This is of course not a new trend, but just over the last couple of years we have seen it being manifested in real products on a mass market scale. I have written many times on this blog about this new blended reality, the challenge of dealing with a new form of "material" (the physical/digital compound).
But even if this is not a new trend, it means many things for anyone involved in interaction design. Maybe the most important one is the realization that there is nothing anymore that is either purely physical or digital products. This is a realization that deeply influences how we think about competence. What does a designer of interaction need to understand in this new world. It is clear that to design interaction involves knowledge and understanding of both the physical aspects of a product as well as the digital.
Ok, I have to go in the middle of this post...maybe I will come back to this later...or someone else can add to it :-)