Smart but Vulnerable IoT Devices Present an Opportunity for Home Broadband Providers

Internet-connected “things” are lacking in basic security protections, putting consumers at risk. Home broadband providers are in a unique position to protect their customers’ connected devices through value-added security solutions.

As the Internet of Things continues its advancement, our world is becoming smarter and smarter. Consumer televisions and security cameras are already connected to the internet. Adoption of connected thermostats, lights, security systems and voice assistants is growing fast, particularly in North America. Soon homes will have connected washing machines and toasters as well.

According to a 2018 PwC survey, ownership of smart devices in UK homes more than doubled in the previous two years. And according to a study from Parks Associates, more than 50% of US households with broadband plan to buy a smart home device in the coming year. A survey from Metova revealed that 74% of respondents think connected home devices are the wave of the future.

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No one is more aware of this trend than Mikko Hyppönen, Chief Research Officer at leading cyber security provider F-Secure. Hyppönen has been fighting computer viruses and defending cyber space since his tenure at F-Secure began in 1991, before most people even knew about the internet. The advent of connected “things” has opened up a new frontier of cyberspace in need of guardians like him to protect it.

“Everything is becoming a computer,” says Hyppönen. This matters because, as he says in an apt aphorism that he’s self-coined as Hyppönen’s Law, “If it’s smart, it’s vulnerable.”

“So here’s a smart phone—vulnerable phone,” Hyppönen says. “Here’s a smart watch—vulnerable watch. Smart car, smart city, smart grid…You get my point.”

The essence of Hyppönen’s Law is that anything that can be programmed can also be hacked. When we add connectivity to the appliances and gadgets around us, we open ourselves and our homes up to potential compromise by malicious actors from afar. Almost all these connected devices use the home gateway Wi-Fi password, yet all are lacking in basic security protections.

Home broadband providers are in the unique position of managing these gateways. Given the relationship of trust already established with customers, broadband providers are well positioned to help consumers deal with the growing complexities of the connected world. By partnering with a cyber security provider like F-Secure, home broadband providers can help consumers keep their living spaces secure, even as homes become smarter.

Connected and compromised

That the IoT has security challenges is being acknowledged by no less than the FBI and Interpol. Both agencies have issued statements in the past year warning about the dangers of connected things.

“Cyber actors actively search for and compromise vulnerable Internet of Things devices for use as proxies or intermediaries for Internet requests to route malicious traffic for cyber-attacks and computer network exploitation,” the FBI warned. “Cyber actors typically compromise devices with weak authentication, unpatched firmware or other software vulnerabilities, or employ brute force attacks on devices with default usernames and passwords.”

The warning echoes a similar finding in a 2018 F-Secure report, Pinning Down the IoT: “In its current form the Internet of Things represents a considerable threat to consumers, due to inadequate regulations regarding its security and use.”

According to the FBI, cyber criminals are leveraging compromised IoT devices for various nefarious activities, such as sending spam emails; generating click fraud activities; buying, selling and trading illegal images and goods; and conducting credential stuffing attacks, which involves testing stolen passwords on website login pages using an automated script.

In the wider context, they can also be used in distributed denial of service (DDoS) attacks on organizations to shut down servers or services. One of the most powerful DDoS attacks ever seen took place in October 2016 when a botnet targeted the systems of a major DNS provider, rendering the internet unavailable to users in many areas of Europe and North America. The ensuing investigation revealed that the botnet had been made up not of conventional computers, but of connected gadgets like IP cameras and baby monitors. The devices were infected with a special type of malware that targets IoT devices, exploiting devices on which the factory default login credentials had not been changed.

Closer to home, what impact can a compromised IoT device have on the average consumer? Device owners may notice spikes in internet usage and increased monthly bills or slow performance of a device or connection. There can potentially be even deeper, more personal effects. In recent years, stories have emerged of vulnerable webcams leaving consumers open to peeping tom hackers and vulnerabilities in critical technology like implantable cardiac devices and baby heart monitors.

Inherently insecure?

Compared with conventional computers, laptops and smartphones, connected “things” present their own unique challenges to security, an issue that begins with the very design of a product. Real world product companies, although they manufacture useful home appliances, toys and everything else you can touch and feel, often know little about information security. It’s no surprise that in their smart products, security is not given the priority it deserves.

These companies focus on how desirable and useful their product is, not on how secure it is. They worry about whether their product is easy to use, not about whether it can be remotely hacked. And to keep costs down and move products out the door, they often sell products built with chips that use outdated software. Such devices may have grave security flaws from the beginning.

