioned RDNA3, which is expected in the 2020-2021 timeframe and will be manufactured with what is described as an “Advanced Node.” Presumably that will be smaller than the 7nm production being used for current RDNA-based GPUs and those based on the forthcoming RDNA2 architecture.

Speaking of production, the company discussed how it intends to move forward aggressively, not only on smaller size process nodes, but also to add in 2.5 and 3D chip stacking (which it termed X3D). Over the past year or so, packaging technologies have taken on new levels of importance for future semiconductor designs, so it will be interesting to see what AMD does here.

On the CPU side, the company laid out its roadmap for several new generations of its Zen core CPU architectures, including a 7nm-based Zen 3 core expected in the next year or so, and the company’s first 5nm CPU, the Zen 4, planned for 2021 or 2022. AMD made a point to highlight the forthcoming Ryzen Mobile 4000 series CPUs for notebooks, expected to be available later this month, which the company expects will boost them to the top of the notebook performance charts, just as the Ryzen Zen 2-based CPUs did for desktops. The company also mentioned that its 3rd-generation Epyc server processor, codenamed Milan and based on the forthcoming Zen 3 core, is expected to ship later this year.

For even higher-performance computing, the combination of Zen 4-based CPU cores, 3rd generation CDNA GPU cores and the 3rd generation Infinity interconnect architecture in the late 2022 timeframe is also what enables the exascale level of computing powering AMD’s recent El Capitan supercomputer announcement. Built in conjunction with HPE on behalf of Lawrence Livermore Laboratory and the US Department of Energy, El Capitan is expected to be the fastest supercomputer in the world when it’s released and, amazingly, will be more powerful than today’s 200 fastest supercomputers combined.

All told, it was a very impressive set of announcements that highlights how AMD continues to build on the momentum it started to create a few years back. Obviously, there are enormous questions about exactly where the tech market is headed in the short term, but looking further out, it’s clear that AMD is here to stay. For the sake of the overall semiconductor market and the competitiveness that it will enable, that’s a good thing.

Podcast: Coronavirus, Virtual Events, AMD

This week’s Techpinions podcast features Carolina Milanesi and Bob O’Donnell discussing the ongoing impact of the coronavirus on the tech industry and how it may provide some people with a bit more time to think through the direction the tech industry is heading, analyzing the impact of the cancellation of many in-person events and how companies should best think about holding virtual events, and chatting about the news from AMD’s financial analyst day regarding their advancements in supercomputers, datacenter-focused GPUs, process technologies and more.

2020: Virtual Reality’s Next Big Moment?

The Virtual Reality (VR) market has seen its fair share of ups and downs over the last few years, but the technology is poised to have a very good 2020. This year we will see VR hardware and software come together in new, exciting ways that will help drive growth in both the consumer and commercial segments. While the market still faces substantial challenges, including hardware supply constraints due to COVID 19, the opportunities are significant.

Hardware Evolution
VR hardware continues to evolve and improve. In late February, VR pioneer HTC announced the launch of its VIVE Cosmos Series, focused on expanding the functionality of the original PC-based Cosmos product. By using modular, swappable faceplates, the company is now offering three flavors of the product. The Elite uses an external tracking faceplate that works with external SteamVR base stations and the company’s Vive or Vive Pro controllers to offer a precision experience that retails for $899. The original Cosmos, which uses six inside-out tracking cameras, will remain in the market at $699. And the upcoming Cosmos play will bring the platform to more value-focused users by utilizing four inside-out tracking cameras at a presumably lower—but not yet announced—starting price. Finally, the company also announced the Cosmos XR edition, which will bring high-quality pass-through cameras to enable a mixed reality experience. The modular nature of the Cosmos product line means that users can effectively move up the stack as their needs change by buying a new faceplate instead of buying a whole new setup.

HTC isn’t the only VR company to bring new capabilities to an existing product line. Last year Facebook’s Oculus announced it would bring a handful of new features to its shipping Oculus Quest headset, and since then, it has rolled those new features out. The first is called Quest Link, a free software update now in beta that lets you connect the Quest to a PC using a USB 3 cable. Link allows Quest users access games previously available only on the higher-performance, PC-tethered Oculus Rift. The second new feature is integrated hand tracking, which lets you put down the controllers and interact with VR content hands-free in the Quest, which tracks your hands using its existing cameras. Oculus rolled out the feature to consumers as a free update and has also now made the SDK available to developers.

HTC and Oculus aren’t the only ones making notable VR hardware moves. I wrote in November about Varjo, which announced four high-resolution headsets in 2019 that I expect to drive continued strong interest in 2020. Another big launch in 2019 that should have a positive impact in 2020 is the Valve Index, a high-fidelity VR experience focused on gamers. Two other companies to keep an eye on in 2020, as they moved significant unit volumes in 2019, are DPVR and Pico. Finally, we expect Sony to ship a follow on to its successful PSVR either later this year (in conjunction with the PlayStation 5 launch) or early next year.

Next-Generation Software
In 2020, expect to see VR software continue to evolve and improve. We’ll see more developers work to bring hands-free capabilities to headsets such as the Quest with hand-tracking capabilities. We’ll see others move to utilize the eye-tracking functionality in products such as the HTC Vive Pro Eye and Varjo VR-2 that radically change the way you interact with content in VR. And I expect to see more developers dip their toe back in the VR waters as the consumer and commercial installed base of devices grows, and it becomes easier to make money in VR. A recent piece noted that an estimated 100 VR apps have now crossed the $1 million revenue mark.

One of the key drivers around VR software will be the continued growth of commercial VR. As more companies embrace the technology, they’ll be engaging with developers to create an ever-increasing range of apps. These purpose-built VR apps don’t need to appeal to a wide audience, and this means developers can create them to run on a single hardware platform. Companies realize that they can quickly recoup the money they spend on the creation of VR apps that help speed training, eliminate unnecessary travel, and accelerate processes such as design and manufacture.
There are two big software-related VR launches to watch closely in 2020, one from Valve and another from Oculus. Later this month, Valve will release Half-Life: Alyx, perhaps the most highly anticipated VR game to date. Based on the much-loved Half-Life series, Alyx is a prequel build specifically for VR. And while Valve would encourage players to enjoy the game in its Valve Index headset, the game will be compatible with any SteamVR-compatible system, which includes HTC Vive, Oculus Rift and Quest (with Link), and Windows Mixed Reality. The success or failure of Alyx will have a notable impact on the near-term future of VR.

The second big launch to watch in the coming year is the rollout of Horizon from Oculus. The company is taking applications for beta testers now to be a part of what it calls a “new social VR world.” I expressed my reservations around Horizon when I first wrote about it last year. That said, Facebook—and CEO Mark Zuckerberg—clearly still see VR as a key component to the future of social. It will be interesting to see what the company has built and how people will respond to it.

Supply Constraints
I’ve painted a pretty rosy picture around the upside for VR in 2020, but I should note that this doesn’t mean I expect VR to be a huge mainstream technology anytime soon. And in the near-term, one of the biggest challenges the industry is going to face is a lack of headset supply. Anyone who’s been paying attention knows that key products such as the Oculus Quest and Valve Index have been in short supply for months. Demand outstripped supply late last year, and now we have the added issue of COVID 19, which is impacting the supply chain and creation of all manner of technology products, including VR headsets. As I noted in my recent piece, it’s very difficult to forecast the speed at which production in China will ramp up, even as the country contains the virus, and this could negatively impact the VR market for months to come. I’m hoping these near-term supply constraints don’t cause the market to miss what could be a key inflection point for VR in 2020.

The Silver Lining With Remote Work’s Moment

As the fear of the spread of COVID-19 increases rapidly, our predictions, more companies will quickly adapt remote working environments that seem to be happening. In some cases, it is happening quicker and at a larger scale than even I anticipated.

Every company with a remote working set of tools like Microsoft, Google, Cisco, Zoom, etc., is offering their tools for free for some time to help companies easily start implementing and support remote working. What has stood out to me as I have had some conversations with friends at companies big and small who are embracing remote work was how many companies were either not prepared or structured for remote work. I don’t know why, but in my mind, I figured most companies at least had some form of support for remote work/collaboration, and that is not the case.

I view this as not only remote work’s moment but also a significant opportunity to learn and create even better tools for remote work. From my own experience working remotely, the biggest gap in the experience is when you try to work remotely on something in real-time. Meaning a team is distributed but all working together at the same time. This is the use case where I think we will see the most holes in current team-based solutions in the market today.

Video meetings work well for a group or team to get together and plan, get caught up, brainstorm, etc. It is not great for a group to make progress on a project or its team-based tasks. Other tools like chat or collaborative documents, when individuals make progress on their own but not as great for a group to work together. I’m not saying it is not possible, I’m simply saying it is not the same as sitting next to someone and executing a project, task, or troubleshooting a problem, etc.

We at Creative Strategies have been researching collaboration for years now. In a study, we did late in 2018, we found that less than 25% of workers (in tech companies) are working remotely in real-time on projects with team members. Even though it is now 2020, I doubt that the number has changed much. Similarly, less than 30% of workers (in tech) were working remotely regularly. This data emphasizes my point that most companies are just not set up for this, both in tools and in culture.

While I think it is great companies like Microsoft, Google, Zoom, and Cisco will see more of their tools get used, it will also shine a bright light in many of the gaps in these offerings that may frustrate workers who will now put these tools to the ultimate test. Remote working, and using the tools to support remote work, is not something you just wake up one day and start doing. You have to change some of your thinking, workflows, discipline, etc., and this will be a major wake up call for many organizations.

