W Book Preview by Idea Couture

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confidential © Idea Couture Inc 2014. All rights reserved. No part of this document may be reproduced in any form or any means without the prior written consent of Idea Couture Inc. (“Idea Couture”). This document contains information that is confidential and proprietary to Idea Couture and is prepared solely for the use by employees of VF Corporation as a confidential document. It is disclosed solely for use by employees in the course of their employment or by contractors for the purpose of facilitating the provision of services by that contractor to the employing VF Corporation and for no other purposes. Unauthorized possession or use of this material or disclosure of the proprietary information without the prior written consent of Idea Couture may result in legal action. If you are not the intended recipient of this report, you are hereby notified that the use, circulation, quoting, or reproducing of this report is strictly prohibited and may be unlawful.

The consumer electronics industry is going through an inflection point.

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INTRODUCTION

It will be transformed. It will be reinvented. It will be reset.

INTRODUCTION

This is the birth of a new category of products and devices and the birth of an entire infrastructure of services to support them. The last thing we want is to pretend this is just a further extension of our smartphones. Itâ&#x20AC;&#x2122;s not. Itâ&#x20AC;&#x2122;s a massive technological and cultural change, a change that will potentially transform industries including pharmaceuticals, healthcare, entertainment, business-to-business and retail. Beyond this, it will transform our social interactions and even our understanding of ourselves. There is no doubt that some potentially game-changing startups will fail. Larger established companies will also struggle to identify areas of the future to explore. They will play catch up as the fast pace of the industry propels forward. The game is going to get tougher, and with competitors joining everyday, the bar to success is moving higher and higher. those who are prepared, ambitious, persistent, and see new behaviour and customer experiences instead of products, will seize these opportunities. The consumer electronics industry is going through an inflection point. It will be transformed. It will be reinvented. It will be reset. Nothing will be the same. Only companies that understand this will survive. This black book is intended to be a guide and a playbook for executives of Fortune 500 companies and innovators seeking to seize this big opportunity. This book is for industry analysts and venture capitalists to spot tomorrowâ&#x20AC;&#x2122;s winners and losers, and for product developers, experience designers and innovation managers to think strategically about their current strategies and design approaches.

Idris Mootee CEO Idea Couture

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00 contents

MARKET OVERVIEW

STRATEGIC FORESIGHT

Current and Future State of the Wearable Devices

Engineering, Design and Prototyping

Concept showcase

“There is a beauty in space, and it is orderly. There is no weather, and there is regularity. It is predictable… Everything in space obeys the laws of physics. If you know these laws and obey them, space will treat you kindly.”

— Wernher Von Braun

This book will not attempt to predict the future of wearables, but it will attempt to outline the approaching challenges and opportunities, key drivers and scenarios that have the potential to discover and shape the markets of tomorrow.

MARKET OVERVIEW

market overview

After decades of experimentation in engineering research labs, designers’ drawing boards and science fiction films, wearable computing devices that fuse accessory with technology are finally becoming real.”

From discreet biometric sensors and activity monitors to wrist-worn sleep sensors and heads-up displays, consumers are being exposed to a wide range of devices that promise deep and seamless integration with their everyday lives. Yet, we are still on the cusp of the opportunities that the wearable market will bring. We are only in the “heavy brick phone” phase of wearable devices. Still, the majority of Wall Street analysts are bullish about the future of wearables for obvious reasons. Many of the most successful technologies, including the smartphones that gained mass adoption during the last five years, have finally reached the end of the S-curve — both the technologies and the dominant designs have reached their very limits. Citi analysts believe that major mobile makers would be best placed to find new devices to sell to gadget-hungry consumers. They estimate that penetration for smartphones is between 75-85% in developed markets, meaning that a saturation point could be reached as early as 2015.

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MARKET OVERVIEW

How Likely do You Think The Following Behavior Will Become Common?

While it’s agreed that the wearable market has large potential, many speculate if it will become the massive global business that PCs and mobile devices are now. The consensus is that we are 2-3 years away from a potential inflection point in market adoption for wearable devices. That adoption will be driven by six primary factors: //

A growing base of smartphones

The ability to deliver sustainable user value

Component cost/performance and battery improvements

An established software ecosystem

New apps/business models, and

Younger consumers wanting to leapfrog to the next generation of technologies.

