Redefined Reality with @SmartTechCheck Mark Vena

‍

As a technology industry veteran for over 25 years, Mark Vena covers many consumer tech topics, including PCs, smartphones, smart home, connected health, security, PC and console gaming, and streaming entertainment solutions. Mark has held senior marketing and business leadership positions at Compaq, Dell, Alienware, Synaptics, Sling Media and Neato Robotics.

Mark has appeared on CNBC, NBC News, ABC News, Business Today, The Discovery Channel and other media outlets. Mark’s analysis and commentary have appeared on Forbes.com and other well-known business news and research sites. His comments about the consumer tech space have repeatedly appeared in The Wall Street Journal, The New York Times, USA Today, TechNewsWorld and other news publications.

‍

Host:
Hey Mark, how's it going?

Mark Vena:
Hey Chris, how are you?

Host:
Good morning!

Mark Vena:
Good morning. Uh, it's around 10... no, it's around 1 where I am. It's like 10 where you are, right?

Host:
Yes.

Mark Vena:
I woke up just for you. I woke up early on Saturday.

Host:
I'll make sure to maximize the use of your time, and may you go straight back to sleep if you so desire. Uh, so this is Mark Vena, and he's been at his job for a very long time. He currently hosts a podcast and runs Smart Tech Research, a technology research firm in the consumer tech space. So just talk about what's going on in tech. You have the Smart Tech Check podcast, which, uh... it should be easy to say, but it was hard for me to say at that moment. But, uh, it's a great podcast, with lots of interesting people. I think you have panel shows and some one-on-ones with clients and other people in the industry. So, uh, glad to have you on and get your perspective on what's going on. It always seems like a fiery time in tech no matter what, but just to... I think you have enough perspective to know whether it's just a bunch of hoopla or, uh, you know, objectively interesting technology entering the market. So, thanks for coming on and telling us a little bit about what's going on.

Mark Vena:
I'm glad to be here.

Host:
So I do want to ask how you got into this in the first place. I always try to get the understanding of why people do what they do. So why...

Mark Vena:
That's a great question. I don't often get asked that. I could probably go for three hours on that, but, um, I'll tell you just a quick short story. The way I kind of got into technology, I was kind of like, um... without the star power, I was kind of like the Matthew Broderick character in War Games. I got into PCs at a very young age. My mom ran a word processing business out of our home in the late 70s.

Host:
What does that mean at that time?

Mark Vena:
Back in those days, you know, only corporations could afford the really high-powered expensive word processing equipment, which was dedicated—$200,000 systems. My father was an attorney. He worked with a lot of lawyers. Lawyers are notoriously frugal, and my father thought, "Hey, this would be a great idea if you could, you know, outsource this," before outsourcing became a thing. He thought, "Hey, have a working business, and we can lease the equipment from IBM." IBM was really at the forefront of that category. We'd hire, and you can do word processing services like letters, mail merges, that kind of stuff, and charge for it. And it became a pretty lucrative business. Ultimately, she had to move it out of the house; it became so big.

At 15 years old, I started to learn how to type at 70 words a minute. IBM had some great word processing software, and they were really at the forefront. You can't imagine what these systems were like in the late 70s. The system itself was the size of a refrigerator, and the screen was about this big.

Host:
Wow.

Mark Vena:
I got into that, and the reason why that's relevant is that when you do business with IBM, IBM falls in love with you. There were always IBM executives stopping by at my mother's place to showcase what a business could be like in a home. I got to know a lot of IBM people when I was 15 or 16 years old. Ultimately, I got a job as an intern at IBM doing word processing. The exciting part about it was I got hired making $7.50 an hour, which, back in those days, I felt like I was a millionaire. During the two summers I worked in high school as an intern, they announced the IBM PC. At that time, I had a Radio Shack TRS-80, which was one of the original first PCs. I had an Apple II back in 1979–1980. So I got into computers at a very early age.

When I went to college, I was on a track to go to law school. That was what my father's dream was for me. But I was thinking, "Why art history?" You know, with all this tech, why art history or, sorry, Bachelor of Arts in history, basically?

Host: 

Yeah, it was basically history and, um, and the plan was, hey, Mark is going to become a lawyer because I kind of like that kind of stuff. But I got offered three jobs from IBM coming out of college from Boston College. So, I got into computers at a very, very early age. I was kind of in, I could tell you other stories that are interesting, but the bottom line is I was indoctrinated with computer technology from the very beginning, and I, you know, realized frankly, you know, that, you know…

Mark Vena: 

And again, that wasn’t consumer technology. The technology that, even when PCs started to hit the ground in the early ‘80s, yeah, it was really a B2B play, and, um, but I quickly realized, you know, hey, this thing is going to have a profound impact on people. And then you flash forward, so I, you know, I worked for companies like Epson in those days. Epson was in the PC business, but I ultimately got recruited by Compaq Computer, and I was the original product manager on the Presario brand, which was the first consumer brand of PCs in the early ‘90s. And that’s when, you know, the market took off, and I really got a flavor for, you know, here’s how personal computers can change your life.

Host: 

You know, and now you look at PCs today and, you know, we’re going to talk a little bit about this now. The PC category is a tough category right now. I mean, it’s a U market, the market is flat or declining after a lot of growth during the pandemic when everybody was up at home upgrading their PCs, but that kind of, that, those salad days are kind of over now. And it’ll probably come back after a little while, after PCs become a bit older and people have to upgrade. But, you know, that category is a bit slow right now. The smartphone category is a bit slow. I was at the Apple event earlier in the week, you know, I think Apple’s trying their level best to keep the smartphone category relevant, but it’s a tough category right now. It’s a tough business.

Mark Vena: 

So, the atmosphere of technology, I think, is a bit, you know, people I think are a bit, uh, you know, skeptical, uh, and they’re a bit tired. You know, um, I mean, Apple, just talking, speaking to Apple, um, on a, on a precise basis, you know, Apple, I think, you know, does everything they can do to keep the category relevant. They have a very strong market share presence, especially at the high end, you know, with those professional models. You know, PC, uh, smartphones now have become part of this computational photography, um, you know, C all smartphone, not just Apple, Samsung has dropped that category well, and some of the technology they’re putting in phones today really have completely removed the reason to buy a separate DSLR. I mean, I used to have a separate DSLR. No more, you know, and they’ve added, they’ve added zoom capability to the new, to the new iPhone 15 Pros, which is going to be enormously important. I, you know, I do a lot of video stuff as you probably do remotely when I’m outside, and having great Zoom kit is amazing.

