May 8, 2001 2

Consideration ofMarket Forces

Consideration ofMarket Forces

Van BakerVan BakerGartnerGartner

May 8, 2001 3

What I Will Not Talk AboutWhat I Will Not Talk About

The technologyThe technology The productsThe products The forecastsThe forecasts

I will discuss some things that will impact all of I will discuss some things that will impact all of you as developersyou as developers

May 8, 2001 4

Connectivity Market DynamicsConnectivity Market Dynamics

AgendaAgenda– Marketing is EvolvingMarketing is Evolving

Focus on technology must changeFocus on technology must change Offer / Experience displaces technologyOffer / Experience displaces technology

– Confused StandardsConfused Standards Impact on the Consumer Impact on the Consumer

– Workstyle issuesWorkstyle issues The Changing Business EnvironmentThe Changing Business Environment

– Lifestyle issuesLifestyle issues MobilityMobility BlendersBlenders Content PortabilityContent Portability

– Turf WarsTurf Wars

May 8, 2001 5

Marketing is EvolvingMarketing is Evolving

PervasivePervasivePervasivePervasive PersonalizationPersonalizationPersonalizationPersonalization

Offer/ExperienceOffer/ExperienceOffer/ExperienceOffer/Experience

4Ps4Ps

Product

PromotionPlacePlace

PricePrice

ValueValueValueValue

May 8, 2001 6

Marketing is EvolvingMarketing is Evolving

ViewpointViewpoint

The focus of the value proposition must focus on real benefitsThe focus of the value proposition must focus on real benefits

The customer will still consider technologyThe customer will still consider technologyDynamicsDynamics

Technology in itself has little value for the consumerTechnology in itself has little value for the consumer

Marketing of products and solutions must focus on benefits for the Marketing of products and solutions must focus on benefits for the consumerconsumer

Speeds and feeds are not benefits they are specificationsSpeeds and feeds are not benefits they are specifications

PredictionPrediction

Products need to be positioned based on value to today’s busy Products need to be positioned based on value to today’s busy consumer but technology tradeoffs will not be acceptableconsumer but technology tradeoffs will not be acceptable

May 8, 2001 7

Marketing is EvolvingMarketing is Evolving

ViewpointViewpointThe value of a product will be determined by the experience of The value of a product will be determined by the experience of buying and using that productbuying and using that productThe mass market no longer existsThe mass market no longer existsDynamicsDynamicsThe purchase experience has significant influence over the purchase The purchase experience has significant influence over the purchase decisiondecisionThe value of a product will be determined by usage rather than The value of a product will be determined by usage rather than featuresfeaturesPost sale experience significantly enhances / detracts from a Post sale experience significantly enhances / detracts from a product’s valueproduct’s valuePredictionPredictionThe experience of buying and using a product together with post The experience of buying and using a product together with post sale experiences will be inseparable from the productsale experiences will be inseparable from the product

May 8, 2001 8

Confusing StandardsConfusing Standards

ViewpointViewpointThe conflicting standards in the market will result in consumers The conflicting standards in the market will result in consumers that are unwilling to make purchases that are unwilling to make purchases De facto standards are beginning to emergeDe facto standards are beginning to emergeDynamicsDynamicsThe confusion between Bluetooth, WiFi, HomeRF, HomePNA and The confusion between Bluetooth, WiFi, HomeRF, HomePNA and HomePlug has significantly delayed adoption of home networksHomePlug has significantly delayed adoption of home networksConfusion between USB 2.0 and 1394 has the potential to delay Confusion between USB 2.0 and 1394 has the potential to delay adoption in a similar manneradoption in a similar mannerConfusion among market participants exacerbates the problemConfusion among market participants exacerbates the problemPredictionPredictionCompeting standards will delay widespread adoption of high speed Competing standards will delay widespread adoption of high speed communication technologiescommunication technologies

May 8, 2001 9

Workstyle IssuesWorkstyle Issues

ViewpointViewpoint

The faster pace of business combined with globalization has The faster pace of business combined with globalization has expanded the professionals workdayexpanded the professionals workday

The value associated with personal time has increasedThe value associated with personal time has increasedDynamicsDynamics

