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The Quantified Group: Getting Over Your Self Jonathan Melnick, Ph.D. Senior Analyst Lux Executive Summit- Americas March 19, 2015 Agenda Wearables enter the ecosystem era There are different levels of ecosystems Ecosystems will need to work with one another 2 Agenda Wearables enter the ecosystem era There are different levels of ecosystems Ecosystems will need to work with one another 3 Wearable computing has a long history 2013: Google Glass 1975: Pulsar watch 1810: First wristwatch- Queen calculator of Naples/ Abraham-Louis Breguet 2000s- connected devices 1960s- wearable electronics 1500s- wearable 1500s: Wearable computing 2013: Samsung abacus 2003: Garmin Forerunner Galaxy Gear 1961:Thorp Roulette computer 4 Connected devices play a key role in the quantified self Activity tracking Jawbone, Fitbit, Misfit Vital signs monitoring- Biovotion, Oxiton, AliveCor, Huneo Infant monitoring- Fever smart, Sproutling 5 Key questions remain for wearables and the quantified self: What is the value of the connected device? 6 Key questions remain for wearables and the quantified self: What is the value of the data? U.S. Nutritional Labelling and Information Act of 1990 required labels on food as we know them today Obesity and diabetes have continued to rise, even more steeply since then Nutrition Labeling and Information Act of 1990 CDC (top) and National Institute of Diabetes and Digestive and Kidney Diseases 7 Wearable ecosystems seek to add value to the devices and the data “Works with Nest” 2010s-wearable 2000s- ecosystems connected devices 1960s- wearable electronics 1500s- wearable computing 8 Agenda Wearables enter the ecosystem era There are different levels of ecosystems Ecosystems will need to work with one another 9 Three types of wearable ecosystems have evolved Environm ent Data Device 10 Pebble is developing its own smartwatch ecosystem Pebble is a smartwatch with an electophoretic display Compatible with iOS and Android Smartphones User base of ~1 million Funding history: 2012 $10 million Kickstarter Lost Kickstarter title to Coolest Cooler ($13 million) in 2014 2015: Pebble Time Steel reclaimed record (~$19 million) Launched Pebble App store in 2014 with 3rd party software developers Notifications, Sports & Fitness, Tools & Utilities, Remotes, Daily, and Games as well as an area for Pebble Faces (aka watchfaces) Partnering with other device developers like activity tracker developer Misfit Wearables 11 Smart watches still have a lot of separate operating systems, which require their own ecosystems Pebble OS Watch OS Android Wear Sony four generations of its own OS before adopting Wear Apple Watch Tizen Moto 360 Qualcomm OS Asus Zenwatch Qualcomm Toq Samsung Gear 2 Sony SmartWatch LG G 12 Smart watches are just one form factor in connected devices Head/neck • Glasses/glasses Torso accessory Hat/headband/h • Chest Strap • elmet • Shirt Headset • Sports bra • Contact lenses • Dress • Necklace • Belt • Mouthguard • Vest • Arms/hands Legs/feet Insoles • Watches • Socks • Bracelets • Pants • Armbands • Anklet • Rings • • Leg strap • Shoe Anywhere accessory • Agnostic device • Tattoo • Patch 13 Saleforce had challenges introducing starter apps for wearables Challenges faced: Platforms: Android, Tizen, C/C++, Unity3D, etc. with no clear winner • Combining devices: can separate devices work in concert? UI/UX: e.g. different displays Data flow: Input/output vs. just output Security/ identity: no lock screens, passwords, Google Glass Android Wear Samsung Gear 2 etc. Pebble Myo Nymi 14 Data ecosystems aggregate users information Environm ent Data Device 15 Data ecosystems enable tracking, sharing, and analyzing wearable data Data ecosystems revolve around function and device compatibility Activity logging • Sony Lifelog Athletics • Nike+ • UA Lifelog- entertainment, • Strava activity, and communication • Ride with GPS • Google Fit Health/wellness Apple Health • Strava- running and cycling • Samsung S health • AT&T Apple Health- activity and health 16 Nike+ is compatible with mostly Nike and Apple devices Nike+ and NikeFuel Tracks and logs workouts and activity Access larger data pools Compare with friends Limited device compatibility Data Device 17 Employers use wellness companies to lower premium costs Employer Insurance Employee Wellness Device 18 Devices come from the wellness programs Data Employer Device Employee Wellness Device 19 Ecosystems develop on three levels Environm ent Data Device 20 Works with Nest looks to control in and out of the house 2014: Google acquired Nest for $3.2 billion Jawbone: tracks when user is about to wake and adjusts temperature Pebble: set and monitor thermostat How will compatibility shake out with Apple’s Homekit? What if you don’t use Pebble or Jawbone? 21 Agenda Wearables enter the ecosystem era There are different levels of ecosystems Ecosystems will need to work with one another 22 Key question for wearable ecosystems: How will ecosystems converge and interact with each other? “Works with Nest” 2010s-wearable 2000s- ecosystems connected devices 1960s- wearable Enviro electronics nment 1500s- Data wearable computing Device 23 Device integration: Freescale’s WaRP Wearable Reference Platform Device component challenges: No standardization leads to lack of uniformity across different devices Most developers use mobile components: • Parts expensive in low volumes • 12 to 18 month component turnover Unlike other markets, it open sources its reference designs to target broad start-up community and portfolio approach of mid-sized companies Freescale provides standardized motherboard and daughterboards for wearables 24 Data integration: Under Armour Record Nov. 2013: $150 Million/ 20 million users Partnered with HTC to develop Feb. 2015: $475 Million/ 80 million users devices for the UA Record UA Record- track fitness, compete with friends Feb. 2015: $85 Million/ 20 million users Currently works with “hundreds of devices” inc. Jawbone, Pebble, and Misfit 25 Key questions and takeaways Ecosystem battles are coming, they are often brutal, but who will win? Enviro There will be lots of data generated, who owns it? nment Performance opportunities exist today, when will health come about? Data There will be opportunity in forming and controlling your own ecosystem, but more in Device merging existing ecosystems Alpha partners will need to push standardization, but also be able to divide revenue through the ecosystems Wearables have enough diversity to avoid commoditization challenges of today’s mobile electronics, but competitive threats will come from far and wide 26 Thank you Jonathan Melnick, Ph.D. Senior Analyst [email protected] +1 617 502 5324 Lux Research Inc. 100 Franklin Street, 8th Floor Boston, MA 02110 USA Phone: +1 617 502 5300 Fax: +1 617 502 5301 www.luxresearchinc.com .