Look into my crystal ball: predictions for 2014 in tech

Steven Loeb · December 28, 2013 · Short URL: https://vator.tv/n/3409

Smartwatches will crash, Glass will live up to the hype and Twitter will still be in the red

We here at VatorNews have been spending the month of December looking back at the year that was. That means the top scandals, social media moments and acquisitions of 2013.

But what about the year ahead? Obviously none of us are psychic, or have a crystal ball, but we can take a look around and see what the experts believe is going to happen in 2014, as well as come up with some of our own.

(I did the same thing last year and to pretty mixed results. While I was right that the new Myspace would fail, and that Facebook would get into search, I also predicted that Google+ would become a top tier network and that Pinterest would try to woo men. Eh, win some, lose some)

So here is what will happen over the next 12 months:

1. The end of the mobile Web

Right off the bat, let's start with a big prediction from Dan Rowinski, Mobile Editor at ReadWrite: 2014 will see the death of the mobile Web, aka all of those sites that create mobile-only version of their sites.

"No more websites crippled with horrible “mobile.yourawfulwebsite.com” URLs. No more reading janky websites that display way too much fine print or omit crucial features when viewed on your smartphone or tablet," he said.

Those sites will be gone, and will be replaced with ones that are able to adapt to different screen sizes.

Companies like Google, Apple, Microsoft and Mozilla are already getting rid of their mobile browsers, he said, and "replacing them with fully functional versions that run on any device."

"In turn, developers will continue to build websites that can work across any screen size. Responsive design (what we do at ReadWrite to make the site look pretty everywhere) will continue to grow in 2014 as people realize that their old websites are losing them a lot of traffic from mobile devices."

2. Square will IPO

Last year, I correctly predicted that Twitter would go public, so let me try to repeat the same thing this year with another company headed by Jack Dorsey: I think that 2014 will be the year that Square finally goes ahead with its IPO.

Rumors began floating around right around the time of Twitter's IPO in November, when  a report from the Wall Street Journal said that Square execs had been in talks with banks, including Goldman Sachs and Morgan Stanley, about a possible 2014 public offering.

As of that time, no banks had been hired and no date has been set in stone.

The IPO is by no means guaranteed: there is also talk that the offering could be pushed back in favor of raising more money at a $5 billion valuation. Though it is possible for the money to be raised early in the year, and for the IPO to happen later. 

Either way, the clear winner will be Jack Dorsey, who earned $1.06 billion from the 4.9% of Twitter, or 23.4 millon shares, he owned. 

Once Square does go public (and it will) Dorsey will go from being an extremely rich man... to an even richer man.

3. Smartwatches will crash and burn

So, smartwatches, huh? Like the ones that Dick Tracy wore? Does anyone really believe that that will be the next big thing? 

While 2013 saw the introduction of smartwatches from both Samsung and Pebble, next year is when the big battle will go down: Google is already gearing up to start selling Android connected smartwatches, while Apple has also reportedly been working on a smartwatch, one that will apparently have a built-in heart monitor.

I predict that the so-called iWatch will in fact come out, and that Apple and Google will once again go head to head in the battle for technology supremacy.

But the smartphone wars these will not be. In fact, I have a sneaking suspicion that smartwatches will crash and burn. Sure, 20% of responders said they would buy an iWatch, sight unseen, earlier this year, but both will be quickly be overshadowed, when it comes to wearable tech.

The real winner will be...

4. Google Glass

Clearly Google has been readying Glass for an early 2014 release, recently releasing new hardware and a new developer kit. The question is, though: will people actually buy this thing?

All signs point to "yes."

Sure, people have already been making fun of it, specifically SNL, and the design could use a little work to be less awkward and clumsy. But analysts are already predicting big sales for 2014, and beyond.

A report from BI Intelligence from last week is predicting that over 800,000 Google Glass units will be sold next year. That number could reach nearly 2.5 million by 2015, and by 2018 the predictions are that 21 million units will be sold. 

Google Glass will be the wearable tech phenomenon that everyone expects it to be and that the world has been waiting for.

5. Instagram will become the premiere social network over Facebook

If Facebook were a shock-jock, it would be known as the "King of all Social Media."

It sits on top of the hill, while a slew of other networks race up and try to knock it off. And that makes it that much more fun for critics and journalists to always predict that the next year will the one where Facebook finally falls.

So which company is the lastest contender for the throne? For a long time it was Twitter that was supposed to do it, while Snapchat is the company that has most recently been mentioned. According to one reporter, though, it will actually be Facebook's own property, Instagram, that does the job in 2014.

"There are thousands of power users on Instagram who influence culture and the buying behaviours of their networks," Ross Simmonds, of Social Media Today, wrote. "Identifying these people and paying to have them post about your brand is something that will become very common place in the upcoming year."

2013 was, of course, the year that Instagram saw its first ad, and a successful one at that. It was also the year that the service branched out beyond just being a picture service, first debuting its own video feature in June and then introducing direct messaging earlier this month.

Meanwhile, Facebook, he believes has peaked, while Instagram has room to grow.

