Source: Mike Powell/ALLSPORT
As quickly as new technology gives rise to innovative new consumer products, it drives the last batch of once-exciting electronics into obsolescence. Nothing has made that cycle more apparent than the rise of the smartphone, an ever-improving staple for consumers who are always connected to the internet, digital media, and all kind of communities, both real-life and virtual, via social media. Many single-use devices, like MP3 players and cameras, have been replaced by apps and services that users can access on their smartphones or tablets. Read on for 10 tech products that seemed innovative when they were introduced but are on their way out.
Source: Apple.com
MP3 players
Sales of MP3 players — and the most iconic product in the category, Apple’s iPod — have been shrinking for years. Since reaching 54.8 million in 2008, iPod sales began an overall decline as the iPhone was introduced. Because the iPhone could handle all of the functions of the iPod and more, there was a dwindling need for a standalone music player, and that continues to hold true as smartphones give users access not only to a local library of MP3 files, but to a growing array of apps that grant access to a cloud-based library of practically any song they could want.
Sales of the iPod have declined steadily since 2009. Apple recently reported that in the fourth quarter of its 2014 fiscal year, it sold just 2.6 million iPods, down 24 percent year over year. While Apple press releases still include the line that “Apple leads the digital music revolution with its iPods and iTunes online store,” the iPod business is steadily shrinking, cannibalized by growing sales of iPhones — of which the company sold 39.2 million in the fourth quarter. Even for users who haven’t replaced extensive libraries of MP3 files with Spotify playlists and instant access to any artist, album, or song via a growing array of streaming apps, smartphones offer an ever-increasing amount of memory to store media locally.
With the iPod classic discontinued and Apple no longer giving the iPod its own category in financial reports, the MP3 player is fading fast. While these standalone devices still have their appeal for athletes, children who are too young to need a smartphone, or consumers who don’t want to upgrade to a smartphone, the days of carrying both a phone and an MP3 player are over.
Source: Amazon.com
E-book readers
With sales of e-book readers like Amazon’s Kindle and the Barnes and Noble Nook steadily falling, the days of single-function e-readers are numbered. As Mashable’s Todd Wasserman pronounced e-readers “the next iPods,” IHS iSuppli predicted that sales of dedicated e-readers will fall to just 7.8 million in the U.S. by 2015.
Forrester similarly projected that sales of e-book readers will fall to as low as 7 million in the U.S. by the end of 2017, compared to the industry’s high of 25 million units in 2012. Forrester analyst James McQuivey predicted at the time that those 7 million devices would be bought by consumers “who read more than two books a week,” and he expects Amazon to eventually give Kindles away as a thank-you to customers who renew their Prime memberships.
E-readers have not only nearly non-existent upgrade cycles to contend with, but are also considered a luxury — especially for consumers who already own a tablet — because of their nature as a single-function device. It takes a particularly avid reader to purchase a dedicated e-book reader when multifunctional tablets are available. The Pew Research Internet Project reported in January that half of American adults own a tablet or an e-reader, with tablet ownership rising to 42 percent of American adults and e-book reader ownership hitting 32 percent.
More than 50 percent of adults own at least one of these devices. While a majority of e-book readers reported reading e-books on an e-reader or tablet — with fewer reading e-books on a desktop or laptop computer — 32% of e-book readers say that they sometimes read e-books on their cell phone, which are just ubiquitous and convenient enough to act as supplementary reading devices.
But in the same report, Pew noted that few readers have abandoned print for an e-book reader. Among adults who reported reading at least one book in the past year, just 5% said that they read an e-book in the last year without also reading a print book. And while the number of books that the average American read in a year stayed about steady, it certainly calls into question the mass market appeal of a device that appeals exclusively to avid readers: the average number of books that American adults read or listened to was 12, and the median was 5, meaning that half of adults in the U.S. read more than 5 books in a year and half read fewer. As full-featured tablets become cheaper, consumers will be hard-pressed to find a reason to buy an e-reader instead of a tablet.
Source: Joe Raedle/ Getty
Landline phones
MP3 players aren’t the only tech product that smartphones have rendered obsolete. More and more Americans are parting with their landline phones — a product that holds a lot of nostalgia for many, but is increasingly regarded as unnecessary by those who have grown up answering all of their calls — and text messages and emails — with mobile phones.
The CDC reported (PDF) that two in five American homes — 41% — had no landline but had at least one mobile phone during the second half of 2013. Approximately 39.1% of all adults — or 93 million adults — lived in households with only mobile phones, and 47.1% of all children — nearly 35 million children — lived in households with only wireless phones. Among households with both landline and wireless phones, 33.6% received all or almost all calls on mobile phones, and about 44 million adults (18.3%) lived in mostly wireless households.