Beyond this, there are many solid indicators showing positive trends from both technology and consumer behavior perspectives. From a technology perspective, wearables are rapidly evolving from single-function, hard-to-connect, dumb devices into what we believe will increasingly become multifunctional, always-connected, smart and aware devices. This transformation is driving the value proposition and a cross-convergence that will create several waves of investments and new wealth. We estimate a potential ten-fold increase in TAM over the next 3-5 years from $3-5 billion to $30-50 billion — still only 6% of total CE spent and only 15% of the smartphone’s base.1 From device marketers to chip makers, consumer electronics, lifestyle products, fashion and apparel, sensing technologies and biomedical devices are more closely interlinked today than ever before, and the synergy between them is opening up new worlds of possibilities. But when attempting to introduce a new wearable product to the market, one must consider a vast and complex series of factors. The next wave of technology will not be able to reply purely on novelty to drive adoption. Those who approach the category with the mentality of traditional consumer electronics will make powerful gadgets that we can strap onto our bodies, while ignoring what it means to wear rather than simply carry a device. To succeed, manufacturers must base their offerings in a deep understanding of a series of complex factors which will be outlined in the following chapters.

This book can “future-proof” your business by providing insights on how we help our clients apply strategic foresights, scenario planning and rapid prototyping to anticipate emerging and future technological developments in order to leverage new opportunities to secure industry leadership positions, and mitigate potential negative consequences. We work with our clients to develop detailed roadmaps that align your short-term and long-term business objectives with specific technology developments, innovations, applications and solutions, to inform strategic planning, assess the impact of technology on your company’s future, and help you achieve your strategic, tactical and operational goals.

14 MARKET OVERVIEW 01

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The separation between our digital and personal lives has practically ceased to exist; the number of apps and resources that centralize and sync to usersâ&#x20AC;&#x2122; profiles continues to increase and their levels of integration will continue to deepen.

Seeing the Future

The success of future wearable products must take a step towards symbiotic design, where relationships between humans and objects evolve to become more like relationships between humans and other life forms. Right now, wearables are equipped with sensors and cameras that can monitor changes in the environment, and follow and understand their users’ motivations and actions. Some wearables will soon behave like sentient beings, and will be able to harmonize with their users and become part of our everyday experience. Many will not even require our conscious attention at all; they will respond to our emotional states and to external factors such as traffic, temperature, humidity, noise level and movement, making sense of all manmade activity and natural forces. Instead of being another device we must control and program, our wearable technology will become a vital extension of our senses, making it possible to live and be in the world in a new manner that we will quickly become accustomed to. We will become uncomfortable without our devices, feeling naked or unprepared when they are not with us.

Additionally, wearables will also have vast and continuing influence on our social environments. The separation between our digital and personal lives has practically ceased to exist; the number of apps and resources that centralize and sync to users’ profiles continues to increase and their levels of integration will continue to deepen. Wearables will add an entirely new level of data and learning that help these platforms interpret users’ behaviors, preferences, moods, and outlooks. It will be possible to offer deeply personal and insightful suggestions, and to help users understand themselves in almost inconceivable ways. It’s time to radically rethink how this transformation will happen and what the opportunities will be for both the short and long term. Beyond entertainment and novelty factors, the social and economic drivers supporting the adoption and integration of wearable wireless devices—such as users taking responsibility for health and wellness consequent of newly available data—can provide a compelling business case for employers and healthcare providers to invest in. A case in point is the Mayo Clinic, who announced a program called Mayo Clinic Healthy Living, which leverages mobile health tools toprovide preventative care to employees of Mayo’s B2B employer clients.

Before we can propel ourselves into this new, exciting, and profitable future, we must better understand the nature of disruptive technologies, how and why companies struggle to embrace them, and the complex factors manufacturers must overcome to drive mass adoption for new devices.