"Storytelling is the glue to building stronger relationships with your audience and being unforgettable," he said.

6. Twitter's revenue will shoot up... but the company still will not be profitable

Twitter may have had a successful IPO this year, but there was one glaring problem: the company is not yet profitable.

Twitter saw rapid revenue growth from 2011 to 2012, jumping 198% to $316.9 million. And its net loss decreased by 38% to $79.4 million. But while revenue in the first six months of 2013 also rose, going up 107% to $253.6 million, so did the company's net loss, rising 41% to $69.3 million.

In the last quarter, ending September 30, 2013, Twitter took in $168.6 million, but, due to expenses, its net loss now stands at $64.6 million.

Revenue is expected to grow quickly, though. Based on JP Morgan analyst Doug Anmuth's revenue estimate of $1.06 billion in 2014. But that still will not be enough to make the company profitable. In fact, the company has already said that spending will increase, in order for it to stay competitive.

"In order to grow our revenue and improve our operating results, we must increase our share of spending on advertising relative to our competitors, many of which are larger companies that offer more traditional and widely accepted advertising products," the company said in its S-1 filing with the Securities and Exchange Commission before its IPO.

"In addition, some of our larger competitors have substantially broader product or service offerings and leverage their relationships based on other products or services to gain additional share of advertising budgets."

With that in mind, expect that the chorus of calling Twitter overvalued to continue for at least another year.

7.  Amazon will follow Netflix's lead and earn Emmy nominations

Netflix’s role as a viable TV content producer was validated this month as its shows earned a collective 14 Emmy nominations—nine for House of Cards, three for Arrested Development, and two for Hemlock Grove. 

It was a game changing moment for the television industry, and a belated acknowledgement that television consumption no longer requires actually owning a television.

Amazon has also been developing its own original content this year. In April, the company put 14 pilots online and allowed viewers to directly tell them which of the shows they want to see by voting, and giving the company direct feedback, on which pilots they were most likely to watch.

Since then Amazon has debuted its first original series, a sitcom called Alpha House, starring John Goodman, and has greenlit two dramas: Bosch, based on Michael Connelly’s Harry Bosch book series, and The After, written and directed by Chris Carter.

These series have enough prestige, and name-value, on them that it is easy to see Amazon pulling a Netflix this year and swiping some Emmy nods. 

8. 2014 will be the biggest year for VCs since 2007

Things seems to be going well for the venture capital marketplace right now.

In the third quarter of 2013, 62 venture firms raised funds, the highest number of funds raised since the fourth quarter of 2008, when limited partners plunked down $7.1 billion across 69 funds.

Meanwhile, the amount of money invested in the third quarter was $8.1 billion, the highest since second quarter of 2012.

And they will apparently get better next year. The VC firms are expected to have their best year in terms of fundraising since 2007, Foundation Capital General Partner Paul Holland told Forbes earlier this month. 

“Over 200 VC firms will go to market next year, including some of the biggest names in the business and with the recent flurry of high value exits, they will receive a much more welcome reception from institutional investors than any time in the last seven years,” he said.

9. BlackBerry will fall even further, but begin to rebound in emerging markets

The sad tale of BlackBerry has been told, and told again. So there really is no reason to rehash it here.

What is more important is figuring whether or not there is any way this company can survive. The answer to that is yes, but it is not going to be easy.

BlackBerry is going to have to turn its attention away from North America, where manufactuerers like Apple and Samsung, dominate, and put a greater focus on emerging markets like Asia and Africa,

The company is already targeting Indonesia, via a deal with Foxconn, a manufacturer of electronic products and components. 

The company also inked deals with manufactuerers in Africa, India, Latin America and the Middle East so that BBM will come pre-installed on smartphones from companies like Celkon, Micromax, Mito, Nexian and Zen.

Emerging markets are the key to the long-term success of tech companies; just ask Mark Zuckerberg about that. If BlackBerry can successfully penetrate these new markets, the death spiral that the company has been on for far too long might just come to an end.

10. Snapchat will take the buyout in 2014

Here is my personal prediction for next year: Snapchat, the company that everyone is annointing as the new Facebook, will allow itself to be sold in 2014.

Just to recap, Facebook offered to buy the company twice; once for $1 billion, and the second time for $3 billion. It also received a $4 billion off from Google.

The company, of course, turned those down in favor of raising more money. The company was supposedly going to raise a total in the hundreds of millions at a $3.5 billion valuation; instead it took $50 million at a $2 billion valuation.

Not that raising $50 million is anything to sneeze at, especially after it raised $60 million in June, but perhaps it is a sign that there is not as much interest in Snapchat as the company thought. 

The company may have just hired away Emily White, who had been in charge of Instagram's advertising program, to be its new COO, but I also believe that monetization will be harder than they think. Advertising will be especially tricky, considering that images only stay on the screen for a matter of seconds, and in-app purchases can only take the company so far.

Now that Snapchat has raised more money, and upped its valuation, I am predicting that Facebook will come back again to purchase the service, and that, this time, Snapchat will say yes. 

(Image source: https://rock.rapgenius.com)

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