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Could manufacturing power base shift to Google and Snapchat?

Los Angeles Times
October 8, 2016 at 6:17PM

It's easy to imagine a future in which products as mundane as toasters and window blinds will be connected to the internet and controlled by software.

It's harder to guess who's going to make them.

Leading producers of consumer software such as Google, Facebook, Amazon.com and Snapchat are branching into designing physical goods at accelerating rates. Driven by intensifying competition for consumer attention and enabled by declining manufacturing costs, software companies are entering battle with firms as far removed from Silicon Valley as Timex and Ray-Ban.

The years to come could see Amazon making bookshelves that know what's on them and music-streaming service Spotify designing headphones with a cellular chip and flip-down video display.

It's all conjecture for now, but they are real considerations for software behemoths that want to solidify monopolies as well as start-ups seeking to upend traditional consumer brands, experts say.

"Everything that's a physical object is eventually going to be a combination of hardware and services," said Amar Hanspal of design software giant Autodesk. "The more industrial and complex ones are going to come from a traditional hardware company. But the more consumer-oriented and less complex, software companies will enter those product categories a lot more."

The latest signs of that future emerged Tuesday, when Google launched Home, a $130 tabletop device comparable to an alarm clock, except it responds aloud to spoken commands. It also revealed a Wi-Fi router and the first fully Google-branded smartphones. Snap Inc., formerly Snapchat, last week shared details about $130 video-camera sunglasses it's shipping later this year.

The rise of smartphones and online-fueled global trade have opened doors mainly in the last five years.

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With more cellphones selling each year than desktops or laptops ever did, prices of Wi-Fi chips, GPS sensors and other technical parts have fallen. Devices no longer need constant tethering to an electrical outlet. And because smartphones are always on and nearby, they are an obvious anchor for a personal gadget ecosystem.

Contract factories now can turn around orders quickly, and there's no waiting for some massive hard drive full of schematics to move by FedEx.

Hazards remain. One miscue can devastate multimillion-dollar investments (just ask Samsung).

Parish Dave works for the Los Angeles Times.

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PARESH DAVE

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