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MARKET OVERVIEW

Wearables will also experience rapid adoption in other contexts, applying themselves to other market segments. It will change the way field workers do their jobs, pushing productivity to a new level. Think of the equivalent of Google Glass for emergency workers like paramedics or firefighters and first responders. The wearable can allow those individuals to communicate in real-time via streaming video from the scene, as well as receive vital information or instructions that can mean the difference between life and death. They can be supplied with building schematics, medical records of victims, live feeds of security cameras in the area or live views from a circling helicopter, and so on. These devices can also be used for field engineers performing maintenance, live support for home repairpersons installing appliances, and training and simulation for hospitality and service industries. New opportunities for innovation will have a significant and pervasive impact on the economy, profoundly altering how we interact with our technology, our environment and each other. Wearables will also provide additional location, context and user sensory information, launching us into the second phase of The Information Age, which has already been dubbed The Industrial Revolution Of Data.

Data collection itself is an enormous and still-growing industry; the retail giant Wal-Mart handles more than 1 million customer transactions every hour, feeding databases estimated at more than 2.5 petabytesâ&#x20AC;&#x201D;the equivalent of 167 times the books in Americaâ&#x20AC;&#x2122;s Library of Congress.2 Yet, this paradigm is in its infancy. With the multitude of sensors integrated into wearable devices, Big Data will transform into a Mega-Trend with far reaching implications that will affect everything from business to science, government and the arts. How we live, work, communicate, sleep, eat, interact, and even think and breathe will all be drastically re-designed because of this contextual information. Life as we know it is truly about to change.

Global Scans

01 Local Autonomy Networks Communicatable Source: www.autonets.org Image source: www.autonets.org

Overview

These are wearable local networks that provide communications and data services independent of corporate or government infrastructures. They mix and match, combine, and recombine as a person walks around to create on-the-fly networks that are constantly changing to meet the requirements of a particular task. They are also untraceable because they do not exist for that long.

Relevance

For more than twenty years our technologies have been eroding our privacy and delocalizing our personas. Our identities are increasingly spread out, even our most intimate ideas increasingly public. Local autonomy networks reverse this trend. Reconnecting personal space with social space is enabled by low-power, wearable transmitter/receiver sets that create networks of just two, or just a few people. Not only do these networks have the potential to revive the experience of being part of an ‘intimate circle,’ they can also provide security and privacy to marginalized or threatened communities.

HOW CAN SMALL-SCALE, AD-HOC TEMPORARY NETWORKS BE USED TO ENHANCE THE CAPABILITIES OF A SINGLE DEVICE? HOW CAN WEARABLES MAXIMIZE THE POTENTIAL FOR SMALL-SCALE, LOCAL NETWORKS? HOW CAN THE SUM BE GREATER THAN THE PARTS? 36

02 03 Magnetic Sense

Changing Metrics

INTERGRATEABLE

augmentables

Source: www.iamdann.com Image source: www.washington.edu

Overview

People are now experimenting with unpowered magnetic implants as a way to expand the body’s ability to interact with technology and even to develop increased tactile sensation.

Relevance

Bodyhacking afficionados have discovered an easy way to develop a new physical sense. When small magnets are embedded under the skin of one’s fingertips, both magnetic fields and electricity can be sensed directly by their nervous systems. People with these implants say they can ‘feel’ whether a power outlet is live and where transformers, power lines and other elements of the grid infrastructure are in their immediate environment. The magnet is in effect giving them a way to sense invisible electromagnetic fields. It is also a way to change the way their body (their fingers) communicate with devices designed to respond to a strong magnetic field.

RATHER THAN SENSING PHYSICAL STATES, CAN WEARABLES ACTUALLY GIVE US NEW SENSES? HOW CAN EXISTING INTEGRATABLES BE ADAPTED TO SERVE MORE THAN ONE FUNCTION?

Source: www.businesswire.com Image source: www.the-gadgeteer.com

Overview

Wearable biometric sensors are becoming smaller and more powerful all the time. We have now reached the point where prototype ECG, pulse, temperature and movement sensors are small enough to clip on belt or to be worn directly on the body. Smaller sensors means a wearable device can combine several different kinds of biometric data. Not only does this tell us more about our bodies, it also allows us to create new metrics by which to measure effort, health, and sickness.

