Tech Predictions for 2013

From the Dec. 2012 issue.

Judging from the media coverage, technology hardly existed at all in 2012. Instead, the nation sat enthralled, week after week, by billions of dollars in political ads, four debates and nearly-endless campaign speeches.

But it wasn’t as slow a tech year as the political wrangling might portend. In fact, between a rising stock market and a declining jobs market, we managed to see tech news that was both good and bad:

  • FaceBook did okay, but not as well as other tech IPOs. A continued lag in financial performance by FaceBook has dragged down the market for tech companies looking to go public, but not for the vertical markets. While big-name consumer companies are scrambling to avoid a Facebook-style stock collapse, the overall markets for both hardware and software remain surprisingly strong. And the thirty or so other tech IPOs that have gone off this year are performing pretty well.
  • Small is the new big – or is it? Poor Blackberry. After defining the market for a tablet device with a 7-inch screen, the company got battered as Amazon.Com took the same basic hardware and beat them bloody in the marketplace with the Kindle Fire. Followed by the introduction of the iPad Mini, which nailed the coffin shut. But just as tablets decided to get smaller, the cell phone market goes big screen, with 5-inch and larger screens that almost serve as tablets in themselves.
  • Nothing happened in tech policy, and no one cared. Dangerous threats to user rights were sharply averted as the ACTA trade agreement died internationally and a user uprising killed the SOPA anti-piracy act. Even efforts to punish Wikileaks have been derailed. All in all, Congress did little in the tech arena for the year, but that did not seem to bother much of anyone. Except Hollywood, of course, which still wants to punish people who want to be entertained.
  • Numbers mean less than strategies. In terms of accounting technologies, gaining control and understanding of the numbers has become far less important than using the numbers to manage better. Spreadsheets and cash flow took a back seat to ERP, CRM and CPM. Case in point: the rise of new technologies for document management and workflow management.

Perhaps the best way to define technology in 2012 is that it was a balance of extremes. On the flashy end of the business, Apple products drove the company to the top of the stock markets; Blackberry died a grisly death; and Microsoft pushed out yet another Windows operating system. On the more subdued end of the industry, companies continued to see solid profits; cyber-security became more critical; and software got notably better – with smaller code, better user interfaces and tighter integration.

As for our tech forecast for the year? We predicted, among other things, that a fragile internet would have problems; that the Kindle would catch fire but 3D television would not; that Internet “wallets” would fail to take off; that Windows 8 would be a success; and that privacy would become the most critical legislative issue. Overall, we scored about 8 out of 10.

Where did we go wrong? Well, the Internet was not as fragile as we predicted, Windows 8 hit a small snag when they tried to do away with the “Start” button, and the recession didn’t do as much damage as predicted to the tech industry – mostly because the recession was pushed into 2013 or beyond.

So what’s in store for 2013? Here are our predictions:

2013 Technology Predictions

1  

It’s all about the car. These are the tech wars for dominance, now comfortably settled into familiar trenches. Apple dominant, Google holding its own, with an occasional assault by Microsoft and its allies. Much like the trenches of World War I and the Maginot Line. The only way for anyone to advance is to open a new front, and that’s slowly happening inside the family automobile. Forget radios and GPS systems. Voice-command systems will be the first battle, and this will be a free-for-all in hands-free computing, with the battleground being the center console of your automobile.

2  

AOL will make a comeback. For a company that is barely two decades old, AOL has been many things to many people. A pioneer in online services. The top of the publishing pyramid. A company without an identity. An email service struggling to survive. But ever so slowly, the company has rebuilt itself around its content and its communities, and in 20133 will begin to re-emerge as a serious contender to some of the market leaders. That AOL mail account someday may mark you as a savvy Internet user once again.

3  

The desktop PC won’t be dead. If I had a dollar for every tech pundit who had predicted the death of the PC computer, I would be retired by now. The desktop PC is not dead, it’s just evolving to take the middle ground between the smartphone/tablet markets at one end and the high-def television and video markets at the other. Bigger screens, touch screens, more USB ports and better integration with devices at both ends of the spectrum. The PC will no longer be the top of the tech pyramid, but will begin to emerge as the bridging device – and thus still indispensable.