As the reliability of wireless coverage improves, chances are good that the number of mobile-phone-only and wireless-mostly households will continue to grow. The dwindling relevance of the landline is an apt illustration of how quickly our communication habits have changed. While a Pew study released in February found that 28% of those who still use a landline said that it would be very hard to give up — down significantly from 48% in 2006 — 53% of internet users said that it would be, at a minimum, “very hard to give up,” up from 38% in 2006. Additionally, 49% of cell phone users said the same thing about their mobile phones, up from 43% in 2006. 39% of U.S. adults feel that they absolutely need to have internet access — many simply because they enjoy being online.
Source: Justin Sullivan/Getty Images
Rental DVDs
Just as the wide availability of music streaming services has made loading thousands of songs onto your device’s local memory a thing of the past, streaming services have also made DVD rentals much less a necessity for countless people.
The heyday of Netflix’s innovative DVD-by-mail service, for example, has passed. As of early June, the company has stopped mailing DVDs on Saturdays, and dropped its signature “red envelope” branding as it shifts its focus to streaming. But as Quartz reported in July, Netflix had 6.26 million DVD subscribers at the end of June, and lost 391,000 DVD subscribers between April and June of this year as customers transitioned to Netflix’s streaming-only service or ended their memberships altogether.
Though Netflix’s DVD service has been steadily losing subscribers, the decline from April to June was actually an improvement over the same quarter last year, when the service lost 475,000 DVD subscribers. Netflix chief executive Reed Hastings said in July that the DVD and Blu-Ray rental service still provides an “amazing and comprehensive selection that keeps a core membership uniquely satisfied,” highlighting the fact that the selection of DVDs is far greater than even what’s offered in Netflix’s extensive library of titles for online streaming.
But Netflix’s extensive selection of DVDs for rent isn’t the highest priority for most consumers, who seem to prefer the instant access to movies and TV shows that streaming services afford them. Even DVD rental businesses that don’t require users to wait for a DVD in the mail are obsolete or declining. Blockbuster’s last stores closed in 2013, and Redbox revenues declined 11% in the third quarter of 2014, according to Geekwire, as cloud-based options from Netflix, Amazon, and others continued to pull business from DVD rentals.
As the Wall Street Journal reported in January, Hollywood has seen sales of digital movies surge as people who would have rented a DVD but are unwilling to wait demonstrate that they’re willing to buy a digital copy instead. Studios have caught onto the trend and now make digital copies of new releases available for purchase before DVDs hit rental store shelves or kiosks. The result is that the quickest and most convenient option wins out for the consumer, and kiosks like Redbox are taking a hit as studios make them wait up to four weeks even after a DVD is released.
Source: DANIEL GARCIA/AFP/Getty Images
Personal computers
While consumer demand for personal computers will likely never disappear completely, times have changed drastically since tablets burst onto the market. As The New York Times reported in October, IDC and Gartner both released numbers that showed only a slight drop in demand for PCs — in sharp contrast to the dramatic declines of the past three years. The reports were interpreted to signify that consumers might not be choosing tablets and smartphones over PCs to the same degree that they were in the past. Some analysts posited that the industry might even see growth again, with companies including Lenovo, Hewlett-Packard, and Dell already seeing good growth in a strong U.S. market.
IDC reported that worldwide PC shipments were 78.5 million units in the third quarter, a year-over-year decline of 1.7%. Gartner said that PC shipments were 79.4 million units, a decline of just 0.5%. Gartner said that the five biggest PC makers in the world — Lenovo, HP, Dell, Acer, and Asus — accounted for two-thirds of global shipments, and other PC makers saw their shipments fall by 15.5% from last year.
Sales of Chromebooks, the inexpensive notebooks equipped with Google’s Chrome operating system, were cited as an increasingly popular option by Jay Chou, a senior research analyst at IDC. Computerworld projected that sales of Windows PCs will decline at a greater rate than the industry average, and Gartner forecasted that 5.2 million Chromebooks will ship this year. Chou also noted that “PCs have come closer to tablets in prices. For the time being I’m seeing good consumer demand, but it is based on price.”