That being said, the silver lining will be the lessons learned by these big companies, investors, and even ambitious young founders, who will see the gaps in existing tools, and we will, hopefully, start to see these tools evolve and get even better.

Interestingly, even within companies who already support work, this will be a moment where they will observe new learnings and challenges as well. Even companies like Microsoft and Google, who offer a competitive suite of collaboration tools, will have more of their workforce use their own tools, eat their own dog food is the term, and provide the company with essential learning and feedback.

I was alerted to this blog post by a Microsoft employee who is based in Shanghai and thought it made some interesting points. Similarly, many work from home experts are publishing articles on the challenges and best tips for working at home or remotely. This is the best time to learn and adapt and be open-minded for many workers and their companies.

This has implications beyond just the desk-based workforce as well. We see an increase in telemedicine as people are fearful of going to the hospital. We see schools cancel in-person classes and go fully remote learning. Interestingly, I’m starting to work with my daughter’s private school on a remote learning plan as a worst-case scenario. This is also turning into an exercise for future preparedness for when something like this inevitably happens again.

Interestingly, by starting to work on remote/video-based learning, the positive side effect is students will have the opportunity to still participate in classes even if they have to miss school. One thing that is very clear in higher-education is students will come to class unless they are dying or have a fever because of fear of falling behind. This only helps spur the spread of illness and video/remote learning opportunities will allow students to participate still and not fall behind.

While the concern is real over COVID-19, I view this as a massive opportunity for us to work now to put solutions in place and be better prepared for when something worse inevitably hits the population. This includes the governments being better prepared, institutions, communities, healthcare and more. We should view this as a wake-up call and seize the opportunity, in all respects, to not be caught off guard in the future.

Five Things To Remember When Hosting A Digital Event

Thanks to the COVID-19 virus, we have seen several events being canceled both in the tech world but also in other industries like fashion, home, and publishing. I am sure more will be announced over the next few weeks, leaving my calendar free from travel but full of digital meetings.

There has been a lot of talk already about remote work and I wrote about it in last week’s column. Hosting digital events, however, is not the same as working remotely and this is true for internal events as well as external ones. I was spoiled to have my first event be hosted by Zoom, a company that was built for remote work and video, so, as you can imagine, the quality of the technology was great. The team knew exactly how to keep the audience engaged over the 8 hours we spent together.

Good Speakers Are Critical

Keeping people engaged for a long period is not easy at the best of times, but when you are not in the same room, it gets even harder. People get easily distracted, but in a room, maybe out of respect for the speaker or just good old fashion manners, people tend to limit their multitasking. During a remote meeting, video can be turned on and off the leaving the participant free to zone out without guilt (I might be projecting a little here .)

Technology can help speakers with live transcription and even live translations making it easier for the audience to follow along in a more natural way than when those options are offered during a live meeting. Remotely nobody knows whether or not you are taking advantage of these features.

The pressure, however, might be higher when it comes to tone of voice, cadence and overall level of engagement. A good speaker, changes pace and tone, tells a story without getting off-topic too much and, most of all, keeps on schedule. Timeliness is more important than during a live event because your audience might have scheduled other meetings or work around the virtual event, something they would be less likely to do if they traveled somewhere to attend the event.

Always On Video Is Not Always Best

Just because you are attending a remote event, it does not mean your camera has to be on all the time. If you have a meeting where you are actively participating, of course, video matters. Seeing people face to face makes the exchange more personal, that’s the point! Yet, if you are mostly listening to a speaker or a set of speakers and you are part of a large group having your camera on and not being muted can take away from the experience for other participants.

Most video conferencing systems have some intelligence built-in that allows for the video to focus on the person who is speaking. How quickly the system performs that switch is crucial to establishing a natural conversation flow and, by doing so, increase engagement. Participants often forget to go on mute, which triggers the system to think you are either speaking or about to speak and therefore focusing on you rather than the actual speaker. This makes for a cumbersome experience, the more participants you have.

All that said, if you are invited to an online meeting, do make an effort to access the meeting through the system, video included rather than just dialing in. This helps with creating a consistency of experience across all participants. Simple things like not having to say your name because the system knows who you are, being able to use the “raise your hand” feature, so you don’t talk over someone else and generally better read the meeting.

Time Zones Will Be A Challenge

This is probably the biggest hurdle for world-wide events. While a live event will have everybody physically in one place while possibly mentally battling jetlag, virtual meetings have to account for time differences.

The time difference can impact the outcome of a meeting in several ways from a simple variable in energy from both speakers and participants due to the time of day, to a change in audience mix. The complexity of dealing with participants in different time zones might lead you to consider splitting the event into an overall event for the top-level remarks and smaller regional events to follow from there. You could even consider a mix of live and recorded portions, so people have the option to join the top-level remarks and then attend the rest of the sessions as a recording. This is no different than how many events are set up with a keynote and then several parallel sessions one chooses from.

One significant point to remember is that for virtual events, people don’t usually get time off around it. For instance, if you have a meeting or event you are attending in a time zone that requires getting up early or staying up late, most participants will be expected to still have a regular workday around it.

Sensitive Information Might Be At Higher Risk

Securing information you share over a remote meeting is both a question of technology and education. While information is not necessarily easier to secure during an in-person meeting, technology does make it easier for people to capture and share information over a virtual meeting.

Most of the collaboration systems use encrypted solutions to safely keep the data as well as offering ways to trace back leaks. Unfortunately, however, participants can use other devices to record or capture data. Informing upfront and reminding participants of what is public information and what is not is a must in a virtual world.

Engagement Can’t Be Taken For Granted

Aside from a good speaker, you need to make sure your audience is engaged, so leave time for questions during the presentation and at the end. In the same way as you would for an in-person meeting, make sure you moderate your Q&A segments, so time does not get away from you.

You can also think about using different tools to keep your audience connected with your speaker and the content. You can ask to submit questions via chat if you have someone who is moderating those questions. This allows the speaker to stay on track and the audience to ask more questions and get clarification when needed rather than at the end. Have your speaker ask questions or take polls, but try and keep your audience within the video platform, so you lower the chances to lose them. If the topic permits, make it a little fun. Zoom used a wheel of fortune with the participants’ names to draw who would be asked a question.

Especially when you are dealing with a large group, the speaker has little chance to see everybody and feel the room in the same way as they would in an in-person meeting. It would be best if you created those opportunities to take a pulse check, especially when the event you are hosting is going to last several hours.

 

I am sure over the coming months, I will have plenty of opportunities to come up with a best practice list, but I have little hope that my experiences will be perfect, not because of the technology but because of the people. After all, we have been doing phone meetings for years, and people can still make it unbearable.

The Coming Tech Boom of the Fourth Quarter

I spent the early part of my week talking to ODM’s, and PC makers to gauge how they see their market demands changing over this year. As you can imagine, all say that because of the closing or slowdown of manufacturing facilities due to the COVID-19 Virus during the first half of this year, it will have a ripple effect during Q1 and Q2 on sales and earnings. Both groups are pretty much writing off the first two quarters as ODM’s can’t make enough products to meet current PC demand.

All PC makers have millions of dollars of PC orders they can’t fill, and many of the new smartphones that would come out in the first half of 2019 will be supply constrained through the summer. The PC makers also have a double whammy in that Intel, starting last fall, was unable to meet their demands for specific processors. Even though many turned to AMD to help fill some demand, PC orders in Q 4 of 2019 could not be filled in many cases.

While ODMs have struggled to get their manufacturing lines fully staffed now, the two ODMs I spoke with are optimistic that they can have all lines fully operational by late May or early June. They admit that they have stacks of orders to fill but, if needed, could run their factories 24×7 for some time to try and catch up and fill the pipeline to have as many products ready to ship by the end of Q3 and ready for the holiday season.

As for the PC makers, Intel has assured them that they will be able to meet most processor orders by Q3 and also make it possible for their PC customers to fill most, but not all of the demand for PCs this fall.

Of course, the caveat is that if the Covid-19 Virus is contained by no later than late May, and most workers in Asia can get back to work, then ODM’s can run factories at full-staff by then. Although health officials are not sure when the Virus can be contained, the tech companies I talked to are using the scenario that all manufacturing lines will be fully staffed by June, and we could see the pipelines filled by the middle of Q3. At least that is what they are counting on as we sit here today.

This development is causing them to believe that we could end up with so much pent up demand that the 4th quarter could be a monstrous one with many unit sales and earnings records broken for a single quarter. Whether this would make up for the losses recorded in Q1 and Q2 is hard to tell, but the consensus I hear from these companies seems to point in this direction.

I, too, am optimistic but admit that we in tech are in unknown territory. The SARS epidemic did impact the supply chain, but we did not have the same type of broader quarantines we see with the Covid-9 Virus. One ODM told me that if even one person got symptoms of this Virus, the whole factory would have to shut down under the new Chinese government rules.

There is no question that this is a challenging year for us in tech. Although things could get worse when it comes to this Virus spreading, tech leaders believe they can weather this storm and are now thinking about longer-term planning issues should this type of thing happen again. The changes include less reliance on most manufacturing done in a single country such as China and diversifying their supply chain. The shift to production in other countries started during the jump in tariffs. However, it is accelerating because of the potential of future pandemics.

It also includes rethinking how people work. There is a reason Zoom’s stock moved higher in the past few weeks. More and more are turning to video conferencing to handle essential business meetings and using it to help customers. Video meetings may be one of the longer-lasting impacts of this Virus.

