SF Technotes

The Winds of Change Are Blowing

By Michael Castelluccio
January 25, 2017

Online business news site Business Insider (BI) has released its top 30 predictions for six different business and tech categories. The six categories are those areas for which BI Intelligence regularly provides research reports, so these prognostications arrive securely wrapped in data, charts, and analysis. The spectrum is wide-ranging, from self-driving cars to seriously smart homes, and the categories cover the Internet of Things (IoT), digital media, apps and platforms, e-commerce, payments, and Fintech (financial technologies). Just a cursory glance at the many changes in those sectors could look like quite a serious atmospheric disturbance on the horizon, especially for those not comfortable with accelerating change.









There are 30 specific prognostications, but we’ll deal with just some of the more dramatic ones.


You can download the complete 46-page report, 30 Big Tech Predictions for 2017. The relevant BI Research reports are listed in each section, and you can order these online.




BI Intelligence begins with the explosion of successful IoT devices for the home and highway in the past year.

“Look for an approved test of self-driving cars on public roads without a driver behind the wheel.” We have many major car manufacturers and even computer companies busily assembling cars that will drive themselves for us, and the next stage is a governmental agency “granting permission for a company to test fully autonomous vehicles on public roads without a backup driver.” BI Intelligence doesn’t specify where and by what manufacturer, but they state that it will happen sometime this year.


Following the impressive success of Amazon’s Echo personal assistant followed by Goggle’s Home speaker/assistant, “Apple and Samsung will release their own AI-powered smart home speakers, and 10 million of the devices will be sold in 2017 in the US.” These devices are part of the observable artificial intelligence revolution.


A negative associated with the growing IoT inventory is BI’s prediction that the October 2016 denial of service attack against DNS provider Dyn that paralyzed sections of the internet will be reprised in 2017. “Unsecured IoT devices will be used in another massive hack that continues to generate bad press.”


“5G will actually start rolling out in 2017—without major delays.” According to the report, rollouts of super-fast 5G networks will probably begin in South Korea and parts of the U.S., “most likely in Texas and California.”




In the world of digital media, Google and Facebook control approximately two-thirds of global ad revenue, but according to BI Intelligence, this might change. Look for an increase of AR (augmented reality) and VR (virtual reality) campaigns, along with AI-powered voice search, and the proliferation of chatbots. These advertising initiatives suggest that “Credible threats [will] emerge to Google and Facebook’s digital-ad dominance.”


Because venture capital investments in digital media companies sagged to a three-year low in Q2 2016, the report surmises: “Consolidation in the digital media space will accelerate as VC money thins and legacy media companies vie for digital audiences, culminating with an acquisition of Twitter.”


If you’re already annoyed by the loud voices of those who frequently engage in conversations with Siri or Alexa, you might be unhappy with the prediction that “Interactive advertising takes off with the emergence of voice search and chatbots.”


And as to those ridiculous, bulky virtual reality rigs you’ve seen strapped to bobbing, swiveling heads, get ready: “Virtual reality will become the next hotbed for content creation, as brands experiment with innovative ways of reaching their audience.”




“The first-year sales of first generation VR headsets will outsell the first-year sales of major game consoles.” This isn’t to say that sales will be spectacular for the headsets that take you into other three dimensional worlds, but BI Intelligence expects sales to exceed first-year sales of the major gaming consoles like PlayStation and Xbox, when they were debuted.


With the advancements in voice-recognition software, you can expect that “Consumer-oriented voice products will reach parity with text input.” In other words, you might even soon be able to recognize the differences between the voices for Siri, Alexa, Cortana, and Google Now.


“Apple’s new iPhone will incorporate AR capabilities.” Mobile AR is currently limited to Lenovo and Google smartphones with the Tango application. The 3D imaging, however, might soon be arriving on Apple’s flagship. Apple’s CEO Tim Cook has already said he expects AR to “become a part of people’s everyday lives, ‘like eating three square meals a day.’”