4  

Touch Screens on the PC will be a bust. Sure, touch screens are amazing and cool and the wave of the future. Until you realize that the screens are more fragile than other types of screen. And until you realize that every tough on the screen means a greasy fingerprint that requires cleaning to see the screen properly. Smartphone users will tell you that touch screens are already a nuisance in that market. Imagine having to clean a surface twenty times that size every few minutes. Remember, touch screen monitors have been around for many years now, and have already failed to capture the attention of users in any significant way.

5  

Tax technology will resurge as a major part of accounting. Particularly tax software and systems. Forget about tax simplification – all of the indicators point to a tax system that is more difficult to keep pace with, tax returns that are more complicated, and tax compliance measures that require more careful attention. This means that tax software will become more sophisticated with each revision, in the battle to keep current. This will drive additional customers to tax professionals – many of whom have done their own taxes in previous years. And will drive the development of newer and better technologies the manage taxes.

6  

Windows 8 will be…moderately successful. Microsoft has gone a long way to make this latest operating system its best ever, and early impressions are that they have succeeded. But they have also attempted to make a radical change in our perceptions of what an operating system is and should be. In an effort to develop a single system for all sizes of screens, Microsoft has upped the ante in the battle for the desktop. But it has also introduced a lot of change very rapidly, and is facing some resistance even now because of it. Stay with Windows 7, anyone?

7  

System security will begin to evolve. Let’s face it, the user-name-and-password routine has failed dismally when it comes to protecting data. Any data that can be shared will be shared with people we don’t choose to share it with. New systems are beginning to emerge, but they are too complicated for the average consumer to easily use. That means that if we have any hope of securing sensitive data, it will require a new strategy. Or more than one. By 2013, we will begin to see that take shape.

8  

Technology costs will soar. The tech sector is one of the few areas that seem impervious to the ravages of recession. Sure, many parts of society get left behind. But the upscale, urban early adopters will continue to buy as long as they have a paycheck, and that drives the sales of technology tools and toys. But the down side to this is that everything becomes more expensive. Entertainment companies will continue to push “anywhere, everywhere” viewing, at increasingly higher costs. Data caps will try to push cell phone data bills higher to offset losses in voice revenues. Cable and satellite companies will push to generate higher revenues per subscriber. Prediction: we will see total tech costs rise by up to 10 percent due to new taxes and efforts to maintain revenue growth for tech companies.

9  

PC Gaming will make a comeback. Gaming consoles have been all the rage for the past decade, because they delivered a superior gaming experience and graphics. But the battle for device space in the living room has caused consoles to move into PC territory, offering streaming video and Internet access. At the same time, PC-based “media centers” have become more prominent as part of the living room entertainment mix. The arena in which PCs do not have superiority today is gaming. Look for PC software manufacturers to pushing harder in gaming to take on competition from the consoles.

10  

App Stores will become a thing of the past. Once Apple proved that it could stock iTunes with superior products and get a superior price, the market exploded with app stores. Virtually every company build castle walls and moats around their content, trying to achieve Apple’s levels of profitability. It did not happen. Instead, many companies found that by making their content proprietary they were simply driving customers toward…well, Apple and its products. Look for companies to dismantle their own app stores, instead rallying around a central store for which they can attain some shared revenue. Sounds like a good deal for Google, or Amazon.com.

Other tech news in the coming year is likely to include, for the first time, taxes on your Internet service and on things purchased online. The quick death of silly technologies, including Google’s monitor glasses. A stronger emphasis on practice management software and hardware. And the beginning of the end for FaceBook, which can’t make money without annoying users, and can’t continue to be what it is without annoying Wall Street.

Of course, there is danger in trying to predict the future of technology. As we saw in 1996 when Fortune magazine wrote that, "Apple's erratic performance has given it the reputation on Wall Street of a stock a long-term investor would probably avoid.”

Our record of being right is better than that, but time will tell.

 

 

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