The Connected Home

It doesn’t take a genius to realize that the typical American home contains more than a few digital devices. But it might surprise some to learn just how many devices there actually are.

According to a recent survey of nearly 700 American adults who have children under the age of 15 living at home, the average household contains 7.3 “screens.”

The survey, which was conducted by technology research company ReportLinker in April 2017, found that TVs remain the #1 item … but the number of digital devices in the typical home is also significant.

Here’s what the ReportLinker findings show:

  • TV: ~93% of homes have at least one
  • Smartphone: ~79%
  • Laptop computer: ~78%
  • Tablet computer: ~68%
  • Desktop computer: ~63%
  • Tablet computer for children age 10 or younger: ~52%
  • Video game console: ~52%
  • e-Reader: ~16%

An interesting facet of the report focuses on how extensively children are interfacing with these devices. Perhaps surprisingly, TV remains the single most popular device used by kids under the age of 15 at home, compared to other devices that may seem to be more attuned to the younger generation’s predilections:

  • TV: ~62% used by children in their homes
  • Tablets: ~47%
  • Smartphones: ~39%
  • Video game consoles: ~38%

The ReportLinker survey also studied attitudes adults have about technology and whether it poses risks for their children. Parents who allow their children to use digital devices in their bedrooms report higher daily usage by their children compared to families who do not do so – around three hours of usage per day versus two.

On balance, parents have positive feelings about the impact technology is having on their children, with ~40% of the respondents believing that technology promotes school readiness and cognitive development, along with a higher level of technical savvy.

On the other hand, around 50% of the respondents feel that technology is hurting the “essence” of childhood, and causing kids to spend less time playing, spending time outdoors, or reading.

A smaller but still-significant ~30% feel that their children are more isolated, because they have fewer social interactions than they would have had without digital devices in their lives.

And lastly, seven in ten parents have activated some form of parental supervision software on the digital devices in their homes – a clear indication that, despite the benefits of the technology that nearly everyone can recognize, there’s a nagging sense that downsides of that technology are always lurking just around the corner …

For more findings from the ReportLinker survey, follow this link.

Microchips migrate to people … and the legislators struggle to catch up.

mcrExpanding beyond their use in applications like IoT household appliances and pet location tracking, sensors and chips are now being embedded in people, too.

Last fall, The Wall Street Journal reported that as many as 50,000 microchips designed for people have been sold globally.  Each microchip kit includes a tag and an injection tool, and is priced at around $100.

More Australians have had chip implants than in any other country, but significant numbers of other people in European nations like Sweden and the Benelux countries have also stepped up to the plate for implants.

According to what I hear, the chip embedding process is easy and painless, as the devices are very small – not much bigger in size than a grain of rice.

But not everyone is thrilled about this latest “turn of technology.” And as a result – and hardly surprising – politicians are starting to become involved.

In a move aimed at trying to put the microchip genie back into the bottle, lawmakers in the state of Nevada have introduced legislation that would make it a felony to require a person to be implanted with microchips such as an RFID (radio frequency identification) or NFC (near field communication) devices.

The legislation doesn’t seek to outlaw the practice – but rather to make it illegal to mandate any such activities targeting any single individual.

Under certain circumstances, I can see how micro-chipping a person could not only be beneficial, it could be a life-saver. Consider situations where people are potentially in danger of kidnapping, or susceptible to violence from spousal threats.

No major opposition to the Nevada bill has been logged – so far. Still, I can’t help but think that this is yet another lame legislative attempt to restrain the inexorable march of technology — one that will come up woefully short.

Water finds its own level – and that’s never more true than in the realm of technological advancements.

But what are your own thoughts pro or con?  Please share your views with other readers here.

Suddenly, GoPro isn’t so “Go-Go” …

untitled2Most likely, I’ll never be a GoPro customer.

The only direct interaction I’ve had with the maker of action cameras was several years ago during the Great Target Credit Card Breach of 2013, when suddenly a half-dozen GoPro purchases mysteriously appeared on my card statement.

But other than that, my connection with GoPro and its line of cameras has been nonexistent — which isn’t at all surprising considering that at my age, I’m hardly an “action adventurer.”

Unfortunately for GoPro, many other people aren’t, either – and it’s one reason why the company’s financial results have been pretty ugly coming off of the most recent holiday season.

This past week, GoPro announced that it is cutting nearly 10% of its workforce (more than 100 people) because of weak sales during the 4th Quarter.

In a holiday quarter when product purchases should have grown revenues considerably, the weaker-than-expected sales volume of ~$435 million meant that GoPro’s revenues were far short of the $510 million originally projected.

