In this presentation from the Emerging Communications Conference, Jeremy Toeman, Head of Marketing at Bug Labs discusses open source hardware and its potential to disrupt the $10 billion consumer electronics industry.  Low cost and flexibility have led to an explosion of innovation and variety in computer software.  Hardware, due to the cost of manufacturing and distribution, has been limited to a few siloed product categories like DVD players, printers, GPS devices, etc.  This is beginning to change with the introduction of product personalization and flexible platforms.

Some big companies are experimenting with opening up their hardware products, and have found that giving customers choice and personalization helps their business.  In the automotive industry, Scion and Mini both offer factory installed customization, with over 2 million combinations possible with the Mini.  Nike and Timbuk2 also offer custom designs. 

At the other end of the spectrum are small companies offering flexible platforms, like Bug Labs' Bug Base.  It is a box that includes things that most devices share: power, processor, OS, and memory.  It also accepts attachments with other features like an LCD screen, camera, 3G modem, and more.  With it, you can assemble devices that defy categorization and may only mean something to you.  These extremely personal devices are the long tail of hardware and present a great opportunity.