Reinventing CE: Transforming Devices to Service Platforms

  • ID: 4339965
  • Report
  • Region: Global
  • 47 Pages
  • Parks Associates
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Discusses the Impact of the Shift from Hardware to Software, With Particular Emphasis On OTT and Streaming Business Models.

FEATURED COMPANIES

  • Alexa
  • Chromecast
  • Frame
  • Insignia
  • NBC
  • Siri
  • MORE

The CE industry has migrated from producing and distributing hardware to distributing OTT content, providing intelligent home function and control services, programming and licensing software, and leveraging advertising models to connect consumers with desired products and services. This report discusses the impact of this shift and key benefits for the CE industry as a result of new business models and tech implementations. It assesses the transition from hardware to software as more content is streamed from the cloud and addresses the impact on CE devices such as streaming media players and mobile devices. 

This report provides case studies of prominent CE device makers: Apple, Amazon, Roku, and Samsung.

Key Findings:

Device makers must strike a delicate balance between closed and open ecosystems. When developing product ecosystems, device makers must determine to what degree their devices will communicate with competitors’ devices. Apple has largely built its devices in a closed ecosystem, which has allowed it to build multiple-device relationships with its customer base. However, more open platforms like Android allow customers and developers to build functional ecosystems enabling competitors’ devices to communicate and function together. Device makers must balance the priority of retaining customers within a single branded ecosystem, or providing the best possible user experience to encourage future device and service interaction.

Voice-enabled personal digital assistants provide a key touchpoint between consumers and the greater connected economy. Devices like Amazon Echo provide the access point between consumers and true artificial intelligence. At the end of 2016, 45% of U.S. broadband households used a voice-enabled personal digital assistant through an application or dedicated device. Parks Associates estimates 15.6 million smart speakers with personal digital assistants were sold in the U.S. in 2016. While the devices themselves are novel, the true value comes from the backend systems that employ machine learning to learn and understand consumer behavior. In the connected smart home, voiceenabled assistants will provide a compelling future for a seamless home control experience.

Pricing continues to play a prominent role in product share of installed base. This is particularly true in the streaming media player space. Apple launched the product category with Apple TV devices, and Amazon and Google followed with Fire TV and Chromecast respectively. However, privately-held Roku emerged as a clear U.S. market leader. Higher priced Apple TV devices have not been able to keep up with low-priced and readily retail available Roku devices, allowing Roku to capture the U.S. market leadership spot with its devices available in Walmart for as low as $29.99.

Original video content has emerged in the tech space as a means for differentiation. While Netflix spearheaded the professional digital originals efforts, Amazon was quick to follow, deploying Fire TV devices to drive users to Amazon content. With the growth in digital video content services like Netflix and Amazon, Apple is serious about producing and distributing original video content to supplement its device sales with Apple Music subscriptions. Recent hires for video programming operations indicate Apple’s seriousness in content creation: Jamie Erlicht and Zack Van Amburg, former Sony Pictures Television co-presidents and the development executives behind TV series like Breaking Bad and The Blacklist.

In an expanded world of device and service ecosystems, device makers face new revenue opportunities. Partnerships with new retailers, service operators, and advertisers open incremental revenue sources for device makers to expand their business models. Business cases like white labeling retail products, participating in service operator promotions, and providing device data to advertisers gives device makers a greater diversity of revenue sources than sales alone can provide. As smart home use cases expand and consumers incorporate more connected devices in the home, the right partnerships are a crucial component of business growth moving forward.

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Note: Product cover images may vary from those shown
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FEATURED COMPANIES

  • Alexa
  • Chromecast
  • Frame
  • Insignia
  • NBC
  • Siri
  • MORE

1.0 Executive Summary
1.1 Key Findings
1.2 Consumer Data Dashboard

2.0 CE Devices - Adoption and Usage

3.0 Case Studies - CE and Service Platforms
3.1 Samsung
3.1.1 Core Businesses and Offerings
3.1.2 Key Market Implementations
3.1.3 Competitive Advantages
3.1.4 Implications
3.2 Apple
3.2.1 Core Businesses and Offerings
3.2.2 Key Market Implementations
3.2.3 Competitive Advantages
3.2.4 Implications
3.3 Amazon
3.3.1 Core Businesses and Offerings
3.3.2 Key Market Implementations
3.3.3 Competitive Advantages
3.3.4 Implications
3.4 Roku
3.4.1 Core Businesses and Offerings
3.4.2 Key Market Implementations
3.4.3 Competitive Advantages
3.4.4 Implications

4.0 Partnership Opportunities
4.1 Device Makers and Service Operators
4.2 Device Makers and Retailers
4.3 Device Makers and Advertisers

5.0 Appendix
5.1 Research Approach/Sources
5.2 Glossary
5.3 Index

List of Figures
Figure 1: Total Average Number of Connected CE Devices Owned Per BB HH
Figure 2: Home Entertainment Device Ownership
Figure 3: Samsung Products and Services: Devices and Users
Figure 4: Samsung Products and Services: Services and Platforms
Figure 5: Samsung Products and Services: Content Services
Figure 6: Purchase of Advanced TV
Figure 7: Reason for Not Shopping an Ultra HD/4K TV
Figure 8: Primary Flat Panel TV Ownership by Brand
Figure 9: Apple Products and Services: Devices and Users
Figure 10: Apple Products and Services: Services and Platforms
Figure 11: Apple Products and Services: Services and Platforms
Figure 12: Use of Voice Command among Apple Watch Users
Figure 13: Streaming Media Player: Brand Share by Installed Base
Figure 14: Smartphone Brand Share by Installed Base
Figure 15: Tablet Brand Share by Installed Base
Figure 16: Amazon Products and Services: Devices and Users
Figure 17: Amazon Products and Services: Services and Platforms
Figure 18: Amazon Products and Services: Content Services
Figure 19: Speakers with Personal Assistant Ownership, by Brand
Figure 20: OTT Video Service Plans and Pricing
Figure 21: Top OTT Service Subscriptions
Figure 22: Roku Product and Service Mix
Figure 23: Cord Cutters, Cord Shavers, and Cord Nevers
Figure 24: Companies Researched or Interviewed

Note: Product cover images may vary from those shown
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  • Alexa
  • Amazon Studios
  • Amazon Web ServicesAndroid TV
  • Apple Music
  • Apple TV
  • Apple Watch
  • ATSC
  • Audible.com
  • Best Buy
  • Bixby
  • Chromecast
  • Cortana
  • DIRECTV
  • Dish Network
  • Dot
  • Echo
  • Electrolux
  • Fire TV
  • Fitbit
  • Frame
  • Google Assistant
  • Google Play
  • HBO
  • Hisense
  • Hitachi
  • Home Depot
  • Hulu
  • IKEA
  • Insignia
  • iTunes
  • Jawbone
  • JCPenney
  • Kenmore
  • LG
  • Lowes
  • MAGNA
  • MLB.TV
  • NBC
  • Netflix
  • QLED
  • Roku Audience Solutions
  • Roku Express
  • Roku TV
  • Sears
  • Sharp
  • Showtime
  • Siri
  • Sling TV
  • Tap
  • TCL
  • Tizen
  • Toshiba
  • UHD Alliance
  • Ultra HD Forum
  • Vivint
  • Vizio
  • Walmart
  • Whirlpool
  • Whole Foods Market
Note: Product cover images may vary from those shown
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