Do you know about the dongle? You put, you stick the little
thing in?
I know you love your dongle bag, right?
I know that you don't want a dongle to come with your new
phone.
A what?
A dongle.
I don't want a dongle ever.
There's a lot of different dongles here.
This silly little adapter is called a...
Dongle. Dongle, dongle, dongle.
Right, a dongle. If you've purchased a laptop or a phone in
the last five years, I'm sure you know what these are. And
many of us can't do what we need to do without these connectors,
which makes them a big business.
Belkin as an example, you're looking at a couple 100 million
dollars that I believe that they're doing in dongles.
It's been a big portion of our business, a very, very high
percentage of our business, in the 70% range of our business in
the past.
These companies and others like them have created a huge market,
which is estimated to bring in more than $25 billion by 2027.
I'm talking to you on this 2012 MacBook Pro. And just looking at
the ports on the side of it, we have power, ethernet, FireWire
800, display out, right, two USB ports, SD slot, microphone in,
microphone out. And that's just on that side. That's the way
things ought to be.
We have this constant march to thinner, okay, and our constant
move to thinner means that the interfaces need to be thinner.
But this march to be thinner has caused a lot of problems for
users. I have this brick next to my computer that I have to use
to plug in my microphone and my SD cards and my monitor, I
literally couldn't do the work I need to do without it. And
honestly I don't mind it, it doesn't take up that much room
on my desktop, it plugs into one USB-C port on the side of my
computer, but it was $260. I had to buy a $260 dock to use my
$3,000 laptop. And Youtuber, TechMeOut, agrees that video
editing nowadays requires some sort of dongle.
When you go into a launch event, especially within the tech space
and you're finished filming you oftentimes want to go back, dump
the footage on your computer and start editing and go ahead and
get your content out as soon as possible. So time is of the
essence. But when I forgot the dongle, it basically had me
stuck for a few moments until I could figure out an alternative
solution.
But with wireless technology constantly on the heels of these
connectors, how long can the dongle domination really last?
Dongles had been around for as long as technology has required
one thing to be plugged into another.
It could be connecting a computer to a printer which is
Belkin's legacy dating back to 1983. That's how we started.
There are some theories on why it's called a dongle, but the
consensus is that it's a playful alteration of the word 'dangle'.
Apple is one of the main reasons these adapters have become a
huge industry. Adapters became almost essential after 2016 when
company removed the headphone jack from its iPhone lineup and
replaced everything but the headphone jack with USB-C ports
on its MacBook lineup. Even though it's not the only company
that nixed the port variety on its products, Apple is the
company that has throughout history encouraged the rest of
the industry to remove ports.
But it's so much more versatile than that. Each one of the ports
can be power, can be Thunderbolt, could be USB,
DisplayPort, video out with VGA.
Let's take a look at how the MacBook Pro lineup has changed
in the last decade or so. The early 2008 model included
FireWire 400 and 800, USB 2 ports, an ExpressCard slot, a
disk drive, an audio in outport, a DVI port and an Ethernet port.
The late 2008 model kept everything but the FireWire 400
and swapped the DVI port for Mini DisplayPort. Most of the
mid-2019 models swapped the ExpressCard slot for a way more
useful SD card slot. Early 2011 models got bumped up to
Thunderbolt and SDXC ports. It was the mid 2012 MacBook Pro
Retina that started to shake things up. It featured a new
Magsafe 2, meaning folks with the old Magsafe connector needed
an adapter and swapped the separate audio in and out ports
for one headphone port, but it added an HDMI port. And then the
2016 lineup came along and wiped the sides of the MacBook Pro
clean and replaced them with the more universal USB-C. This is
the form factor we know today only the USB-C ports are faster
and rebranded to Thunderbolt 3. Outside of Apple you're much
more likely to see an HDMI port or a USB-A port on laptops,
especially laptops marketed as business laptops from companies
like HP and Dell. There are still companies that are selling
USB-A accessories like external hard drives and people still use
HDMI ports to connect to their TVs.
It's a constantly moving target. And you have devices all in the
market that have different types of interfaces like DVI, mini
DVI, HDMI.
So why do ports keep changing? Well, some people might
speculate that it's to create a new revenue stream. I mean, why
does a connector like this have to cost $70? More realistically,
one reason is because manufacturers keep wanting to
make products that are thinner and thinner.
I think they tried to streamline the workflow in their eyes. And,
you know, keep it simple at the core things, but sometimes with
the simplicity, it restricts you and limits you
Designers want to remove everything, right, their perfect
product is a product with no ports, they want it to just
charge wirelessly, and there's no ports that you plug in ever,
right, because that's effort that the user has to put in.
Some cell phone companies like to say the headphone jack was
limiting the thinness of the phone. But I don't think that's
really the case with the headphone jack. You can pry my,
you know, audio jack headphones out of my cold, dead hands.
I wish I at least had the, what I consider, for me at least, the
essential ports, at least a USB hub, USB-C and SD card slot on
my computer, so I wouldn't have to solely rely on a hub or a
dongle for those things.
But for Belkin, dongles are a byproduct of progress and
innovation.
While it can be difficult, and you have to adapt and adjust to
change, the long term benefits of pushing forward, bringing new
ideas, new technology, faster enhancements, easier ways of
working, I think brings benefit that far exceed any of the
challenges that we see when we go through these transitions.
Here's my setup, I use an SD card reader for my footage, a
USB-A for my microphone and charger, a DisplayPort for my
display. Apple sells all of these adapters separately
ranging from $10 to $70. And other companies sell docks that
include all of these ports. And those can be $100, $250 or more.
