Since I was born, cassettes, laserdiscs, VHS tapes, floppy disks, pagers, fax machines, and car phones have all become entirely obsolete. Some companies have been able to adapt, while others have seemingly fallen off the face of the planet; I don't remember, for example, the last time I saw that Maxell (HTHIY) guy with his hair blown back.
As the pace of tech development quickens and our phones get smarter and smaller, it's anyone's guess which product will be the next to die, but there are a few clues here and there. Companies that can read these patterns will be at a distinct advantage as the world of technology develops. Here, then, are seven products that will become either changed forever or entirely obsolete over the next few years and some companies that need to make changes, and quickly.
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Well, it only took us about a century to realize that we were blowing through our planet's supply of fossil fuels, but we’ve finally gotten there. Ford (F) and General Motors (GM) will face increasingly stringent federal regulations on fuel economy in the next decade; proposed changes to the Corporate Average Fuel Economy (or CAFE) laws would require a 2022 Ford F-150 to have better fuel economy than a 2013 Mini Cooper. This would almost certainly mean the death of the internal combustion engine as we know it; nearly every vehicle on the road would have to be at least a hybrid. The very nature of cars is changing, and the industry will have to change with it.
This holiday quarter was a rude awakening for the PC industry. Between October and December of 2012, unit sales for PCs dropped by 6.4% from the same period in 2011. Only Apple (AAPL) managed to keep its PC sales level from one year to the next under pressure from the growing tablet market. Microsoft's (MSFT) Surface RT tablet, despite its lagging sales numbers, has proved that one of the next steps for designers is incorporating a keyboard into a tablet, and as solid-state hard drives improve, the feasibility of tablets replacing PCs becomes more and more real. While Apple and Microsoft are diversified enough to push through, companies like Dell (DELL) and Hewlett-Packard (HPQ) may suddenly find themselves shorn of a major revenue stream if PCs start to disappear.
"In my hand right now," said comedian Patton Oswalt, brandishing an iPhone at last year's Just For Laughs Festival, "I am holding more filmmaking technology than Orson Welles had when he made Citizen Kane." The fact is that point-and-shoot cameras and their video-capable counterparts are practically sprinting into obsolescence thanks to the incredible cameras that most Americans have in their pockets. Samsung (SSNLF) has started running advertisements for the Galaxy S3 by simply showing short films—gorgeous ones—shot entirely on a phone. At this point, even a simple $300 iPod is at least the equal of a point-and-shoot camera with an identical price tag. While companies like Sony (SNE) and Nikon (NINOY) may always have professional photographers willing to pay big bucks f or high-quality equipment, they will be selling precisely zero entry-level cameras within a few years.
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Credit card companies make money by taking a small slice of each purchase, and up until recently, merchants have seen this as simply the cost of doing business. Now, however, near-field communications (commonly referred to as NFC) chips are posing a major threat to those middlemen; the day is not far off when people's phones could be hooked up directly to their bank accounts, and the transition is already underway in Japan. High-turnover companies like Starbucks (SBUX) or Chipotle (CMG) would benefit greatly from a switch to NFC payments, but the big card companies—Visa (V), MasterCard (MA), American Express (AXP), and Discover (DFS)—could find themselves out in the cold. If credit cards go the way of the horse and buggy, mobile payment processors like Square might be the next Visa.
What if NFC chips in phones and mobile payment devices like Square lead not only to the death of credit cards, but to the death of cash as well? It's a bit of a stretch, but only a bit; after all, we've been banking online for over three decades, and services like PayPal have been commonplace for years, so why not take that process (like every other one) mobile? According to a 2012 study by Pew Internet, 65% of technology experts believe that cash may be obsolete as early as 2020, although some believe that the "legacy infrastructure" of cash will allow it to survive until perhaps 2030. Even so, pity poor NCR Corporation (NCR), which builds and runs most of the ATMs in the country, and pity whoever makes piggy banks; they’ll both be equally obsolete once dollars and cents are concepts rather than tangible things.
This stings because I just bought a Kindle, but e-readers may already be on the way out. According to the Pew Research Center, about 5% of the population owns a tablet, the same percentage that owns an e-reader. Right now, e-ink displays like the Amazon (AMZN) Kindle or the Barnes & Noble (BKS) Nook are easier on the eyes than bright, backlit tablets, but as tablets get cheaper to produce and better at providing a glare-free display, they should overtake their single-function counterparts. After all, a 7" Kindle Fire, at $159, costs only $40 more than the top-of-the-line Kindle Paperwhite. There are, of course, upsides to e-readers: battery life, price, the lack of non-reading-related distractions. But as tablets improve, more and more consumers will make the switch and doom my beautiful new Kindle to extinction.
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I remember the day Steve Jobs walked onstage and made MP3 players the hottest electronic gadget in the world. I also remember the day he killed them; it was the same day he introduced the iPhone. Now, everyone with a Samsung Galaxy, Apple iPhone, or any decent smartphone already owns an MP3 player. Microsoft's hapless Zune is officially dead, Apple didn't even bother to update the chip in its latest iPod Touch, leaving an ARM A5 chip in the device while upgrading the chips in the iPhone and iPad. This follows news that Apple has been selling fewer and fewer iPods; ever since the company finally lifted the lid on iPod Touch sales back in 2010, the news has gotten bleaker and bleaker, until finally analyst Gene Munster said this week that he expected a staggering 23% decline in iPod sales year over year. And as for MP3 players that aren't iPods—do they even still make those?