Cloud Technology Can Accelerate Sports-Tech Growth, But At What Cost?
Keeping up with the sports technology market can feel like trying to match pace with Usain Bolt. Traditional business models have been up-ended by cloud computing which enables organizations to establish and expand at an astounding rate. Manufacturing, banking, retail, healthcare, and education are using software-as-a-service (SaaS) solutions, data analytics and web APIs to create new products and features. The sports technology industry is no different.
The sports technology market pressure tests the next wave of consumer technology. Sports are a proving ground for innovative technology applications, platforms, and ideas. Understanding what tech matters and why is further complicated by the 3-fold proliferation of sports tech companies over the last ten years. Enter the Sports Innovation Lab: we track sports technology across five key trends: Quantified Athlete, Smart Venue, Immersive Media, Next-Generation Sponsorship and Esports.
Wait, wait, I’m confused. Why does cloud computing impact the number of sports tech companies?
Starting is easier. Starting a company is difficult, and you need more than a great idea: you need the technology to execute that idea. Cloud computing provides an easy to manage, scalable infrastructure resource which allows companies to get running faster. Open APIs allow one service to use another, for example instead of managing email and conferencing tools; startups can use Gmail, Slack and Skype. Not only can you become competitive faster, but you can also do it with fewer employees. These factors drove the “start-up explosion” 2010-2014. By making the tedious and often difficult processes more efficient, cloud computing is empowering entrepreneurs to bring their ideas to life across all industries.
Sharing is easier. Cloud services have enabled the explosion of consumer applications. Applications on the Google Play store have increased from 30,000 in 2010 to 3.5 million in 2018. Quantified Athlete applications in the form of wearables, performance management applications, and connected accessories sprung up, multiplying 4-fold 2007-2017 . These consumer applications that rely on cloud computing are the first wave of digital health applications. By pressure testing cloud technologies with consumer applications, the digital health industry will be ready when the rubber hits the road.
Iteration is faster. All of this ease unlocks time for businesses to focus on innovation, this is evident in the wealth of new product features and categories. Thanks to Pokémon Go, most people are starting to understand the difference between augmented reality and virtual reality. Others concepts are more elusive, like how Internet of Things technologies such as Ephesus Lighting, Armored Things or Infite Peripherals bring security and efficiency to Smart Venues or how valuation technologies such as Hookit, MVPIndex or GumGum help brands measure the effectiveness of experience-based campaigns.
The Takeaway: This beautiful story of fast growth is not without its graveyards. In 2007, there were 703,834 US companies incorporated in the private sector, of these only 33% still exist today. Surviving in the cloud-centric world means creating a scalable strategy, without skyrocketing bills to Microsoft Azure or Amazon Web Services. Many sports technology companies rely on these services to host vast amounts of data and content. Startup unicorn Dropbox recently announced that it would no longer be using Amazon Web Services for storage. Instead they have brought their data back on premises and saved $75 million in the process. For the next wave of sports technology companies, innovation may be more about cost-efficient content storage than awesome features.