This month’s iPhone X launch comes a full decade after the iPhone’s original debut and harkens back to its first release in 2007. Like the original, the X is priced much higher ($999 for 64GB and $1,149 for the 256 GB model) than the average phone available today; the first iPhone was originally priced at $399, while most phones at the time were $199. The release of X is also similar to the original, with its limited availability due to manufacturing constraints and its certain role as a status symbol. Continue reading
To gauge the innovation activity in the smart textile space, Lux surveyed the patent landscape and identified 10,051 patents published since 1997 relevant to smart textiles and fabrics. There has been a consistent uptick in activity, showing a greater interest in smart textiles as other enabling technologies, such as conductive inks, sensors, and power systems, further develop. We have previously looked at the innovation occurring in smart textiles (see the report “Innovation in Smart Textiles Moves from Materials to Analytics” [client registration required]) and printed electronics. To evaluate the patent landscape, we utilized a Lux-developed search tool that uses patent data that has been stored and categorized by Clarivate Analytics. The search terms used were conductive fabric, conductive textile, electronic fabric, electronic textile, smart fabric, and smart textile. There were no specific conductive ink terms used in the search; therefore, companies that innovate primarily in conductive ink were not included in this search. Even without including conductive inks, the amount of patent publications specifically around smart textiles is growing; 2016 saw the most-ever patents granted, with a total of 377. Figure 1 shows the total number of patent publications per year, with the data for 2017 current to May 2.
The widely-publicized Samsung Galaxy Note 7 lithium-ion (Li-ion) battery fires add another case in the file of Li-ion battery fires that already includes Dell, Boeing, and scores of hoverboard manufacturers. The fires have not revealed anything new about Li-ion batteries – they store large amounts of energy in a small space and, on occasion, fail in a spectacular fashion. It’s also not surprising to see established players in the energy storage industry suffer very public failures: Sony supplied faulty batteries to Dell laptops, GS Yuasa provided batteries for Boeing’s 787, and Tesla supplier Panasonic has recalled laptop batteries as well. Samsung was hit swift and hard by the recall, halting production while its mobile division’s profits fell 96% and Samsung SDI’s share price fell 25%. This begs the question where did Samsung go wrong?
We still don’t have an official answer from Samsung on the technical reason behind the failures, but we can look at a few key strategic decisions that may have played a role in this disaster. The company reportedly rushed a product to market as it sensed weakness from competitor Apple’s iPhone 7 Plus – the same strategy that led to mass hoverboard recalls, as adequate quality control could not be insured. Additionally, Samsung performed all battery testing and certification in-house, a practice none of its competitors follow. The lab is certified to complete testing, and hasn’t faced battery issues in the past, although a clear conflict of interests exists which may be magnified by rushing to market. These factors, adding to an existing possibility that even the safest Li-ion batteries can catch fire, created an environment within Samsung in which thorough evaluation may not have occurred.
Companies are highly sensitive to the costs of each component in the design of handsets, and rightly so, as the high volume nature of these products means even small changes in component price have significant impact on revenues. However, in making these decisions, a key factor can be left out: risk. It’s difficult to understate the financial burden Samsung will ultimately feel from this fiasco – the company estimates it will cost over $5 billion including lost sales and the direct costs associated with the recall. Considering Samsung would likely sell around 10 million of these handsets, this recall costs the company a staggering $500 dollars per phone – 100 times the cost of the battery.
Financial concerns aside, it’s more difficult to put a price point on the bad press that comes from product recalls, but look to Nokia for an example: Once the world’s largest handset manufacturer, the company saw its value plummet after a 46-million handset recall due to batteries overheating – from which it never recovered. Software can be rushed to market and fixed after release with a patch; however, batteries don’t have a simple fix, and potentially cause physical harm. Those in the Li-ion value chain should take risk much more seriously, factoring it into energy storage considerations along with price and performance.
Among its recent string of announcements, Apple has introduced the successor to its first wearable device, the Apple Watch, appropriately dubbed “Apple Watch Series 2,” along with an update to the the Operating System “Watch OS 3.” The Apple Watch Series 2 has a few additional hardware features, namely a faster processor, bigger battery, waterproof, brighter screen, and GPS module. The Watch OS 3, which is for both the Apple Watch 1 and 2, revamped the information provided during workouts with users being able to track distance, pace, active calories, heart rate, and elapsed time, in addition to being able to share activity with friends, and to track swim workouts and running workouts without also needing to carry a smartphone. The Watch OS 3 also includes a breathing app that guides users through deep breath exercises to help them relax. Continue reading
Apple recently launched a subsidiary, Apple Energy, which filed with the Federal Energy Regulatory Commission (FERC) as a supplier of power to wholesale markets across the U.S. for energy, capacity, and ancillary services.