I think you're looking at a multi-billion dollar industry.
You should take like a $2500 MacBook Pro, and then go on the
Apple store and buy all the dongles that you need to get the
capability of the 2012 MacBook Pro is, how much money would
that be? It's insane.
In specific with computers, especially when my friends and
family are telling me they're thinking about getting a new
computer, I got to make sure I get them to factor in as well
the additional accessories that they're going to need. Not, you
know, it's not an option.
But it's hard to pin down how big of a moneymaker this
industry really is.
Most of the companies that are in the dongle industry don't
actually tell anybody how much they make out of it.
Apple includes the sales of adapters along with the testing
and licensing from third party manufacturers in its Wearables,
Home and Accessories category, which brought in over $30
billion in 2020.
If I back out, out of other which includes things like
watch, and things that that the company doesn't want to break
out, you're looking at $100, $200 million just in licensing
and testing
Show up at one of the apple keynotes, and watch the
reporters with a go bags and count how many dongles they have
and then multiply every dongle by $29. It's hundreds of
dollars. So absolutely there's a large part of Apple's bottom
line associated with this.
And then there are the environmental impacts. On the
one hand, you have these extra products that we need to buy
that use metal and plastic and other materials that we wouldn't
need if those ports were included in our phones and our
laptops.
Their environmental impact is a lot lower than, you know, a
phone or something. Now, some of them do have circuitry and chips
in them like a lot of Apple's like MFI cables. You have to be
doing the multiplication times hundreds of millions of these
things being sold to really have an environmental impact. But
that is happening. Right?
On the other hand, dongles make things like laptops more
versatile and therefore longer lasting. Think about an SD card.
If a new technology comes along that's better and faster and
more reliable than SD cards, I don't have to get a new laptop,
I can just swap out my dongle or my adapter.
So when you sell a product you have how adaptable and flexible
it is, is related to how long it will last.
I do think dongles do mean some more plastic but I think the
corresponding benefit though is less metal and less plastic and
less battery in the new designs.
For its part, Belkin has a sustainability program in place
to make sure it's contributing to solutions.
The pace of technology is not going to slow down, we need to
figure out how to adapt to those things in the right way. And
we're committed to doing those things. We feel like we're
making progress, but we have an enormous amount of work to do to
really get where you want to go over time.
And so in these new iPad pros, we're moving to USB-C.
With the increase of dongles, we've also seen the rise of the
USB-C port which is incredibly versatile and powerful. Even
Apple broke from its proprietary Lightning port on the iPad
lineup to include USB-C, and some folks speculated the iPhone
lineup would make the swap, too.
In the new world of USB-C everything, if you were to say
well, we got rid of all ports, but now we're standardizing and
in the future USB-C is going to be the port on everything. And
so really what you need is adapters between the legacy
functionality and the port of the future, I think you can make
a little bit more of a case for it. But I don't know, I mean,
the microphone talking to you is USB-A not USB-C and so I don't
have a way of plugging into a new laptop. The the webcam I'm
using is USB-A, it can't plug into the laptop.
Even EVs, electric vehicles, are getting their own adapters. But
just because dongles are everywhere does not mean they're
the right solution. In fact, it's rumored that Apple is
bringing the built in SD card reader back to its MacBook
lineup.
Apple's re-inclusion of the SD card, I think is going to be a
great example where, although Apple would never say it, they
made a mistake. HP, based on their research, made one of
their notebooks thicker to be able to fit in a full HDMI,
because that's what businesses wanted, is because they didn't
want a ton of dongles that that they had to support.
But make no mistake, the trend is moving towards fewer ports.
Apple's moved to Magsafe for its iPhone 12 lineup is seen by some
as a precursor to a totally portlets iPhone.
Wireless is always the technology that's going to make
the cable go away. And we've been talking about that for 30
years. We always find a way to outperform wireless.
The moment that your wireless, you are dependent on wireless
technologies that are fickle, right. I'll give you an example
of an area where I gave a manufacturer really hard time.
Sonos, they sold all these smart speakers without ports. So they
didn't have an analog audio input. So if you have a smart
speaker for your TV, and the software becomes out of date,
it's still a perfectly functional speaker. But because
they didn't give you an analog input to it, it's not useful
anymore.
The wired to wireless trend is where the majority of the growth
is going to come over time.
Are you ready for this transition?
We've been making investments in those areas for many, many years
now. So we're loving where the technology trends are headed.
We're really excited about our product roadmaps now and the way
we're thinking about the future.
We've been talking about dongles for years, the good, the bad,
and the ugly,
It's a love and hate relationship. I love the way
that it expands the way in which I can connect different devices
to my computer, but there's always that scenario where
you're going to forget it and then you feel restricted in what
you can do.
And even though trends predict the future to be a portlets,
wireless one, these connectors will likely remain useful for
years connecting legacy technologies,
The thing that, you know, continues to be tried and true
and the thing that will last for a long time are analog
interfaces. You go back to, you know, people invested in
high-end audio gear in the 70s and it still works today just as
good as it ever did. We have to sort of resist the temptation to
buy whatever shiny thing that the manufacturers are pitching
right now because you know, you go back to your Audio Technicas
and they're going to be just fine. They're going to last long
enough for you to hand them off to your kids.
Do I like the prices that they have, particularly the docks? I
don't, but I do think they're worth it because it allows the
entire world to connect together, 10 to 15 years of
devices to be able to connect to each other. I think that's a
good thing.
They could be useful for quite a few more years. So hang on to
your...
Dongle, dongle, dongle, dongle.
You'd like saying it.
Wow, that just does not sound good.