So it took that data and tweaked its approach. Now when it sees a slowdown it reaches out to the client to try a new plan or just make sure the clients don’t cancel. In the future it may offer new pricing plans to adjust for slack usage.

That’s just one way connected devices and the data they offer can be used for benefitting a business. But the value of constant connectivity to a firm goes far beyond that — and could change the way businesses operate. Even after a product goes out the door, the company responsible can still keep an eye on it. That has big repercussions for business and consumers — and not all of those repercussions may be welcome.

Always be talking … to your device.

For example, the constant contact can also help tweak a design or improve the function of a product — even out in the field. In a recent conversation, Splunk’s Tapan Bhatt walked me through a few examples such as the one above, where the company’s machine logging data helped businesses adjust. For example, the makers of the Nest thermostat use Splunk to analyze data uploaded from hundreds of thousands of homes, and tune their algorithms for energy performance.

Medical device manufacturer iRhythm uploads remote monitor data to Splunk to make sure devices run as expected, as well as help ensure that patients can use the devices intuitively. In many ways this isn’t new. Jeremy Conrad at Lemnos Labs pointed out to me in a conversation last month that many manufactured devices are tweaked again and again after the first manufacturing run to smooth out perceived and real flaws in the design.

The shift is that it can now happen constantly and that the changes might be implemented weeks or months after the product has been manufactured. Advertising firms and online publications have been using such data to refine their products for years. The Huffington Post’s love of A/B headline testing is well documented, while the use of eye tracking in web site design is a common practice. But more connectivity in devices means the fine-tuning and easy tracking that are common in digital products are now available in the real world.

Want to tweak a feature? Send out some software

Connected devices not only offer you the ability to get data from your goods (while software like Splunk’s helps you log and later analyse it), but it also allows you to change how they feel and function. For example, Orbotix, the company that makes the Sphero not only knows the moment someone activates one of the Bluetooth-controlled balls, but can give it new abilities with an over the air update.

This connectivity and resulting data can also help with business goals, like improving manufacturing, anticipating demand and even holding reviewers accountable for their articles as was the case when The New York Times and Elon Musk, the CEO of Tesla got in a public battle over a poor review of the electric car.

The board at the Orbotix HQ that tracks all the active Spheros in the wild.

At Orbotix a billboard in the office tracks how many Sphero’s were activated that day, that month and even over longer periods of time. If you stand in front of it for a few moments the numbers will change. Paul Berberian, the CEO of Orbotix told me that during the holiday season the numbers were changing so fast it was hard to keep up. During the rest of the year evenings and weekends were popular times for seeing the numbers flip more rapidly.

Just in time manufacturing gets a data infusion

As this data accumulates he’s finding that he can better anticipate demand and plan inventory to meet it. Perhaps if he wanted to, he could implement a similar program to that elevator company, watch the data from individual Sphero’s and when interest seems to wane perhaps the company sends a notification to the user about a new app available for the ball.

But it’s not always about the customer — this data can be used to monitor manufacturing partners or suppliers. For example, Electric Imp, which makes a tiny module that device makers can insert into their products to give it connectivity (it’s a radio with access to a cloud back end), connects its modules as they come off the line. One of the final steps in the packaging process is each module gets an ID laser-etched onto it.

This process requires the module to “wake up,” connect to its virtual machine in the cloud to get its ID number, and then tell the laser etching machine (which has its own Imp module) what number to print on it. As part of this process Electric Imp’s management can track all of its modules off the manufacturing line and get key information about yields and even product theft.

Of course the flip side of this constant connectivity is the disquieting sensation that even as you enjoy a product it’s not yours. It’s features might change at any point. Perhaps things you love about the product or even features you’ve purchased, might suddenly disappear. As a consumer, the idea of dynamic pricing can seem exciting if you don’t use something a lot, but it becomes a source of higher costs if you have a building with very active elevators, for example.

And perhaps most unsettling is the realization that these products can act as a doorway into your home, sharing information that perhaps you’d rather it didn’t. Your car tracking your trips. A toy that knows if you’ve skipped school to play video games. It’s unsettling enough that this happens on the web and with our phones. As this capability hits more devices, we may find ourselves taking the stairs instead of a connected elevator or playing with an old-fashioned doll instead of a Bluetooth enabled ball.

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First off, this show is huge. There are more than 1,000 vendors spread over 366,339 square feet of space. There are plush toys, dancing plush toys, building sets and dolls. The buyers at the show represent a wide assortment of stores, from large chains like Toys R Us and Best Buy to mom and pop toy shops, schools, car washes and dollar stores. These people are here to scope out new toys and buy inventory.

Despite the lure of the high-tech toys that brought me here, many of the things that caught my eye and interest were lower tech. For example, I was charmed by shelves of Android robot plush toys (from $10 to $43) from Gann Memorials, a company in North Carolina. You could even buy a plush Android phone cover for $7 if you were so inclined.

Another toy that I liked and saw buyers flock to at the Launchpad event — a small portion of the hall for upstart toy companies with prototypes and $1,900 to spend on a table — was a game called Awkward Moments. While it somewhat resembled the Cards Against Humanity game, it was created by a lab out of Dartmouth that built games to change public perception. This $18.95 game was designed to help overcome prejudice against women in the science, math and engineering fields with a small number of cards dedicated to situations that women might encounter. Surprisingly, it was fun instead of preachy.

