When you leave the house today or just about any other day, what do you have on your possession? You likely have keys for the house, maybe keys for a vehicle, some coins, your wallet and a smartphone. In 2007, the first Apple iPhone was sold to the public and the phone has changed society, but it could have made you money too. In an article by Reuters, 10 ways the phone has changed the world.
In 2020 there are 5 billion smartphones in use around the world, according to Canalys Research. Internet subscriptions has gone from 1.3 billion to 7.2 billion globally. In the developing world, there are now more mobile connections than people.
(in relationship to the big telcoms – they make their money from smartphone subscriptions not land lines)
Tech Uber Alles
Apple was once a niche company, today it is one of the world’s most valuable companies. The 5 largest Fortune 500 technology companies are Apple, Amazon, Alphabet, Microsoft and Facebook. They are worth $4.7 trillion compared to $800 billion in 2010. How are they in your portfolio? Mobile phone related technologies and services accounted for nearly $4 trillion in 2018.
There’s An App for That
On every smart phone there are dozens of Apps for services, many of them are free but once you have them, consumers are expected to spend more than $120 billion in app stores.
People spend an average of 34 minutes every day scrolling on their phone. Advertisers noticed and mobile ad spending surpassed TV for the first time in 2018 as a percentage share of the US market.
Smile for the Smartphone Camera
Global shipments of digital cameras dropped from 121 million in 2010 to 19 million in 2018 according to Camera and Imaging Products Association. (do you remember Kodak?)
Google reports its Android devices takes 93 million selfies everyday.
Where Am I?
The combination of GPS and information from the cell towers and WiFi networks makes smartphones incredibly powerful tracking devices. Phone companies and app makers routinely record the movements of subscribers and sell the data to advertisers for $20 billion a year.
Nearly 50% of the companies surveyed by Verizon said they planned to use smartphone management tools to track their employees.
You Can Look it Up
Before 2010, people typically consulted the Encyclopedia Britannica for information, now Wikipedia is consulted 240 million times daily.
One of the places people look at their phones is in their vehicles, sometimes they are driving and about 13% of accidents involve mobile phone use according to the National Highway Traffic Safety Administration
Forget Your Wallet
Apple Pay, Google Pay, or your bank account app for debit or credit are being used to pay bills. In China Alipay and WeChat Pay are used by 80% of the population. QR codes made this possible.
The phone aspect of the smartphone is decreasing usage. In Britain, the number of minutes on the phone fell from 254 billion in 2013 to 206 billion in 2018. Mobile data usage jumped almost 9 fold and the number of emojis has tripled to 3,000.
Linking to dividend paying stocks, the smartphone has changed the way we communicate and companies had to make the change to stay profitable. The money use to be in voice but now it is data and it seems it will not stop evolving. As the smartphone evolved some industries did not do as well, making cameras, but others did very well. The bigger question is as the industry changed how did you benefit? Did you buy the FANG stocks? An ETF? the individual stocks? or did you watch from the sidelines?
There are more questions than answers, till the next time – to raising questions.