Tech Predictions For 2008

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From the Jan./Mar. 2008 Issue

Just when we thought that 2007 would only be about politics and gas prices, along come three devices that turn their respective industries on their ears and make us once again pay a little attention.

What three technologies? Well, many would qualify this year, but my top three would have to include the following: the iPhone, which has completely revolutionized how we think of cell phone converged devices; external hard drives, which truly came into their own in 2007 to re-energize the backup and archiving industries with low costs and high ease of use; and micro computing devices, which showed much promise in 2000, lay stagnant last year and then came roaring back this year.

All three devices became hits in 2007 out of necessity and consumer demand. Years of poorly built, error-prone and underpowered smartphones had left most consumers howling in outrage while the cellular service companies yawned and pushed yet more junk into the marketplace. The iPhone not only brought to market Apple’s trademark quality, but a redesign that has sent handset manufacturers running back to the drawing board. A new model promised in 2008 will enable some type of PC synchronization and access to faster Internet speeds — both updates designed to maintain the iPhone’s status as the year’s Killer App.

The backup and archiving market is being driven by a host of market forces — Sarbanes Oxley requirements, legal precedents and cost-cutting efforts among them. But where small businesses were once stuck with a simple choice of diskette backups or tape, a new generation of hard drives has made securing data on backups a nearly effortless process. It is no coincidence that the two scientists who led the development of faster, better and larger drives took this year’s Nobel Prize for Physics.

Road Warriors have always complained about the size and weight of laptop computers, but they never really saw enough inconvenience in them to switch to something smaller. That started to change in a post-911 world, where having less to carry on the airplane and through security checks became more important. At the same time, the new generation of Internet-capable devices (like the micro PC from Viao or the new generation of computers with 10-inch screens) makes it less awkward to carry and use smaller devices. A lower price tag doesn’t hurt their sales, either.

Likewise, there were some technologies that stumbled. Wi-Fi was finally recognized as not being the path of free unlimited bandwidth, and WiMax showed its first signs of stumbling as investors came to realize that it could neither live up to its hype nor be as cheap as consumers want. Voice over IP (VoIP) telephone calls lost much of their luster as Skype hit performance problems and Vonage fell prey to patent law. Blu-Ray technology fell on its sword as an increasing number of companies rallied behind the competing DVD-HD standard. Finally, 2007 was a bad year for memory cards, which continued to suffer from far too many sizes and standards (memory stick, memory stick pro, SD card, mini-SD card, micro-SD card, CF card, etc.).

As for Kent Associates, our lab rats took their best shots at a forecast for 2007, and did not fare too badly:

2007 PREDICTIONS & RESULTS

PREDICTION: The cable mergers will be in full swing.
ACTUAL RESULTS: Some mergers and acquisitions did occur, but not nearly on the scale predicted. The cable giants got bigger by eating up smaller competitors but did not merge with one another. Today, those mergers seem less likely, as does a cable acquisition of Sprint or T-Mobile. The markets have moved on.