So, I think that will be a terrific feature, but now, will that compel people to run out and throw their phone out and go out and upgrade? Probably not unless you’re, you know, you’re someone who, um, takes advantage of that capability, but, uh, but it’s a tough business right now. I mean, and it’ll probably be another year and a half or so before things start to kick back into life. I think people are very excited right now about, about Vision Pro, the new XR capability that, um, goggles that Apple announced, uh, a few months ago. And they’ll be in the market, they’re not in the market yet. They won’t be in the market until early next year, uh, but, you know, interesting Chris, is if you saw what Apple did earlier in the week when they announced the 15 Pros. It went over the head of some people, but the 15 Pros now will be capable of capturing spatial video, 3D video, and that’s a big deal because what Apple wants to make sure is that when these Vision Pros come out, um, early next year, they want people to have the ability on day one to share videos of their family, videos of when they’re outside in 3D that can be enjoyed on these Vision Pro, um, goggles.

And I have to tell you, the resolution on these goggles, you have to, you know, I, I tell everybody and their brother when they show up in stores, you got, even if you’re not going to buy one, you got to go to an Apple Store and ultimately put these on. Even though they’re $3,500, they’re not going to be cheap and no, they, well not with Apple, but it will blow your mind away in terms of the resolution because they literally have, it’s like a 5k camera, uh, I’m sorry, a screen over each eye. So, they’ve spared no expense. The, uh, the new, um, the new technology is great, and they’re setting the table right now with, with iPhone Pros, the new 15, that will be able to capture video because remember, you know, you look at it from a, um, uh, using, um, 8K TVs as an analogy. 8K TVs are great. They’re still expensive, but they’re coming down in price. There’s really no compelling reason to buy an 8K TV because there's no 8K content out there. Most of the content on, um, that is streamed or on your cable system is only 4K, so you're buying a TV that, if you buy an 8K TV, you're not going to be able to take advantage of it. Apple is trying to avoid that problem that, hey, when the Vision Pros come out, you'll already, the iPhone 15 Pro will be out in the market for then three or four months, and day one there's going to be lots of 3D spatial video content that people can take advantage of.

One of the things, uh, you know, with, uh, with these, I think you hit three different sort of hardware categories with phones, laptops, and goggles, but, but, um, 'cause I, I guess my, the first thing that came to mind when you were talking was this kid, I, that I know, he has a very good business. It’s a multi-million dollar business; he does it all from his phone mostly. I mean, it’s, it’s the kind of business where, uh, he's going to shops, he owns basically a, um, fulfillment center for Amazon. He knows a few, right, but most of the work he does, he's texting people, messaging people, or, and he can do quite a lot on his phone 'cause he kind of has to. Uh, sitting at a desk is not his forte.

 Oh, I'll, I'll give you, I'll give you a perfect, I'll give you a perfect use case that's not entertainment, uh, oriented. Um, I do a lot of video editing, you know, I do podcasts. I do all the post-production editing and, as you know, because you probably do it yourself, when you try to do that on a 13-inch, 14-inch laptop, it's very difficult because video editing, by nature, is a very linear type of thing. And very frequently, I'm not in, right now I'm in front of a big HP 45-inch wide screen. It's lovely to do video editing because I have all this real estate. Well, you don't have that advantage when you're traveling, and I'm very frequently on the road. I'm in a hotel room; I don't drag a 45-inch display with me. So what the Vision Pros can do is, you can take your desktop from your Mac, and ultimately, I'm sure there'll be apps out there that allow you to do this with Windows as well, and you can move your desktop into that virtual window. So all of a sudden, now, I'm in a cramped hotel room, I could have several 80-inch monitors virtually in that desktop. So there's enormous activity, um, advantages to that. Um, think about that being on a plane now. You know, I've debated this with different people that I respect, and a lot of people say, well, I would not wear that on a, on a plane. Well, I don't know about that. I, I think that, uh, if you want to make... I think I would wear it on a plane, actually. In fact, that's might be the perfect place to wear it. It's not going to get stolen on a plane. Um, I know, well, someone might try to do that if you fall asleep, but, but I was, but he has, he doesn't have, where he doesn't have too many places to go. I would not wear them on the New York City subway or on, or on a, you know, bus probably. But just to be very, uh, direct, I just came back from Germany. I went to IFA, which is a big technology trade show, and that was a 14-hour flight on the way back. And how many movies can you watch on the plane? And by the way, the planes all have the same damn movies, and you know, there's not a lot of, uh, content that's mixed up. If I had had those Vision Pros on the plane, you know, I could have absolutely done a tremendous amount of work, you know, for my desk without, you know, with the laptop closed. Because that's the other problem when you're working with a laptop on a plane because you put the, the screen up, and some person in front of you, you know, adjusts the seat and all of a sudden, they break the, you break the screen in half. So there's all kinds of usage models that I think are, uh, going to be very, very compelling and productivity ones, not entertainment.

Host: 

Sure. Yeah, I mean, watching a movie on a 100-inch virtual display will blow your mind. Will that justify you going out and spending being the main character there? There will be applications like that to do that, but I, I'm convinced this is the one advantage that Apple has, and they talked a little bit about this during the, um, announcement. If you believe Apple, and I tend to believe them, uh, it's not all hyperbole, they have a tremendous developer community. I mean, they have tens of thousands who've made lots of money, Chris, developing apps for the iPhone, developing apps for their other devices. I mean They have that as part of their ecosystem, and I am convinced that the killer app, you know, when you use the phrase killer app, that kind of dates me, but the killer app is like a Lotus 123 or a Visicalc in the day, and what that means to the average person who's ever heard that phrase before is that the app is so compelling and so interesting and can change your life in such profound ways. You've got to go out and buy the platform that runs that. That was true of 123 initially; only Lotus 123 ran on the IBM PC, and they ran on ultimately ran on clones, but you had to buy a PC. You couldn't run it on an Apple or for something newer, only something like even like Excel, right? Excel is sort of the modern version of some of the things you talked about that everybody knows.

Mark Vena:

That's exactly right.

So, there's going to be a lot of, you know, there's a lot of folks who, um, they're a bit—I don't know, I wouldn't say they're jealous of Apple, but you know, when you look at the community that I operate in, the analyst community, you know, you've got people who tend to be pro-Apple, and you have some people who tend to be pro-Windows, and they're all very good people, and they're very independent. Uh, but Apple has been so enormously successful in most of the stuff they do. It's not that they don't have misfires every once in a while, but it's rare—it's way less misfires than most other organizations. They've been quite tight, you know, and most companies, by the way, would like to have the kind of success with their misfires, let alone the ones that really take off. But for the most part, you know, they have a very high batting average, you know. They probably are batting, you know, if you use a baseball analogy, they probably bat—they get hits eight out of 10 times. And as technology evolves, there's a growing trend in AI and IoT making its way into smart devices. We’re also seeing more integration of AI-driven smart home solutions, which offer unprecedented automation. For example, in smart home security, the ability to monitor and control home systems remotely is increasing consumer trust in these technologies. It’s clear that consumer behavior is shifting as people embrace connected environments and the convenience that comes with them.

Host: 

Yeah.

Mark Vena: 

But the reality is, is that since the PC community doesn't really have the kind of ecosystem that Apple ultimately has, the challenge that you have is that you have kind of sluggish growth right now, and that's what I think the concern is. But I do think if I look at one bright spot in the space, I think Vision Pro could be a big deal. Now, in a strange way, I'm going to make a statement here. I think the PC community will have for Vision Pro, because Apple's not going to have 100% of that market. There's going to be someone else that comes forward, whether it's a Samsung—probably going to be a Samsung—or someone that's going to come out with a compatible platform at a lot lower price, because that's, at the end of the day, that's what—and you know this—I think the price is where they're going to lose a lot of market share. But I don't think they care. They've never sort of cared about that sort of thing.

Host: 

Yeah, they don't care, but they might. Something that might be interesting is, because, you know, the iPhone, the status symbol of the iPhone, sort of just the way people see it—it wasn't about the technology; the technology is great, it's seamless. I think the thing about the iPhone is just like, it doesn't cause you problems. So, if you don't care about technology, my iPhone is a perfect phone for you, right? You just—okay, it works, and, like, look, it looks nice, and there's a lot of this. In fact, that's most people.

Mark Vena: 

But when we talk about the Vision Pro, because of the way you use it, it can still go in that direction where it just mostly works, uh, and sort of wins that. But, while you're using it, you don't see other people see you use it, so do you know what I mean?

Host: 

Yeah, yeah.

Mark Vena: 

So, you don't get that feedback loop of, this is how people perceive me because I'm using this technology. I must use it always, right? So, that social capital, they—it's going to be harder for them to, I don't know for sure, but it might be harder for them to sit on top of that and use that to grow in the same way they did with the iPhones. Something new might come out of there, my analysis might be, you know, nothing's—you can't analyze what hasn't happened. But I think that's an interesting thing. I want to see how that does.

Host: 

Well, you know, it's a brand new category. You know, many people don't quite get it. You know, to be very honest with you, guys like me, guys like you that are kind of into technology, we get it, and we're excited. We're early adopters, and we love that kind of stuff, but that's not the majority of the audience.

Mark Vena: 

And I think what Apple does better than anybody on the planet—and I say this in a very independent third-party way—they can take very complex topics and they can articulate it in such a way that people get it. And by the way, they have hundreds of Apple Stores across the country, across the globe. They are second to none in terms of when you walk into an Apple Store, articulating in a very, um, non-confrontational, understandable way to the average person, um, hey, here's how this device can change your life.

Host: 

Yeah.

Mark Vena: 

Now, I'll give you a perfect example. You know, they showed a little bit about this during the—the, um, WWDC when they kind of announced the, uh, the Vision Pro. But I really think some type of, um, XR version of FaceTime—you know, let me take a step back. If you recall, before Apple came out with FaceTime video conferencing, there was Skype, right? There was Skype. Skype was pretty complex to use. But if you wanted a video conference, you could do it, but it wasn't really a mainstream thing. People who were doing Skype and other video conferencing, it was really more of a B2B type of thing. 

 FaceTime was so simple to use, your mom could use FaceTime, you know? And I think what's going to happen right now, if they create some type of XR version of FaceTime where people who are wearing these goggles even or in remote locations, if you think that you're in the same room with the other person, that's a game-changer, especially if you're my mom. You know, she's still in good shape, but she doesn't travel a lot. She loves the FaceTime, but I suspect—and since she doesn't travel a lot—if she could see her grandkids or her extended family in an almost like an in-person way without leaving her place, that's a game-changer. And you could see a lot of people upgrading purely for that capability. I think this is a good segue into AI because I think to make all this happen, you know, you usually would have a camera and all that, but if you have AI, you can simulate human behavior quite accurately and sort of generate it based on nominal cues here and there. You can make that happen. But, you know, moving even more deeply into that topic, I'd like to hear what you think about AI—not specifically about Apple per se, but it's been all in the range in the market right now. It's sort of tapering off, but the value is improving. People are not confused that this can have value, so I'd love to hear where you think all these technology companies are trying to go with it and see how they can sort of take advantage of it in their own way and just not get left behind. Because some of the companies you mentioned before no longer have, you know, market shares, just simply didn't catch up or just didn't keep up.

Host: 

I've got some interesting views on that. It's a great topic, I'm glad you pulled that into the conversation. I mean, first of all, let's face it, there's incredible excitement over applications like Gen, you know, applications where, hey, I can ask the app, "Hey, write me a term paper on Napoleon Bonaparte, write it in 2,000 words," and it does it instantly, and most of the time, it's fairly correct. You know, on a historical topic, it's probably very correct. It gets a little... and other tools when it's information that's more current, but I mean, it's amazing, let's face it.

