Latest Research
AT&T’s 5GE Is Largely Marketing Hype
Source: 5Gstore

AT&T’s 5GE Is Largely Marketing Hype

AT&T recently rolled out a limited 5G Evolution (5GE) network in Minneapolis in combination with its sponsorship of the Final Four. We tested the network and found only modest improvements in network speeds. Given AT&T’s 5GE marketing hype, we’re disappointed with the performance but remain optimistic about the potential of true 5G. This will, however, take time, and we expect to wait until the end of 2022 until the US achieves 75% coverage. The takeaways from our network test:

  • AT&T 5GE had 17% faster downloads, and 6% faster uploads compared to AT&T’s LTE network.
  • This compares to AT&T’s marketing, which suggests speeds can be up to 100% faster than its LTE offering.
  • T-Mobile’s LTE network had comparable download speeds to 5GE. However, T-Mobile’s upload speed was 56% faster than 5GE.

The Significance of True 5G

4G seems fast enough, so why do we need 5G’s 100x faster promise? It’s not just about speed, it’s also about latency. Data will be delivered instantaneously. At first, the use cases will be subtle, like instant app downloads and 4K video streaming. The mobile phone experience will be better, but won’t be revolutionary. Over time, that will change. Real-time data will allow new phone designs, new apps, off-device storage, processing in the cloud for AI applications, game streaming, and other compute-intensive mobile use cases. The smartphone is just one area that will benefit from low-latency, high-speed data. 5G will enable or vastly improve augmented reality, wireless virtual reality, countless IoT and smart home applications, autonomous vehicles, and V2X communication, to name a few.

The 5 Year 5G Transition

It’s important to note that the rollout of 5G will take time. We expect it won’t be until the end of 2022 before 75% of the US population will have 5G service.

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Artificial Intelligence, Augmented Reality, Autonomous Vehicles
2 min. read Show less
Why Amazon’s AirPods Competitor Won’t Compete

Why Amazon’s AirPods Competitor Won’t Compete

Bloomberg recently reported that Amazon is planning an Alexa-based rival to Apple’s AirPods in an attempt to get Alexa out of the home and into the world.

Thus far, Amazon’s device efforts have been muted because they don’t own an operating system or a mobile device. This new product is aimed at filling that gap, but we believe it will fall short because Amazon does not have expertise in building personal consumer hardware, they don’t own the OS of the device the headphones are paired to, and Alexa is not as useful as her rivals in on-the-go environments.

From Bloomberg: “The Seattle-based e-commerce giant is readying earbuds with built-in Alexa access for as early as the second half of this year, according to people with knowledge of the plans. The headphones will look and act similar to AirPods, but people working on the product inside Amazon are striving for better audio quality, the people said. Like the AirPods, the Amazon earbuds are designed to sit inside users’ ears without clips around the ear.

The headphones will let people use their voice to order goods, access music, weather and other information on the go. The Amazon digital assistant will be summoned by saying “Alexa.” There will be physical gesture controls, such as tapping to pick up and end calls and switch between songs, the people said.”

Apple’s AirPods have succeeded for three core reasons: they are masterfully designed, they tie in magically with your devices, and Siri is coming into her own for on-the-go use cases. We think Amazon, by contrast, will not be able to deliver on these three elements. In other words, all the things that made AirPods a success are missing from Amazon’s rumored product.

This is Amazon’s chance to own a device that has as personal and constant a relationship with its owner as a smartphone. However, for the above reasons, we are pessimistic about the outlook for the product and its ability to advance Alexa’s cause.

Amazon Is Bad at Consumer Hardware

Earbuds, like your phone and your watch, are personal products. They must be both aesthetically appealing to the owner and an outward signal of style. This is generally thought of as Apple’s core competency, and it is baked into the company’s culture and roots. The attention to detail needed to produce compelling personal products is hard to add to a company that has not had it before.

Amazon is not geared toward creating a personal consumer product. This shows in the Echo product line, which could be described as budget hardware. While the Echo has found success, a smart speaker is not a personal device. The hardware is less important because ambient computing doesn’t require any touch or visual interaction at all. However, when you take that product out into the world and wear it on your head, the hardware is very important.

Amazon Doesn’t Own the Operating System

AirPods’ primary appeal isn’t that they’re wireless or they sound the best, but that they work with our devices like magic. As it stands, third-party headphones can’t do much for an iPhone user when the phone is locked, so you may not be able to make calls, search for places, or ask questions without pulling out your phone anyway. This could differ on Android, but many smartphone makers also have their own wireless headphone competitors (see Galaxy Buds or Pixel Buds).

Pairing the headphones with your Alexa account will also likely require you to download the Alexa App and refer to it frequently to deal with Alexa-related questions. This is another point of friction that repels consumers unless the experience is vastly better.

Alexa May Not Be as Useful on the Go (Yet)

We believe that the use cases for voice computing vary in different environments. For instance, in the living room, you ask for music, weather, and general questions; in the car, you ask for directions, music, and local business information; and in the kitchen, you might ask for recipes and use smart home devices. In our latest Digital Assistant IQ Test (designed to comprehensively assess utility across five question categories), we found that Alexa lagged behind both Siri and Google Assistant in “local” and “navigation,” which are important categories for use out in the world as opposed to in the living room. Local businesses and navigation data that comes from owning a proprietary maps stack (as both Google and Apple do) is particularly valuable. In other words, when we think about the use cases for environments in which one would wear headphones, it’s hard for us to see Alexa outpacing Siri or Google Assistant.

People Don’t Want to Say “Alexa” on the Bus

Smart speakers work well in the home because there is a certain amount of privacy that allows you to speak your intent out loud. On the bus or the sidewalk, people are more reluctant to exclaim what they are doing on their devices. Even if it’s something basic like finding directions, a few silent taps is less disruptive than saying aloud, “Alexa, navigate to the nearest Starbucks.” As voice computing becomes more common and the use cases become better defined, it will be more acceptable to hear people uttering commands to their devices in public places, but for the time being, that still stands as a hurdle to adoption.

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Amazon, Apple, Artificial Intelligence
4 min. read Show less
Investing in Catch

Investing in Catch

We’re excited to invest in Catch, a company helping define the future of work.

Freelancing is an important and growing part of the future of work both near term and long. According to Morgan Stanley, freelancers make up 35% of the US workforce today (about 56m workers) and could grow to 50% in the next 10 years. A core reason for this growth is that the freelance lifestyle is appealing to millennials. It’s easy to pick up primary or secondary work through services like Upwork, Uber, etc. Being an entrepreneur also carries a certain type of romanticism.

The move to freelance labor doesn’t come without concerns from workers. A 2018 study by Upwork and the Freelancers Union revealed the following:

  • 63% of freelancers said they feel nervous about what they have to manage (taxes, financials, insurance, etc.).
  • The biggest concern for freelancers is access to affordable healthcare (22% of respondents). Saving for retirement was tied for second (19% of respondents).

Catch is building the platform to address these concerns and give freelancers the structure and security of benefits more commonly found in traditional work situations. Catch joins tax preparedness (savings), retirement, and health insurance into a single system to create a safety net that travels with the freelancer wherever and however they choose to apply their labor.

As millennials make up a larger part of the workforce overall and embrace the freelance work style, these younger workers expect services like Catch to deliver a certain type of experience. These users expect products to be intuitive, pricing to be fair, and brands that they’re proud to be associated with. Just as Robinhood and Circle cracked this code for finance products tailored to millennial investors, Catch can do the same for millennial freelancers.

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Health, Portfolio Company
2 min. read Show less