Marc Andreessen: The Resurgence of Consumer Electronics

We think there's going to be a whole new wave of consumer electronics companies in the U.S. and particularly in Silicon Valley. And we think that the sort of center of gravity for the whole consumer electronics industry is likely to shift back to the U.S. And the reason fundamentally is because the technology that goes into a modern consumer electronics device product is completely different than it was when these products left the U.S. Like completely different. And specifically, The hardware is much more commoditized today than it was 20 years ago, excuse me, and then these products consist of a much higher percentage of software than they used to. And so what we are seeing is a whole pattern of companies in the Valley, and I will just name a whole bunch, and they are not all super successful or super successful yet, but Palm and TiVo and of course Apple and Sling and Flip and Jawbone, like there is a whole series of these companies and a whole bunch of new ones coming including some that we are backing. Basically, what they all have in common is they're taking off-the-shelf components and in particular off-the-shelf chips, and in particular these really, really powerful new off-the-shelf graphics chips from companies like NVIDIA and TI that do high-speed— they do high-speed 3D graphics and they do high-def video and it's just all in a single little chip that you can buy for a couple of bucks. They wrap it in a box, it comes in a box, but then they build software and services that integrate built right in. And of course Apple is in many ways the template for that these days, the way that Apple provides the device and the OS and the application stack and the store and the online services. And Google is obviously doing a lot of that as well. And so we think that's actually a really interesting model. And so we think there are a whole bunch of categories of consumer electronics that can get reinvented. And then there's a whole bunch of new categories that can get created. And so I'll just give you one example. We are angel investors in a company called Jawbone that makes the sort of high-end Bluetooth headset. Sort of the high fashion Bluetooth headset. What's interesting about Jawbone, Jawbone is an example of this exact thing. Jawbone is a real R&D company with deep R&D in Bluetooth and in hardware and in software. And in the new version of the Jawbone headset that just came out, when you connect it to your PC, it turns out it has an app store. And of course, at first people think, well, that's crazy. It's a Bluetooth headset. Like, what kind of apps could we possibly be talking about? Well, you know, The ability to read you turn-by-turn directions, literally read you in your ear turn-by-turn directions when you're driving around. Or the ability to read you your voicemails. Or the ability to read you a Twitter feed or a Facebook feed. Or the ability to do voice SMS. And our view is these are just the tip of the iceberg. And basically you want to view the Bluetooth headset as a wearable computer that's going to have many different kinds of software applications running on it in the future. And so basically if you can do that in Bluetooth headsets, there's any number of categories that you can do that in. So we're extremely excited about this. And if anybody has any great ideas, we're We're totally game.