From the financial market’s perspective, this news was sufficiently negative that trading of GoPro shares had to be halted briefly this past Wednesday.

untitled
GoPro shares over the past six months.

The company promises to divulge more information about its financial results in early February, but some observers are already beginning to paint the picture of what’s out of kilter:

  • GoPro misjudged the price consumers were willing to pay for its Hero4 Session cube cam, introduced in July 2015, resulting in two dramatic drops of the sticker price in September and December down to $199. 
  • Competitors are entering the field, putting further downward pressure on pricing. 
  • There’s a ceiling on the demand for action cameras because “action adventurer” consumers are such a small slice of the general population.

But does any of this come as a particular surprise?

Like in any other consumer electronics product category, the trajectory of high growth among early adopters leads to new market entrants, followed by the hardware becoming essentially a commodity.

… And the whole process is as swift as it is inevitable.

GoPro is branching into newer segments like camera drones — and not a moment too soon. But the reality is that in a product segment like action cameras, any supplier will always be just one step ahead of commoditization.  And for this reason, product mix reinvention has to be happening continuously.

China’s controversial product supplier pledge: An “on the ground” view from the Far East.

The business world is abuzz about the latest moves by China to regulate the behavior of U.S. and other foreign companies that choose to do business in that country.  What’s the real skinny?

contract

While much of the reporting and commentary has been decidedly scant on details, we can actually take a look at the official document that contains the various provisos the Chinese government is intending to impose on foreign companies.

Ostensibly, the declaration is aimed at “protecting user security.” Here are the six provisions that make up the declaration:

Information Technology Product Supplier Declaration of Commitment to Protect User Security

Our company agrees to strictly adhere to the two key principles of “not harming national security and not harming consumer rights” and hereby promises to:

#1.  Respect the user’s right to know. To clearly advise users of the scope, purpose, quantity, storage location, etc. of information collected about the user; and to use clear and easy-to-understand language in the user agreement regarding policies and details of protecting user security and privacy.

#2.  Respect the user’s right to control. To permit the user to determine the scope of information that is collected and products and systems that are controlled; to collect user information only after openly obtaining user permission, and to use collected user information to [sic] the authorized purposes only.

#3.  Respect the user’s right to choice. To allow the user to agree, reject or withdraw agreement for collection of user information; to permit the user to choose to install or uninstall non-essential components; to not restrict user selection of other products and services.

#4.  Guarantee product safety and trustworthiness. To use effective measures to ensure the security and trustworthiness of products during the design, development, production, delivery and maintenance processes; to provide timely notice and fixes upon discovery of security vulnerabilities; to not install any hidden functionalities or operations the user is unaware of [sic] within the product.

#5.  Guarantee the security of user information. To employ effective measures to guarantee that any user information that is collected or processed isn’t illegally altered, leaked, or used; to not transfer, store or process any sensitive user information collected within the China market outside China’s borders without express permission of the user or approval from relevant authorities.

#6.  Accept the supervision of all parts of society. To promise to accept supervision from all parts of society, to cooperate with third-party institutions for assessment and verification that products are secure and controllable and that user information is protected etc. to prove actual compliance with these commitments.

Often with China, there are “official” pronouncements … and then there’s what’s “really” going on behind the curtain.

So to find out the real skinny, I decided to ask my brother, Nelson Nones, who has lived and worked in East Asia for years.  Since Nelson’s business activities take him to China and all of the other key Asian economies on a regular basis, I figured that his perspectives would be well-grounded and worth hearing.  Here’s Nelson’s take:

Points 1 through 3 are fundamentally no different from the provisions of personal data protection laws already on the books in the 27 member states of the European Union, plus Australia, Hong Kong, Iceland, India, Japan, South Korea, Liechtenstein, Macau, Malaysia, New Zealand, Norway, Singapore, the Philippines, Taiwan and some U.S. states.  Nor do they materially differ from privacy policy best practices — so I would not see these as particularly onerous or unreasonable.

The key difference is that these points are not enshrined in law in Mainland China, so compliance is voluntary at the moment (as it was in Singapore until 2013) – presumably binding on only those companies that sign this declaration. 

News reports also indicate that China has asked only American technology companies to sign its Declaration of Commitment, implying that domestic Chinese companies aren’t necessarily held to the same standards — although if this is truly the case, it might actually put Chinese companies at a competitive disadvantage by enhancing the appeal of American technology products to discerning Chinese users.