I do believe that our tech industry is going to learn a lot about itself in the next few months, but is up to the task of making the kind of adjustments needed to survive and thrive again. However, I believe we will remember 2020 as one of our most challenging years in tech, and let’s hope the lessons we learn helps us make positive changes for the best.

iPad’s Evolving Vision and Unintended Consequences

The iPad has been a hot topic lately. 2020 marks the tenth anniversary of the iPad launch and the beginning of its rapid rise to fame in the years following. Looking back at the last ten years of iPad, it becomes clear the original vision for the product has not yet been reached, nor has its full potential.

The challenge, however, is the iPad’s true vision may have been too forward-thinking and perhaps require too much behavioral change than the market was willing to embrace. I still believe the iPad represents a much broader vision of personal larger screen computing. Still, the sad truth is most consumers are just happy to do the vast majority of their day-to-day computing on their smartphones.

There is nothing wrong with smartphones, they are just limited in capabilities. This is why, to this day, I think Steve Jobs’s framing of the iPad that it is more intimate than a notebook and more capable of a smartphone remains one of the most brilliant positioning statements of a device I’ve ever heard.

I personally bought into the vision, believing the iPad would make large-screen computing more accessible for the masses, by making it simpler and more enriching for more people who are less computer literate and tech-savvy. But, iPhone sales peaked and for Apple to reach that vision, a pivot may be on the horizon.

The potential pivot comes in the way of a mouse. Even as I write this, it pains me to even think about mouse/trackpad support on iPad. But if a recent leak/rumor is to be believed, Apple is ready to launch a brand new keyboard for iPad that includes trackpad support.

iOS 13 brought with it accessibility support for a lightweight cursor experience. And if Apple is building full support for mouse/trackpad, then I do feel it is a pivot away from the iPad’s original vision. Good or bad, that is my conviction. And if that is the direction Apple is going, I fear the unintended consequences.

Merging Operating Systems
Apple has long fought to merge macOS and iPad in the way Microsoft has with Windows where the same operating system runs across all Windows hardware. iPad has always been more iPhone like, just more capable, and tried to focus on reinventing the concept of work/productivity by hoping new classification of app experiences would be developed. Touch and pen-based computing bring more to the table than just mouse and keyboard, but those experiences have not become mainstream in everyone’s daily workflows. Perhaps they never will.

Ultimately, my thesis on behavioral debt may be at play again. Most people don’t seem willing to change or learn new habits, and thus, the demand for PCs remains strong, despite some initial fears iPad would impact PC sales.

I don’t believe Apple ever wanted to bring macOS and iPadOS closer together, if not merge them entirely, but this may now be the inevitable path. I wrote last week, that I have been living in a Windows world and using both a 15′ Surface Laptop and a Surface Pro X and the more I become comfortable with my new workflows on Windows the more I like the Surface Pro X tablet functions as a companion to the laptop. Being able to seamlessly move from one device to the next and keep my workflow intact is efficient. This is counter the experience I have using Mac and iPad together as they both have two very different workflows for most of my main tasks.

This is why I’m not as down on the idea of Mac and iPad merging as I once was. I still believe it would be a pivot from the original vision. Still, I do recognize the value of having a notebook and tablet working together and having consistent workflows and software across the two.

I received some questions on this from readers last week about whether this would lead to a touchscreen-based Mac. It is a good question, and my hunch would be the Mac does not necessarily need a touch-screen even in a world where macOS and iPadOS are merged. We know from our research, the vast majority of people using a touch-screen based Windows notebook rarely, if ever, touch their screens. The mouse or trackpad is still the primary and most used input. However, when people use a Windows 2-1 form factor, the usage of touch screen and pen input goes up significantly over the traditional notebook form-factor.

This suggests that when a device looks and feels like a traditional notebook, people use their traditional tools, and I’d bet that stays the same for Mac users even if they had a touch-screen, Mac. This would suggest a unified OS could live in harmony on Mac and iPad, and the software to support a range of inputs could potentially thrive.

I alluded to this point in my piece last week as well, but merging macOS and iPadOS could help iPhone development if/when the iPhone gets a foldable screen that turns it into a small iPad. Interestingly, this sequence of moves could ultimately end up benefitting iPhone the most. if a folding screen is in the cards. This would enable the iPhone to become even more of a productivity device than it is today and encourage developers to embrace entirely new software paradigms for iPhone apps, which in turn would also help iPad and Mac if all operating systems are essentially unified.

Unintended Consequences
There could, however, be unintended consequences for merging operating systems. The main consequence of being a sub-par experience with software that hurts both iPad and Mac software more than it helps. But, what sticks out to me is something like this has never worked before if we consider the unification of OS, development tools, UI, etc., impacts Macs, iPads, and iPhones from a software standpoint.

My personal main concern is the potential negative impact on software/apps, something like this could bring. I also worry developers aren’t willing to put the extra work in and that consumers are simply not willing to embrace change.

Of course, this is all just game theory at the moment and just one of many potential scenarios facing Apple as they think about their software platforms. But, the common truth remains, developers are key to the success of any platform, and Apple has historically been blessed by its developers. I just hope that continues as their software platform evolves, and continues to move into a post-mature computing world.

Coronavirus-Induced Pause Gives Tech Industry Opportunity to Reflect

As the news has now made clear, the COVID-19 coronavirus is having a significant impact, not just on the tech industry, but on society and the globe as a whole. There are still huge numbers of unanswered questions about the virus and what it’s full effect will be. Importantly, and appropriately, most of the focus is on the health and well-being of those impacted and educating people about how to keep themselves and their loved ones safe. There’s also a lot being done to keep people accurately and adequately informed about which concerns are legitimate and which ones are unnecessarily overblown.

At the same time, it’s now very clear that there’s a very practical impact happening to people in the tech industry: their calendars are opening up in a way that many haven’t experience before. The reason? The cancellation and/or “digitization” of more and more events scheduled for this spring and, likely, into the summer. Not just big events like MWC, GDC and F8, but lots of small public and private events are being cancelled, rescheduled, or in the latest move, “virtualized” to streaming-only digital form.

Combine that with the travel restrictions in place for important tech-focused countries around the world, and the tangible result is that many people in the tech industry are going to be falling way short of their frequent flyer requirements this year. Practically speaking, they’re also going to have more time available to them.

The reality is that this “pause” in the action will likely be short-lived. If history has taught us nothing else, it is that “this too shall pass”, and there will come a time in the hopefully not-to-distant future when coronavirus-related concerns will be nothing but a memory.

For a while at least, though, things are going to be different for a lot of people in tech. So, the important question that comes to mind is, how are people going to be spending that extra time?

I don’t claim to have any brilliant answers, but I certainly hope that, in addition to maybe spending a little more time with our loved ones, some of that newfound time is spent thinking about the direction that some key tech industry trends are heading, and whether or not they’re moving in a manner that people really want or intended. On the privacy and security front, for example, there’s arguably a great deal of soul-searching that ought to be done about what kind of data can and/or should be collected about each of us as we go about our digital lives. Similarly, advertising and other information-driven services that leverage (or, in many cases, abuse) that information, might want to consider less invasive alternative approaches.

In the case of autonomous cars, I’d argue that’s it’s time to look past technological advances and figure out how real people actually want to interact with their vehicles. Similarly, it’s worth taking time to think more about how vehicles could be made safer without necessarily becoming dependent on autonomous control.
For many companies, the “found time” may (and should) also lead to more discussions about how to refine their messages and deliver information that doesn’t overpromise what’s possible (as the tech industry has become notorious for doing), but gives people a realistic set of expectations.

There are also bound to be some very interesting discussions about the overall merits of holding big (or even small) events. Again, society and the industry will make it through this, so it will be very interesting to see what people believe was lost and/or gained from the cancellations or recasting of these events. Yes, I’m sure we’ll see more discussions about working from home and video-based collaboration and those are all good things. However, there are still serious questions about how much people are willing to change their work habits for the long-term.

Of course, there are literally millions of other positive ways that people in tech can use this potential opportunity of extra time for good. What I’m afraid might happen, however, is that more of it will be spent on social media, adding yet more undeserved influence to a serious blight on the tech industry’s legacy that, among other things, has already cultivated a heightened level of fear and panic about the coronavirus.

It’s rare that an industry, or a society, suddenly finds itself with access to the precious resource of additional time. In the end, I think that’s one positive thing that we could end up realizing from the unfortunate reality that is now upon us. Let’s hope the newfound time gets used in a positive way.

Podcast: Coronavirus, Intel 5G, Asian Phone Launches, Qualcomm

This week’s Techpinions podcast features Carolina Milanesi and Bob O’Donnell discussing the ongoing impact of the Coronavirus on the tech industry, and several news announcements that were originally scheduled for MWC including Intel’s debut of new chips for 5G network infrastructure, the launch of several new Android phones from Huawei, Xiaomi and other Chinese vendors, and Qualcomm’s press briefing on 5G phone momentum, the third generation X60 5G modem, and more.

What’s Your MWC Plan B?

If things had hewn to plan, I’d be writing this column from balmy Barcelona, rather than staring out my window at 42 and drizzle in Boston. In the immediate aftermath of MWC’s cancellation, Carolina wrote an excellent piece reflecting on how companies made the decision to withdraw and what impact this might have on future trade shows.  The cancellation of MWC was a big deal – 120,000 attendees, ½ a billion Euros to Barcelona’s economy, countless hours spent planning for the event, and no small number of dollars lost in non-refundable travel bookings.

