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12 internet predictions for 2012

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12 internet predictions for 2012

  1. 1. 12 Internet Predictions For 2012Yes, predictions are hard, especially about the future. But theyre fun!And, sometimes, they can even be useful. Theyre rarely correct but, perhaps, they helpclarify and hone ones thinking about the future.And so, in the spirit of enlightened thinking about our industry, here are Business InsiderIntelligences 12 Internet Predictions For 2012:Google Will Release A $200 TabletAmazons Kindle Fire changed the tablet game, largely thanks to its price, way below thecompetition; It looks like its going to be a holiday blockbuster;Meanwhile, Google is fighting a platform war with Apple and has been humiliated on thetablet front, with high-priced, lower-featured Android tablets getting clobbered by the iPad.The way Google can grab tablet marketshare, which it needs to do, is to imitate Amazonsstrategy of selling a radically lower-priced tablet at a loss. And, for the first time, it can dothat, since its in the process of buying tablet-maker Motorola.Facebook Will Grow Faster Than Anyone Thinks And Hit1 Billion UsersFacebook already has 800 million users, and many people assume that its growth is hitting awall, as it reaches dominance in the big developed markets and its locked out of markets like
  2. 2. China and Russia. But, there is still a lot of room for growth in places like South-East Asia,India and Brazil, and Facebooks network effect is a powerful thing.Twitter Will Build A Huge BusinessA lot of ink is being spilt on Twitters product, Twitters executive turnover, Twitters usage--and these are all noteworthy topics to cover. But while all this is going on, Twitter has beenquietly building a huge business.In the past year or so, Twitter has been tentatively experimenting with various ad formats,and now its found the formats that work for advertisers and consumers. 2012 will be the yearwhen Twitter really scales it up and starts generating very serious revenue.RIM Will SellIts over for RIM. The companys the walking dead. We all know that. The market now hasrealized it. At some point someone like HTC or Nokia or someone else will snap it up for itspatents and its enterprise business. (Maybe even ZTE, the Chinese mobile OEM that is tryingto move up the stack and become a consumer brand.)Apple Will Boringly Grow In Line With AnalystsEstimates Apple has had an uncannyability to explode past most analyst estimates, as this great chart at right from AsymcosHorace Dediu shows. This was due to two reasons: analysts underestimated Apple, and Applegrabbed on to two huge rocketship markets with the iPhone and the iPad.These two problems are being solved. The iPhone is hitting a natural limit as Androidswallows the market, and while the iPad is ushering in the post-PC era, its growth is probably
  3. 3. steadily predictable. And while Apple is likely to come out with some sort of amazingrevolutionary new TV product next year, thats not as big a market as phones and tablets, soeven if it does very well it wont supercharge Apples top and bottom lines, at least not in thefirst year.This boring prediction is actually risky: over the past few years, the "safe" bet has been thatApple would overperform, and Apple fanboys have had a lot of fun quoting industry analystspredicting the demise of, you name it, the iMac, the iPod, the iPhone and the iPad. Andmaybe well look this foolish a year from now. But we think Apple is in "cruise speed" andexpectations have caught up to this superbly-run and innovative company. So we think Applewill grow fast and be in rude health in 2012, but, for once, wont deviate much from theconsensus forecast.Nokia Will Do OKMany people are expecting Nokia to be the next RIM--an ignominious collapse. And indeedit has slid a lot. But Nokia is much bigger than RIM and, unlike RIM, its execs arent asleepat the wheels. They are pumping out good phones with a good software platform, into one ofthe worlds biggest phone distribution channels. It will take many years before we see ifNokia and Microsoft will become a strong player in mobile, but next year Nokia will neitherdo outstandingly nor collapse, but do OK.Amazon Will Post Serious Losses And OutstandingRevenue GrowthAs the price of a Kindle goes down, Amazons revenue and losses go upAfter years in "harvesting" mode Amazon is back in "investing" mode. Jeff Bezos, the mostlong-term thinking entrepreneur on Earth, realizes he is looking at some massiveopportunities: building a complete digital media distribution ecosystem; building the biggestcloud platform of the 21st century; and, last but not least, eating retail.
  4. 4. All of these opportunities require upfront investment. But because Bezos has been at thisbefore, they will pay off. All of the things that Bezos is investing in--below-cost tablets, perksfor Amazon Prime subscribers, data centers for Amazon Web Services--show up as morerevenue and less profits. We think you will be surprised next year by how big the losses willbe and how fast the revenue will grow.The New Breed Of Vertical, Entertaimnent-FocusedEcommerce Companies Will Get HugeWith the internet now reaching over a billion people, plenty of vertical markets have reacheda tipping point, becoming big enough to support massive companies focused on one productcategory. Examples include Gilt Groupe for fashion, Warby Parker for glasses, One KingsLane and Fab.com for home decor, and others. With these pioneers leading the way,investment and value creation in this area will proliferate. (Thanks to Silicon Valley demigodMarc Andreessen for reminding us.)2012 Will Finally Be The Year Mobile Advertising ReallyTake Off, With At Least One AdNet Going PublicWhere usage leads, dollars follow...Mobile advertising is still tiny compared to internet advertising, let alone all advertising, butit wont stay that way forever: smartphones are proliferating, outselling even PCs, and willsoon reach a scale unseen in the history of computing. This isnt a bold prediction. What maybe bolder is that some mobile ad companies will finally grow huge this year, with a mobile adnetwork, probably either InMobi or Millenial Media, going public. Mobile isnt yet takingover the world, but its now big enough that some companies are now generating seriousrevenue and well see more of that.Rovio Will Open At Least One Store In The US
  5. 5. Rovio is (or at least wants to be) the next Disney: it makes money not so much through theproducts its known for (movies for Disney, games for Rovio), but through tons ofmerchandise connected to the magic brands these products popularize. Accordingly, Roviohas an ambitious retail strategy of opening amazing Angry Birds stores, and it will probablyopen one in the US in 2012 (though Europe and China are first).This Year, Enterprise-Focused Startups Will Blow Up"Enterprise is sexy." Youre about to hear that phrase a lot. The stars are all aligned forenterprise startups. Companies are sitting on tons of cash, not knowing what to do with it,because of the economy. Trends like the consumerization of IT, the proliferation of newmobile devices and the cloud have converged, giving a serious opportunity for newcomers todisplace the incumbent enterprise software players. 2012 will be a year of big IPOs (likeWorkday) and big financings (Yammer, Box.net) for ambitious enterprise startups.You Will See A Ton Of Hype Around "The Internet OfThings""The Internet Of Things" is a catchy term revolving around the idea that most everydayobjects around us will be equipped with internet-collected electronics, and this will open upnew applications. This goes from novelty items like scales that tweet your weight(encouraging you through peer pressure to watch it) to ambitious visions like Jawbones stepstoward wearable computing. Were not yet sure if The Internet Of Things will be a hugebusiness or a passing fad, but were willing to bet youll be hearing a ton about it in 2012.