Mark Vena: 

The problem is, is that AI and IoT have kind of stolen the show over what AI can do. People, when they think of AI, they think of Gen AI, and that's not really accurate. I mean, AI can do a lot of other things than just conjure up text for you and write things, and there's hundreds of apps that can do that with different levels of capability. The thing that scares me most about AI, and I'm in the belly of the Beast out here in Silicon Valley, every Silicon company has got this mission that they want to participate in this AI boom. Whether it's AMD, Qualcomm, or Intel to a lesser extent—I shouldn't say a lesser extent—I mean, they don't get the credit they should get, but you know, Intel's got to play there. They're doing a lot of work. We interviewed the head of Intel on this podcast, and they're doing a lot of work. Nvidia is doing amazing things. You can see their stock rise.

The thing that concerns me—and now the industry is starting to address it a little bit—is that AI also has the ability, and you can do it in a variety of different ways, but one of the things that gets a lot of the attention is that AI can be used to create images. You know, there's apps out there, "Hey, create an image of Babe Ruth pitching at Yankee Stadium." And there are apps out there that can conjure up animations. Some of the more advanced ones, if you give it a little bit of photography content, it could actually do it with photorealistic images. Even at... you know, the Holy Grail is to be able to say, "Hey, create a video for me on these set of parameters." Now, that's all great. The problem is, is that AI can, you know, in that context, also be used for some very destructive stuff. You know, and it can destroy people. It can create deep fakes, as the industry calls it. And by the way, we're in the middle of an election right now. Wait till you see some of the stuff that's going to come out over the next 12 months on both sides. It's not a Republican or Democratic thing. I'm surprised it hasn't really happened yet, honestly. I thought there'd be some sort of concern, and the concern that I have is, I don't know whether you can... you probably can't stop that. I mean, the social media platforms obviously will try to do their best to at least—you have to be able to identify, you know, there's a fine line between parody, where you're making fun of somebody, or you know, which is protected by the First Amendment, versus doing something versus trying to fool you into thinking that this is real. The industry has to do a much better job of allowing the consumer or the person who's consuming that content to be able to identify it as deep fakes.

Now, let's bring this closer to home. When we think about how AI is shaping the future of homes, particularly in smart home security, we see how connected devices are revolutionizing the way we live. People are increasingly relying on smart devices to monitor and control their environments. Whether it's a smart thermostat or a security camera, these devices are powered by AI algorithms that offer personalized, real-time insights into our homes' security status. In fact, the rise of AI-driven smart home solutions is making it easier than ever for homeowners to monitor their properties. With AI enhancing the capabilities of home security systems, it's possible to anticipate security threats before they even happen.

But what does this mean for us as consumers? With the growth of smart home security options, there's a shift in consumer behavior as people are becoming more cautious about how their data is being used. As more consumers embrace smart devices, the demand for more secure, AI-powered solutions will likely continue to grow. However, as with any emerging technology, the challenges of privacy and security must be addressed before these systems can become fully integrated into everyday life.

And finally, you're seeing companies coming—well, we better do some things that allow a user to identify whether it's an image or, especially, a video. "Hey, this is a deep fake," whether it's some type of smartphone application that you can, you know, scan the image, and it will give you a probability rating whether it's fake or not. But all—several of the Silicon companies and software companies now are doing things to embed some type of digital signature that you might not necessarily be able to see. You know, when I say—when I say watermark to people, people think that's a watermark on the video itself. Well, that can be cropped out. That's probably help—you need something that only a sensor or a camera could see and identify that can't be removed, that will identify the content, and that would be a powerful step in the right direction.

But I will tell you right... So, one of—no, no, sorry, uh, so one of the things—I was thinking when you were saying this is, uh, you know, when we talk about these deep fakes, it becomes a problem of, uh, authenticity, which is kind of—it's basically, um, authenticity, or I guess authorization. Like, you know, I guess like, where—can this enter a place where, and however you can define that place, where everything here is considered authentic?

Host: : 

Right? So then—and then it comes—so, so they're kind of like tied together, and um, but anything—but that's kind of just security, right? And with anything—and this, some on your podcast said this—it’s a rat race with security. It’s a bit of a cat-and-mouse game, uh, where, you know, the more secure you are, and the more established the security protocol is, the more attack you're going to have from every direction.

Mark Vena: 

Um, I should—I don’t know if you remember or have ever seen this, uh, parody—and that’s a good thing you talked about parody—a newspaper called The Onion that the Chinese, yeah...

 So the Chinese government at one point had an article that they considered to be true. I—I mean, how true it was, it kind of doesn’t—the point is it isn’t the point, but um, or how true they perceived it to be isn’t the point. But they—it was enough where they could use it as propaganda or, to some degree, think Chinese or North Korean. Um, so like, it’s almost like at the fringes of the network of information is where it can have the most damage, cu—either because they have the least concern as to whether it is or isn’t authentic, or, uh, it is the fringes in which the technology to make it authentic isn’t so...

Um, I think that to some degree, that is going to—and it already has—and this is where I sort of move into, like, um, social media fatigue. Right? I think people kind of just exhausted with the attention-grabbing, uh, that they’ve had to endure. It’s like, I—you know, need more and more of your attention. These social media companies sort of selling attention. So, how do you think that’s going to evolve with this? Um, with AI sort of proliferating? And like, do you think people are kind of going to disconnect, like, to the degree that the social media companies aren’t competitive anymore because nobody believes anything? It’s just not worth it?

Host: 

No, I think you raised a number of good points, and I think the—you know, part of the challenge is that—and I don’t think Steve Jobs ever anticipated this would happen—but the smartphone technology has made—it has created this environment where your—the average attention span, where you can digest information and consider it, and not just act on it, has completely eliminated or minimized, um, people’s attention span. You can see this when you’re on a... It’s zero. And people react to things—they see something, they don’t take the time to digest it and say, “Well, is this accurate or not?” Is this something that, um, some people do, but the vast majority of the audience out there, they just consume it for what it is, and they react to it.