I’d like to build on Carolina’s column with some thoughts of my own, focused on three key questions:

  • What are companies doing to offset some of the real or perceived business losses from the cancellation of this important annual event?
  • For those who use events like MWC to keep up on the latest and greatest on 5G, IoT, and other hot, mobile-related issues, what are some alternative means and substitutes?
  • Will the cancellation of MWC have any longer-term impact on major trade shows?

Company Strategies

Aside from the parties, SWAG, and the customary trade show excess, MWC is a gargantuan effort and expense for key vendors in the mobile ecosystem. Huge numbers of people spend more than a year planning for this event, with some companies’ MWC-related budgets running into the tens of millions of dollars. They plan major product announcements at this show. Some smaller companies allocate much of their annual sales and marketing budget to MWC basket, seeing it as the opportunity to have meetings with key prospects all in one place and in a concentrated amount of time.

So, in addition to the dollars lost and massive inconvenience of MWC’s cancellation, what are companies doing to make up for the perceived loss of business? We haven’t detected a major pattern, yet. Key vendors are implementing a variety of strategies. They’re issuing press releases of major product announcements and are holding webinars and other types of online briefings. One example is the slew of announcements of 5G phones, showcased in a Qualcomm 5G-related press event held this week.

In the immediate aftermath of MWC’s cancellation, some companies had announced plans to conduct a series of road shows or smaller, more customer-focused events. But we understand many of these plans have been put on hold, due to the still-spreading Coronavirus and escalating number of travel restrictions.

More urgently, over the past few days, I’ve had several discussions with companies who have shifted their focus from the new product announcements they were planning to make at MWC to focusing on their global supply chain and trying to minimize any disruption to customer commitments.

The GSMA, organizer of MWC, is trying to keep itself visible. Its news service is sending out product announcements and alerts. It is producing a series of MWC Shorts, showcasing some of the knowledge-sharing that would have happened in Barcelona. And, the GSMA has been mum with respect to MWC Shanghai, planned for June 30-July 2. I think they’re going to have to make a go/no-go decision on that one within a month.

For those who’d like an analysis of key MWC-related product announcements, please join me and two other highly respected industry analysts, Monica Paolini and Chris Nicoll, in a ‘Sparring Partners’ Webinar, Wireless Without MWC.

Substitute Events

Another key element of a tradeshow such as MWC is its role as an annual benchmark for the state of the industry, communicated in countless executive sessions and educational tracks. The 2020 MWC was set to be particularly critical, as we’re hip deep in Phase I of the 5G rollout, with new networks, new devices, and new use cases all emerging and being discussed.

The industry can ill-afford waiting until MWC 2021 for some sort of major confab. So, in addition to what some companies themselves might be doing directly (see above), it might be time to consider attending some of the smaller, regional, but still significant trade shows and conferences that will still hopefully happen. Among them:

5G World. London, June 9-11. I’ve attended/spoken at this event a couple of times. Last year I thought it was a bit flat, but the event might see a bit of a boost this year…

The Big 5G Event. Dallas, May 18-120. The North America version of the above show, and a re-branded version of what had been called The Big Telecom Event. No, Dallas ain’t Barcelona, but it’ll be easier to find accommodations…

IoT World. San Jose, April 6-9. A good opportunity to do a deep dive on IoT, visit your Silicon Valley friends, and feel like you’re in Barcelona by spending on overpriced hotels while missing Barcelona’s hyper-efficient transportation system (even when it’s on strike)

MWC Shanghai. June 30-July 2. A regional version of MWC. Would be a great opportunity to benchmark the 5G rollout in China and in Japan, in advance of the Olympics. Still on, as of late February…but we’ll see.

MWC Los Angeles. October 28-30. This event might move closer to ‘must attend’ status if there continue to be travel disruptions through the first half of 2020, but then things start recovering this summer. Then again, three days in downtown L.A. will really make you miss Barcelona.

Longer Term Effect on Trade Shows?

It’s too early to tell whether the cancellation of MWC, and, presumably, numerous other events over the next few months, will result in some bigger picture soul-searching about the value of big trade shows. Let’s face it, these types of events have a mix quantifiable benefits as well as ‘softer’ attributes experienced through meals, receptions, casual conversations, chance encounters, and just the sheer energy and osmosis that validate you’re part of something important and exciting.

I do think that some larger companies might use MWC’s cancellation as a ‘control variable’ in assessing the true value of this type of event. I don’t think we’ll see large scale pullouts of future MWCs, but we could see some companies adjusting how they approach major trade shows, what sorts of resources they devote to them, and what types of alternative events are equally effective.

Perhaps as one consolation, it was an unusually mild 65º in Boston on Monday — about the same temperature it was in Barcelona. Perhaps I should now do a search for ‘Best Tapas, Boston’…

COVID-19’s Impact on Trade Shows

For those of us in the tech industry, we know that the biggest telecom industry event was canceled recently due to the COVID-19 outbreak. MWC wisely canceled the show, given the concerns of this virus and our lack of understanding of how it spreads.

I had the privilege of helping run the largest CRM show in the US from 1993 to 2003 and understand the ramifications of having to cancel a show. It is costly for both the show management and many of the trade show vendors and disruptive for the thousands of people had scheduled to be at these shows.

I was also on the Comdex board of advisors for 17 years and the CES advisory board for 10 years and understand their importance and why they exist. One-to-one meetings and the ability to view products and get demos in one place, play a big role in why some shows like CES, MWC, IFA, etc are still going strong, even today.

Other tech shows since then have been canceled and one of the next big tech shows, Computex in Taiwan in June, could move to Sept as they did during the SARS outbreak. That is not firm yet but a possibility if the Corona Virus is not contained soon.

Other shows for this spring are also in question and show organizers are monitoring the spread of this virus closely. While I have no doubt that big trade shows and conferences will continue to be important in the future, the rapid spread of the Corona Virus and our lack of understanding of how it can spread, maybe a watershed moment for trade shows as well as how we work in the future.

Given that I have connections to major trade shows and conference organizers, I reached out to three of them to get their take on the future of trade shows and conferences. Since these people are still producers and promoters of big shows and conferences, they still believe that these types of events are important and will continue. However, they are watching what is happening with the COVID-19 carefully and monitoring one particular aspect of how vendors are dealing with a show cancellation and finding different ways to launch products and show of their products in light of not having a trade show or conference to use for this purpose.

For really big companies, many have already moved to do product launches in dedicated company-sponsored venues already. For the last 10 years, Apple has mostly done its own events to launch products and Samsung has followed suit by launching their UnPacked events to introduce their new smartphones and other new mobile-related products. While Apple does not do trade shows anymore, Samsung still attends CES, MWC and sometimes has big booths at IFA.

For very big companies with a lot of marketing dollars, doing their own events makes sense. But for others, they are finding alternative ways to get their message out without having to attend trade shows or conferences. For example, this week Qualcomm held a media event in San Diego to deliver what would have been their keynote address at MWC. They hastily brought media to their San Diego HQ and then posted the event live all over the world. While they did not have the booth experience for customers who could have visited them at MWC, their launch this way was just as effective.

All of the three trade show execs I talked to said that the role of technology to provide virtual media events is one of the things that really concerns them. Samsung, Huawei, Apple, and others are perfecting this means of using real-time video events to launch products and get there message out to millions of people, instead of just sharing with smaller audiences at trade shows.

They know that there will still be people who need to go to trade shows and conferences for networking, hands-on experiences, etc. However, all three believe that the COVID-19 issue could push more and more companies, especially the big ones that are the lifeblood of most of these shows, to test out the role technology can play to do more of their launches virtually, which could in turn, have them reduce their presence at any given trade show or conference.

In yesterday’s Think.tank piece, Ben talked about the Corona Virus’s impact on remote working. Here is one key point he stated that is relevant to this conversation-

“As companies are limiting travel to key countries, and China, in particular, teams are working together in those countries are not going to stop working together. Rather they will adopt new means to collaborate still and function as a team, and video meetings are what everyone is now rapidly adopting whether they were ready or not.”

His piece focused on another aspect of this virus’s impact which is on remote working. But this underscores that by forcing people to not travel during this virus outbreak, they are finding new ways to communicate and collaborate with colleagues and using things like Zoom to serve as the communication medium to accomplish these work goals.

The execs I talked to from the trade shows say that this is another area they are monitoring closely. As network speeds increase and video conferencing becomes so easy, meeting with company reps via video instead of having to go and meet them at trade shows and conferences, could become more preferable.

Their fear is that companies who find “workarounds” to getting their marketing messages out without a trade show, along with individuals using video conferencing to meet with company reps without going to a trade show or conference for a meeting, could have a big impact on the future of trade shows and conferences.

While they don’t see trade shows and conferences going away completely, they admit that we could see the big shows scaled back if large vendors find other ways to get their marketing and sales messages out virtually and scale back any trade show presence in the future. We already saw some of this at CES this year when Microsoft, Intel, and Qualcomm, who for decades had large booths, pulled out of the CES show floor and only had private suites instead.

It is way to early to suggest the demise of trade shows and conferences. But the Corona Virus has brought to the forefront for many companies a need to find other ways to launch products and for those who attend these events to find new ways to interact with companies they deal with virtually instead of traveling to dedicated events.

What I do think is that over the next few years, the role of technology to deliver more virtual trade shows and conferences spurred on not only by the current Corona Virus issue but others that could follow, and see many trade shows downsized. They could also become more vertically focused and see individuals become more comfortable with virtual meetings as an option to going to big events in the future.

Why Does it Take the Threat of a Pandemic to Support Remote Working?

