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Last week’s Consumer Electronics Show (CES) offered a buffet of tech trends and related investment ideas for 2014. I’d characterize the major themes as more evolutionary than revolutionary. But that doesn’t limit the investment options – in fact it might even expand them.
There is considerably less risk investing in a somewhat proven technology than one which hasn’t yet been accepted by the market. And as technologies evolve, new entrants can provide more investable options for early-stage investors.
Here are three major consumer tech trends that I expect will keep making headlines in 2014.
Wearable technology is a no-brainer. I already find this buzz word to be annoyingly overused. But that aside, I have little doubt that technology will continue to find its way into everyday clothing and accessories, and provide revenue growth for many consumer tech companies.
Items like the Nike (NYSE:NKE) FuelBand, GoPro camera and Samsung Galaxy Gear smartwatch have already been flying off shelves. The next iterations will be even lower profile wearable cameras, brain monitors and motion sensors. Applications include sports photography (I expect the winter Olympics will have some incredible footage from cameras attached to athletes), professional training (think Google Helpouts application) and impact sensing (race car drivers, football helmets, etc.).
The excitement with this tech trend is more about the massive variety of applications than a big, new idea. Wearable tech has been around for a while; I expect 2014 will take it to an entirely new level.
3D manufacturing is just getting started. This will continue to be a disruptive technology. 3D printing empowers everyone from garage hobbyists to prototype shops to make a huge variety of items. Printing items like toys and machine parts is quickly evolving into printing larger and more complex items with movable parts.
Last year’s CES featured just a few 3D printing companies. This year there were more than a dozen. And I’m starting to see advertisements for start-up 3D printing companies too. Everyone is trying to get on the bandwagon as the industry tries to make machines accessible to everyday people. And that means bringing the cost down below $1,000.
It’s going to be really interesting when the cost of printers and the availability of raw materials allow people to make virtually anything at home. There are going to be a lot of winners and a lot of losers here, so investors will need to tread carefully.
Chips are going to be put in everything. I’m somewhat apprehensive about this tech trend. I’m not sure I need to control my oven’s temperature, start my truck or turn on the lights in the bathroom from my mobile phone. But pretty soon I’ll be able to.
Everything is getting connected. That’s the next phase of the mobile revolution. And it’s going to be a mixed bag of usefulness and creepiness.
There are some features I really care about. I’d like to control my home thermostat, check the level in the heating oil tank and, OK, I’ll admit it, start my truck when it’s below zero. I just hope the interconnectedness doesn’t make people lazy and forgetful.
One of the more interesting aspects of the connectivity trend is going to be who supplies what. The chips themselves are easy – it will probably be Intel (NASDAQ:INTC) and Qualcomm (NASDAQ:QCOM) leading the charge. As far as devices, companies including Google (NASDAQ:GOOG), Apple (NASDAQ:AAPL) and Honeywell (NYSE:HON), just to name a few, are testing what exactly makes sense to connect to mobile phones. And they are taking a hard look at acquisition opportunities. Just look to Google’s acquisition of Nest earlier this week.
These are just a few of the evolutionary tech trends highlighted at this year’s CES. I’ll be covering these technologies throughout the year, and highlighting companies that are cashing in, too.
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