Lululemon acquires Mirror fitness
Workout clothing maker Lululemon makes its first acquisition, agreeing to purchase at home personal fitness provider, Mirror for $500 million. Mirror, a competitor to Peloton, provides a $1,495 connected mirror camera device that offers online group fitness, or one-on-one personal training sessions. The company’s primary competitor, Peloton, has 886,000 subscribers, up 94% in a year. CNBC
dis-rup-shun: The clothing company is making some very strategic moves here. It is cashing in on the “connected community” movement that has resulted from Coronavirus, ensuring that its core customers, the workout enthusiast who wants to impress those at the yoga studio, have a way to continue to spend time and money in leggings. It has an advantage that Peloton does not, and that is the ability to offer one-on-one personal training sessions. This is an opportunity for premium customer experiences which will offer more opportunities for Lululemon to demonstrate its clothing line to a well heeled buyer. The clothing company is following business icon Apple’s model of using content (classes) to increase the value of its hardware (clothing).
Despite Coronavirus, 5G rollout begins in 2020
Coronavirus, in late February, led to the cancellation of the mobile industry’s primary trade event, Mobile World Congress. That cancellation put the world on notice that the virus was a force to be reckoned with and blocked thousands of opportunities to promote the next mobile telecom standard, 5G. The same pandemic, however, has fueled demand for 5G, as people are spending more time online. China, in particular, has shown its interest in 5G as the bulk of the expected 190 million 5G subscribers in 2020 will be in China. CNET
dis-rup-shun: The pandemic has not slowed the development of 5G infrastructure, meaning that as soon as consumers are ready to upgrade their smartphones and networks, the carriers are ready. With the world sheltered in place, drops in Internet service have become more common than ever (I bet there is data on that). Consumers are ripe for a migration to an all 5G home and mobile network, if carriers wish to offer fixed mobile broadband solutions. Let’s see if AT&T, distracted by its absorption of Time Warner and its change of CEOs will seize the moment, and if T-Mobile/Sprint, mid-merger, can make 5G a marketing priority.
An iPhone without charger or headphones?
An Apple expert, TF Securities analyst Ming-Chi Kuo, speculates that in order to keep the next iPhone (iPhone 12) at the same price as its predecessor, Apple will ship the device without a charging cable or earbuds. CNBC
dis-rup-shun: If the speculation is true, Apple will change the industry standard such that other makers will also stop shipping accessories in the box. But is a charging cable to power the very device in the box really an accessory? It is in Apple’s best interest to not include earbuds, thus compelling buyers to gravitate to their premium priced Airbuds. Can Apple provide less for their flagship device and still delight its loyal customers? Probably.
The future console is in the cloud
The future of gaming is in the cloud. With every major gaming platform offering a cloud service and more rumored on the way, the role of the cloud is at the center of gaming. Gaming, like video, drives enormous revenues, and other than bandwidth, the responsiveness of data centers will be the biggest factors in good game experiences. Data centers are in a race to create the best gaming infrastructure, not only by having high capacity, but by placing data centers on the right parts of the globe to minimize latency. Wired
dis-rup-shun: Like Netflix for video, cloud gaming services will become the new standards for gaming, and consoles will remain to serve only the enthusiasts who want the experience that only hardware in the home can provide. But the middle of the road gamer, who has traditionally been on the edge of the console customer base, will be content with cloud games, meaning Sony, Microsoft and Nintendo will have to work harder to serve the core gamer, or will have to create an experience so unique that it simply can’t be replicated in the cloud. And at least one of them will.