The iPhone ruined my perception of innovation cycles
It’s good practice to review your predictions and see which you got right and where you went wrong. Here is a retrospective of one of my predictions that I got wrong, plus some learnings.
Soon after the Oculus DK1 was released in 2013, I made the prediction that within the next ten years, all major fashion shows, and some specific sport events like boxing, will have dedicated VR channels, broadcasting the events as virtual reality experiences.
Ten years later that obviously didn’t happen. Time for a retrospective: Why was I wrong?
TLDR: I blame the iPhone.
What was I thinking?!
When I looked at the Oculus DK1, it was obvious to me that VR would become an eventual success. There were strong visions for VR, from movies like Tron, Avatar, Inception to The Matrix. There were also several signals, many documented here: The Wacky World of VR in the 80s and 90s. And it seemed like the technology was close to becoming “good enough”.
My thinking was that VR would be like VCRs: Not a true disruption but adding a new quality to an existing medium. Especially in entertainment and education, because VR already had working use-cases there, albeit via expensive, high-end installations. However, new opportunities would also emerge in sports and fashion, adding new sensory experiences to popular formats.
This was my timeline:
- The Oculus DK1 is a dev kit, hastily put together with common, off-the-shelf components
- The next generation (2) will have first bespoke components, but still be bulky and prototype-like
- The next generation (3) will have better bespoke components and be less bulky, with better out-of-the-box experiences
- The next generation (4) will have the first “good enough” bespoke components and be almost good enough to wear for extended periods of time, being the first commercial success, driving content generation
- The next generation (5) will focus on optimization, tightening the platform, adding content monetarization, with reduced overall sales as many customers will wait for a feature bump in gen 6
- The next generation (6) will be a leap into making the devices fashionable, still as a niche product but very present in the public consciousness, we will see a lot of TV / pre-roll ads and product placements of this generation, reigniting sales
- The next generation (7) will be the first entering commodity territory
So, one generation per year means this represents a seven-year plan, plus three to get the content in order, which makes this a safe prediction for a ten-year horizon, right?
Annual technology innovation cycles are an illusion
We had annual innovation cycles in software for quite a while. Think of all the EA sports games cranking out a hockey / soccer / football game every year.
Hardware on the other hand is traditionally on a 3 to 5-year innovation cycle.
But then came the smartphone, and with it the expectation that new generations would happen every year. And nobody set this expectation better than the iPhone. In his amazing talk “How to predict the future”, Ben Hammersley put it like this:
“You know that every September Tim Cook from Apple will step on a stage and instantly make the phone in your pocket shit.”
But this is an illusion — a marketing trick. What the iPhone did is to put components on different innovation cycles, so that there always would be something new to show.
Here are the main-line iPhone generations and what each improved upon (overgeneralized):
- iPhone launch: June 29, 2007
- iPhone 3G, 2008: App store, 3G connectivity
- iPhone 3GS, 2009: Better camera, voice control
- iPhone 4, 2010: New body design, retina display
- iPhone 4S, 2011: Siri, better video recording
- iPhone 5, 2012: LTE connectivity, bigger screen
- iPhone 5S, 2013: Touch ID, colors
- iPhone 6, 2014: HD retina display
- iPhone 6S, 2015: Better camera, 3D Touch
- iPhone 7, 2016: New body design, EarPods + AirPods
- iPhone 8, 2017: Wireless charging, true-tone display
- iPhone X, 2017: Better display, better front-facing camera
- iPhone XS, 2018: Super Retina HD display
- iPhone 11, 2019: New colors, better cameras
- iPhone 12, 2020: New body design, better battery
- iPhone 13, 2021: Smaller notch, better camera software
- iPhone 14, 2022: Emergency SOS, better camera
Instead of one big innovation cycle every 3–5 years updating every component, Apple pushed for annual innovation cycles that update a small number of components. It cuts up radical innovation into a series of incremental ones.
And that is very smart. It allows users to get acquainted with change over time instead of overwhelming them. It also reduces development risks and technical dependencies.
But it totally messes with our perception of how innovation cycles actually work. Radical jumps are not annual in hardware — even incremental ones rarely are, regardless how much Tim Cook and team wants you to believe that.
I fell for it, and I should have known better.
Back to my VR prediction
With 10 years of hindsight, we can have a look at my assumptions again, this time against actual products as they were released:
- Generation 1, 2013: Oculus DK1
- Generation 2, 2016: HTC Vive & Oculus Rift
- Generation 3, 2019: Oculus Quest
- Generation 4, 2023: Playstation VR2, Vive XR Elite (Oculus Quest 3?)
I was close regarding the feature progression, but wrong about the timeline. Generational improvements are not annual, they are within the usual 3–5 years.
That also means we’re 3+ generations out for VR scale adoption, or another 10 to 15 years or so. Let’s say twelve. Ouch.
Based on usage, I say that I was spot on regarding games and education, as people made money catering to smaller, more focused audiences. But event broadcasting in VR is not a thing yet as it requires true scale audiences to be profitable.
Learnings
- Nothing in hardware is ever easy
- Annual innovation cycles in hardware are an illusion
- Adoption might be fast once the product exists, but the path to get there is still long
- Be patient, wishful thinking is not an accelerant