However, the tech-related toys that I was there to see were pretty cool. NeuroSky, a company that makes a brainwave-reading helmet was there with a few toys that worked with its headsets. They ranged form ears that wiggled when you were focused to a helicopter that you controlled with your mind. After trying the headset on, I discovered that I am a very focused individual — perhaps a little too focused. My helicopter launched itself pretty aggressively from the moment I put the headset on. At $70 for the headset and ears this was an investment, however.

There were also tech toys for babies with iPads, such as Tiggly, a puzzle game to help toddlers recognize shapes.

And for young kids with iPads, there were the Apptivators. They sat on top of an iPad and interacted with the game playing on the screen. For $25 kids could get either a monster head or a car and play an associated game. When the character dies, the shell covering the little plastic head pops off.

And for adults with $1,000 to blow? Two 18-inch-high robots that could fight another robot via the web (the boxing ring is thrown in too).

After all of this, the $150 for the Romo smartphone robot looked downright reasonable.

And the $90 for the LittleBits toys that have been dubbed the next-generation of LEGOs had me ready to plunk down my credit card. Several educational buyers felt the same way apparently. A lot of people were at the LittleBits booth.

Yet, the 20th century settled back in once I wandered away from the relatively small interactive and tech section of the show. Once again I was surrounded by plastic, plush and puzzles. And as I wondered how tech toys might do in the bigger market outside the geeks and early adopters, I got a reality check from a fellow blogger who writes for the parenting site Babble. She pointed out that $90 was crazy money for a toy. Adrienne Appell, a spokesman for the Toy Industry Association backed that up with data, telling me that the average price of a toy is $8. Of course, that average is brought down by stuff like the junk below.

At the end of two days at the Toy Fair I realized that connected toys, the threat of Kickstarter as a prototyping and marketing tool and advances in robotics were pretty inconsequential in the minds of most exhibitors, buyers and entrepreneurs at the fair, despite headlines shouting that tech was the big trend this year.

The world of tech and the world of toys may be on a collision course, but that crash is far off. If the small space at the show dedicated to truly connected or novel tech toys wasn’t proof, then the fact that I was offered “a disc” of high-resolution images” by the PR person staffing the Madame Alexander booth was. Sadly, My MacBook Air doesn’t have a CD drive and she didn’t have the images on USB. I’m still waiting her to email the images, but I’m not holding my breath ( or the story).

Photos by Rani Molla
Disclosure: LittleBits is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

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Think big: 3M shows off 84” multitouch table

3M showed off the prototype of a 84” multitouch table, which ran an app developed for a science museum, allowing users to manipulate objects and reveal information about them. I was told that the app actually is used in the wild, albeit on a somewhat smaller table. The one shown at CES Unveiled allowed around 40 simultaneous touch points, but 3M wants to get that number up to 100 to comfortably allow up to 10 people to play with the table.

3M has been working on these touch interfaces for some time, and a spokesperson told me that there is significant interest from museums, retailers and even casinos. However, it’s rather unlikely that you’ll get to take one of these home anytime soon: I was told that the 4K LG display used for the 84” table alone costs around $12,000.

Think round: Sphero goes for a hands-on approach

Sphero, the Bluetooth-connected ball that you can remotely control with your cellphone or tablet, is getting a whole lot more interesting: The Colorado-based startup showed off a bunch of new games, including an augmented reality application that lets you throw cupcakes at game characters in your living room.

Sphero lets you use its Bluetooth-connected ball as a gaming remote control.

But what I found really intriguing was that a Sphero can also double as a gyro remote control. I was shown a game that allows users to run through the streets and fight zombies, all by turning and rolling the Sphero ball in your hand.

Now I know, that’s not technically a tactile interface, but it definitely felt like a very haptic experience to me. And granted, gyro isn’t exactly new, and there are plenty of games that allow you to do the same thing by simply tilting your iPad. But somehow, doing the same thing with the Sphero ball while the display surface stayed flat on whichever surface you had placed it on felt a lot more natural.

Interested in more CES Unveiled discoveries? Then check out my colleague Kevin Tofel’s mobile finds: 2-week fuel-cell; FitBug and Wi-Fi-to-USB media sharing.

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However, that fun comes at a whopping $129 price per ball, which I’m not going to shell out for a toy. But, for those with deeper pockets than I, it does have several apps/functions, such as Drive (you move your finder on an iPad or smartphone, and the ball moves too!), Chroma (a game that uses the accelerometer in the ball and asks you to tilt it in the direction of whatever color is flashing on the screen) and my favorite, MacroLabs, which is essentially a way to program the ball and then watch it take the actions you described.

Here’s my crappy video of the Sphero on the floor of the Hilton here at SXSW:

I’m genuinely intrigued by the way connected toys can change how people play and interact with one another. Sphero, which is made by a Boulder, Colo.-based firm called Orbotix, seems to me to be limited right now because, while it’s pretty, it doesn’t offer anything fundamentally new in play. The Chroma game is similar to some bad Wii game, and driving it around doesn’t hold my interest for long. However, I like the idea of a ball with Sphero’s capabilities that one can write apps to — and there is a software development kit.

Building a platform so people could envision games for their Sphero and build them is super powerful and may be why Highway 12 Ventures and Foundry Group invested in the company making Sphero. MacroLabs might become that, but I’d want multiplayer functionality. With something like that, perhaps I could build the next Calvinball.

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