Since the announcement, the media has been abuzz with speculation as to what Apple Energy might mean for utilities, power customers, and Apple, but ultimately, this development is hardly newsworthy. To cut through the hype, we clarify some misunderstandings to explain why Apple Energy should not raise any eyebrows in the energy community: Continue reading
Lux Research analysts recently attended the Enterprise Wearable Technology Summit East in Atlanta, GA. The conference included about 250 attendees, with presenters and exhibitors focused on the opportunities and challenges of implementing wearable devices in the workplace. The buzz at the conference centered around smart glasses and three main issues facing smart glasses in the workplace today: Continue reading
Last week ended with Apple announcing a $1 billion investment in the Chinese ride-sharing company Didi Chuxing. Didi Chuxing is Uber’s biggest competitor in the Chinese market. Apple’s investment is meant to act as a chance for Apple to learn more about Chinese market segments. The investment would also be a key component in Apple’s rumored self-driving vehicle project.
With each new partnership or investment announcement, an ecosystem within the autonomous vehicle space is developing that consists of three key components: autonomous vehicle technology development, the emergence of new business models, and manufacturing of vehicles. To survive in this evolving ecosystem, companies must be able to touch all three of these points. It isn’t feasible for any one company to hit all three of these by itself, though; companies operating in this space are looking for relationships with other companies to be able to fill any gaps. A recent example of this is the automaker GM, investing in the ride-sharing company Lyft, and in the process of acquiring the autonomous vehicle technology developer Cruise (client registration requred). Lux recently wrote a report (client registration required) comparing automotive OEMs and the companies that were lagging behind were the ones that chose to ignore one of these components, like Audi and its conservative approach to technology implementation or Renault Nissan and its lack of self-driving vehicle technology.
Apple’s recent investment shows that it is taking the autonomous vehicle space very seriously, even if it hasn’t openly stated that it is working on this technology. But for Apple to consider approaching the rest of the pack, there is still a critical question remaining: who will make its cars? Previously, Daimler and BMW both rebuffed Apple’s advance, likely due to arguments over data ownership and Apple’s notoriously demanding requirements from its partners. Clients can expect tech companies operating in the autonomous vehicle space to look elsewhere for the vehicle manufacturing piece of this new – and still developing – ecosystem. If an automotive OEM isn’t an option, Apple will need to look toward tier-ones with experience manufacturing vehicles.
By: Kyle Landry
The Quantified Self (QS) movement began with fringe consumers obsessed with self-measurement, but today’s Internet of Things (IoT) – with sensors on and inside bodies, connected cars, and smart homes, offices, and cities – is expanding it to include everyone. Consumers will not have a shortage of devices or data to choose from anytime in the near future. Looking out further, to 2025, three specific factors will drive the technical evolution of the QS/IoT as a computing platform, each with implications for consumer relationships: improvement of individual devices; integration, from aspects of inner self to a holistic view of inner, outer, and extended self; and intervention in consumer actions.
- Improvement: Before too long, gimmicky and overpriced devices will disappear from the market, while runaway hits will make headlines (and millions of dollars). From 2005 until now, sensors have driven QS – specifically, sensors attached to or focused on humans. An early example is fitness wearables, but they’re already a commodity; today’s Samsung, Google, and Apple smartwatches are a natural evolution. Bragi headphones now do health tracking; Samsung’s Artik platform, Intel’s Curie and GE’s GreenBean offer startups an easy way to create consumer IoT devices. Image sensors – cameras – enable gesture interfaces and new channels like lifelogging, where users of Twitter’s Periscope and Facebook’s Facescope live-stream their lives.
- Integration: Fitness trackers and action cameras capture data on or next to consumers’ bodies. IoT technologies quantify consumers’ “inner selves,” and marketers can learn as much from them as they have by examining purchase histories, web surfing habits, and other digital footprints. Other IoT datapoints include vital signs from exercise, sports, and adventure wearables; food, from precision agriculture to smart utensils like HAPIfork, to microbiomes and Toto’s smart toilet; and medical bioelectronics, personal genomics, and mood- and mind-monitoring like Neurosky. The IoT tracks consumers’ outer lives of family via smart baby bottles and wearables for pets, and extended selves via connected thermostats, diagnostic dongles in cars, and image-recognition systems in stores and city streets.