There has been a lot of talk over the last week of how COVID-19 might be the pivotal moment for remote working to really take off. China, Silicon Valley, Japan and even Italy are all adopting remote working at various degrees to limit the spreading of the virus. There is such excitement around remote work that brands like Zoom have seen their stock value climb up.

While I really hope people are right and we will see remote working remain relevant once the threat is removed, I cannot help but be skeptical because we have been here before!

First, there was SARS in 2003, but the technology back then was nowhere near what can be delivered today, both in terms of sound and video clarity as well as latency. Then there was the economic crisis of 2008-2009, when companies like HP, Cisco and Polycom were heavily marketing telepresence as a way lower air travel cost. Intra-company business travel is often the largest controllable expense for most organizations. Video conferencing was an effective way to keep communications going and manage operations while reducing costs. However, at the time, technology had improved, but most solutions were still not economical enough for broad adoption. Remember that 2009 was less than two years after the iPhone and before smartphones made their way into enterprises beyond the C-suite.

On paper, now is the time! The experience has improved so much that videoconference is something people actually want to do. Companies like Zoom and BlueJeans have lowered friction and saw the popularity of their solutions grow thanks to individuals buying into it rather than management, making it a must. Well established brands such as Cisco WebEx and Poly reinvented themselves, focusing on better all-around hardware and solutions that cater to collaboration as a whole. Millennials are the generation that has embraced digital collaboration like never before with Slack and Microsoft Teams. Gen Z pushed it a step further, embracing video at its fullest. So why am I skeptical?

Video Conferencing and Remote Working Are Not The Same

It seems like a silly point to make, but doing a few video calls does not make you a remote worker. We need to make a distinction between turning some face to face meetings into virtual ones and allowing your workforce to regularly work from places other than the company office. The first requires technology; the latter requires a considerable cultural change that really empowers people to continue to contribute and be part of the day to day process.

Ultimately, three words are at the root cause of my skepticism: regulation, trust and people.

Regulation

When you are considering remote working, many regulations kick in. Some might be company-driven, like making sure that your employee has a proper space dedicated to work with a desk or table and a suitable chair, a reliable internet connection and overall a place that is conducive to getting work done. After all, we all saw that BBC interview with the kid barging in the background!

In other cases, though, regulations go beyond the company you work for and involve government decisions. In Italy, for instance, there is a specific law that governs remote working or smart working. Due to the current emergency, corporations are asking to allow remote working without setting in place all the paperwork that is usually required. Italy is among the countries in Europe that have adopted remote working the least with only 4.8% of people working from home. The Netherlands and Sweden lead the way with 36% and 35% of the workforce working remotely.

I am sure Italy has other reasons other than regulations that hold back remote working, culture and technology adoptions come to mind. Still, laws that consider liability, overtime compensation, security all play a role and add to the complexity of deciding in favor of remote working.

Trust and People

I put these two together because they are profoundly interconnected.

On the one hand, you have trust issues of managers who need to feel they are in control of their own employees. One would think that in 2020, productivity should be measured in output and not in hours. In other words, it really should be all about what you deliver, not how. If you are not embracing this philosophy, you should at least feel reassured that technology gives you so many ways to keep an eye on your workers that their physical presence in the office is no longer necessary to do that.

Managers are not the only ones with trust issues, though. Remote workers can, at times, feel isolated and be concerned about being “out of sight out of mind” when decisions are made, meaningful work is allocated and, of course, when work is recognized for promotions or incentives.

Trust issues are human but also a clear sign that remote-working needs to be implemented with some degree of formality. It requires processes that foster inclusivity by communicating frequently and allowing every member of the team to have a voice, which means being mindful of time zones. Creating a routine and set expectations for response time also helps to minimize the pressure of always wanting to be present to avoid raising trust issues only to end up creating the potential for burn out. On the employee side, there must be boundaries both in space, by creating an appropriate workspace within the home or remote location, as well as time, by avoiding spreading work over what should be personal time like late in the evening or at the weekend.

Remote Working As A Business Asset

Ultimately, remote working should be seen as a business asset at any time, not just when we are under the threat of a pandemic. Aside from providing cost reduction on travel, it does offer many other advantages like decreasing the need for office space that in some areas can be extremely expensive as well as reducing the need to provide services such as childcare. On the employee side, we could register lower stress levels from not having to commute, which results in more time with the family and potentially lower childcare costs.

What remote working should not be seen as is a benefit or a luxury. Modern employees expect some level of flexibility, although there are, of course, roles where such flexibility can be offered in terms of flexible hours rather than location. Furthermore, positioning remote working as a benefit or a luxury comes loaded with perceived implications that not being in the office makes your actual work easier, better, or a lighter load, which of course it is not the case.

Remote working is smart-working, so I really hope that the current circumstances will help companies see that their business cannot just survive during a pandemic threat but could flourish under normal conditions. The key is to plan for it in the same way we would any work transformation.

Remote Work’s Tipping Point, Apple Arm Mac Rumors, Unified Operating Systems

Now that we are several months into assessing the full impact of COVID-19 on the global economy and the tech industry as a whole, one narrative has continued to stand out. Remote working may have its inflection point.

One of my takeaways from Zoomtopia, Zoom’s annual customer conference, was discussions with executives of companies who have adopted remote work and video meetings as a culture. Every CTO/CIO who shared their experience talked about how difficult it was to change the culture from predominantly in-person meetings and audio-only conference calls. Employees were hesitant to embrace video, and it was a slow-roll. However, once employees started trying it, they didn’t want to go back to audio-only conference calls/meetings, and the culture changed quickly. One CTO of a big health care firm said within three years they went from zero video calls/video meetings to over 90%. All the workforce needs to do is try it, and they won’t go back.

As companies are limiting travel to key countries, and China, in particular, teams are working together in those countries are not going to stop working together. Rather they will adopt new means to collaborate still and function as a team, and video meetings are what everyone is now rapidly adopting whether they were ready or not.

Yesterday, noted investor Fred Wilson wrote a brief post proclaiming this was videoconferencing’s moment. He made the point while commenting on Zoom’s stock price, something I have been watching for over two weeks now. Investors think Zoom is among the winners of this moment for video calls/meetings. In part, it may be because many of them are now trying Zoom for their own needs and realizing how easy and convenient video calls/meetings are in practice.

While it is true, Zoom is the front-runner due to how easy it is to set up and start having video meetings, this moment created by COVID-19 is likely to benefit Microsoft Teams, as well as G-Suite with Hangouts. Companies who are in Microsoft’s ecosystem or Google’s will likely use the tools they provide for video meetings, and overall, I expect this to be a boon for remote working.

That being said, the question is if this potential workplace transformation will stick or not once the COVID-19 concern is over. My colleague Carolina Milanesi and I were talking about this yesterday, and she made the great point that for many cultures, both entrenched company cultures, and regional cultures may still prefer to be in person, or continue to mandate employees come to work due to lack of trust or concerns about productivity. I think it is reasonable to assume remote work and collaboration will move faster in some companies and some countries, but may not take off as quickly in others.

That being said, if anything, the increased remote work happening now due to COVID-19 will expose both companies and employees to the benefits of video calls/meetings and at the very least starting getting the workplace thinking about how best to enable and support more efficient team collaboration from distributed workforces.

Arm Mac Rumors
Everyone’s, well maybe not everyone, favorite Mac rumor has resurfaced. Noted Apple analyst Ming-Chi Kuo put a report out saying Arm-based Macs could be coming in 2021.

We all know, Apple has one of the world-leading semiconductor development teams inside their walls, making incredible SoCs for iPhone and iPad as well as a host of companion processors all designed to give Apple products unique differentiators.

Apple has the best track record as any company making transitions from semiconductor technology, and the vast majority of Apple’s ecosystem already runs on Arm. But as Microsoft has demonstrated, and still battling, the PC ecosystem has remained stuck in x86 land for such a long-time most of the Windows ecosystem is slow to optimize for Arm, if they do so at all.

Perhaps one of the best Windows devices using Arm is the Surface Pro X, which has a co-designed SoC between Qualcomm and Microsoft, and to meet performance requirements, the CPU is boosted to 3ghz. This is due to Microsoft emulating x86 software on Arm, which takes a significant performance hit.

Apple likely knows this, and that any Arm-based Mac would require software to emulate native x86 software. To emulate the native x86 software on Mac, Apple would need to design a chip that over-indexes on performance and I’d have a high degree of confidence Apple could do this if they wanted to. Still, the question remains whether or not it is worth it or not.

Answering the question of if it is worth it for Apple now becomes a philosophical question. Does Apple want to unify macOS, iPadOS, and iOS. If so, then moving to an Arm-based Mac is absolutely the right strategic move for Apple. The world may be going to a unified OS, and that may be a good thing.

Unified Operating Systems
Personally, I’ve started living a hybrid operating system life. I’ve been using a Microsoft Surface 15′ laptop along with the Surface Pro X as its companion. A the same time, I use a 16″ MacBook Pro along with the 12.9′ iPad Pro as its companion.

I absolutely understand this is a luxury and not the kind of thing most people do, however, using one platform that is very close to a unified operating system and using one that has separated operating systems is a fascinating experiment.

Long-time readers of my analysis know I like to boil things we do on our machines to workflows. We establish the most efficient means we can to get things done on our devices. I have been using a Mac for nearly two decades, and I have some deeply entrenched workflows. I always found bouncing those workflows between Mac and iPad to be a challenge because with iPad, I had to develop totally different workflows to do similar things I do on my Mac.