Mark Vena: 

Now, you raised some really interesting issues on a political level, and what I mean by political level—you know, keep in mind that we now—America has enemies like most countries do. Not like in the 1940s, but we certainly have, um, parties that are not too crazy about us, and you could easily get into a military conflict with someone if all of a sudden another country saw a piece of content that they thought was real that was not real, that gave them cause to do something bad. You know, that’s kind of a MacGuffin, right? And the inverse...And the inverses can happen as well here. Let me bring that down to a more practical level with AI and IoT. There have been cases about this already where some bad guys—I'm being very nice and using the phrase "bad guys"—have used audio AI and IoT to call people and make them think, "Oh, my daughter's being kidnapped." They may have a sample of her voice, and it's completely interactive. The person on the other line is saying, "What the hell's going on here? My daughter's in distress." A very famous case happened about three or four months ago, and the only reason why the mother on the other end of the line realized it was a fake is that the real daughter happened to call at the same time. She knew it was a fake, but what would have happened if that mother reacted to that by hopping in her car and, in a crazy and agitated state, got into a car accident and killed someone, or she injured herself in some way? So, this is very, very dangerous. It's very dangerous. I do think the Silicon companies and the software companies, because it has to be done in tandem, I think now finally are thinking, "Hey, this is a big deal." A lot of these companies, Chris, were waiting for the federal government to give them rules. "Okay, you have to do this." As you know, the federal government—much as I love Washington, and I say that tongue in cheek—is about 25 years behind the curve in terms of understanding technology. If you watch a congressional hearing, or watch a senator hearing, they don't know what the heck's going on. I mean, these congressmen and senators, they have young people on their staffs that kind of get it, but when you're talking to these senators who have been in office for 35 years, they're lucky if they know how to send text messages, let alone understand the implications of smart devices. So, they have to get these companies together, because if they wait for the federal government to come together with legislation, it's going to be too late. They're going to absolutely lose. Sort of what would you call it? Their branding is going to suffer because there are going to be so many different kinds of problems. As you know, sort of what Facebook went through, where if you're any kind of merchant on Facebook, you're going through a lot just to deal with them. But that's just because what happened with them was so unfortunate for them, they had to deal with a lot. So, now, you know, your accounts get banned just for sneezing the wrong way.

Yeah, that kind of leaves me just to have this last point on smart home security. I was glad you brought up the sort of the government policies and things like that, where with any kind of security, you lose a little bit of freedom. And, you know, what it looks like when it comes to security is just like how many points about that verification can you really... There's algorithms you can do, and this clever thing, you can be as clever as you want, you can make this difficult to attack one. But ultimately, it's like you're the boundary for whether something's authentic. So, two-factor authentication came in, they send you an email, they send you a text, they send you, you know, just every digital touchpoint they can to make sure that it is you. With something like your voice, where that could really, you know... And it's so easy to do, right? And most people are public with who they are now. Everybody's on video, so it's super easy to do. So, what happens with that? Do you have to have some verification system for your voice? Is that automated through a company like... Is there a burgeoning business there, or is this just something that these companies are going to just do naturally in order for this technology to even get in the public in the first place?

The intersection of AI-driven smart home and consumer behavior will be crucial in shaping how people interact with emerging technologies. We're entering an era where smart home security and smart devices will need to evolve alongside the needs of consumers, whose behaviors will be influenced by convenience and security alike.

‍

Host: 

Some improvements in that area? You mentioned two-factor authentication, which is, you know, it's not foolproof, by the way. There are ways of getting around it, but it's better than nothing. The problem with two-factor authentication is that for most people—when consumers, there's all kinds of research that will underscore my point here—but if a consumer has to go out of the way and do three or four extra steps to buy something on Amazon, what they do is they disable the two-factor authentication, which completely diminishes the impact. I really think—and Apple's doing some interesting work—the new Apple iPhones are going to have some capability where it could authenticate you because you have the phone itself, and it can validate you by using Face ID or biometrics. I'm a big fan of biometrics, you know, fingerprint, because that capability, it's not a big thing. You know, it asks you for the password, you just put your finger on it, like for example, my MacBook Pro, which is what I have, it reads your fingerprint, and that's very hard to duplicate. It can be done, like the KGB could do it, but to send your fingerprint over the network, it's a whole thing. It's kind of, you know, you can't... it doesn't have a digital signature.

Mark Vena: 

Yeah, but remember one thing about the hacker community: If you can applaud them for anything, they're clever. They’ll always find a way around things Very clever and they can roll with the punches and they, you know, and by the way, to my point, most people, you know, do not want to go through the extra step of putting... like again, two-factor authentication is a perfect deal. I don't find it that inconvenient because I would rather take a couple of extra seconds and be protected. But Chris, let's face it, I bet here's a... here's a... um, no, I'm going to be honest, I'm already annoyed with it. I just know it's necessary. But next time you talk to five of your friends and you... I'll just use a sample size of five, and you go to their house and you say, "Okay, open up your PC or your Mac or PC." I bet out of five people, five different people, I'm going to bet that two out of the five have antivirus software on their PC.

Most of them... most people don't even go, "Oh, I don't need it." You know, there used to be this rumor that if I had a Mac, I don't need antivirus software. Believe me, and that antivirus software is what, 50 bucks a year? You know, it's not even depending on which brand you buy. Now, that's not foolproof either. But I would rather have antivirus software and maybe a VPN on my computer to protect my anonymity because I don't want other people knowing, you know, what websites I'm necessarily shopping on and things like that. But the average consumer still doesn't do that. You know, they buy a PC, they get a trial version of antivirus software, but after that antivirus software, the trial offer ends, they don't renew it. Oh, hey, I haven't had any problems so far. Why should I do it?

Host: 

So, you know, consumers... and I'm not pointing the finger at consumers because consumers are always looking for the way with the least amount of friction to do something. And even if it's something that's good for them, you know, it's analogous to, uh, vaccines. You know, and, and get the whole vaccine conversation, but, you know, at the end of the day, you know, forget about the COVID, for example. I should get a vaccine for the shingles, I should get a vaccine for the flu. A lot of people say, "If I haven't gotten sick so far, why should I, you know, why should I take that pain for two seconds for someone to stick a needle in my arm?" So, it's kind of analogous to that. But I do think that ultimately that when biometric technology becomes so simple, where it's in every device that we use and that biometric password is kept either locally or in some type of highly secure way that it really can't be accessed, I do think that will be a big frictionless way for people to get on board with being more cautious about security.

