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Microsoft’s Fear Of Missing Out, or How NOT to design a Smart Thermostat

Last week, with a fair degree of razzmatazz and press coverage, Microsoft launched a smart thermostat called Glas. Except it wasn’t really Microsoft’s. And whilst it might be pretty, it certainly isn’t smart.

If you look behind the promotional video, it’s clear that it’s not really driven by any desire to be smart. It’s come out of Johnson Controls, who have been designing dumb thermostats for many years, and it perpetuates the dumb elements of control, which means it won’t save users as much money as a proper smart device could. However, small things like the truth didn’t stop them headlining it as “reinventing the thermostat”. I suspect the only reason that Glas exists is that Microsoft are currently in a poor third place in getting their Cortana speech recognition capability into the market. I quite like Cortana, but compared with Amazon and Google’s success in persuading consumer product manufacturers to support their offerings, Cortana is definitely an also-ran.

What you see if you watch the video carefully is an outdated control system, a user interface that was probably inspired by Bishop Berkeley and an attempt to break the second law of thermodynamics. All of which details appear to have slipped past the rose-tinted editorial glasses of the technology press, who have just said “Shiny – want one!”. So let me explain why it’s another smart opportunity missed.

Hearables attract $50 million of crowdfunding

It’s almost four years since I coined the word “hearables”, so it was pleasant to see it displayed as a headline product category on NXP’s stand at the Mobile World Congress last week, confirming that hearables are taking off as a serious market sector. It was also encouraging to see the range of products that they had on display which are already available, or close to being available to buy, including models from Bragi, Doppler, Earin, Nuheara, MyManu and Jabra.

Most of these still come from start-up companies. With the exception of Jabra and Apple, the majority of companies shipping hearable products started off life through crowdfunding campaigns. I’ve been tracking many of these, and was fascinated to see that at the end of February, the overall total that has been raised for hearable devices passed the $50 million dollar mark, with backers placing orders for over 300,000 products. With major headphone brands starting to weigh in, it’s a good indication that hearables are topping the list of wearable products that consumers want to buy. That’s in stark contrast to other wearable products, where the demise of Pebble and continuing layoffs at Fitbit and GoPro suggest that the initial customer enthusiasm has not translated into a compelling desire to continue wearing them.

IoV – The Internet of Voice

Forget the Internet of Things – it’s a bubble. The majority of products currently claiming to be IoT devices are just the same, vertical M2M products we’ve always had, but taking the opportunity to benefit from a rebrand. Most of the rest of the IoT is the wet dream of Venture Capitalists and Makers who think that by overfunding and stimulating each other’s egos in a frenzy of technical masturbation, they can create a consumer market for the Internet of Things. As the IoT slips slowly backwards into the foothills of Gartner’s Hype curve you need to look elsewhere to find the real Internet device opportunity, which is only just emerging. It’s the IoV, or the Internet of Voice.

The problem that the current IoT paradigm has is that it’s mostly about collecting data and then applying algorithms to extract value from the data. That’s a difficult job. You need to make the devices, work out how to connect them and then hope you can find something valuable within the data to engage the customer. The problem is that all of that takes time, not least the time to get a critical mass of products out into the field. The Catch 22 which most business plans ignore is that you need to deploy tens of thousands of devices to accumulate enough data before you can even see if there’s anything of value in it. But without an upfront value, people are loath to buy the devices. Everyone, from wearables manufacturers to smart cities are discovering that it’s not a very compelling business case, not least because it needs fairly technical consumers to install everything in the first place.

The Internet of Voice takes a different route. Instead of expecting users to know anything about the IoT, they just get to ask questions and then get answers. No more buttons, no more keyboards, no more coding, just ask. But it has the power to control everything we come into contact with. It could mark the end of our love affair with smartphones and is probably the biggest threat that Apple faces today.

I come to praise Arduino

If you know your Julius Caesar, you may guess where this is going. Arduinos can seriously damage your start-up and your investors. But before we talk about that let me start by saying that I love Arduinos. I use them around the house in all sort of projects; they water my strawberries, and automate all sorts of things which most people wouldn’t ever think need automating. I’ve recently been inspired by Kurt Grandis’ project using video recognition and a water gun to track and deter squirrels – I’ve plans to use that as the basis of a robot to stop the local wildlife stealing our figs and apricots. Without Arduinos I’d never embark on some of the projects that eat up my free time.

