Deloitte predicts big changes in 2007

15 Jan 2007

Deloitte’s Technology, Media and Telecommunications (TMT) practice has predicted that 2007 will see major changes in what technology companies are offering to the public, including PC-less internet access, energy-saving devices and new business models for social networking sites.

The company claims that technology companies will respond to concern about the environment by designing products and services that are environmentally friendly, including “power-scavenging” solutions.

“Given that the limits of lithium ion technology may be approaching, it is likely that technology companies will turn to power-scavenging solutions which draw energy from the environment around them. Body heat, ambient light, vibrations and movement may all be harvested to supply supplementary charge to tiring batteries,” according to the Deloitte forecast report.

Another major change it predicted to occur was the way in which social networking sites make profit, indicating that consumers will end up paying for privacy on the web.

“To appeal to older age groups, social networks may need to offer privacy – for which users may be prepared to pay to ensure that only their intimate circle, not prospective employers or existing peers, can see their uninhibited moments. Subscription revenues will become an increasingly important part of the revenue mix, potentially offering a range of value-added services, from voice messaging to group chat, from online storage to webpage design.”

Deloitte also predicted that user interfaces will be simplified, claiming that over half of all consumer electronic devices returned to retailers are not broken but are too difficult for consumers to use.

The company also claimed that internet penetration via PCs has reached saturation point and future access will be based around a range of small, specialist, simple-to-use and relatively inexpensive devices which will be adopted by the mass market.

Video-on-demand will not saturate the market in 2007, according to Deloitte, because it still takes too long to download video footage from the internet. “For example, on a typical two Mbps DSL network, it can take one minute to download each minute of a movie,” said the Deloitte report. “Thus in 2007, it may be the case that [if] wanting instant access to blockbusters, a swift walk to the local store may be the most immediate route to satisfaction.”

Commenting on the predictions, Tom Cassin, head of the Deloitte TMT Group in Ireland, said: “2007 is certainly a year in which technologies are moving to the next stage: the next stage of the internet where a PC is no longer needed and the next stage of social networking where older generations are participating. That said, it is important the companies within the sector realise where their key revenues will be coming from and do not overlook the mass market – simple product offerings such as text messaging that have proved so successful in the past.”

For its 2007 predictions, Deloitte included inputs from member firms’ 5,000 partners and managers specialising in TMT and discussions with industry analysts, as well as a series of 36 interviews with global executives.

By Niall Byrne