There is significant confusion as to how to respond to these There is significant confusion as to how to respond to these changeschanges

Solutions that help to alleviate the increased pressures of the Solutions that help to alleviate the increased pressures of the business environment will have high perceived valuebusiness environment will have high perceived value

PredictionPrediction

Products that facilitate the rapid transfer of information between Products that facilitate the rapid transfer of information between platforms will dominate the business professional marketplatforms will dominate the business professional market

May 8, 2001 10

Lifestyle IssuesLifestyle Issues

ViewpointViewpointThe personal time of contemporary households is fragmented and The personal time of contemporary households is fragmented and distributed across several locationsdistributed across several locationsThis demands highly mobile but simple information flowThis demands highly mobile but simple information flowDynamicsDynamicsAll family members have increasingly mobile lifestylesAll family members have increasingly mobile lifestylesValue associated with diminished personal time is enhancedValue associated with diminished personal time is enhancedLifestyle mobility places high value on product design and power Lifestyle mobility places high value on product design and power requirementsrequirementsPredictionPredictionProducts designed with mobility and long battery life in mind will Products designed with mobility and long battery life in mind will have high value in the consumer markethave high value in the consumer market

May 8, 2001 11

Lifestyle IssuesLifestyle Issues

ViewpointViewpoint

The blender lifestyle is emerging as the dominant lifestyle among The blender lifestyle is emerging as the dominant lifestyle among business professionalsbusiness professionals

Business and personal applications need to be addressedBusiness and personal applications need to be addressedDynamicsDynamics

Business professionals will increasingly move between personal Business professionals will increasingly move between personal and professional activities during the dayand professional activities during the day

Buying decisions will be based on simplicity and functionalityBuying decisions will be based on simplicity and functionality

PredictionPrediction

Products designed with a Products designed with a logicallogical combination of business and combination of business and personal applications will command a premiumpersonal applications will command a premium

May 8, 2001 12

Lifestyle IssuesLifestyle Issues

ViewpointViewpoint

The rapid pace and mobility of personal and professional lifestyles The rapid pace and mobility of personal and professional lifestyles will result in consumption patterns driven by time and place utilitywill result in consumption patterns driven by time and place utility

Content flexibility is not the prevailing pattern todayContent flexibility is not the prevailing pattern todayDynamicsDynamics

Information gains value with ease of accessInformation gains value with ease of access

With today’s lifestyle ease of access is difficult to achieveWith today’s lifestyle ease of access is difficult to achieve

Content providers need to improve content flexibilityContent providers need to improve content flexibility

PredictionPrediction

Products designed with content portability as a primary design Products designed with content portability as a primary design goal will be well received by professional peoplegoal will be well received by professional people

May 8, 2001 13

Turf WarsTurf Wars

ViewpointViewpointIntellectual property concerns will impact the ability to have mobile Intellectual property concerns will impact the ability to have mobile contentcontentPressure from the regulatory bodies and consumers will accelerate Pressure from the regulatory bodies and consumers will accelerate resolution of this issueresolution of this issueDynamicsDynamicsContent owners do not like mobile contentContent owners do not like mobile contentConsumer lifestyles demand mobile contentConsumer lifestyles demand mobile contentNew channels that give access to consumers are emerging New channels that give access to consumers are emerging PredictionPredictionLegal actions regarding intellectual property will diminish / delay Legal actions regarding intellectual property will diminish / delay consumer acceptance of mobile devicesconsumer acceptance of mobile devices

May 8, 2001 14

Netting It OutNetting It Out

RecommendationsRecommendations

When designing new products:When designing new products:

Consider the blender lifestyleConsider the blender lifestyle

Focus on the experience not the technologyFocus on the experience not the technology

Be aware of the threat from 1394Be aware of the threat from 1394

Help reduce consumer confusionHelp reduce consumer confusion

Position USB 2.0 relative to wireless technologiesPosition USB 2.0 relative to wireless technologies

Consider the big P product rather than the smallConsider the big P product rather than the smallP productP product

May 8, 2001 15

USB vs. 1394USB vs. 1394

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1999 2000 2001 2002 2003 2004 2005

USB 2.0 1394

May 8, 2001 16

QuestionsQuestions

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