I also love the innovation they enable. They underpin much of electronics design within the Maker community, letting makers accomplish projects that they would never have dreamt of starting without the benefit of the breadth of shared expertise which the community generates. The innovation of these developers has reenergised a love for making things for the sheer sake of it – because they can be made. For those of us who grew up with tinkering, frequenting the Tandys and Henry’s of this world, the Arduino and Raspberry Pi have brought back and re-energised a hobbyist love of design which most of my engineering generation thought had permanently died with the advent of mass market consumer electronics.

Not only that, they’ve helped the growth of crowdfunded hardware projects. Over the past few years Indiegogo and Kickstarter have blossomed, with all kinds of innovative concepts raising hundreds of millions of dollars of support from funders. Many of the prototypes for these developments only happened because they were based on Arduinos. And the process is self-fulfilling, as projects such as the RFduino, Qduino, Neutrino, Microduino, Piccolino, Attoduino, BLEduino, Garagino, Superduino, Tinyduino and others have developed ever more specialised variants to feed future generations of products.

After the Apple Watch, will we see the iPhone6 mini?

Last week, after several years of build-up and hype, the world had the opportunity to place their pre-orders for the Apple Watch. It hasn’t generated the queues outside stores that have come to typify recent Apple releases, and despite some options “selling out” we have no idea what that means in terms of total numbers ordered, as supply is obviously constrained. Slice Intelligence reckon that over a million people signed up on launch day, but I suspect that’s over-optimistic. Nor I am I convinced by other analysts predicting sales of 19 million this year. However, over the course of the rest of this year I expect several million people around the world will spend between $349 and $20,000 each to acquire one. It will be the start of an interesting experiment which is far more than just about what we wear on our wrist. I see it as a similar, but larger scale experiment along the same lines as Google Glass, albeit a much lower risk one in terms of social acceptance. But it is still an experiment. To succeed it will need to change user behaviour – it’s not enough that it’s just a new Apple toy.

It may turn out to be an experiment which will indicate whether our love affair with the smartphone has a best-before date. That may seem an odd statement, but we’re already seeing some interesting feedback from people who have had the opportunity to trial the Apple Watch. Matthew Panzrino at Techcrunch has interviewed a number of these, reporting that the biggest recurring theme from those lucky few is how little they use their iPhone once you have an Apple watch. People he spoke to that have worn the Apple Watch said that they take their phones out of their pockets far, far less than they used to. One user told him that they “nearly stopped using their phone during the day; they used to have it out and now they don’t, period”.

Last month at the Apple presentation Kevin Lynch echoed the same point remarking that “you can put your iPhone down when you get home – you don’t need to have it with you all of the time”. For the VP of Technology at Apple to say that sounded almost heretical, but it highlighted an important point – Apple connectivity products, like the iPhone and Apple TV could become invisible hubs for connectivity to more personal products which Apple may produce in the future. That could have an important bearing on the way we use smartphones.

Apple is doing a lot of interesting things in its product ranges and we’ve yet to see how they fit together, or what that will mean for the future of the Apple ecosystem. But it’s important to get past the hardware and understand how they could work as an ecosystem to change behaviour. This is my view of where the iPhone may be going.

Smart Wearables – a $30 billion dollar opportunity

Over the past year I’ve been following the hype around smart wearable technology. Fuelled by the enthusiasm of the big players to embrace this market, analysts are falling over themselves to define and inflate the size of the wearable market opportunity, predicting a market worth over $30 billion by 2020. That belief is driven by a desperate need for major companies to find something to follow on from laptops, tablets and PCs, all of which are being commoditised. In his seminal book on technical disruption “The Innovator’s Dilemma”, Clayton Christiansen warns that “no one can learn from market research what the early market will be. I can hire consultants, but the only thing I can know for sure is that their findings will be wrong”. As I look at the current predictions, that warning feels worryingly appropriate.

The problem is that most of the models being used to estimate the consumer appetite for wearable technology are built around technology push, with manufacturers trying to shape their technology to fit what they believe consumers will buy. It’s a strategy that is likely to fail, as wearable technology is more personal than any product they’ve ever made before. To try and see whether there is a market, I’ve put together a report that looks at the market opportunity from the contrary viewpoint, building it up from known consumer behaviour and preferences. Whilst there’s no guarantee that doesn’t fall into the same Christiansen trap, it suggests the market could still reach $30 billion in 2020, but with a very different mix of products being made by some very different companies. You can download the report here.