Contrast that with my current Windows experiences and all the workflows I developed on Windows are easily picked up on the Surface Pro X because they are the same operating system running the same software. I was surprised how beneficial this unified operating-system is now that I have been immersing myself in it.

Apple has stayed away from this, and for many years I thought this was the right approach for Apple. However, I am now reconsidering that stance and wondering if the division between macOS and iPadOS has actually been more of a factor holding back the potential of these two platforms than the benefit I originally thought.

If Apple goes this route, does it mean a touch-screen Mac? I think it has to, whether or not the touch dimension is used in a notebook factor, doing so would be beneficial to the more mobile computing factors of iPad, which would also carry with it a benefit to a potential folding iPhone.

So the current thinking is then, unify the OS, get a boost of more large-screen touch productivity apps on Apple’s A-series processor designs and accompanying development tools. All of which will create an even more powerful iPad experience, which in turn would pave the way for an incredible solution in a folding iPhone.

Time will tell if my logic holds!

Intel Focuses on 5G Infrastructure

Despite the cancellation of this year’s Mobile World Congress show in Barcelona, quite a few tech companies are still making important announcements that were originally planned for the show. Not surprisingly, several of those announcements are focused on 5G.

One of them—perhaps somewhat surprisingly—comes from chip leader Intel. The company sold its 5G modem business assets to Apple last fall, and many considered that move to be the company’s exit from the 5G world. But Intel has a much bigger, though significantly less well-known, business creating chips that help power the network infrastructure equipment that sits at the heart of today’s 4G LTE and 5G networks, including base stations and other core components.

For years, much of the network silicon inside these devices was custom designed and built by the vendors making the equipment—companies like Ericsson, Nokia, Huawei, etc. However, with the growth of more software-based networking advancements, including things like network function virtualization (NFV), as well as increasing demand for general compute performance to handle applications like AI at the edge, Intel and other specialized vendors like Marvell have seen strong interest in their off-the-shelf “merchant” chips.

The basic idea is that, as with many other computing platforms, it’s the software that’s driving the biggest innovations in networking. By building on more standardized hardware platforms (x86 for Intel and Arm for Marvell) and leveraging open source software tools and platforms, like Linux, companies can create networking-related innovations at a faster and more efficient pace.

To better address those needs, Intel made several different announcements focused on adding the computing power and specialized resources that new 5G networks require at multiple points along the network path. Starting at the network edge, the company introduced a new version of its Atom processor, the P5900, that’s specifically targeted towards wireless base stations. Based on a 10nm process technology, the new SOC (system on chip) integrates a next-generation set of Atom CPU cores along with network acceleration functions that are specifically targeted for radio access functions, small cells, and other edge of the network applications. Given the strong expected market for 5G-focused small cells that millimeter wave, mid-band sub-6 GHz and CBRS-based spectrum demand—as well as the potential to do cloud-based computing workloads on the edge, such as AI—this looks to be a very interesting opportunity.

For more compute-intensive workloads at the core of the network, the company also chose to make a number of additions to its second-generation general-purpose Xeon Scalable server processors as part of this 5G announcement. Facing intensive pricing and performance pressure from AMD’s second generation Epyc server processors, Intel added 18 new SKUs to its lineup that offer more cores, faster clock speeds, and large cache sizes at lower prices than some of its initial second-gen Xeon Scalable parts. In terms of performance, Intel touted up to 56% improvement for NFV workloads versus some of its first-generation Xeon Scalable CPUs (though the company didn’t clarify performance improvements vs. some of the earlier second-generation parts).

Another key element that’s essential to speed up the performance of core telecom markets are programmable chips that can be optimized to run network packet processing and other functions that are critical to guaranteeing lower latency and meeting consistent quality of service requirements. These points are becoming particularly important for 5G, which has promised improved latency as one of its key benefits versus 4G.

FPGAs (Field Programmable Gate Arrays) have traditionally done much of this kind of work in telecom equipment, and Intel has a large, established FPGA business with its Agilex line of chips. The power and flexibility of FPGAs do come with a cost, however, in terms of both pricing and power, so Intel debuted its first all-new design in a chip category it’s calling a structured ASIC and a product that’s currently codenamed Diamond Mesa. The idea with a structured ASIC is that it’s essentially only partially programmable, and therefore sits between an FPGA and custom-designed ASIC. From a practical perspective, that means it offers faster time to market than building a custom ASIC at a lower price and power requirement than an FPGA. To ease the transition for existing FPGA users, however, Intel has designed Diamond Mesa to be footprint compatible with its FPGAs, making it easier to integrate into existing designs. The real-world benefit is that, used in conjunction with the latest Xeon Scalable CPUs, Diamond Mesa will let telco equipment providers create products that can handle the increased performance, latency, and security demands of 5G networks.

The last portion of the Intel announcement centered on, of all things, a wired ethernet adaptor. While much of the focus for 5G and any other telecom network is typically on wireless technologies, the reality is that much of the infrastructure still uses wired connections for interconnecting different components across the network core and to enable certain capabilities. Particularly for applications that require time-sensitive networking—including things like precise industrial automation—we’re still several years away from being able to ensure consistent real-time signal delivery over completely wireless networks. As a result, Intel’s new 700 series network adapter—which incorporates hardware-enhanced precision time protocol (PTP) support that leverages GPS clock signals for cross-network service synchronization, according to the company—still has an important, if not terribly exciting, function to fulfill in 5G networks.

All told, the Intel 5G network infrastructure story offers a pretty comprehensive set of offerings that highlight how the company has a bigger role to play in the latest generation wireless network than many people may initially realize. Of course, it’s a big field, with a lot of different opportunities for many different vendors, but there’s no doubt that Intel is serious about making its presence felt in 5G. With these announcements the company has made several important steps in that direction, and it will be interesting to see what the future brings.

Predicting the Unpredictable: Forecasting in the Wake of Coronavirus

The Coronavirus—now officially designated COVID-19—has infected more than an estimated 75,000 people and claimed the lives of more than 2,000. The human toll is staggering and far from fully paid, and that should be the first thought anyone has when discussing this topic, with the impact on industries and markets a distant second. At IDC, we issue quarterly market forecast updates across a wide range of categories, and this quarter’s device forecasts proved dramatically more challenging than usual. Today I’ll share some of what I learned through the process.

Dozens of Inputs, Loads of Uncertainty
At IDC, I have the privilege of working with analysts all over the world who are very good at their jobs. We have people looking at individual component manufacturers, tracking the creation of processors, graphics chips, memory, storage, and more. We have an amazing ODM team that tracks the companies that build the device for major OEMs such as Apple, Samsung, Dell, HP, Lenovo, and more. And, of course, we have device analysts that track the shipments of those final products into regional and country-level channels. Each of these teams has done a remarkable job of collecting information at every step of the manufacturing and shipment process. And here’s what we’ve learned: Nobody knows exactly what is happening, or what will happen.

In a highly fluid situation like this, the best way to approach a forecast is to build out scenarios using the best available information. My colleague Linn Huang issued a series of tweets yesterday based upon a pending document that spells out IDC’s current assumptions around the long-term impact of COVID-19 on the smartphone and PC markets. I’m not going to repeat what he describes there except to say that even our best-case scenario shows the virus impacting unit volumes in the first half of 2020, our probable scenario shows an impact lasting well into the second half, and our worst-case scenario impacts the full year and beyond. I encourage you to read Linn’s tweets, and when the final document does appear on IDC.com, I’d be happy to share it.

Look Beyond Factories Reopening
Over the last few weeks, I’ve been on dozens of calls talking to supply chain companies, vendors, and Wall Street, and one of the things many of these folks—especially the latter—have focused upon is the word from China that factories are reopening. Obviously, this is a key indicator, but I’d caution against reading too much into this single factor. While it’s true that many manufacturing plants have reopened after extending closures a week or more beyond the traditional Lunar New Year shutdowns, most of these factories are operating at well below capacity.

Why? Because the workers can’t (or won’t) return to work. In many cases, workers are stuck in cities far from home, in places where they traveled during the holiday break. In other cases, people are simply staying home, unwilling to risk infection. Until we have definite word that China has contained the outbreak, and infections have begun to decline, it is nearly impossible to predict the ramp in production. We know manufacturing for most of February will have been negligible, and whether it increases to one third, one half or more capacity in March and April remains to be seen.

It’s also important to note that China does much more than assemble the final goods. In many cases, the component flow through the country, too. For example, the fabrication of most PC processors happens outside of China, but some volume of those chips goes to the country for final packaging. In other words, even parts and products manufactured outside of China are likely to be impacted.
And production is just part of the supply equation. Another is logistics, and that too is and will continue to be impacted by the same factors. In other words, even as the factories begin to produce new products, there is a strong probability that shipment of those products could face delays as warehouse workers, truck drivers, ship captains, and others sit at home, waiting for the epidemic to play out.

Long-Term Impacts on China and WW Markets
Obviously, China is and will continue to experience the worst impact of COVID-19 as it decimates both production and consumption in the country. With streets empty and stores closed, people simply aren’t buying devices there this quarter. As a result. IDC’s China team has forecasted a notable drop in volumes there for the first quarter, a reality that Apple acknowledged in an earnings warning earlier this week. I expect to see more such warnings from other vendors in the coming weeks.

At a worldwide level, the virus isn’t impacting demand, but as noted earlier, it will undoubtedly impact supply. In fact, the timing for the PC industry couldn’t be worse. After a better-than-expected 4Q19, the PC industry headed into the new year with a strong head of steam that will now likely be constrained by supply. While it’s clear some of the strength in the holiday quarter was related to inventory pull in the US driven by fears of December tariffs, the Windows 7 EOS in January was also driving many small and medium businesses to buy new PCs. The industry is likely to struggle to regain this momentum.