Even if these companies were concerned about security, the miniature size of many IoT devices creates challenges. Limited size and processing power narrow the options for security measures. A given computer, smartphone or tablet can have third party security software installed to protect it; this is not the case with connected things. There is no way to install security onto a smart surveillance camera or a smart fitness tracker.

Compounding the problem is the difficulty with updating vulnerable software in IoT devices. Many smaller devices are low cost, and if a vulnerability is discovered on such a device it may be difficult to update the software and then to let customers know about a fix. Even if customers were notified, they would have to have the know-how to download and install the patch.

How smart is smart?

For consumers, there are already “smart” hairbrushes, luggage, even condoms. Almost half the homes in America have a smart TV. New F-Secure research confirms that the only thing preventing even faster adoption of smart devices that connect to the internet is the privacy and security concerns of the people who are most excited about this technology. While 89% of early tech adopters in the UK said they are excited about IoT, 66% also reported being concerned about malware and hacking.

For businesses, the move to connecting almost everything has been happening since before this decade began. To get a sense of how far along we are in the computerization of the world, Hyppönen advises visiting a factory, where companies rely on industrial control systems for billions if not trillions of dollars of commerce.

“When everything is becoming a computer, companies get hacked in surprising ways,” he says. For an example, he points to one of the largest credit card breaches in history—the 2014 hack of US department store retailer Target, which exposed the data of up to 70 million customers.

“In this case, the actual credit numbers were lost as customers were paying at the cashier desks…The shop’s own credit card terminals were stealing the credit card numbers.” The attackers had found a way in through the computers that controlled the ventilation systems, and had worked their way over to infiltrating the POS systems.

When everything is connected, everything must be protected

Anything that can be programmed can be hacked, and like the Target case, it may be hacked to get to something else that’s far more interesting than just the ventilation system.

“They are not hacking your washing machine or your fridges to gain access to your washing machine or to your fridge,” Hyppönen told Nasdaq’s Tomorrow’s Capital. “They are hacking those devices to gain access to your home network…The weakest link in the home network is an IoT device, and we have seen this multiple times. Company networks get breached because of ventilation-automation systems which have nothing to do with your laptops or your servers, but they are computers because everything is becoming a computer.”  In the same way, home networks can get compromised through the most innocuous smart device…smart, remember, meaning vulnerable.

There’s no easy solution for securing the Internet of Things. In order to experience all the benefits of the IoT without scary scenarios of cyber criminals accessing our data and controlling us via our Things, we have to begin by coming to grips with what it’s going to be like to live in a future governed by Hyppönen’s Law.

Home Wi-Fi security

The good news is the problem is recognized, and bold new solutions are available – and it’s up to home broadband providers to bring these solutions to their customers. According to an F-Secure survey*, 60% of consumers said they would purchase their security and privacy services from their internet service provider. Partnering with a cyber security partner to offer value-added IoT security solutions on top of broadband services is one way a broadband provider can secure their customers’ connected lives, and in doing so, enhance their own brand loyalty and trust.

Home Wi-Fi security from F-Secure gives broadband customers protection for every internet-connected device in their home – from smart TVs to gaming consoles, thermostats, wireless printers and baby monitors, to traditional computers and mobile devices. IoT devices are protected against malicious websites and other online threats with breakthrough SENSE technology from F-Secure. Consumers also receive notifications if their devices begin to exhibit odd behaviour. Home broadband providers can enhance their proposition and increase their addressable market with leading-edge, worry-free security for consumers and small businesses.

A more secure tomorrow

Everything is becoming a computer, so everything is vulnerable. This is already true for our businesses and it’s becoming truer and truer for our homes. Our personal sanctuaries where we live, work, and play need to be shielded from the dark underbelly of the internet. Home broadband providers are already providing the bandwidth that powers our connected home and all its devices; it just makes sense to also be part of the solution for protecting these devices, their owners, and the connected home.

*[F-Secure Consumer Research: 4 years-12 countries-20,000 consumer interviews-15 million data points]

Trump’s Huawei executive order not much more than a power play

Rumours are swirling around Washington DC suggesting President Donald Trump is on the verge of signing another executive order, this one the final blow to Huawei’s US ambitions.

While the document itself will actually have very little impact on Huawei’s business, it is more of a symbolic blow to the kit vendor, as well as other Chinese businesses looking to exploit the riches of the Land of the Free. While the rumours were originally reported last week, by the time you get back to the office on Monday the order may well have been signed.

