Smartphones are still central to our lives

At the latest Apple keynote event, the company unveiled the highly-anticipated iPhone X. CEO Tim Cook referred to it as “the future of the smartphone” and the “biggest leap forward since the original iPhone.” There is already a lot of talk about where smartphones fit into our modern lives. The devices have never been so influential, but they’ve also never had so much competition for users’ attention thanks to all the connected devices and wearables available now.

While Apple has an incentive to convince people that it has reinvented the smartphone, the changes so far don’t seem so dramatic. Still, people spend a lot of time with their phones and an ever more connected world means smartphones are becoming ever more central to our lives. Though there are many solutions to interacting with smart homes these days, smartphones are still one of the most popular means of controlling other devices. These devices are almost always within reach, even if Amazon’s Alexa can’t hear us from another room.

Spending on smart home devices and related services continues to climb, and smartphones remain a key component for these devices. (Source: eMarketer)

For hardware startups, the way their products work with smartphones can be very important to the overall user experience. This means having apps that people enjoy using. This is one area that has caused some friction with smart home devices. As a Built.io marketing manager told eMarketer, “Nobody wants to walk into their house and have to open up five apps just to turn the lights and some music on.”

This is one reason voice assistants and voice-activated speakers have become so popular. Yet smartphones remain immensely important in smart homes. While it’s true that younger demographics have helped push up the sale of voice-activated speakers, this is in part because they have become accustomed to talking to the same or similar digital assistants on their smartphones. For many people, smartphones remain the primary gateway to the internet.

This is especially true of teenagers, who have grown up in a world of mobile internet. One recent survey from YouGov found most teenagers believe they could not go more than one day without using a smartphone. Texting and social media are the preferred uses. This is the Snaptchat generation, after all.

Teenagers spend their time on services from Google, Facebook and Snap, all of which are moving into hardware. (Source: eMarketer)

Snap, the company that owns Snapchat, knows which ways the winds are blowing, though. Hardware and software are both needed for growth. This is why Snapchat rebranded to Snap when it released Spectacles, the company’s camera sunglasses. Snap has also reportedly bought Zero Zero Robotics, the company responsible for the Hover Camera Passport drone that recently got an exclusive distribution deal with Apple stores.

It’s possible that Snap moved into hardware when it realized it couldn’t compete with the Facebook juggernaut in social media. Yet Facebook has moved into hardware, as well. It bought the virtual reality company Oculus VR in 2014, and it was recently reported the company is looking to open a Shanghai office to help with hardware ambitions.

At the center of all of this is the smartphone. Even as social media companies move into hardware, the smartphone remains the main way of reaching new users. It’s how people pull data from their Spectacles or watch 360-degree videos on mobile VR headsets. Though the Oculus Rift relies on a computer connection, the company collaborated with Samsung on the Gear VR mobile headset. Google is also convinced that mobile is the future of VR.

In some developing markets, all people know of the internet comes from smartphones. Things are moving that direction in developed markets, too. In the US, it’s projected that nearly a fifth of internet users will be mobile-only internet users by 2021.

By 2021, more than 18 percent of internet users in the US will be relying solely on mobile connections. (Source: eMarketer)

For some companies, it’s already clear that how much users love their products is inherently intertwined with how much they love the software. In 2017, that means smartphone apps.

With the iPhone X, Apple has not really reinvented the smartphone. It does show how powerful the minicomputers in our pockets have become, though. They’re capable of doing so much that drives adoption of other products. However, the greatest product idea in the world with the best hardware engineers behind it can’t save a company from bad software.

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