As the market for tablets and smartphones matures: what’s next for tech companies?



For the first time in computing history, we have better hardware than any software application actually needs. Microprocessors are getting more powerful and more microscopic by the minute and huge data storage is being fit into tiny USB flash drives. We might be nearing the point where we no longer need to buy a new computer or smartphone every year to keep up with the technically demanding apps that are being released.

Such a shift would have a significant impact on the technology market.

Like most consumer electronics producers, tech manufacturers moved their factories to Asia and other less developed parts of the world, in a quest for cheap workforce. But if we are getting to that point where no software applications are being developed that demand more powerful hardware, we’ll see people holding on to their devices much longer. Apple’s recent order cancellations for iPhone 5 parts might be a first sign that consumers are increasingly happy with their current model.

In a consumer technology world that isn’t device driven anymore, tech companies would shift their focus towards software development and monetization as they watch hardware sales slow down. These last few years we’ve seen hardware manufacturers like Apple, TiVo and Jawbone filling stores with more than just good looking, multifunctional devices. They created entire software ecosystems for other developers to build and sell on.

Physical products evolved from being an end in itself, to becoming a medium. A medium that will eventually earn them a lot more money than selling MP3 players, DVRs or wireless headsets.

Big tech manufacturers would no longer be looking for more cheap workforce to power their factories, but instead start hunting down skilled developers. Meaning that the more highly educated developers and engineers a country can deliver, the more they can grow their tech industry, irrespective of their manufacturing capacity.

And this is bad news for emerging economies. Year after year, major parts of their revenues have been consistently re-injected in manufacturing in order to grow their production resources. And while education significantly progressed, it’s often only accessible to a small urban elite which won’t be able to fill the vacuum.

Perhaps, hardware manufacturers will ease the transition by diversifying their offer. Developing more devices adapted to specific uses and user-types or integrating their technology in everyday objects ( a.k.a. internet of things) are trends that have been taking off these last few years. Sticking to Apple’s case; they surprised everyone with their iPad Mini last year, as until now the company was known to limit it’s range of products to a strict minimum.

So are we moving back to a time of more sustainable objects? And are we seeing a come back of tech companies in developed countries?

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About the author

Pierre de Schaetzen

Word of Mouth Architect and founder of Brussels based agency Superette. Before taking the entrepreneurial path, Pierre de Schaetzen worked at european startups Mixcloud, Dragontape and Checkthis. For love & hate tweets: @pidesc

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