Mark Vena:

 So, one of the... the one thing I don't... I don't really know too much about is like sort of how the semiconductor industry is sort of dealing with all this. So, one of the things I was interested in asking about is, you know, what sort of... where, where you see them trying to sort of do things and, and make improvements that make, uh, you know, make this kind of technology more efficient for them or if they're in, because what they have learned is that when you... one, these big software waves, uh, where this basically the math has to change or the... the primary math has to change, they go up and down the stack to make it feasible. Um, and it's, it's a big software change more. It is a hardware change. Just like what kind of math are these chips prioritizing?

Host:

 I think they're much more responsive to than a lot of people think. It's, it's not as sexy because when the chips that go into a computer or into a device, that the only people who really care about that are the guys like me, maybe due to a degree because you enjoy getting into the technical stuff that they're doing, but to the average consumer, they don't really care about, oh, here’s the new security algorithms like Qualcomm or Intel are putting into their CPU. But they are... I mean, they're... I mean, I think they are playing and that's why I think in general, the silicon being manufactured today versus five years ago is much more secure than the stuff that was around, you know, not too long ago. So, that's a good step in the right direction.

Mark Vena: 

But even companies like Qualcomm, for example, you know, they're trying to... and they're, they're a major leader in the AI space. They, they, um, uh, now have, uh, uh, silicon basically that allows you to do AI algorithms in an offline manner, on-device manner, meaning that you don't have to be connected to the cloud, which is going to be really interesting. That you could, you could use applications like ChatGPT or others even without an internet connection, you know, because remember, there's... they operate in markets where the internet connectivity is not that good, you know.

And, you know, you prioritize... exactly right. Oh, so, they're doing a really wonderful job with this, a, you know, call it age-based AI where you don't need it, you can actually, um, you can execute these large language models, which are billions and billions of, um, of transactions, you can do that on a local device level without having a, uh, uh, internet connection and remember there's also...You know, there are advantages from a security standpoint for doing more stuff locally than up in the cloud. I mean, not to say the cloud is not important, because the cloud obviously is very, very important, but unless you're dealing with cloud applications that have their own set of security protocols—and most of them do—you know, you're always taking a bit of a risk when you put some content up in the cloud. Now, fortunately, there hasn't—at least for what I know—there hasn't been a major hack of cloud services like Box or Dropbox. But look what happened, you know? I just thought— I think there was one with UI. I think there was one recently with a password service.

Well, just a couple days ago, and in the interest of transparency, my cousin works in the entertainment center at MGM, and MGM just had— I called him last night—they just had a massive, massive breach into their reservation systems that have all that confidential information about the patrons that go to the MGM hotels, and that's how they distribute all kinds of rewards and perks. And I spoke to them last night. They are shut down right now. Their business is down 60% because most of their business is people who go to the casinos. They're high rollers, they spend a lot of money, frankly, but they get perks, they get their rooms paid for, they get kinds of comps. All of that is shut down until they can, you know, resolve this breach. It's costing them hundreds of millions of dollars, if not more, for every day that they can't get their systems up and running.

So my point is, a lot of this stuff will continue to happen, and let's face it, you know, you'll appreciate this: most companies treat it in a very transactional way in terms of budget. They don't really worry about it until they have a problem. Until somebody— their companies get hacked, whether it's a ransomware attack or, God forbid, someone hacks and steals a lot of information. Then they get serious and say, "Well, now we do have to upgrade our security system. Now we have to—we may be a company that has 25,000 people in the field with computers. Maybe we do need to have better security software on those client devices to make sure this kind of thing doesn't happen."

And unfortunately, a lot of companies—it's kind of like earthquake insurance out in California. You don't have to get it just for the peace of mind. Frankly, because I'm in California, I could use it right now, but the reality is most people don't worry about it until they have a problem, you know? And that's unfortunately when—yeah. The rise of smart home technology has made it even more crucial for companies to be proactive about their security measures. With more smart home technology integrated into everyday life, the risk of cyber threats continues to grow.

 I mean, I think you’re right in general, and I agree with you, but I think—hopefully people don’t get used to it—but I think there’s something pernicious about, for the example you gave, with this unfortunately this lady who had a ransom situation with her daughter where it was a phone call. There’s something pernicious about that kind of experience that hits a bit more, maybe emotionally. I think people really run out of emotion that, uh, it hits more emotionally than someone stealing my password or something, you know? Where you can...

I think there might—I'm not sure—but there might be a bit of a boom in this security industry, because like the demos you can do when it comes to, um, showing what can happen. It can be a lot more... it can be a bit more like a movie, right? Like this, I mean, this really is, this is literally taken with—you just gave that example, right? So, uh, we'll see. We'll see. I might have to eat my words very soon, but I feel like there—you can really sell, like, "Hey, this is a demo, could be just like this. 

Host: 

This is very convincing, wasn’t it?" But is that true?

Mark Vena: 

Yeah. I mean, the general rule that I kind of impart to people—people, you know, family members—I get a lot of inquiries from individuals because of my podcast. I get a lot of inquiries from individuals is that you really have to—you really have to guard your information in a very tightly controlled and managed way. And you know, people who use smartphones, for example, they’re so excited when they see a new app, and they download it, they just kind of willy-nilly hit the accept button when they see the terms because they’re not lawyers. They don’t read the terms and conditions, and then they realize sometimes, “Guess what? I just agreed to something that gives away a piece of my privacy.”

And that’s a shame, because, you know, companies should do a better job of articulating what’s required to use your app. And many— but in a way, because it’s a bit of an oligopoly, right? So, they almost don’t give you a choice. Like, you kind of need this for work, and, like, you don’t really have an option. And sometimes these selections are, if you don’t agree to the terms and conditions, they say, "Okay, good. See you later when you change the app. Thank you for your time."

