CES 2015’s Implications for Business

By Charles King, Pund-IT, Inc.  January 21, 2015

Given my usual focus on business IT, I’m often asked why I bother attending the annual Consumer Electronics Show (CES) in Las Vegas. It’s a reasonable question since in the main, CES mainly acts as a stage where consumer electronics companies place their bets and roll the dice on where they believe the CE market will go in the coming year. In that particular sense, there literally couldn’t be a better venue for CES than Vegas.

My interest in the conference mainly centers on the dynamic interaction between consumer and business technologies which is usually called IT consumerization, but actually has far deeper roots than many folks realize. For nearly three decades now, business IT has often been driven and stretched beyond comfort by consumer products that walked, slipped and were smuggled into the office by canny employees.

At its best, CES can provide a peek at some products and trends that will eventually find their ways into the workplace and/or impact business IT and data centers. With that in mind, let’s consider how some of the major products and trends at CES 2015 may eventually impact businesses and business IT.

CES 2015 – From the show floor

As usual, there was way too much to see at CES, so this is a short list of products and events that caught my eye and piqued my interest.

  • Drones – Drones made their first appearance at CES a couple of years back and continued to be a center of attention in 2015. The business applications of drones is intriguing, but the vision of commercial delivery drones (like those promoted by Amazon’s Jeff Bezos) flying in public air space seems unlikely to get off the ground (pun intended). That said, there have been some interesting uses to which drones are being put, like aerial inspection of construction sites and facilities and security surveillance. One of the more impressive demoes I saw at CES occurred during Intel CEO Brian Krzanich’s CES keynote where an Intel drone autonomously navigated an obstacle course, a feat which could have obvious ramifications for complex business tasks.
  • Internet of Things (IoT) – IoT has been getting a lot of attention during the past year, but it’s actually been a cause célèbre at CES for half a decade, mainly in the form of “smart” home devices and strategies. There was no shortage of consumer IoT products and gizmos at CES 2015 (one estimate placed the number of attending IoT vendors at nearly 700), but many of those were smalltime startups unlikely to be around for next year’s show. I personally find the value of most consumer IoT products to be wanting, and I expect the real plays in the space will be in industrial applications. The hype around CES also obscures just how much work remains to be done in IoT management schemas and infrastructure, but I believe that many businesses will eventually gain real value from IoT solutions.
  • Virtual reality (VR) – Facebook’s $2.3B purchase of Oculus Rift last March created a frenzy of sorts around the commercial consumer opportunities in VR. To achieve that goal, Facebook and Oculus will have to shake off decades of similarly optimistic yet eventually failed efforts and hype around VR. In addition, while the technological underpinnings necessary for VR are far more powerful and promising today than they have ever been, there is little proof that sustainable consumer markets for VR exist beyond niche gaming and entertainment. However, I do expect VR to complement or enhance immersive technologies already used in business areas such as engineering/design and immersive training. But that intimates a market more diverse and less monolithic than anything Facebook has in mind.
  • Wearables – The market success of Fitbit and attempts by Apple, Samsung and other vendors to integrate bands and digital watches with smart phones has many claiming big things for the segment in 2015. That certainly seemed to be the story at CES where the show floor was crowded with wearable tech of one kind or another. While I don’t doubt that Apple will move a metric crap load of Watches whenever it finally delivers them, how long owners will actually use the things is less certain. Watches as a product class are largely out of fashion, with most consumers relying on their phones for simple timekeeping. Plus, some research suggests that fitness bands are already turning into the latest generation of abandoned exercise equipment. I do think there is a rosy future for wearables in industrial settings, and in vertical segments like healthcare for monitoring the health of at-risk patients but those are far smaller potential markets than Apple and others seem to be counting on.
  • Green technologies – Climate change and stratospheric oil and gas prices have made energy efficiency a fairly hot topic in both consumer and business technology. One clear side effect has been the growing popularity of electric cars like Teslas and the Nissan Leaf, and the repercussions continued at CES 2105 with scores of vendors demoing and displaying passive solar and other green products. That’s all to the good, but the influx of oil and natural gas that helped to send petroleum prices tumbling in 2014 could significantly erode interest in green technologies. That same scenario occurred in mid-2008 when crude oil prices reached nearly $150.00 per barrel, causing a run on alternative energy development and projects. But when prices fell to under $50.00 per barrel the following February, they effectively pulled the rug out from under green technologies and initiatives of every kind. Sadly, I believe that a similar result seems likely this time around.

Final analysis

A larger issue, at least to me, is that many of the products displayed and demonstrated at CES have all sorts of business IT and data center dependencies, as in their reliance on apps, capabilities and/or services provided by commercial wireless networks and massive data centers.

Of course, that’s ironic considering how much attention and money is being showered on consumer endpoints, like smart phones, tablets and wearables, and vendors, like Apple. But if you disagree, consider the virtual screams of anger and anguish that fill social media when an app falters, a web site goes offline and this or that service goes on the fritz.

A secondary, yet deeply related irony is that as consumers become increasingly (if unconsciously) reliant on data center-delivered services, IT infrastructures themselves are becoming increasingly invisible. This has happened numerous times in the past as evolving technologies enabled services like electrical utilities and telecommunications to be delivered from geographically remote locations.

As a result, while data centers and business IT may be increasingly out of sight/out of mind, they are increasingly indispensable resources for hundreds of millions of individuals and organizations. So the final irony of CES 2015 is that while many believe consumer technologies are more ascendant than ever before, its connections to and dependency upon business IT has never been deeper.

In other words, it looks like I’ll be attending CES for years to come.

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