Beyond the near-term, the crisis in China is already driving additional changes in the broader device industry. In the lead up to the outbreak, many companies had already begun to look to diversify their manufacturing beyond China. COVID-19 has many accelerating those plans. That said, there’s no chance that China cedes its dominant position as the manufacturer to the world any time soon, as no other countries have the environment or resources to do what China can do.

Inside China, I also expect the government to pull out all the stops to drive a rapid recovery once it has fully contained the virus. Expect to see huge investments that jumpstart the economy in a way that no other country could muster.

In the meantime, the keyword for the device industry: Patience. Don’t overreact to positive or negative news out of China. Take the word of factories opening with a grain of salt and remember that production is just one element of a complex supply ecosystem. Finally, remember that millions of people’s lives have been dramatically disrupted or worse, and at the end of the day, our concern should be with everyone’s health and safety first and foremost.

Foldable Devices Glass Challenge

Let it be known, the challenges initially stated by many companies and industry experts, that creating a durable cover glass for foldable phones that is on par with modern smartphones today, is as difficult as initially stated. We have yet to see a folding screen device release to the public that has not come with some issues. It is important to note, this is new ground, so we should assume some bumps in the road, but these are problems worth solving. The question is who will get it right and how? We have no idea, but we know many are working hard to solve the problems of durability that are, for the moment, inherent with folding devices.

The Verge has been aggressive in their testing of the Galaxy Flip Z’s durability, as well as pressing Samsung to reveal who their supplier was. Samsung rather provided this description of the screen solution.

Galaxy Z Flip features an Infinity Flex Display with Samsung’s Ultra Thin Glass (UTG) to deliver a sleek, premium look and offer an immersive viewing experience,” a spokesperson said by email. “Samsung’s first-of-its-kind UTG technology is different from other Galaxy flagship devices. While the display does bend, it should be handled with care. Also, Galaxy Z Flip has a protective layer on top of the UTG similar to Galaxy Fold.

Interestingly, last night a company named Schott, who Ben Bajarin wrote about when he shared insights from Display Week last year, came forward as the supplier of the cover glass solution for the Galaxy Z Flip. Schott released this statement to confirm this yesterday:

“SCHOTT has been producing ultra-thin glass for more than 25 years – based on this strong heritage, we are extremely happy to help shaping the future of foldable phones with this breathtaking material. We can confirm that we deliver SCHOTT ultra-thin glass to Samsung. Kindly note that we cannot comment on any processing details of the raw glass material or the display technology itself. In case you want to learn more about Samsung’s foldable glass display technology, please reach out to them
directly.

Although Schott will not comment on the scratching issue, and they and Samsung are working to deal with this, this particular problem underscores how difficult it is to create even folding glass covers that are totally scratch-free and today it is not a perfect science.

Some of the media thought this glass cover was from Corning, but Corning put out their own release to clarify that they are working on a folding glass cover but it will not be ready for 12-18 months:

“Corning is currently working on several glass-based products that we see as the ultimate solution set for foldable device designs. To meet the everyday activities and demands of consumers, we believe that future designs will need to address durability, scratch resistance, and optical clarity – all attributes of a glass cover solution. Corning’s work in this area is focused on developing an ultra-thin, durable, and optically advantaged glass solution for the inside cover of a continuous display that can bend at a tight radius hundreds of thousands of times without significant damage at the fold. We’re actively developing these solutions and sampling them with our customers and expect the timing of commercialization to be within the next 12-18 months.” In addition, imagery of our ultra-thin, bendable glass in development can be found here.

I have had the opportunity of seeing Corning’s work on folding glass when I visited their headquarters last June. The video in the link above shows how it can fold and, more importantly, the material they are folding is actually glass and not some type of coating. From a materials science standpoint, this is not only impressive but seems to defy the laws of physics.

Corning shared with me how this particular glass was developed, and while I can’t divulge what they shared about the process or materials used, due to an NDA, I have no doubt that, as Corning says, they will have a Gorilla Glass quality covers for foldable smartphones in the near future.

To date, Samsung and many others doing folding phones or design concepts, have had issues with everything from broken hinges, glass that breaks or scratches and actual breakage after as little as 10,000 folds. I have heard many reviewers who have tested the few folding smartphones already in release, telling their audience that these products are not ready for the mass market.

Their recommendations are to wait and let the various vendors of folding smartphones work the bugs out of these first-generation models before buying them. At the moment, only the early adopters have bought these phones anyway and these buyers go into these purchases knowing that they are early models and in many ways, untested in the market.

As one who has tracked product launches for decades, all of these folding phones remind me of many early products that came to market with flaws, but in version 3 or 4, the vendors got the bugs out and finally created a model that worked. I sense that folding phones are in this same category. Early models blazed new territory but are not ready for the mass market. Besides being too expensive at first, and even though the companies have put them through rugged tests, many still can’t stand up to the rigorous daily usage they get since they have moving parts that are not perfected yet.

History suggests that in even 2nd generation models, these products could still be vulnerable and can have flaws. But historically speaking, the third generation models finally have the right components, gone through enough testing to get the bugs out and finally become ready for broader market acceptance. Once these folding smartphones are perceived as viable alternatives to mainstream smartphones, we will see if the public actually bites and they take off.

There is one other shoe that could drop that could make folding smartphones go mainstream and that is if and when Apple jumps into this market. We know they have multiple patents on folding smartphones, but as in the past, Apple seems to be sitting back and letting those who are bringing folding smartphones to the market now, take the slings and arrows from the reviewers and learn about market interest and demand vicariously.

Once they are sure there is a market, then they jump in with models that have Apple’s design language, ease of use, and tight-software integration. But even Apple is susceptible to the three times the charm metaphor. Many may not remember that the original iPhone was not a big seller and sold less than 1 million in its first year. Version 2 of the iPhone was more stable and a better version but it too was not a big hit. But the year after Apple released the 2nd version of the iPhone, they began to work aggressively with softer developers and help spur the creation of over a thousand apps by the time iPhone 3 came to market. It was the third generation iPhone that skyrocketed due to strong demand and access to new apps, and Apple continues to set iPhone sales records with their iPhone franchise.

As I have written before, we are in the very early days of foldable smartphones and I believe it is too early to forecast strong demand based on what we have seen so far. And if history repeats itself, it may take the third generation of folding smartphones to hit the market before we can see if demand is sustainable.

MWC2020 Cancellation And What We Can Learn From It

What a difference does a week make! Last Tuesday, I was still making plans to attend Mobile World Congress (MWC) in Barcelona despite the number of companies withdrawing from the show was growing. Since 2000, when I started covering the mobile market, I only missed the show once, the year my daughter was born. Interestingly that year, I thought I had the best grasp of the show because not being on the ground allowed me to follow press conferences as well as read all the material that was being published. I did miss out though on catching up with people either formally or informally. If you ask most people, aside from seeing and touching products, it is that chance to meet face to face they cherish the most. MWC, in particular, offers the opportunity to meet high-ranking executives from organizations that might not be based where you are. Hence why I was disappointed to hear the news that the GSMA had decided to cancel the show entirely, a decision that seemed inevitable. It was the right step to take not just for the show but to avoid a broader expansion of the coronavirus.

The chances of getting infected at the show were minimal, but we know how a common flu bug affects hundreds of people at the end of any show like the Consumer Electronics Show (CES) or MWC where thousands of people travel from all the corner of the world to touch the same devices, shake hands, share food and breath the same air. Siding on caution was undoubtedly the right thing to do for the event organizers and I would argue the decision could have been taken sooner.

Liability and Employee Welfare

As much as I was willing to take a risk and still attend MWC, many companies felt that they were not going to impose attendance onto their employees, so when exhibitors were not canceling, they were giving options. All of the companies that decided to withdraw mentioned that the safety of their employees was paramount, and they were being ultra-cautious. I do not want to be cynical, but I am sure that an abundance of caution was driven more by liability concerns than anything else.

It was fascinating also to see how companies based in Europe and the US were among the first to withdraw while China-based brands were among the last. I am sure there is a correlation between the more litigious nature of the employee base and worker rights in the US and Europe, respectively, that might explain the different stands on the issue. China-based companies might have also had a more pragmatic approach to the situation based on their learnings during SARS and possibly a feeling of being better informed on how the situation in China was developing.

As China plays a more crucial role, not just in the tech supply chain, but in driving innovation for key technologies such as 5G and AI, it will be interesting to see how the different values and beliefs will play a role in the development and go to market.

More Connected Than We Realize

MWC, maybe even more so than CES, really attracts exhibitors and attendees from all regions of the world, including a high number of Chinese brands. Establishing who was coming from where and, maybe more importantly, who traveled where before the 14 days of the virus incubation was going to be impossible. If you stop and think about it for a second, it is quite amazing to think of how easy it is for us to travel nowadays and of course how easy it would be for the virus to travel too especially at a time when we are still not sure on the how and why. Interestingly, even with all the data that is available about us and our life, when it comes to international activity finding all the pieces of the puzzle is not easy due to how the data is kept and shared or not shared because of individual country regulations or privacy laws. It seems to me that because of how easy travel has become health organizations should start thinking of how to drive governments to come up with a disaster protocol that accounts for prompt data sharing.

