Here are some of the estimates and statistics we’ve plucked from a McKinsey Global report we mentioned last week:
- 1.1 billion people currently use smartphones and tablets, with a potential to reach two billion to three billion more.
- The processing power of the average smartphone has increased by about 25% per year over the last five years.
- By 2025, nearly 80% of all internet connections could be through mobile devices.
- Near field payments grew 400% in 2012 and are expected to increase 20 fold by 2016.
Take financial services here in Australia, for example. Consumers are moving to mobile banking at a ‘breakneck’ pace, according to The Age this week. The uptake is up to eight times as fast as the original shift to internet banking. Billions of dollars are transacting through the big four banks’ ‘apps’ like CBA’s Kaching or ANZ’s goMoney.
In the Australian Financial Review, Jason Yetton, Westpac’s head of retail and business banking, suggested than within five years mobile technology will have almost completely overtaken PCs for retail banking.
He argued this will give Westpac the opportunity to target consumers with other products like home loans via specialists that can use video conferencing to talk with the customer.
But mobile technology is shaping up to be both an opportunity and a threat for the banks. Check out this from The Australian at the end of May: ‘Major banks are facing increasing competition from Apple, Google and Samsung — particularly from so-called "wallet" payment systems that allow consumers to pay for goods without credit cards from banks.’
Commonwealth Bank chief exec Ian Narev went on the record and said he was just as worried about the threat from major tech companies as he was about normal competition from the other big three banks.
No wonder the McKinsey Global Institute put mobile technology as the biggest disruptive technology that will impact the world until 2025. Of course, banking is not the only industry it will affect. There’s plenty more.
We asked our new technology analyst Sam Volkering here at Money Morning headquarters for his thoughts on the mobile technology trend. He told us:
‘The mindset people have at the moment is they carry around a phone capable of doing all these wonderful things with various apps and what-not. But they’ve got the wrong mindset. People are really carrying around computers with the ability to make phone calls.
‘So it’s not really an evolution in mobile devices so to speak, it’s just an acceleration of the evolution of computing. The trend means three things. Smaller, more powerful and immersive computing. And not in 10 or 15 years, but in the next two or three.’
Here’s a quick snapshot of that accelerating trend. The iPhone 4 has the same performance power as the fastest supercomputer in 1975. The difference is the supercomputer cost $5 million in 1975 and the iPhone 4 is under five hundred bucks today.
Of course, following the trend is one thing. Trying to identify which computers stand to win and lose is the hard part. That’s where Kris Sayce and Sam come into the picture with their new technology service, Revolutionary Tech Investor. The hunt is on. Going by the evidence, they’ve got the wind at their back on this part of the tech space. Stay tuned.
Don’t Miss This
Of course, Kris and Sam are excited by the opportunities in technology stocks and what they see as a transformational revolution that’s about to hit the global economy.
But over at Sound Money Sound Investments, editor Greg Canavan is more worried about China’s slowdown and what it means for the broader market and Aussie economy. He’s worried enough to want to show you a recent talk he recorded with fellow editor of The Daily Reckoning Dan Denning. You can see it here. It’s under thirty minutes. Grab a drink and enjoy.
Until next week.
Callum Newman.
Editor, Money Weekend
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PS. Don’t forget if you want to keep track of the latest things we’re reading and brief commentary on events that happen through the day, check out our Google+ page and Kris Sayce’s as well.
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