Yeah, and a lot of people are using these apps because their company’s using the app, and so their personal information goes through because their company, you know, so it becomes—you know, they have quite a stranglehold. So, we—you know... Anyway, I do want to move to another topic.  Because, uh, I think you, there's a lot of things that, uh, you do know about, you do cover. I think the next thing I think would be smart homes. Um, that's a bit of a, um, so recently I met, uh, someone who, uh, he works in a Solar Company and, and they're, what they're doing is very interesting where, uh, what I did know is the solar, uh, solar roofs they, they shut off if there's a leaf on it, all right. So, they, the circuit doesn't complete and, and, uh, you start losing power very quickly. Uh, so it just shuts off. So you really have to maintain those very well, but they have a technology that makes it so that's not true anymore. Um, and that got me really thinking about, uh, home automation, smart home. I think with that technology, you know, every, the home, the home unit is going to be quite self-sustaining in the future. That's, that's with the, with the cost of silicon moving that, and quite exponentially now. I think this, this AI Evolution definitely helps, like the money going into silicon is so much so that Nvidia is having a hard time producing chips. I mean, that's, if that's not the man, I don't know what the, uh, what, what is it. And I think economies scale will absolutely, um, you know, play its own part. Um, so just to bring it back, it's, uh, so what do you think sort of how the, the smart home industry or home automation Industries, how is it going to get affected by all this, either directly or just by association? Um, and then so, what do you, how do you think, I think people have left that a little bit for all kinds of reasons. I think Tesla, sorry, Elon Musk and the Teslas of the world, they had a, uh, a business with that, that they had to absorb. But, uh, so I think people aren't as excited. Also, the capital cost is a lot higher. So, it's, you know, it's harder to see the transactions. But, uh, so yeah, so just, just to give me, uh, so what you, how do you think that's going to evolve and you think it's going to sort of come back in a different kind of way?

When you say smart home, that's a big, big phrase. It encompasses a lot of devices, smart speakers, IoT devices, there's literally hundreds of devices that are defined in that smart home category. That category is still continuing to grow pretty rapidly. Um, especially, it was growing rapidly before the pandemic. It got a kick in the pants during the pandemic because people were home and they, it was, well, if I'm home all the time, I might as well make my home into a smart home. Now, having said that, a couple of observations to make. You know, people have very modest definitions of what a smart home is. If you have a home that has no, nothing that's smart about it, but you go out and buy an Alexa speaker and you buy a smart light bulb and you get fascinated by that, I can use a digital assistant to turn the light on or turn the light off in a very binary way, that's something like George Jess. People get very excited about that. That, to me, is very rudimentary. Where the, where the real potential of the smart home is, is when you get your home outfitted with all kinds of connected devices. Can the home become that smart that it, it, you don't have to ask it anything? It just recognizes and does things by itself. For example, let's say that I have an entirely smart, uh, connected home. I do, and I happen to have one because I'm in the business, that when I arrive home at night, the, uh, the smart home system can identify me because of my smartphone with NFC. Then, it can say, well, Mark, at home, so we're going to turn the air condition in. No, it knows that the, it's been shut off all day to save energy. It knows that it's already warm in the house. So, it may be even anticipation. Even before I arrive, I might be five miles away from home, knows I'm coming home, it turn, yes, it can turn on the air condition in advance. So, you walk into a nice cool home, maybe it, you know, in my case, it plays some Frank Sinatra music, so it makes me feel at home. Uh, it turns the lights on, it might be typical type of, uh, an evening that it might, you know, there might be a lighting scenario that, you know, there might be a lighting scenario that, you know, there might be a lighting scenario that, you know. It turns my TV on to Sports Center so I, I, I can, I don't even have to, to worry about turning the TV on. Um, there's a variety of different things that it could, it could do. Now, that's more and that's more kind of anticipation-based, home, smart home stuff based on AI capability that, to me, the vast part of the market hasn't gotten there yet. They're still kind of, you know, kind of engrossed in, oh, I just use Alexa, for example, to turn something on. My Alexa is going to go off in, uh, a sec, the light just went on. But, but, but the, the thing is, is that that's the opportunities. Now, one thing about that you probably, you haven't asked about is that one, the thing that's interesting about the smart home is that you've got all these digital assistants, you've got, you got Apple Siri. You got Apple, you know, by extension, you've got Apple's HomeKit, which is their answer to the, uh, smart home. Amazon, Alexa, Google Assistant. And, those devices, unfortunately, they use different activation words. When you come home, some devices only work with Alexa. Some devices work with Google Assistant. And, you don't want to have to remember what activation word you want to use, you know. So, there's an initiative out there called a Matter initiative, M-A-T-T-R. And that's...

An initiative that's been in the market for about three years is finally starting to—you're finally starting to see devices with matter compatibility. And what the advantage of that is, is if you have a device, a smart light, a smart lock that has that ability to have matter capability, it can standardize on one activation phrase regardless of what that device was designed to do, whether it's Apple, Google, or Amazon. So, that's a big step in the right direction. Those devices have been coming out slower than I think a lot of people wanted, but they are making progress. There are devices out there. Everybody, they've got enormous support. That should be said, the matter team is a nonprofit standards body; it's connected to connectivity standards. So that's a good sign, but it's going to be a few years until we see that become ubiquitous. When you walk into a Best Buy, you don't have to even ask the question. The device is already matter-compatible.

The thing that's also nice about matter, by the way, is that if you're a manufacturer and you make a device that's matter compliant, all those devices have to have a certain level of security capability. So, there's security benefits to using matter-compatible devices as well. Because, let's face it, a lot of people buy these cameras and devices on Amazon that are manufactured in China, which has very little security protocols. The default password to use them is “password.” You know, my Siri just went off. I wish she would be smart enough to know that I'm on a podcast. But the thing is, my point is that that's a real problem. You go out and buy a webcam, you go out and buy a nanny cam, and as you know, those are notorious for—there are websites out there that say, "You want to see someone's webcam that's not secure? Go to this website." That's kind of a scary thought.

But I have a lot of faith. I think the smart home technology category is a category that's going to still continue to grow very rapidly. People are still buying security cameras, whether they're outside or inside. Although, for the most part, unless you're a business, most people don't want a security camera inside their house for privacy reasons. But you do want a security camera, by the way, to monitor the perimeter of your property, your driveway, and things like that. Another category that I've been doing some work for is a great company called Ultraloch, based out of here, and they are enormously successful on Amazon. They've sold, I think, 700,000 smart locks. That’s a category that's right for growth because most people don’t have smart home technology like smart locks on their doors. And there's a convenience advantage—not just security advantages. You know, if you're not home and the kids forgot their keys, you can send them a one-time code to let them in. If you're an Airbnb property, you want to be able to let people in without being there. So, that's another great usage model. But the whole smart home technology category is just right for growth.

