Kevin Parmenter, Contributing Editor
Once upon a time electronics went into neat precise product categories, making marketing people at electronics component companies happy. However the situation has become far more complex. Consumer electronics products are now finding their way into other applications, because frankly they are better, faster, and cheaper than defined-purpose closed-architecture designs.
For example, Ford just selected Blackberry-QNX to replace Microsoft in cabin electronics technologies –is a car a consumer electronics product now? Flat panel displays for home users are now used in Digital signage and in retail establishments, restaurants, airports and other environments. Tablets and smartphones are being used for route navigation in Super Shuttle vans; as dedicated barcode scanners, dispatch systems, and by airlines for electronic flight bags vs. paper.
The BYOD movement, first resisted by IT operations in corporate business users in the enterprise (business talk for corporate America) and in automotive – (IT might be shifting from policy enforcers to business partners?) Now BYOD is being embraced likely because eventually someone figured out the ROI of people bringing their own hardware that works better is actually cheaper and increases productivity more than forcing everyone to use something that looks like what the airports used in the 1980’s because they know how it works.
A product might be PC hardware, however the user might not know it because its running an RTOS for the user interface. Hardware is not a commodity - the fact that consumer products have better-cost structures because they are made in greater volumes than specific purpose designs and the operating systems have to be easy to use and robust for consumer use. In addition, the cost and complexity of new product development is going up.
Product development is inexorably linked with the semiconductor industry and many of these designs are really either designed in lock step between the semiconductor companies and the OEM or the OEM does the semiconductor designs on the major system components and has them fabricated by a foundry. The software is often developed in parallel. This means that clever companies wishing to avoid huge investments can easily adapt the inertia and the investment of consumer products, taking advantage of someone else’s big investments.
How many companies want to invest in anything like that today, with the volumes and resources needed? It has become yet another “Make vs. Buy” decision in the electronics industry. Traditionally consumer applications have been disposable – when it breaks toss it and get another DVD player because the new one does more and the old one can’t be fixed anyway. What are the downsides?
Industrial applications require wide temperature ranges and long product lifecycles plus high reliability over time –so we can expect to see many mandatory lifetime buys or lots of activity qualifying another source for something that went away. It’s going to be interesting to see how the differences between two markets that are merging together can co-exist and if this trend will continue. Either way consumer isn’t a tidy category any more.