Industry News

Down to earth: Year-end predictions tend toward the dramatic, yet the best advances are often the most practical

by Adam Foroughi on Jan 7, 2016

Those of us who work in tech love to discuss what’s next. It’s in our DNA. And then when something doesn’t happen, we gloat if we got it right, and shrug it off if we got it wrong (hey! things change!). We just saw a spate of 2016 predictions in the last month, but let’s look back to those from a year earlier. I won’t point any fingers at who got what wrong, but I will share with you my thoughts on why some popular predictions didn’t happen in 2015 and what actually happened in their wake.

It wasn’t only about wearables…it was also about the connected TV.

2015 was supposed to be the year of the wearables: Google Glass, fitness trackers, and smartwatches were, many thought, going to be ubiquitous.

Then, Google stopped selling Google Glass in January. The wearable became a punch-line rather than a consumer must-have. Other wearables like smartwatches also didn’t take off as much as anticipated, and fitness trackers tended to lose their appeal post-purchase.

Not all is lost for wearablesGoogle Glass could have a second life with the new slicker design Google has patented. But the wearable just didn’t dominate in 2015 quite like we thought it would.

But a segment that emerged this year, and is primed for a big 2016, is that of the connected TV. Google might have stumbled with Glass, but its Chromecast skyrocketed to the top of streaming devices, and Apple TV captured 20% of market share. This is the start of a whole new era in TV, with Apple TV leading the way. The iPod wasn’t the first mp3 player, but it’s the one that defined an era. I think the new Apple TV, with its tvOS platform, will come to define the next phase of connected TV era. Earlier this year, Apple said that apps are the future of TV, and we happen to agree, and this will be a fun prediction to check in with in late 2016.

So much for paying with your phone in the store…consumers are skipping the store altogether by shopping on their phones.

For the last few years, we’ve been dreaming of a world where we could magically wave our phones (or watches) at check-out scanners. Payment methods like Android Pay (neé Google Wallet), Apple Pay, Square, and Level Up were supposed to free us from the tyranny of wallets. But only 700,000 of 10 million US points-of-sale support NFC payments, according to The Nilson Report.

The number of NFC terminals in the US will no doubt increase over the next few years, but there is another reason why the dream of a wallet-free world has rather suddenly become beside the point: You don’t pay with your phone in a store if you don’t go to a store in the first place. Consumers are now avoiding stores altogether. Mall traffic continues but it’s still in decline, and analysts called this year’s Black Friday for brick and mortar retail a “bust.”

Instead, we skipped the store and shopped straight from our phone (to the point where mobile shopping actually saved Black Friday, accounting for 36% of online sales). In January of 2015, Gartner predicted that by 2017, mobile transactions would account for half of all online commerce. However, as payment platforms, Apple Pay and Android Pay in particular should be fine no matter what the future of shopping holds. Beyond offering NFC payments, the two are also available in-app.

The Internet of Things didn’t explode…but mobile on-demand apps did.

Smart cars are cool in concept, but who needs one if you can Uber everywhere? And a fridge that can let you know that you’re out of eggs is great in theory, but only if you have to go to the store to begin with. Why would you do that if Instacart can get you what you need in an hour?

IoT (Internet of Things) products like Nest (a “learning” thermostat) and Dropcam (Internet connected security cameras) have gained some traction because they’re so useful, and there are surely exciting things on the horizon, but my guess is that smart things won’t take off in 2016, either (at least not in the way we originally thought). There are significant security issues with IoT that need to be figured out before any mass adoption occurs.

There’s a reason why Uber is valued at $62.5 billion. It’s because the On-Demand Economy is real, and it’s empowered by mobile. IoT still relies on disparate devices told to talk to each other and hack together a tenuous functionality (with security usually the first casualty in the name of co-operation). But with mobile, because everything occurs on one device, using decades old protocols, security isn’t compromised in making the connection between buyers and sellers. For example, on-demand app Hotel Tonight (which will find users a deal on a nearby hotel) provides a service to hotels (allowing them to sell surplus inventory), and a service to its end-users (deals on hotel rooms). It’s convenient AND secure, and made possible by a mobile apps.

2015 was all about what truly works for consumers, on a very practical level; over and over again, we saw the notion of “meeting consumers where they are” successfully taken to whole new levels. We’re living in an age when many friction points of daily life are disappearing, one after the other.  I might be biased, but I really do think that mobile will continue to transform how we do so many things in our lives; in 2016, it will become still more ubiquitous, with more convenient but life-changing applications. You can safely bet on mobile continuing to have the biggest impact in technology, and on connected TV heading in that direction.

Adam Foroughi is AppLovin’s CEO.