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.

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Qualkia – Constructing the 5G Myth

I’ve just returned from the Mobile World Congress, and a fairly clear theme this year was the alleged imminent arrival of 5G, with companies promoting the current status variously as 4.9G, the Bridge to 5G or pre-5G.  The only problem is that no-one seemed to be very clear about what 5G is going to be.

Up until now, it’s been pretty clear what the “G”s stand for – it’s been the main user application area over and above the basics of voice and text.  For 2G they were pretty much confined to Games and Gambling.  In other words, applications which relied on timely, but minimal data.  3G gave us Girls, as the porn industry realised that, with higher data rates, they could charge for sending pictures to the most private of our devices.  The increased bandwidth of 4G resulted in Gossip – the net curtain twitching of Twitter and Facebook which has glued millions to their smartphones.  But the potential killer app for 5G is proving remarkably elusive.  Participants at the Global 5G Test Summit event kept on emphasising the importance of early testing for exploring new usage models and applications.  That appeared to be because nobody had no idea of what they might be.  Judging from the reticence of many network operators at the show, who are obviously struggling to see how they are going to make any money from investing in 5G infrastructure, the fifth “G” may end up bringing little other than Grief and Gloom.

At which point I’d like to highlight a recent book by William Webb, entitled “The Myth of 5G”.  In it, he argues that not only does no-one know what 5G is, but there’s no need for it.  After which, I’ll tell you about Qualkia.

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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.

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NB-IoT is Dead. Long Live NB-IoT.

As the old adage goes, “while the cat’s away, the mice will play”.  In the case of NB-IOT, “when the spec’s delayed, LPWAN will play”, which is exactly what’s happening in the Internet of Things market today.  The problem is that 3GPP (the 3rd Generation Partnership Project), the standards body which has been responsible for the 3G, 4G and 5G mobile standards, dropped the ball as far as the Internet of Things is concerned.  Seduced by the slabs of black glass which suck up both our attention and the mobile networks’ spectrum, the 3GPP engineers totally forgot to design something to replace the old 2G workhorse of GPRS, which is responsible for most of today’s machine to machine communications.  Instead, they spent all of their time designing high power, high speed, expensive variants of 4G to support an ongoing dynasty of iPhones, Galaxys and Pixels, none of which were any use for the Internet of Things.

Noticing this hole, a number of companies who had been developing proprietary, low cost, low speed, low power communication options saw an opportunity and created the Low Power WAN market.  Whilst many perceived them as a group of Emperors with no clothes, the network operators were so desperate to have something to offer for upcoming IoT applications that they started engaging with them, rolling out LPWAN infrastructure.  Whether they believed the LPWAN story, or just hoped it would fill a hole is difficult to ascertain, but no-one can deny that LPWAN is now firmly on the map, in the form of Sigfox, LoRa, Ingenu and a raft of others.  To address that challenge to their hegemony, the GSM Association (GSMA) directed the 3GPP to assemble their own suit of imperial clothing which would be called the Narrow Band Internet of Things, or NB-IoT.

This is the story of why NB-IOT was too late, why it will fail in the short term, why it will win in the long term, and why the industry will struggle to make any money from it.

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What’s the difference between Sir Philip Green and the GB Smart Metering Program?

BEIS (the Department for Business, Energy and Industrial Strategy) have just released their long overdue assessment of the cost of the country’s smart metering program.  Hidden among the figures is the amount of money that they have spent.  So far, they have squandered £450 million on the project, despite the fact that not a single compliant smart meter has been installed in any house.  By a strange coincidence, that’s exactly the same amount as the shortfall in BHS’ pension fund which occurred when Philip Green flogged off BHS.

The £450 million hole in the BHS pension fund had MPs baying for Philip Green’s blood, threatening to remove his knighthood and demonising him in the press.  The £450 million expenditure by BEIS on civil servants and consultants, with nothing to show for it, has elicited virtually no reaction from Parliament, yet it will end up costing the taxpayer far more.

Let me reiterate this, as it is truly shocking.  Over the last six years, DECC, BEIS and Smart Energy GB have spent £450 million on consultations, developing specifications, fighting Freedom of Information requests and spinning PR stories, yet we have not had a single smart meter installed which conforms to their specifications.  Isn’t it time that Parliament stops fuming about super yachts and calls BEIS to account?  Not least, because the latest report from BEIS shows they can’t even manage simple arithmetic.

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Hearables sales could reach $45 billion in 2020

Back in 2014, when I reviewed the emerging wearables market, I suggested that the sector with the greatest potential would be hearables.  Over the intervening two years it has seen intense activity.  Over $45 million has been pledged in crowdfunding campaigns for earbuds and stereo headphones from almost a quarter a million backers.  The value of sales of wireless headsets has overtaken that of wired headsets and now Apple has added momentum by removing the 3.5mm jack on the iPhone 7, as well as launching their own earbud – the Airpod.

One of the key reasons hearables are doing so well compared to other wearable sectors is because they don’t need to work out what to do with the data they generate.  Every other wearable is a slave to the treadmill of quantitative feedback, where it needs to make the data it produces compelling, or else risk being consigned to the drawer of doom.  Hearables are bought for consuming existing content in the form of music or videos, giving apps developers much more time and freedom to play with the accompanying data.  That is a massive advantage over anything that you wear on your wrist.

I’ve just published a report on the hearables market which takes these new developments into account.  It shows a growing opportunity, even greater than I’d suggested two years ago, which could rise to sales of almost $45 billion in 2020.  You can download the report – The Market for Hearable Devices 2016-2020 here.

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