Host: 

Yeah, so, but then, you know, you talked about the matter solution. The first thing that came to mind is that it could reduce the lifetime value of these customers for any of these companies. So, what's your incentive for not blocking this, I suppose? How do they see this?

Mark Vena: 

Well, you look at the roster of players who signed up for this matter initiative. It's very impressive. It's literally hundreds and hundreds and hundreds of companies. The chief members are companies like Google, Apple, and Amazon. So, I'm not worried about that too much.

 An initiative that's been in the market for about three years is finally starting to... you're finally starting to see devices with matter compatibility, and what the advantage of that is, is if you have a device, a smart light, a smart lock that has that ability to have matter capability, it can standardize on one activation phrase regardless of what that device was designed to do, whether it's Apple, Google, or Amazon. So that's a big step in the right direction. Those devices have been coming out slower than I think a lot of people wanted, but they are making progress. There are devices out there, everybody's got enormous support. That should be said, the matter team is a nonprofit standards body that's connected to connectivity standards, so that's a good sign. But it's going to be a few years until we see that be ubiquitous. When you walk into a Best Buy, you don't have to even ask the question: "Is this device already matter or compatible?" Now, the thing that's also nice about matter, by the way, is that if you're a manufacturer and you make a device that's matter compliant, all those devices have to have a certain level of security capability. So there are security benefits to using matter-compatible devices as well because let's face it, a lot of people buy these cameras and devices on Amazon that are manufactured in China, which has very little security protocols. The default password to use them is "password," you know. My Siri just went off... I wish Siri would be smart enough to know that I'm on a podcast.

But the thing is, my point is, that's a real problem. You know, you go out and buy a webcam, you go out and buy a nanny cam, and as you know, those are notorious for... there's websites out there that say, "You want to see someone's webcam that is not secure? Go to this website." That's kind of scary when you think about it. But I think the smart home technology category is a category that's going to continue to grow very rapidly. People are still buying security cameras, whether they're outside or inside. They buy security cameras on the inside, although for the most part, unless you're a business, you don't really want a security camera inside your house for privacy reasons. But you want a security camera, by the way, to monitor the perimeter of your property and driveway and things like that. Another category that I've been doing some work for is a great company called Ultraloch, that's based out of here, and they are enormously successful on Amazon. They've sold, I think, 700,000 smart locks. That's a category that is right for growth because most people don't have smart home technology like smart locks on their doors, you know. And there's a convenience advantage, not just security advantages. You know, if you're not home, you want to let the kids in, they forgot their keys, you can send them a one-time code to let them in. If you're an Airbnb property, you want to be able to let people in without having to be there. So that's another great usage model, but the whole smart home technology category is just right for growth.

Yeah, so... but then, you know, you talked about the matter solution. The first thing that came to mind is that it reduces the LTV, the lifetime value of the customer for any of these companies. Lifetime value of the customer, so, you know, what's your incentive for not... what's your incentive for not blocking this? I suppose. Right, so how do they see this? You look at the roster of players, who's signed up for this matter thing. It's very impressive. It's literally hundreds and hundreds and hundreds of companies, and the chief members are companies like Google, Apple, Amazon, so I'm not worried about that too much. I'm not worried about much. So what's the incentive for letting it happen, right? Because their whole... the whole... I think it may be customer convenience, and that's just better for them. But the whole ecosystem idea actually just came from Apple, right? They... people weren't doing ecosystems before Apple said, "Everything is going to be a variation of gray." You know what I mean? So why in the world are they, you know, not... yeah, that... it's interesting you make that comment because if you think about it in the abstract, intuitively, you would think, you know, why would Apple, Amazon, and Google, just to use those three guys, why would they cooperate together? Because they're competitors at the end of the day, and if one vendor has a smart lock and another person has a smart lock, well, our smart lock is better than their smart lock. Why do I want to sign up to a standard that's going to be much more easier for use, for devices, whatever brand you have? And I think the answer is very simple: the big smart home companies realize that this intercompatibility issue is so important that it's retarding growth. You know, and I think they're willing to put that consideration aside now. And I'll give you a statistic: at Best Buy, they have, kind of, the... if you've been in Best Buy, I'm sure, multiple times, they have a pretty big chunk of their real estate in the store dedicated to smart home devices. Most of the stores within 20 feet of me, I can walk out to it. I go there, do testing of retail all the time, and that Best Buy store probably dedicates 100 square feet, which is big in a store, to smart home devices. I've been told... you know, I won't take Best Buy out of it, but at retail, when someone goes out and buys a smart light or a smart lock, the return rates on smart home devices is something in the neighborhood of 25%. One in four devices gets returned at retail, and when Best Buy, for example, takes that back and examines the device, there's nothing wrong with the device. It's not defective, they just couldn't get it to work. You know, so there is... if you want to get this whole... you know, turbocharge consumer satisfaction and make these things work... you know, imagine if, you know, just to use a stupid analogy, if 25 years ago when CDs were still around, and you went to a music store, you bought a CD, and you took it home, and you popped it into your CD player and it didn't work, you'd say, "Jesus, you know, my God, you know, all I wanted to do was play the CD that I bought." Obviously, there was a standard, and even though there were multiple players that made CD players, whether it was Sony or Panasonic, or whatever the brand that you knew, that music CD was going to work. So I think there's some wisdom kicking in here where the manufacturers realize, yeah, maybe it might not be the right thing for us from a competitiveness standpoint because it kind of goes in the opposite direction, but we really believe that customer satisfaction and interoperability and enhancing someone's lives and getting this stuff working up, you know, very quickly without requiring a Ph.D., is worth it. You know, versus, you know, not having that kind of capability that hopefully will be delivered by Matter.

Host: 

Thank you so much for coming on. Where can people find you? I think you have a podcast, a lot of places, but hopefully you have more, but I think if someone wants to reach out to you and hear what you have to say?

Mark Vena: 

No, that'd be great. You can reach me on Twitter or X, as it's now known. My handle is markvtechguy, M-A-R-K-V, then tech guy. My website is smarttechresearch.net, very simple to find. This was exciting! I'm really glad we took the time, and I hope I provided some insights that you didn't have before.

Host: 

Definitely. Absolutely. Thank you so much for coming on. 

Mark Vena: 

Have a nice rest of the weekend, Chris. Bye!

‍