In a single signature, Huawei, a representation of China’s ambitions in the global technology and telecommunications industry, could be officially and explicitly shut out of the worlds’ largest economies.

Although details on the executive order are limited to rumour and hearsay for the moment, officials have stated this order will not impact electronics companies or products which incorporate Chinese components. This is a political move to demonstrate the power of the US. Trump is making a statement to China; look at what I can do to one of your flagbearers.

As it stands, Huawei’s involvement in US communications infrastructure is pretty minimal. T-Mobile US CEO John Legere has very publicly stated his business will very much avoid using Huawei equipment, while back in August Trump signed the Defense Authorization Act into law which effectively banned any meaningful work Huawei or ZTE could do in the US.

Huawei’s, and ZTE to a lesser extent, condemnation has become nothing more than a symbol of US dominance on the technology world. Trump is posturing, demonstrating what will happen to anyone who challenges the US leadership position. Over the last few months, US delegations have been visiting governments around the world to pitch the idea of a ban, admittedly with varied success, though there have been some willing to listen. Banning ZTE from using US components or IP brought the firm to the brink of extinction. The US forced Canada to arrest the Huawei CFO. A lot of this is a demonstration of power.

This is of course a complex and rich tapestry, and there are numerous intertwining and independent narratives going on. Some of it will be political, some economic, some espionage assumptions will be true and there will be validity to accusations of a government-influenced unfair playing field. This is an incredibly complex matter. But look at what the executive order actually is.

Huawei is already incredibly limited in the US, the damage to ambitions has already been dealt, this is chest beating from Trump.

Samsung looks to capitalise on Huawei’s woes

Samsung is reported to be investing heavily in infrastructure business to fill the market gap left by Huawei’s ban from 5G business in the developed markets.

Sources inside Samsung and other industry executives have told the Reuters that Samsung is pouring resources into its telecom infrastructure business unit, aiming to seize the opportunity created by the ban on Huawei in a number of important western markets. Samsung’s infrastructure business had been insignificant until recently, trailing Huawei, Nokia, Ericsson, Cisco, and ZTE, according to figures from the research firm Dell’Oro Group. But it saw a chance when first ZTE then Huawei found themselves being shut out of the lucrative 5G markets in one country after another in the developed world.

To join the ranks of Ericsson and Nokia, Samsung is said to be moving strong management resources as well as software engineers from the smartphone unit to the infrastructure business and to have started charming Huawei’s current customers. One of the global heavyweights that has been impressed by what Samsung has got to offer is Orange. After visiting Japan, where Samsung was conducting a 5G trial, Mari-Noëlle Jégo-Laveissière, Orange’s CTO, was happy to include Samsung in its shortlist of alternative suppliers, after the telco decided to ban Huawei, its long-term top supplier, from its 5G business in France. An Orange 5G trial with Samsung will be conducted this year.

One difficulty Samsung needs to overcome is the shortage of talents. To start with it needs good engineers. To this end, Samsung’s heir apparent and de facto head Lee Jae-yong, or Jay Y. Lee as he is known in the western world, has sought the support from the Prime Minister when the latter visited Samsung in January. “We need more software engineers and want to work with the government to find that talent,” Lee was quoted by government officials. Samsung’s infrastructure unit has a workforce of about 5,000 people, both Nokia and Ericsson employ more than 100,000 people, and Huawei is said to have employed 200,000 people.

Another type of people Samsung needs to get onboard is those that can build operator relations. This needs a different skill sets from what Samsung has excelled in dealing with distribution channels for its smartphones, and it needs them to be in all the right places in the mature markets, and, better still, to have already worked with the potential operator customers. Due to the nature of business, trusty relationship with telcos often need to be cultivated for years or even decades.

However, Samsung may have just chosen a perfect timing for expansion. Both Ericsson and Nokia are laying off people, either wholesale shutting down of full business units, or selectively downsizing certain teams. Many of these functions have actually had customer interface experience. Huawei’s founder meanwhile has warned that the company may also need to adopt some cost control measures. Though they could not bolster Samsung’s strengths to the same level of its competitors, these could all be good recruitment targets for Samsung to pounce.

Delivering 5G Promises with Efficient and Intelligent Solutions

5G is one of the defining buzzwords of the telecom industry. After years of lab and field trials, live networks have been switched on in North America and Asia-Pacific, with more expected to follow soon. The industry has high expectations of 5G, with the most important use cases falling into three categories: enhanced mobile broadband, massive IoT, and extreme low latency. The services offered to business users and consumers so far are mainly of the first category.

