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Connected Homes April 2020 Viewpoints

Technology Analyst: David Strachan-Olson

Mobile-Centric Video

Why is this topic significant?

Early signs signal a shift from TV-centric video viewership to mobile-centric viewership, which could affect both hardware makers and service providers.

Description

Since its widespread commercialization, the TV set has remained the primary entertainment device for many households. However, viewership habits are shifting, and the number of people who are watching content through mobile devices is increasing.

Emerging platforms for media consumption commonly target mobile devices. Companies that operate the most popular social networks for photo and video sharing—including Instagram, Snapchat, and TikTok—design their platforms with a mobile-centric or mobile-only focus. All major video-streaming services offer mobile apps, and some services are targeting mobile devices explicitly. Quibi is an emerging video-streaming service that claims to provide "Hollywood-quality content" designed for mobile devices. Quibi delivers its content in five-to-ten minute segments, which is akin to how social media and YouTube deliver content, instead of delivering feature-length films and half-hour TV shows. In addition, Quibi will allow users to switch between two views of a scene instantly by rotating their mobile device. Quibi has raised $1.75 billion and is founded by Jeffrey Katzenberg—a former Disney executive and cofounder of DreamWorks.

Emerging markets, such as those in India and Southeast Asia, where TV ownership lags behind smartphone ownership, also drive the rise of mobile content. Streaming companies continue to adjust their offerings to make their services more appealing in emerging markets. In 2019, Netflix began introducing mobile-only streaming plans in certain markets with monthly costs of approximately $5.

Designers at Samsung are also aware of the growing importance of mobile video. At CES 2019 and 2020, Samsung demonstrated a concept 4K TV set—Sero—that can rotate between landscape and portrait orientation to match the aspect ratio of content originating from apps on a user's mobile device.

Implications

In many households, using TVs and multichannel-TV services remains the primary way users consume video content; however, this preference appears to be changing—for younger individuals in particular. Not only is there a growing shift away from multichannel services toward streaming services, but there is also a slow shift from watching video content on fixed devices to portable devices. TV sets provide a great experience for groups to watch content together, whether it be a group of friends watching a sporting event or a family watching a sitcom. In comparison, smartphones and mobile devices provide an intimate and private viewing experience in which a user can watch content that might interest only him or her. The portability of mobile devices also enables users to watch shows when they are away from home.

Impacts/Disruptions

Though TV sets are fixtures in many households, TV manufacturers worldwide are struggling with mediocre demand and falling prices. Players should monitor the growing use of smartphones for video consumption and the potential impacts it might have on their businesses. For example, mobile viewing offers advertisers the opportunity to target ads to the individual rather than rely on the demographic-based ad targeting of traditional TV shows. In developing markets, the rapid commercialization of smartphones and the proliferation of mobile-centric streaming services could cause households to postpone, perhaps indefinitely, purchases of TVs and multichannel-TV services. The lack of a TV would change the products and services such customers seek. In addition, even if such households eventually purchase TVs, their familiarity with smartphones and mobile apps will characterize their expectations of and interactions with TVs.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: Medium

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: Now to 5 Years

Opportunities in the following industry areas:

Streaming services, mobile devices, targeted advertising, smart televisions, film and television production, television broadcasting

Relevant to the following Explorer Technology Areas:

Mesh-Network Cybersecurity

By Michael Gold
Gold is a senior research engineer with Strategic Business Insights.

Why is this topic significant?

Makers of network-connected consumer products continue to face challenges to deliver secure solutions.

Description

During late 2019, Check Point Software notified consumer-electronics leader Philips of a method of using its smart-illumination systems to spread malware to other connected devices. Philips patched its software and issued over-the-air updates for its Hue routers during early 2020. The incident was the latest in a series of cybersecurity challenges for home-network-business developers that have emerged over the years.

Hue relies on ZigBee, which is one of several industry standards that govern communications in multivendor mesh networks and that require far less battery maintenance than Wi-Fi requires. The main alternative to ZigBee is Z-Wave. Two additional alternatives—Bluetooth Mesh and Thread—see very little use, but vendors and consumers might adopt these alternatives in the future. Cybersecurity researchers have also indicated that vulnerabilities exist in all of the alternatives. But reports of actual attacks against mesh networks are rare.

In many cases, including that of Philips's router, vulnerability arises in part because someone applies a factory reset to a connected device. Hackers have various ways to exploit the process of a device rejoining a network.

Implications

Not every remedy will be as easy to apply as was Philips's recent over-the-air update. Cybersecurity measures will likely require users' time and attention. On the advice of a manufacturer or software developer, users might sometimes need to take active measures such as installing new firmware and changing devices' software settings.

Bluetooth Mesh and Thread have seen less scrutiny than have Z-Wave and ZigBee, which see far more common use. But if Bluetooth Mesh and Thread become more common, cybersecurity researchers will likely increase their scrutiny of them.

Devices can be especially vulnerable if an adversary can gain physical access to a reset button. So far, such attacks are the only ones that seem to be effective in defeating cybersecurity of Bluetooth Mesh. But generally, portable devices such as a handheld remote control, pocket-size key fob, or (in theory) mesh-network-capable cell phone might be especially vulnerable to an adversary who wishes to force a reset. And if many mesh-connected portable devices come into service, adversaries would have increased motivation to steal the devices.

Impacts/Disruptions

Meshes are increasingly important for connected homes, but cybersecurity concerns are among the factors that keep the market from reaching its potential. People who are more than 30 to 100 meters away from a mesh network probably cannot break into the network. But an adversary in a nearby vehicle might be able to gain control of a home's computers and service gateways, for example, during the hours when a user or contractor is installing a home-security system and configuring the system's mesh network.

Mesh-connected Wi-Fi can solve indoor coverage problems in both single-family homes and apartments. Best practices for Wi-Fi tend to result in adequate defenses, but users must address various cybersecurity issues. For example, residents can configure a separate virtual network for visitors, yielding substantial extra protection from adversaries. However, from time to time, a cybersecurity researcher claims to have a general way to defeat Wi-Fi encryption. A controversial hypothesis holds that an undiscovered algorithm might allow available computers to perform the computation-intensive task of factoring cryptographic keys that Wi-Fi uses. Cybersecurity researcher Dan Gleason reportedly demonstrated such factoring recently, though computer scientists remain skeptical.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: Medium

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: Now to 5 Years

Opportunities in the following industry areas:

Home-security services, illumination, appliances, electrical fixtures, climate controls, network equipment, handheld devices, mobile apps

Relevant to the following Explorer Technology Areas: