What's Next? -- 10 Years of iPhone and the Future of Mobile

February 3, 2020


Soon, for the first time in history, every human will have a reasonably powerful computer in their pocket. Just 50,000 computers were sold in 1975. By 2000 that number had jumped to nearly 135 million units. Research compiled by Benedict Evans at Andreessen Horowitz shows that today, nearly 5 billion people are mobile users, nearly half of which have an iOS or Android smartphone. Let that sink in for a moment.



So we now need to ask the following questions:

1. What enabled us to get here?
2. What has mobile changed in technology and society?
3. What are the implications for the future?

The iPhone proved transformative for the distribution of smartphones, as you can see by observing the graphs above. But where did the technologies that empowered the iPhone to be so transformative originate?

According to a report from the Breakthrough Institute on the origins of good technologies, many of the major enabling technologies that so transformed the mobile experience post-iPhone were developed in government funded labs or as a result of public-private partnerships.

Microchips owe a debt of gratitude to the military and space programs, which created the lion’s share of the market in the early years. DARPA pioneered the research that led to the Internet as we know it today. GPS was part of a military satellite program known as NAVSTAR. The multi-touch screen was initially developed by University of Delaware thanks to grants and fellowships from the National Science Foundation and the CIA.

The iPhone isn’t unique in this. Much of the basic research performed in the United States and elsewhere comes as the direct or indirect result of a combination of public and private efforts. Many enabler technologies (particularly in hardware) were developed as a result of public investments into technologies that had enormous long term implications but uncertain technical risk and required significant upfront capital investment. They were important, but initially not economically feasible for many private groups. Much excellent research has been performed on the role of the State in the development of certain types of technologies, from Mariana MazzucatoFred Block and Matthew Keller and many others.

That’s not to suggest all innovation is best left to governments. Ultimately Apple is responsible for assembling these technologies into such a compelling platform during a time when QWERTY keyboards were still largely an anomaly on mobile phones… much less a touchscreen.

The existence of the necessary technology for small digital cameras isn’t enough — they have to be present on a device that you want to carry around with you. Otherwise you wouldn’t use them, and Instagram wouldn’t have been acquired for a billion dollars.

Over the last 10 years, we’ve experienced a hardware technology deployment phase that at least rivals any other in modern history and the related growth is impressive. From their initial launch in 2005, smart phone sales overtook personal computer sales in just 6 years. This made mobile the default native platform to reach consumers en masse, and apps from Facebook to WeChat benefited greatly from that opportunity.

Social sharing is perhaps the most straightforward beneficiary of the ascendance of mobile, enabled by the anytime / anywhere opportunity to share what’s going on in your life, wherever you are in the world, right this moment. While the smart phone revolution, with the iPhone as its standard bearer, led to rethinking community engagement, distribution of news, e-commerce, banking and a litany of other industries, social networks (in both the literal and abstract sense) have perhaps created the greatest impact as the OS for social engagement. We’re just starting to see smartphones disrupt the physical world as well, as mobile software engagement with physical devices and services is starting to take shape in healthcare, IIoT, and finance. While mobile payments are finally beginning to get traction, there’s still significant growth to be seen with projections the volume will quintuple by 2020.

So where do we go from here? We appear to be in the midst of what Carlota Perez would term the “deployment phase.” That doesn’t imply that there won’t be additional adjustment to the market over the coming years, but rather that broad mobile technological deployment is the new normal, and that the pervasiveness of smart devices will continue to remake the economy in ways that we probably can’t yet fully conceive. It also necessitates a re-think of our socio-institutional framework to accommodate the new techno-economic paradigm. The impact of Twitter, hacking, e-mail, etc. on the US Presidential elections this year is just the latest and most visible sign of this shift.

That friction between technology and the structure of governance is going to yield opportunities for radical disruption, and savvy entrepreneurs and business leaders will be watching closely to take advantage as we rebuild our institutions in a way that more closely matches the modern world. Whatever shape those institutions eventually take, we’ll probably be engaging with them on an iPhone.

"If you want to build a ship, don't drum up people to collect wood, don't assign them tasks and work, but rather teach them to long for the endless immensity of the sea."
Antoine de Saint-Exupery
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