As the Washington Post reported earlier this year, maintenance, software licensing, and hardware costs typically make laptops significantly more expensive than tablets, and a growing number of businesses are opting to equip their workforces with tablets instead of PCs. As tablet and PC prices decline, it becomes more likely that general consumers and enterprise customers will own both computers and tablets. But the simple fact that some consumers can opt for a tablet instead of a PC demonstrates both the growing capabilities of the smaller devices and the increasingly app-centric nature of the tasks that users need to complete on a daily basis.
Source: KAREN BLEIER/AFP/Getty Images
Bitcoin
After experiencing an enthusiastic reception as the cryptocurrency of the future, Bitcoin’s bubble has burst. Since virtual currencies — and Bitcoin in particular — burst into the tech community’s consciousness as a possible alternative to traditional, government-issued currencies, the community hasn’t stopped arguing about whether Bitcoin will become a viable, even mainstream way to pay for things. As a virtual currency, Bitcoin is built on computer-generated tokens and algorithms that ensure the anonymity of online transactions. As Edward Hadas reported for The New York Times last year, the value of a Bitcoin rose from $13 to $900 in less than a year — hardly stable enough to become a global currency to pay wages, set prices of products, or to borrow in loans.
In October, TechCrunch reported that the value of one Bitcoin had fallen below $300. While it’s since gone up again, the value of the currency has steadily declined since December 2013, when each Bitcoin was worth more than $1,100. While an increasing number of retailers and payments processing firms have signed on to support Bitcoin, any gains that resulted from those announcements have now eroded, and BBC reports that one factor behind the steady decline is the steady supply of new Bitcoins introduced by miners, who are rewarded with about 3,600 new Bitcoins everyday. The implosion of Mt. Gox is also a major obstacle to acceptance of Bitcoin because it demonstrated the security concerns inherent with an anonymous virtual currency.
To Hadas, and to many other critics of Bitcoin, money is too closely related to economics, politics, and other societal forces to be managed by any institution other than a government. As Hadas notes, Bitcoin is problematic because “its value is uncertain, its legal status is unclear, and it could easily become valueless if users lose faith.” While the appeal of currencies like Bitcoin is their anonymity, their technological innovation, or their speculative potential, Hadas explains that its appeal is also political. Bitcoin appeals to consumers who are unhappy with the way that governments handle the state-sponsored monetary system.
But governments would have to either lose control or give up control of currency before virtual currencies like Bitcoin can take off as anything more than a niche, speculative currency.
Source: YOSHIKAZU TSUNO/AFP/Getty Images
Point-and-shoot digital cameras
As CNBC reported recently, the widespread usage of smartphone cameras has pushed sales of point-and-shoot digital cameras into free fall. Digital camera shipments by Japanese manufacturers dropped 32.5% year-over-year, falling to 3.96 million units in September. September marked the 29th consecutive month of declines, according to a Tokyo-based industry group, the Camera & Imaging Products Association. Domestic shipments fell 28.6% to 540,000 units, and export shipments fell 33% to 3.42 million. Shipment volume also fell 32.5% in Europe, 41.9% in the Americas, 21.9% in Asia, and 27.4% in other regions.
Digital cameras aren’t following the course charted by TVs, laptops, and smartphones. Each of these products gained traction first in developed markets and subsequently took off in emerging markets. But consumers in emerging markets aren’t buying digital cameras, because for the price of an entry-level digital camera, they can buy a mid-range smartphone that is considerably more convenient and full-featured than owning both a phone and a camera.
Continued demand for DSLRs and other high-end cameras demonstrates a key difference between consumers who buy cameras and those who don’t. Casual users who take photos primarily for social purposes often don’t need any more capability than what smartphones and their ever-increasing specifications offer. While photography enthusiasts, professional photographers, and others who need high-quality photos and fine control over their images still buy high-end cameras, chances are that the last photo that the average consumer took was shot on a smartphone, not on a point-and-shoot camera.
Source: Garmin.com
GPS units
Another item on the list of tech products made obsolete by smartphones are GPS units, like those sold by Garmin, a company that was once considered “the next Apple,” according to MIT Technology Review. In 2007, the company was the world’s top seller of GPS devices for car dashboards and boat cockpits — but then smartphones came along and effectively killed the mass appeal of the location-finding gadgets.
As Technology Review explains, the smartphone has become the Swiss army knife of consumer electronics. Like the camera or the MP3 player, the GPS unit is another standalone device that consumers no longer need to purchase to obtain the key functions. For Garmin and others like it, that development is practically a death sentence. Garmin is worth less than a third of what it was worth in 2007, and a recent earnings report showed that revenue for its automotive/ mobile division fell 5% from last year as sales of in-car and personal GPS units continued to fall.
