In case you haven’t heard it’s 2015 and a new year means new themes (or re-emphasis on old old themes) for the internet industry. The three themes that I see taking shape in 2015 revolve around health, home and payments. I give my quick take on each of these themes below.
With regard to health, you may have heard that Apple is fixing to release their watch in early 2015. Sensors that gather health data are a key component of the Apple Watch. I assume that the data from the watch will be aggregated in Apple’s native Health app and in turn will be made available to third-party apps. Given the myriad of fitness trackers and watches already available Apple is something of a johnny come lately into this space. Everyone interested in this space is waiting for the Apple Watch and so I think that the race to track people’s health data really begins once Apple launches.
With regard to the home, 2015 is expected to be the year when products that take advantage of Apple’s HomeKit home automation integration for iOS hit the market. Google already moved into this market in a big way in 2014 via their purchase of Nest, which makes app-driven thermostats and smoke alarms. A variety of other companies (including Philips with their Hue line of smart lightbulbs) are in this space as well. For years companies like GE have trumpeted smart appliances like a dishwasher that you can turn on and off remotely or a refrigerator whose temperature can be remotely monitored. The grandiose visions of smart appliances have mostly fallen flat (the appliances are too expensive and the control devices aren’t very useful) but now that smart phone/tablet integration is possible there could be a new wave of innovation.
With regards to payments, a number of major players in the internet space seems to be lining up to help make payments simpler and more secure. PayPal has been in this business for years but has had trouble gaining broad traction for their mobile payments app. Google has been around for awhile with their NFC enabled Google Wallet app. Once again it’s Apple reinvigorating the space with the launch of Apple Pay for the iPhone 6. From the get go Apple has had the support of many major banks and retailers but there is still competition including the aforementioned players, Starbucks (which has their own app-enabled system) and Softcard (a joint venture of AT&T, T-Mobile and Verizon). Some big investments have been made in this space so while I think that Apple does have the inside track right now I also think that the competition won’t go down without a fight.
While I believe that the themes of health, home and payments will be prevalent in 2015 it’s too early to tell if any of them will actually mature this year. If anything I think that payments is the one area where the quickest change could occur. Think about companies like Square (which enables merchants to accept credit/debit cards via their mobile devices) whose technology quickly gained traction with independent merchants. People pay for things every day and if the devices that they already have integrate with payment systems then so much the better.
I think that as far as health goes the near-term outlook is dependent on the success of the Apple Watch. If that sells well I think that it will spur a new wave of innovation as companies seek to replicate the sensor functionality at a price (rumor is that the basic Apple Watch will cost around $400) that is more palatable to the average consumer. If the Apple Watch flops I think that we’ll continue to see innovation by the traditional players in the fitness tracker space like Garmin, Polar and others.
Finally, I think that home automation is the area that’s least likely to gain critical mass in 2015. Yes, a lot of resources will be thrown at it. But of the three themes I mention here home automation is the least personal and the most expensive. It’s a space that needs to be propped up in the short run by passionate early adopters who help to perfect the functionality and drive down the price. Those challenges aside I think that companies like Google, Apple and Samsung will continue to hammer away at home automation since it’s a long-term growth prospect that can’t be ignored. After all, these companies are all in the home in a big way in one way or another. Now they just have to figure out how they can become more relevant in the home.