iPhone Video Reveals Apple Product Roadmap 2014 – 2024

If you pay careful attention, the video for the iPhone 6 contains Apple’s strategy for capturing three new verticals over the next ten to twenty years.

They are:

  • Health
  • Payments
  • Global

Health

The motion co-processor enables iPhone 6 to track physical activity of its users throughout the day. The fact that it is an on-board co-processor specifically for motion optimizes battery usage, since a specific instruction set can be tuned and used instead of making use of the general purpose CPU.

While the iPhone 5s also had a motion coprocessor what is significant is the focus given to it in the iPhone 6 video.

As mobile develops further, self diagnostics/patient compliance, telemedicine, and personalized fitness and medical tracking will explode. Developing hardware now to take advantage of those trends is smart positioning on Apple’s part, and fits in nicely with the iWatch’s heart sensor.

But it’s more than that. Apple begins the video with Senior VP Design Jony Ive saying “A truly great product is ultimately defined by the integration of its hardware and software.” Motion tracking to see how many steps someone takes will not be the ultimate hardware coup of mobile fitness. But training millions of people around the globe to respond to Apple’s UI and to expect Apple’s UI when they think of mobile fitness is a giant software coup.

It’s part of a strategy to increase the likelihood that future mobile fitness developers build on Apple, and that future hardware innovators innovate for Apple devices. As current generic hardware gets exhausted* for medical application, specialized devices like blood glucose meters for diabetics and cancer screening tools for physicians will be developed. And Apple wants them to be developed for the iPhone. Here Apple leverages its software dominance to extend its platform/ecosystem into a new vertical, health, by capturing what will become the most important differentiator: the ability to support novel hardware devices that accomplish medical tasks.

*It’s worth noting that current generic-use hardware on mobile has a long way to go before its medical uses are exhausted. For example, movement tracking for physical activity, gyroscopes to measure fine and gross motor control, camera systems to measure ocular disease, eye tracking to measure reflexes or pupil dilation (maybe even prescriptions for new glasses?), machine learning apps to nudge human behavior in the right direction (e.g. combining ambient auditory data with motion and location tracking correlated to time of day to help smokers stop smoking – like Quitbit without the additional lighter), etc.

Payments

ApplePay is the iPhone (and iWatch)’s new mobile wallet. Since users already have credit cards associated with the iTunes store, extending their reach via mobile devices was a no-brainer for Apple. Over the long term mobile wallets are likely to largely replace physical cards, with added benefits of less-stuff-to-carry-around and security. With Apple controlling the user’s wallet they may eventually be able to leverage merchant fees like credit card companies do. Or, in a total moonshot maneuver, Apple could simply start its own currency.

Even if an “applecoin” never materializes, the fact is that diverse credit and debit institutions from millions of users in hundreds of countries will be able to interoperate as ApplePay expands globally. Not just on the Internet, but physically as well. Merchants in developing economies (the billions at the base of the pyramid) will require physical payments infrastructure. Consumers will have an incentive to use mobile wallets in general, as they offer more security than cash — likewise for businesses. While iPhones face difficulty gaining adoption in large developing markets like India where Android holds sway, the potential of being able to finally convert the cash economy to digital is a windfall no technology company can afford to miss.

Here again Apple’s software dominance (iTunes/App Store capture of US credit card information) leads to hardware and physical dominance (construction of secure, globally recognized mobile payments solution leading to physical POS infrastructure sales). Hell, Apple could even provide banking services for The Next Billion, since both consumers and (micro-)businesses will be accessing their cash through Apple.

Global

My 6 year old Droid 2 Global is finally starting to kick the bucket, so recently I’ve been shopping for a new phone. One of my questions has been global interoperability. I used to live in Japan and visited again this summer – will my phone work with broadband in Japan? I’d like to spend time traveling East Asia in the future, will I be good in Korea, Singapore, Taiwan, China? I’m not sure where I’ll end up long term and some of my friends live double lives: studying in America but home in India, or born in America but moved to Thailand, etc. What if that’s the path my life takes?

Navigating the myriad LTE specifications, implementations, and hardware jargon is mind-numbingly shitty. Wikipedia is the best source but even then carriers provide sparse information on what is actually implemented or will actually work, no one in tech support can answer you definitively, and few phones give you the precise spread of bands you want. Oftentimes phones are split into US versions and Global versions, like the Nexus 5.

Apple is clearly aware of this, and decided to do something about it. The new iPhone sports over 20 LTE bands – more than any other phone on the market. As networks continue to interpenetrate global data coverage will become the new norm rather than the exception, as T-Mobile’s Simple Choice ($50-$70/mo. for global data coverage) presages. Users will have a home base country (or two), and get the rest of the world for free under their current monthly plan.

Recent accelerations in Software Defined Networking make me confident that we will see increasing interpenetration of global network offerings. All networks – even individual networks – will become technological and fiscal internetworks. While the explanation is outside the scope of the discussion, a simple example should clarify.

An ISP or data center might have one part of its network (the edge) operated by a given company, with another part (the core) operated by a different specialist company, with yet another part (network invariant maintenance for flow rules, transparent and invisible to cloud-based clients) managed by yet another. Networks are becoming discretized into individual functional parts and will be operated in this new fashion.

Eventually we will see bandwidth provisioning – what most of us think of when we think of the word ‘network’ – sink to the status of lowest common denominator. Apart from making sure you have the right convertor for the plug, none of us worry about whether or not the electricity in Mumbai can power a device from Los Angeles (which was probably manufactured in Chengdu to begin with). Bandwidth will become as electricity, and it will be available to the consumer wherever she goes.

When this happens, people will need a phone that can take advantage of it. Students, transnationals/expats, and businesses already have demonstrated use-cases for this technology, and Apple is the first to figure out how to place so much antenna in such a thin profile.

Conclusion

Of course it’s not a given that Apple wins any of these three plays. As previously mentioned, the iPhone prices out large segments of the population, and Android’s cost-per-value (along with dual-sim support) is a huge differentiator in markets like India, where it has over 90% market penetration. Google also already has Google Wallet. Xbox Kinect and other in-home (or in-hospital!) devices could access a different portion of the telemedecine and home diagnostics market, perhaps offering Microsoft a beachhead for making up lost ground in mobile.

Despite the stiff competition expected from Google, Samsung, and Microsoft it is a healthy sign for the world’s largest corporation that it hasn’t given up on innovation. The latest iPhone video makes clear just where Apple sees technology going.

 

bobo