Relevance

Nike’s Fuel points and UnderArmour’s Will Power are actually new ways to measure the body’s activity. They represent new metrics that have yet to be fully explored. As such, they are an entirely new opportunity to understand the body’s processes and the implications of a person’s actions. This is one of the few ways in which wearables can actually change our social and individual behavours--the new metrics change how we look at our bodies.

WHAT OTHER COMBINATIONS CAN UNLOCK NEW WAYS TO LOOK AT THE HUMAN BODY? CAN WE ORGANIZE THE COMBINATION OF SENSORS AROUND METRICS THAT CONVEY IMPORTANT AND ACCURATE INFORMATION ABOUT THE BODY?

TECHNOLOGY ROADMAP & EMERGING EXPERIENCES

INTELLIGENT ACTIVITY TRACKERS

NUTRITION

PROFESSIONAL ACTIVITY ANALYTICS

PROSUMER 04

CONSUMER

ALLERGY MITIGATION

EMOTIONAL STATES

2014

OXIMETRY EMG

• HEART RATE • RESPIRATION • STRESS AND EMOTIONAL ESTIMATION • MUSCLE AC TIVIT Y • MUSCLE FATIGUE • MORE ACCURATE MUSCLE AC TIVIT Y DETEC TION • DISTINGUISH BET WEEN SUB MUSCULAR GROUPS • BRAINWAVE DETEC TION FOR AT TENTIVENESS AND CALMNESS • THOUGHT BASED SPACIAL INTERAC TION

• PERSONALIZED ALWAYS-ON NATURAL LANGUAGE PROCESSING • MOTION AND POSTURE MEASUREMENT • FULL BODY MOTION AND ARTICULATION MEASUREMENT

AIR QUALIT Y

• LIMITED SCENT DETEC TION • HIGHLY SPECIALIZED GAS DETEC TION

• MINIATURIZED DETEC TION OF LARGE AIRBORNE PARTICLES

RAMAN SPECTROSCOPY LOCALIZED POSITIONING GLOBAL POSITIONING

• HIGHER FIDELIT Y AT TENTION AND CALMNESS DETEC TION • IMPROVED THOUGHT BASED SPACIAL INTERAC TION

• SPEECH TO TEXT • NATURAL LANGUAGE PROCESSING

OLFACTORY

MOTION

SOUND

EEG

BIO SENSORS PERSONAL INTERACTION ENVIRONMENTAL SENSING

2016

2015

• DETEC TS PESTICIDES AND ALLERGENS IN SOLIDS AND LIQUIDS • DETEC TS CHEMICAL COMPOSITIONS OF FOOD • MEASURE PROXIMIT Y TO BEACONS • EXTRAPOLATES LOCATION WITHIN 4FT ACCURACY • ORIENTATION DETEC TION • LOCATION WITHIN 1FT ACCURACY • GPS ACCURATE TO 10FT

• EMOTIONAL DETEC TION THROUGH VOICE

2017

WORK PLACE SAFETY

MEDICAL PREDIAGNOSIS

ADVANCED AUTOMATED PROSTHETICS

ROBUST BRAIN CONTROLLED INTERFACES

MULTI-SENSORIAL LIFE LOGGING

2020 2018

2019

• DETEC T AND INTERPRET WIDER RANGE OF BRAINWAVES (UNCONSCIOUS THOUGHTS) • IMPROVED ROBUSTNESS AND ACCURACY OF BRAINWAVE DETEC TION

• CONTEXTUAL AWARENESS THROUGH SOUND

• ROBUST SCENT RECOGNITION

• DETEC TS ALLERGENS, MICROBES, AND OTHER AIRBORNE PARTICLES • DETEC TS PRESENCE OF NOXIOUS GASES

• DETEC TS WATER QUALIT Y • QUANTIFYING NUTRITIONAL INFORMATION OF FOOD

• SATELLITE UPGRADES FOR IMPROVED GPS DETEC TION, ACCURATE TO LESS THAN 3FT

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