To deliver all the 5G promises, telecom operators and other stakeholders in the value chain do not only have to overcome the remaining technology hurdles, but also do some deep soul searching regarding what business models to adopt and what services to offer whom.

When interviewed by recently, I shared my thinking on how telcos can deliver the 5G promises by addressing these issues. 5G is more than just technologies. Can you please share your views on some fundamental questions telcos need to answer before they start planning technology deployment?

Pu, ZTE: You are right. 5G is the first time in the cellular industry that business cases and applications were considered prior to technology specifications. So before planning technology options, telcos should ask themselves what short-term and long-term business objectives they want to achieve with 5G. For example, for all the incumbent operators which have 4G networks, they should realise that every dollar spent today on the network infrastructure should not only make 5G deployment faster, easier, and more cost-efficient, but also would offer faster 4G with lower per-bit cost. Rolling out 5G without coordination with existing networks would run the risk of compromising the user experiences of the current customers, whereas improving 4G without factoring in the demand of 5G deployment would marginalise the operator in the long term, if not right away.

Along the same lines, when we consider the technology impediments in the road to 5G deployment, we should strive for the balance between critical investment in 5G to offer much better user experiences and guaranteed service in the existing 4G. This is exactly why ZTE believes a comprehensive solution for both efficient 5G rollout and modernised 4G is in the core of facilitating operators’ network upgrade and 5G implementation. ZTE’s UniSite is such an integrated solution for multi-RATs, especially the long-term 4G/5G coordination, integration and evolution. This is true. Most operators will run hybrid networks with legacy technologies side by side 5G. In those cases where operators combine 5G with 4G and sometimes even 3G, pressure on the radio frequencies, which arguably is the scarcest resource in the cellular industry, is increasing. How should operators manage mixed networks to maximise the frequency efficiency?

Pu, ZTE: Many wireless networks have embraced or evolved into multi-RATs co-existence, and the co-existence will stay for a long time, even after 5G is rolled out on a big scale. To optimise spectrum utilisation, mobile operators need a super-efficient networking solution. Essentially this should be an intelligent and dynamic spectrum allocation mechanism between multi-RATs, including 5G in the future. ZTE’s Magic Radio Pro is a leading solution of this kind. This dynamic spectrum allocation should be carried out based on real-time traffic loads on the different RATs, as well as AI-supported traffic load prediction, which will improve the spectrum sharing efficiency. A smooth network evolution, the phasing-in and phasing-out of RATs, is then realised with the least impact on the network.

In addition to dynamic spectrum sharing, the FDD Massive MIMO Solution has also been proved to be able to improve 4G spectrum efficiency by three to six times. It has been deployed in many live networks for FDD Massive MIMO, with a surprisingly large capacity improvement. ZTE is going to release a new dual-band FDD Massive MIMO product in 2019, with three-carrier configuration, up to 2Gbps data throughput within a single product to support commercial applications. Similar to radio frequency, base station sites are also a resource getting harder to come by. From 2G, 3G to 4G, with very few exceptions, operators are moving to higher frequencies. In most markets 5G will be deployed in the higher end of the sub-6GHz bands and the mmWave bands, which means the cell sizes are getting smaller, and more sites are needed. How do you see mobile operators dealing with this dilemma?

Pu, ZTE: Yes, with the exceptions of the greenfield 5G operators, which will need to build the networks from ground up, all the incumbent operators are going to manage mixed networks for a long time. This means that they will still keep updating the 4G networks (even 3G in some parts of the world). The fast-growing demand for mobile data is driving bigger capacity, for example, 2T to 4T upgrade, more sectors and even new spectrums etc., which in term will demand more RRUs, antennas, additional combiners and cables, all congesting the site space. That is even before 5G is deployed on top.

To solve this problem, operators need a unified site solution to not only dynamically share spectrums between multi-RATs (2/3/4/5G) but also share as many common components as possible so as to minimise the amount of equipment at one site. ZTE’s UniSite solution comes with a series of UBR (ultra-band radio) products to reduce the number of RRUs by close to 70%, plus the innovative RRUs with imbedded combiners can handle the 2/3/4/5G in sub-3GHz band with only one antenna. Additionally, the UniSite solution is not only made for macro sites, but also able to offer differentiation for other scenarios such as hot spots, traffic centric indoor access, etc. The increasing complexity of networks and the fast-growing amounts of data going through them, as you just mentioned, have gone beyond the capacity of manual operation and maintenance. Therefore, operators would require strong automation capability to provide system assurance and deliver service quality. How should operators leverage the AI advancements to improve their operation quality and efficiency?