Point 4 doesn’t generally fall within the scope of existing personal data protection laws, but in my view its provisions fall well within the QA and warranty commitments that any legitimate technology company should be prepared to make in today’s competitive environment.

Comparing Point 5 with legislation currently in force within the European Union, Australia, Hong Kong, Iceland, India, Japan, South Korea, Liechtenstein, Macau, Malaysia, New Zealand, Norway, Singapore, the Philippines, Taiwan and some U.S. states, this point lacks some really key definitions, including:  

  • Who exactly is a “data subject” who is entitled to personal (i.e. user) data protection?
  • Who exactly is the “data controller” who owns the user information that is being collected or processed?
  • Who might be the “data processor” who stores and/or processes user information on behalf of the “data controller”?

EU Data Protection DirectiveThe legislation and regulations I’ve reviewed in this realm provide very explicit (and varied) definitions of these entities. Unlike China’s Declaration of Commitment, for instance, the E.U. Data Protection Directive allows “data controllers” or “data processors” to transfer user data outside the E.U., as long as the country where the data is transferred protects the rights of “data subjects” as much as the E.U. 

It also defines which “data controllers” and “data processors” must comply with E.U. law, based on whether or not they store or process personal information with the E.U., or operate within the E.U. (regardless of where the data is actually stored or processed).

The requirement to keep sensitive user information within China’s borders, in the absence of permission from users or “relevant authorities” to transfer, store or process it elsewhere, could also be seen as an attempt by the Chinese government to enlist the help of American technology companies in circumventing the U.S. government’s ongoing Internet data-gathering programs.

If this attempt succeeds, it might further enhance the appeal of American technology products to discerning Chinese users. 

Point 6 is garnering the most headlines in the West because of the implied threat that cooperating with “third-party institutions for assessment and verification … to prove actual compliance with these commitments” could mean being forced to reveal source code or encryption algorithms.  

However, in classic Chinese style, none of that is actually spelled out. 

Green Dam Youth Escort ServiceA little history about this: Over the past decade, the Chinese government has put forward various proposals for controlling IT – and then abruptly withdrawing them in the face of domestic as well as global criticism. Here are two: 

As for implications, China’s Declaration of Commitment shouldn’t have significant impact on companies that aren’t in the consumer IT market.  At best, its first five points could potentially improve the competitiveness of American IT products in the  Chinese market.    

However, I would advise any tech companies that may be wondering what to do, to sit on their hands for a while. Law in China is always a “work in progress,” so the safest bet is to wait for that “progress” for as long as possible.

So there you have it – the view from someone who is smack in the middle of the business economy in East Asia. If you have your own perspectives to share on the topic, I’m sure other readers would be interested to hear them as well.

Samsung gets its marketing knuckles wrapped – twice.

Samsung logoTech manufacturing giant Samsung’s “questionable” marketing activities have been in the news this past week – again.

This time, it’s reported that the company has been fined a $340,000 penalty for paying people to post trash-talk comments about competitor HTC’s products in customer online forums in Taiwan.

Back in April, the Fair Trade Commission in Taiwan opened an investigation into allegations that Samsung had recruited certain employees along with freelance writers from the outside to flack the shortcomings of its competitors’ products.

In addition to the company being held culpable, two of Samsung’s outside marketing firms were fined for their part in the marketing shenanigans masquerading as natural content.

This is pretty big news in the world of smartphones.  HTC and Samsung are major competitors in this highly competitive marketplace, and both companies offer products that operate on the Android platform.

But Samsung’s fortunes have risen dramatically over the past year as its global smartphone market share jumped from ~19% to ~30%.

By contrast, HTC’s share declined from ~9% to slightly less than ~5% over the same period.

Evidently, Samsung couldn’t resist the temptation to kick a competitor when it was already on the ropes.

Chalk it up to the “take no prisoners” atmosphere in the cutthroat competitive world of mobile technology – the “New York Garment District mentality” writ large.

“Astro-turfing” isn’t new, of course.  But the practice is usually the province of smaller companies with fewer scruples … or marketing people who are simply unaware of proper marketing etiquette (and often backed by legal opinion).

Amateur hour
“Amateur hour” at Samsung’s marketing department makes the company look just … silly.

For a company as large and as sophisticated at Samsung, it does seem a little … odd.  And certainly not in good form.

But as it turns out, this isn’t the first time Samsung’s gotten caught with its marketing pants down.

Just a few months ago, the company was discovered bribing various people to “talk up” its development activities – and “talk down” their competitors – during the Samsung Smart App Challenge competition.

Android developer Delyan Kratunov went public with ongoing correspondence in which a viral marketing company working for Samsung offered him $500 to cite positive mentions on the Stack Overflow online community.