As apps like Google Maps and Apple Maps compete for market share on consumers’ smartphones, the general consumer doesn’t consider a GPS unit a necessity anymore. Smartphones use GPS chips or cell towers to pinpoint users’ locations and quickly offer them directions, or information on the stores and attractions around them. GPS units will likely be relegated to a niche market of hikers, backpackers, and others who need reliable navigation systems in areas where wireless networks don’t typically offer reliable coverage. But for the average consumer, a regular smartphone is up to the task of providing directions to get to unfamiliar locations around town.
Source: Dell.com
External hard drives
Like the PC, the hard drive will never go away completely. But it will become a much less popular product as consumers increasingly entrust cloud storage services with their files, from Dropbox to Apple’s iCloud, Google Drive to Microsoft’s OneDrive — as demonstrated by stagnating sales and innovation.
As Business Insider reported recently, the companies competing to provide cloud storage services to consumers are engaged in a “race to zero,” cutting their prices even as they increase their storage limits, just to stay competitive as the space heats up. While a gigabyte’s worth of storage on a hard drive cost more than $9,000 in 1993, it cost just 4 cents in 2013. Amazon and the continually falling prices of its Web Services are in part to thank for declining prices. Amazon Web Services saw 45 price cuts in the past six years — savings which companies pass along to their customers — and Amazon increases revenue by gaining more customers and offering more features for which they’re willing to pay.
Microsoft and Google are competing by matching Amazon’s prices while increasing their array of services, and Aaron Levie, chief executive of cloud storage provider Box, famously noted that he envisioned a future where storage is “free and infinite.” For consumers looking for a place to stash their documents, photos, and videos, that’s great — especially as companies add more services, like Microsoft and Google’s office apps in the cloud, to attract customers.
For consumers who are loath to trust their sensitive documents to cloud storage — and would prefer to store everything on an external hard drive sitting on their desk — companies like Box are marketing their services’ capability for extra security. Enterprise customers, especially, have demonstrated that they’re willing to pay for secure cloud storage. And while there will always be consumers who are unwilling to trust their sensitive documents to the cloud, the current capacity of the hard drives on the market has far outstripped most consumers’ needs.
Source: Sharpusa.com
Cash registers
It’s not just NFC mobile payments systems like Apple Pay that are rendering traditional cash registers and point-of-sale systems obsolete. Retailers are implementing a variety of different payment technologies that make the cash register look as outdated as it really is.
As VentureBeat reports, the average point-of-sale system is expensive to purchase, costly to maintain, inconvenient to manage — and not connected to the Internet. The last major change to hit the payments industry was the introduction of credit cards and accompanying terminals in the 1950’s. A variety of e-commerce and digital payment solutions are readying the space for a major overhaul, and traditional cash registers will soon be a thing of the past.
One hardware solution on the rise is the dongle, a small piece of hardware like the Square card reader that plugs into a smartphone or a tablet to read credit and debit cards. Square was originally marketed to small business owners who couldn’t afford a traditional POS system but needed to be able to accept electronic payments. Since then, Square has grown to offer a full set of software with custom checkout features, management tools, and data analytics, and Square has expanded beyond its original market to the quickly-growing segment of businesses that use iPads instead of cash registers.
Retailers like smartphones and tablets because they take up little space, and aren’t anchored to one location in the store. Many retailers plan to get rid of registers altogether, enabling customers to check out more quickly and conveniently. Consumers, in turn, are looking with more interest at digital wallets and mobile payments, following Apple’s introduction of its NFC-based Apple Pay system this fall. Apple, Square, Google, Mastercard, and others all offer digital wallets, and while adoption and awareness have been relatively low in the past, even Apple Pay competitor Google Wallet has seen an uptick in interest since Apple Pay put digital wallets back on the map this fall.
As consumers contemplate new options, retailers, in turn, are deciding not only which mobile payments systems they’ll accept, but also how they’ll respond to upcoming regulatory changes that will require them to change the hardware they have in thousands of locations nationwide. As Tech Cheat Sheet reported in October, retailers and card issuers will need to transition to new technology, switching to credit and debit cards that use a microchip instead of a magnetic stripe. Consumers won’t swipe their cards anymore, but will instead insert the card into a slot where the machine will read the chip.
The switch to this EMV technology will help safeguard against the type of data breaches that have become all too common as hackers exploit the vulnerabilities of traditional POS systems. As retailers look to replace their cash registers — or else bear the liability of any potential fraud — they’ll undoubtedly look to replace a traditional POS with a smarter system, making traditional cash registers a thing of the past.
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