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Hardware Hacks Are Cool Again, and Software Stands to Gain

October 1, 2012

Last weekend I was at a party with a bunch of people from various parts of the tech industry, and one of them brought up a cool hack from Techcrunch Disrupt. But the hack the group marveled at wasn’t merely cool code; it had a hardware component, and that’s a big part of why it was so interesting.

The hack is called Livebolt, and it’s an authentication system that lets users unlock a door via a smartphone app. Hackathons like the one at Disrupt have tended to produce purely software, but that’s changing. Back in June, I served as a judge for AngelHack2 in Boston, and two of the three finalists had a hardware component. (One helped personalize your workout at the gym, the other was a smart cigarette case that tracked your smoking.)

You can point to several reasons why hardware is becoming cool again, from the rising profile of “maker” culture to the plummeting cost of technologies like 3D printing, but I want to focus on just one. Over the past several years we’ve increasingly layered information networks over our physical environment, and that environment is poised to itself be reinvented. Here’s what I mean…

Take Airbnb, which lets users rent space in their homes to business or vacation travelers, or RelayRides, which lets you rent out your car to someone for a short period of time. In both cases the idea is to use physical goods or infrastructure more efficiently by adding an information network that lets people connect and share resources. It’s a really cool business model, and one that has potential in a lot of other sectors.

But one of your priorities if you’re running a business like this is to minimize any transaction costs for your users. In other words, the more time and effort people have to spend to prepare their home or car for use, the fewer will participate. When you’re getting people onto the network, change is the enemy.

Yet, once you’ve built out a network and proven value to your users, you have a bit more room to experiment. And that’s where something like Livebolt comes in. If users love Airbnb, they might appreciate the ability to let guests unlock their door via smartphone, provided they believe the authentication works. Once the network is up and running and has proven its value, there’s room to make changes to the physical environment.

And that’s where hardware hacks, broadly defined, become interesting. Take mobile payments, for instance. Right now mobile payment players just want to make it as seamless as possible to switch from paying with a credit card to paying with a smartphone. But once you get a bunch of people paying with their phones, what changes might you make to the physical layout of a store, to the registers, the checkout line, or to the products themselves to optimize for that new system? I’m confident that many cool physical hacks would be possible.

The fact that hardware hacks and hackathons are on the rise is great for a number of reasons, including that many of them are just plain cool. But one reason that gets me particularly excited is that they can add value to some of our existing networks by optimizing our physical environment. Just because we build a lot of networks to fit with our current environment, doesn’t mean it couldn’t use a change.

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