The instructions were specific:  Mr. Kratunov would need to ask a series of “casual and organic” questions about Samsung’s app challenge over a month-long period.

Later, the marketing company attempted to distance itself from the egregious behavior — but not before the incident had been exposed.

My response to Samsung is this:  You’re already winning.  There’s no need to engage in “adolescent business behavior” of this kind.

It’s in very bad form … and sooner or later it’ll come back to bite you.

Stuff like this always does eventually.

Grand Funk: PC Sales are in the Doldrums

PC sales decline in 2012
Eyebrow-rasing stat: Worldwide PC shipments declined in 2012 … the first drop since 2001.

If people had any doubts about the inexorable rise of tablet devices and smartphones, the sales results for the holiday season would surey erase them.

In fact, for the first time in five years, holiday PC sales have actually declined. Tech industry tracking firm IDC reports that personal computer manufacturers sold just shy of 90 million units worldwide during the last quarter of 2012. That’s down more than 6% compared to PCs sold in the final quarter of 2011.

What makes the news doubly troubling for the PC segment is that, unlike in 2009 when sales of all tech devices were hammered by a worldwide recession, this time around sales of other devices such as tablets and smartphones have grown substantially.

And considering 2012 as a whole, the news is even worse. The estimated 352 million PCs sold were ~3% lower than in 2011, which makes this the first annual decline in more than a decade – since 2001 in fact, when the 9/11 attacks roiled markets and impacted sales of all goods across the board.

And it isn’t trouble for just one manufacturer, either: The 2012 sales drop hit all of the big players including Dell, HP and Lenovo.

What about the prognosis for 2013?

It’s not much better. IDC is forecasting mediocre growth in the PC segment (less than 3%) — although at least that isn’t a decline.

But on the downside, it’s very possible that tablets will actually outsell PCs in 2013 – a possibility that would have seemed unthinkable just one or two years ago.

We’re hearing a number of explanations for the slump in PC sales. One of those is that Microsoft’s new Windows 8 operating system isn’t doing much to excite buyers – at least not so far.  The surge in new PC hardware purchases, which commonly occurrs when newer versions of Windows have been introduced, hasn’t happen this time around.

More fundamental than the Windows 8 conversion rate are signs that PCs are losing their edge over other devices in the perception that they’re the most secure, reliable and efficient options.

This shift may be less about PCs themselves or their quality, and more about the aggressiveness by folks like Apple iPad and their incursions into the PC “space.”

QR Codes Go Ghoulish

QR Code on HeadstoneIt’s no secret that QR (“quick response”) codes, the Japanese communications tech import, have had a difficult time taking off here in the United States. It’s a topic I’ve blogged about before. 

Indeed, it seems that marketing people are more attached to them than anyone else.

And why wouldn’t marketers be excited? It’s yet another way to engage audiences “in the moment” and enable them to head over to a landing page on impulse to take an immediate action … or at least to find out more information.

But a mix of things – lack of complete smartphone penetration, lack of QR-enabling software on mobile devices, ignorance of how QR codes operate, or just plain laziness – have conspired to keep QR engagement levels far below what marketers were hoping.

But hope springs eternal. And now we even see the QR spirit rising in the grave marker business.

That is correct: At least four monument companies in the United States are now offering QR code services as part of the grave markers they’re preparing for families of deceased loved ones.

And the QR codes look just like you’d expect: one of those square splotch-marks, affixed prominently to the headstone. So now gravesite visitors can point their smartphone at the headstone and immediately pull up a biography, pictures, or even videos of the dear, departed soul.

One of the companies offering QR service is Katzman Monument Company, a Minnesota-based company that conducts its business completely online.

“It’s a chance for future generations to make a connection with a loved one,” company head Norm Taple reported to the Minneapolis Star-Tribune newspaper. “There’s no emotional connection when all you can look at is a headstone – probably a dirty headstone at that.”

Part of the fun is the person who maintains the login code for the deceased’s online information. While anyone can access information on the deceased via a smartphone, only that one person can edit the information … and he or she can do so at any time.

Want to beef up Grandpa’s legacy by having him graduating from Harvard as opposed to Haverford? Done in a flash.

Looking to spice up Great Aunt Emma’s early dramatic career by having her being a burlesque showgirl in Chicago? Just a couple keystrokes and it’s now in her official biography.

Kidding aside, it’ll be interesting to see if this latest manifestation of QR code technology is more successful than the other attempts to force-feed them to the public.

My hunch tells me … it’s doubtful.