What They Said
Sony announced it is spinning off its image sensor business into Sony Semiconductor Solutions Corporation (SSSC). Sony will also spin off its battery and storage media business into Sony Energy Devices Corpation and Sony Storage Media and Device Corporation. SSSC, whose primary focus will be Sony’s image sensors, will be given oversight over R&D, business control, sales and other operations related to these products. In addition to its spin-off, the company acquired SoftKinetic, a 3D vision company specializing in time of flight (ToF) laser-based systems. Shortly after its acquisition of SoftKinetic, Sony announced it will license the 3D technology to Melexis, an automotive electronics company, and partner to further develop the technology.
What We Think
Sony has been dominant in the image sensor market mainly because it has a hold on the smart phone market (with the latest smartphones from vendors like Samsung, Apple, HTC, and Google using Sony’s sensors). In fact, Sony attributes its 23.9% annual revenue growth primarily to its growth of image sensors in 2014. However, the growth of the smartphone market is slowing down; companies like Samsung and TSMC have seen a drop for demand in smartphone related products in their latest quarterly financial filing. In addition, Sony has little to no room to grow in the market, as it already is involved with the majority of smartphone suppliers after winning the Apple iPhone 6 contract over Apple’s old supplier, Omnivision, in 2014. The only perceivable way for Sony’s image sensor division to grow is by branching into the automotive and industrial markets. In particular, ToF sensors in the automotive market will capture a portion of the $2.5 billion LIDAR market by 2030 (client registration required).
In both automotive and industrial image sensors, Sony has been behind the pack; the company only introduced a handful of these types of sensors in mid-2014, while its competitors – Ominivision, Toshiba, and On Semiconductor (Aptina) have been targeting these markets (especially automotive) heavily since before 2014. To play catch-up, Sony had to shed its consumer focus and show that it could differentiate itself. This plan resulted in the spin-out (which allows the image sensor business to grow independently from Sony’s consumer focus) and its acquisition of SoftKinetic. Sony’s timing of its acquisition couldn’t be better; automotive manufacturers have not found their ideal ToF partnerships and are willing to switch to new vendors who can promise cheaper or better components. While SoftKinetic’s technology is on par with other ToF companies, Sony can push its technology forward through its image sensor expertise and developmental partnership with Melexis. Sony has two routes to capture interest from automotive manufacturers; it can provide a ‘smart sensor’ which does all of the software including gesture and facial recognition in one, or provide the component at low cost. Automotive companies should monitor Sony’s progress in the area to see if its development of ToF fits their criteria.
While the Apple Watch and Samsung Gear S smartwatches may function and even appear similar, these are just first attempts at the wearables market. To understand their future strategic direction, we’ve examined the wearable patents of Apple and Samsung since 2010 and analyzed their overall portfolios in three major taxonomy families: applications, form factors, and components (client registration required). Apple and Samsung’s patents cover nearly identical form factors and components, but they diverge when it comes to applications. Samsung is more health-focused, while Apple is focused more on consumer communication. As illustrated in Figure 1, 28% of Samsung’s and 10% of Apple’s patents are for medical devices or health monitoring, while 10% of Samsung’s and 43% of Apple’s patents are relevant to consumer communication like entertainment, gaming, and notification.
Samsung and Apple have dominated the smartphone market for years; however, in the wearable space, the two companies will fight on different battlegrounds. The smartphone competition between Samsung and Apple has been especially intense as the two battle for top market share. However, wearables are shaping up to be a very different competitive landscape, as the two giants focus on different applications. Samsung, with 12% of the whole wearable medical device patent pool (see Figure 2), will find itself primarily competing in wearable health monitoring devices with other innovative medical wearable companies like Zoll Medical and Asante, or wearable component companies like Qualcomm that are still determining how much of the device they should develop themselves. On the other hand, by focusing on consumer communication, Apple will compete with the usual host of competitors from the mobile space: Nokia, Sony, Microsoft, Motorola, and LG are all among the top 10 IP holders for wearable devices designed for consumer communication, not to mention that Qualcomm has actually filed the most consumer communication device patents (see Figure 2).
The roots for this apparent divergence between Samsung and Apple can at least partially be found in the origins of these two companies. While Apple has stayed true to its consumer electronics roots from inception, Samsung has grown from a trading company into a global conglomerate with business units as diverse as health care, financial services, and heavy industries. Therefore, expect wearables to inherently be a more fragmented market than other consumer electronics. Clients should be prepared to develop a broader range of products and channels to market, and perhaps a more diversified technology portfolio, as well.