“Online grocery shopping will become commonplace in US households.” In 2016, BI Intelligence reports only 2% of grocery purchases happened online, but the report anticipates healthy growth in 2017.
On the other hand, social media buy buttons, or single-tap purchase icons, will move in the opposite direction, eventually dying out. The report points to Twitter, which halted all development of its buy buttons back in May, 2016. “Buy buttons will die out.”


“Amazon will steal market share from logistics providers.” Amazon will begin to decrease its reliance on third-party shippers like FedEx and UPS. The report expects the company to begin to handle a greater share of its own packages.


“AR will enter the e-commerce mainstream.” The report lists a number of 2016 examples of AR in retail situations. “Home furnishings e-tailer Wayfair debuted its AR app to allow shoppers to see how a piece of furniture would fit in their home, and numerous beauty merchants including Sephora launched AR tools to show how makeup would look on a user’s face. Moreover, the popularity of the Pokémon Go mobile game demonstrated the willingness of mobile users to adopt AR tools.” All these efforts will help overcome the impediment of not being able to see products in person when you shop online.


“Mobile commerce will grow to nearly half of all e-commerce.” The report cites numbers from Criteo that 2016 saw growth that elevated mobile commerce to 35% of all online purchases—a 17% year-over-year growth. BI Intelligence sees growth to 50%, rewarding all those who have dedicated an effort to roll out mobile tools and platforms.




“US mobile wallet firms will drastically expand their use cases in an attempt to catalyze adoption.” This effort follows a disappointing 25% use in 2016 by those who have Apple Pay, Samsung Pay, and Android Pay.


“Alibaba’s Alipay mobile wallet will begin to target international users as the company continues to build partnerships in the global payments ecosystem.” Alibaba expanded into foreign markets initially to serve its Chinese users when they travel. Now, the focus will shift to include foreign users at these point-of-sale terminals.


“Card networks will become more merchant-friendly in the face of increasing pressure from retailers and regulators.” In 2016, a number of major retailers in the U.S. and U.K. sued card networks over their fee structures. Those moves prompt BI Intelligence to predict that “card networks will begin to soften.”




“The US will get more challenger banks.” In this instance, there’s a direct cause and effect traceable to a particular event. “In December, the office of the Comptroller of the Currency (OCC) announced its decision to introduce a federal charter that will allow Fintechs to become licensed as special-purpose national banks. As a result, the number of digital-only banks in the country will swell.” This will allow the U.S. to begin to catch up with the U.K. (40 challenger banks) and India (8).


“There will be a shift from ideation to tangible use cases for blockchain technology in financial services.” The editors of the report expect to see a growing focus on tests and trial runs of blockchain technology in 2017 for “real life use cases,” but “we will not see the establishment of sole providers in any area by the end of the year.”


“Asia — or more accurately China — will take the lead in fintech funding.” As venture capital is disappearing for digital media, the same is true of the Fintech sector in the U.S. and Europe. Asia, however, will see continuing increases. The report explains, “Largely driven by Chinese megarounds the size of which is unheard of elsewhere, Asia’s fintechs attracted staggering amounts of funding in 2016—the largest deal was Ant Financial’s $4.5 billion round in April.” BI Intelligence expects these megarounds to continue through 2017.




If, as Google cofounder Sergey Brin reminded the World Economic Forum last week, “The evolution of technology might be inherently chaotic,” and if the changes are accelerating, we could probably expect a re-emergence of Alvin Toffler’s paranoia over what he called “future shock” (too much change, too soon). But as always, as the winds ramp up there’s a choice. You can either start planting a new windbreak, or you could invest in some wind turbines designed for home installation.


Michael Castelluccio has been the Technology Editor for Strategic Finance for 23 years. His SF TECHNOTES blog is in its 20th year. You can contact Mike at mcastelluccio@imanet.org.

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