The Next Big Thing

Half an decade back Smartphones and Tablets were the next big thing. Everyone – from banks to studios to service providers to consumer electronics folks wanted to reserve a seat in that bandwagon. When I look back now, yes Smartphone is a big concept that changed the way we were living and it touched a billion people’s life. Seems there more life left in that concept and now the same thread is being extended as Internet-of-Things and a lot more folks have joined the bandwagon.

But things were different for several electronic hardware manufacturers. Smartphones and tablets turned around the market and created a few power centres. More and more devices, even medical instruments were made irrelevant by smartphones. Then folks tried to embed a tablet into each and everything possible (not literally but tried to embed the functionalities and capabilities of a tablet so that same underlying chipset can be used) – technology of portable personal devices to immobile devices at home like Televisions and Audio Systems. Though there is a competition between the devices in the living room on who will become the centrepiece one with smart functions, its not yet clear how much smart they have to become with a tablet/smartphone anyways around.

Automotive industry which traditionally is a lagger on adapting such technologies is now also on the move. At the low end of the spectrum, people who got used to better infotainment experience with smartphone are forcing automobile manufactures to at lest embed a tablet into the front panel. At the other end, need for making vehicles more and more autonomous or at lest assist the driver is driving both innovation and adoption of technology from other sectors. Is the next big technological innovation (in the likes of stream engine, factories, oil, internet & smartphones) going to happen in automobiles or some other form of personal transportation? may be, but unlikely to happen now. Is automobiles the next big market for electronic hardware manufactures after smartphone? again, no.

Because of regulation and market demand, amount of electronics that go into each car is increasing. But number of cars that gets produced globally every year still hovers in 8 digit number. Assuming need for high end electronics in an average automobile is 10 times that of a smartphone and 150 million automobiles get sold annually (say, after five years), that’s equivalent to catering to 1.5 billion smartphones. That number is close to number of smartphones and tables being shipped globally this year. And smartphone shipments are expected to grow at a much faster rate. So automotive industry cannot eclipse smartphone as the biggest market for electronics hardware manufacturers. And it definitely doesn’t have the characteristics to become next big engine powering the economy, let alone electronics.

To become an engine powering the economy, it has to touch the lives of most of the population; it should be a essential entity in their lives; there should be a continuous demand for it; it should be a significant entity in monetary terms; it should spawn allied entities & ecosystem; it should continue to evolve; lives of significant portion of the workforce should revolve around it. Look at the history of clothing, healthcare, capital goods/factories, transportation and weapons for how such engines evolve and mature. Lets compare housing, automobiles and smartphones on this front.

	Housing	Automobiles	Smartphone
Need	Basic and absolute necessity	Not a necessity in most of the geographies but a convenience need	A convenience and in some cases livelihood need
Monetary value	Several years/decades earning	Several months/years earning	Several weeks/months earning
Longevity	Close to a human being’s life expectancy	A decade	A few years
Count needed	1 per family	1 per family to 1 per person	1 per person
Future	Need will continue to exist	Might be needed	Needed till next technology obsoletes it

New life changing innovations are not predictable, but incremental engines of growths can be inferred. Based on the above information, my guess is next incremental engine for economic growth might be a smaller pervasive one that everyone can afford; that are used in volume and replaced at a relatively faster rate. I don’t know what that is, but sure we can’t go back to an older engine like automobiles and call it the next driver for growth.