Over the past few years, China has grown as a center of gravity for the tech world. Companies have much of their supply chain based there, and many have a very sizable customer base. Spending time in China is part of being in tech. Whether you attend events, visit suppliers, or meet with partners, tech executives across the world, visit China regularly.

As the coronavirus spread outside of China, travel to and from China was suspended, leaving industry watchers to call out the benefits of video conferencing and digital collaboration as an alternative to keep business going. A health crisis is not the only time we hear calls for technology to help us cut back on travel; economic downturns usually fuel calls for cost-cutting by embracing online meetings.

2019 has seen the rise of video services such as Zoom and BlueJeans as well as collaboration platforms such as Microsoft Teams, WebEx, and Slack. People have their favorite, and as much as they swear their workday is at a total loss when any one of these services is down, we all still look for in-person meetings. We want to meet in person because even if video has come of a long way, it lacks the degree of intimacy that an in-person meeting delivers. Reading people is so much easier in person than on video, plus familiarity builds trust, which is critical in many sessions aimed at creating or cementing a partnership, sharing confidential information, or only evaluating a product.

Companies will be struck this year with losses coming from the cancellation of MWC, and smaller companies especially might evaluate whether or not attending in the future is worthwhile. It is somewhat ironic that as we discuss 5G speeds and coverage, AR and VR capabilities and remote everything we are reluctant to rely on those very technologies to discuss the future of the industry.

What Now?

Since last week I have received a few requests for online meetings, but very little has been said about what will replace the press conferences that were scheduled for MWC. Many people asked me what the impact on consumers will be, and there is no real impact from canceling the show. The delays in new product releases will come from the effect the novel coronavirus will have on factory workers and production, not from the cancellation of a trade show.

The GSMA is already marketing next year’s show, and it is too early to say if attendance will be impacted. I do wonder if people will use this year’s break as an excuse to reevaluate their participation as well as make a more general consideration of whether all these tradeshows we attend every year make business sense. At a time when sustainability and social responsibility are higher up in many companies’ priority list, maybe leveraging technology to lower travel for the good of the planet and the health of the employees is not a bad thing.

Corona Virus Impact Update, Smartphones and Premium vs. The Masses

A few weeks ago, I shared the concerns I was hearing from supply chain vendors over Coronavirus. Then it was only a warning, but now we see the first impact on tech manufacturing. Apple has come out and said it wouldn’t make March’s guidance due to issues in their factories being able to manufacture iPhones. Apple had already provided a wide range of guidance, and things ended up being worse than even Apple thought.

Talking with contacts in the manufacturing supply chain, factories had to have a 14-day quarantine for employees coming back from certain regions of China after the Chinese New Year. Most factories did not even allow employees to come back to work until Feb. 10th, at which point most factories did not see a full workforce return due to quarantines.

Another fun fact I found out was a rule was implemented that if any employee who was found to have symptoms, mainly a fever, at a manufacturing plant, then that plant had a mandatory shut down for 30 days.

It has been kept relatively quiet in which factories have been impacted the most, but a lot of different components come out of Wuhan and the city shutting down alone would have had a significant impact on manufacturing as other factories were stuck waiting for parts even if they were operational.

Yes, this is a short term blip, but it may go longer than even the March quarter. As companies seek to re-ramp their supply chain and meet demand, they have a lot of catching up to do. Some companies are likely to manage this better than others, but I’ve already heard concerns products may be delayed or in short supply even into the holiday season of 2020.

Premium vs. Mass Market Smartphones
With Samsung’s newest smartphone launch, and even coming off observations from Apple’s fall launch, my perspective has been altering now that both Apple and Samsung are creating a line between pro smartphones and non-pro smartphones. This line has been drawn both by pricing and capabilities.

As was evidenced by the iPhone Xr, the masses are going to buy the cheaper option of the new lineup. Apple learned there was a price threshold in any lineup the masses were willing to pay, and that limit was over $800. Samsung has priced all three of its flagship devices above that price, which will be interesting to see how the market responds. What interests me the most to analyze, as this market has evolved, is to look less (short-term) at what the pro device capabilities have because those are not features the mass market will have access to, at least right away.

It’s great that iPhone and Samsung devices have pro-features that do incredible things technologically, but the masses are not using those features. When we look at the opportunity for modern technology to impact the types of content we consume or create, we have to look not at what exists in the small pro-segment of consumer smartphones but at what is in the hands of most people. Interestingly, here, the gap between pro and mainstream is much smaller in Apple’s current lineup than Samsung’s. And I’ll be curious if Apple keeps this strategy consistent even as they bring more pro-features (largely camera related) to their lineup.

That being said, looking at what pushes the envelope in pro-smartphones is relevant if it is viewed as something that starts in the pro-segment and then becomes common throughout the lineup. My guess is those pro-feature innovations coming to smartphones are things that become common to the lower-priced models either the next year or the year after. In that regard, it is worth analyzing the technology behind the pro-features to understand what could be possible for the mainstream at some point.

The last thing that has impacted my thinking lately, is how much farther can we push the boundaries on features for pro-devices before we dramatically overserve the market? There is more than ample evidence that supports the consumer psychology behind the overserving features of a product where it can quickly move from cool to off-putting. Historically, consumer products have had to balance this fine line of making features that dramatically overserve the market and then lose more value than gain with a technological advance.

This is also a key part of our analysis, to understand where the line from useful to over-serving is drawn and help the market make sense of the impacts of what technology becomes mainstream, and what technology remains niche.

Apple Coronavirus Warnings Highlight Complexities of Tech Supply Chains

As the impact of the coronavirus spreads, Apple issued a rare statement yesterday related to the coronavirus’ impact on its quarterly earnings guidance and that announcement is now reverberating throughout the tech industry as well. The company reported that its current quarter’s earnings will likely be negatively affected by several factors related to the virus, specifically its effect on the Chinese market and its global supply chain.

What makes the news even more disconcerting is that the company had already suggested on its last earnings call just a few weeks back that revenues for the quarter could fall into a much wider range of potential outcomes than they typically provide because of the uncertainties the virus was creating. A second negative statement just a few weeks later highlights that the impact of the virus is proving to be much worse than originally thought. The fact that they didn’t say how much the earnings guidance decline would be also emphasizes the uncertainty about the total extent of the virus’ impact.

Specifically, Apple said that sales of iPhones in China—an increasingly important market for the company—will be lower than it had predicted because many of its retail stores and other retail partners’ stores have been closed as a result of the virus. In addition, as stores reopen, the traffic in them has been significantly lighter than normal, leading to the slowdown in sales. Theoretically, online sales shouldn’t be impacted as strongly, but it’s not hard to imagine that the delivery mechanisms in China have also been slowed by the virus.

The second factor Apple cited—a slower ramp to full production after Chinese New Year—is potentially more troublesome, because it impacts the company’s entire global supply of iPhones and other devices. In addition, it certainly implies that other major tech hardware vendors could start feeling this soon as well.

As most people know, the vast majority of Apple’s devices are built in Chinese factories, so the company—like most every other hardware tech vendor—is currently very reliant on these Chinese factories cranking out products in huge quantities on a steady basis. And that’s really the problem, because if Apple is starting to notice the impact strongly enough that it felt the need to issue a statement on revised guidance, then we’re likely going to see a lot of other hardware-focused tech vendors do something similar over the next few days or weeks. In fact, even before Apple, Nintendo had disclosed that it won’t be able to build as many of its Switch gaming consoles as it would like, because its primary production partner Foxconn—who also happens to be Apple’s largest factory partner—was facing delays at its Chinese factories.

The other thing to bear in mind is that even companies that don’t have factories in the most affected areas of China can see their production slowed because of their dependence on certain parts or other components that do come from the most impacted regions. These days, the number of subcomponents that go into more sophisticated tech devices can easily reach over 100, and because so many of these subcomponents are built in China, the range of impact from the virus is potentially much wider than it first appears.

By the way, the timing here is also very important. One thing that many people don’t understand is that, as terrible as it is, the coronavirus started seriously impacting Chinese factories just before the one week in the year when they’re scheduled to be offline: Chinese New Year. If the virus had hit at another time of year, the impact could have been much worse. Now companies are trying to determine how many workers are returning to the factories after their scheduled break, and it’s those metrics that are going to be the most closely watched over the next few weeks.

In addition, out of an abundance of caution, I’ve also heard some hardware vendors say that the Chinese government is imposing mandatory factory shutdowns of 30 days if a single worker is discovered to be infected. Needless to say, that’s going to force companies to be very conservative about letting employees come back to work, which could also result in serious delays in production.

Ultimately, however, it’s essential to remember that this issue is an extremely challenging humanitarian crisis and that companies need to be (and, likely will be) sensitive to the issue and do whatever they can to keep their workers safe. Taking the big picture view, these production delays will likely (and hopefully) be little more than a blip on the long-term radar of tech industry production. Unfortunately, because many institutional investors are more concerned with short-term financial performance, this may cause some short-term challenges for those companies who are being impacted. Long-term, let’s hope the tech industry can learn from this crisis and figure out ways to both protect the workers who help bring products to life and to create supply chains that can withstand the inevitable challenges that lie ahead.

Podcast: Samsung S20 and Z Flip Launch, T-Mobile-Sprint Merger, MWC Cancellation

This week’s Techpinions podcast features Carolina Milanesi and Bob O’Donnell analyzing the new smartphone announcements from Samsung, including their 5G-enabled S20 line and the foldable Galaxy Z Flip, discussing the implications of the approval for the T-Mobile-Sprint merger on 5G competitiveness in the US, and chatting about the impact of the cancellation of the big Mobile World Congress trade show.