Pu, ZTE: There are a number of areas that AI can play a significant role, in particular, network operation and maintenance (O&M), network planning, network optimisation, and fault investigation etc.

ZTE’s next-generation network O&M platform, called UME, can deliver the unified management and operation of 2G, 3G, 4G and 5G. Moreover, supported by AI, the UME platform can largely improve the efficiency of network optimisation and error investigation. For example, the alarm processing time is vastly reduced in root cause analysis (RCA), based on RCA rules mining, self-learning associations, and forming rules into the RCA model for alarm root cause viewing and alarm suppression. Furthermore, the unified big data platform (V-MAX) based on richer data and stronger data processing capability can support more efficient and more intelligent network planning, network evaluation and optimisation, and centralised SON.

Government to give Ofcom new stick swinging targets

The UK Government has unveiled a new consultation which will explore how it can encourage Ofcom to snap the whip, making sure telcos get their gears churning to meet connectivity targets.

Over the next decade, if the government manages to create a suitable amount of urgency across the telco industry, there will certainly be some progress made. The objectives currently set out are nationwide full fibre broadband coverage by 2033, while also increasing geographic mobile coverage to 95% of the UK by 2022.

Although this sounds very official, this consultation is more of a temperature check from the government. It’s asking the industry to give it feedback on its Statement of Strategic Priorities to reinforce its position and create a framework for Ofcom to work towards, ensuring the aims and objectives of the government and the regulator are on the same page.

In this consultation, the government is presenting its Statement of Strategic Priorities for a legally required 40-day consultation, which will validate and justify the aims, therefore providing a more stable foundation to bring Ofcom’s work in-line with government ambitions. This is a process which is required in other utility verticals and brings the telco industry more in-line with the stricter regulatory scrutiny which is placed on segments such as water and energy.

Aside from meeting the connectivity and coverage ambitions, the consultation will also look at how ‘loyalty penalties’, the price-creep which is placed on contract renewals, can be tackled. The telco industry is one which is geared towards customer acquisition, though many would like to see loyalty rewarded, instead of picking up the slack created by offers to lure customers away from competitors.

“As the UK’s telecoms regulator, Ofcom has a critical role in realising our shared connectivity aspirations for the UK,” said Secretary of State, Jeremy Wright. “As well as ensuring the necessary improvements to broadband and mobile services, consumers must also be protected. I urge Ofcom to tackle harmful business practices and remove barriers to switching.”

The ‘loyalty penalty’ is a highly emotive mission from bureaucrats and consumer champions to stop an age-old practise of the telcos, which is perhaps underhanded. It is effectively taking advantage of those who are not savvy-enough to search for a new deal, or those who might innocently and naively presume loyalty would be rewarded. Unfortunately, this is not the case in the telco space, an industry which has a woeful track record and outlook on customer experience and services.

In terms of improving mobile coverage, the up-coming Ofcom 700 MHz auction has caught the attention of the government. The auction will aim to sell off 80 MHz in the 700 MHz band, spectrum which is well suited for providing mobile coverage over wide areas and indoors. Ofcom is currently clearing this band of transmissions for Digital Terrestrial Television (DTT) and by wireless microphones used in the entertainment industry, though the plans are to have the spectrum free for mobile use by summer 2020.

Elsewhere in the consultation, rural roaming will be covered. Again, this ties back to empowering the consumer with greater connectivity and coverage, tackling the not-spots across the UK. Despite each of the telcos claiming progress in improving coverage, there are still plenty of not-spots across the UK where consumers only have the choice of one operator. Future proposals would aim to improve roaming agreements, to offer greater choice of providers to the consumer.

Finally, the consultation will ask for opinions on the current regulatory landscape. Central to this aspect of the investigation will be the suitability of rules and regulations to ensure the UK attracts investment.

While this might seem like bureaucracy for the sake of bureaucracy, it is a democratic nation ensuring all the boxes are ticked. The government has ambitions and objectives, though it is seeking validation from the community, before presenting a mandate to Ofcom to ensure it is regulating the industry in the way the government feels is most beneficial for society on the whole.

Three UK’s guerrilla marketing strategy backfires

Challenger brands need to try harder to get noticed, but this approach can sometimes backfire, as Three UK found out this week.

Three is hoping to build on its #PhonesAreGood campaign, launched in October last year, that took a tongue-in-cheek look at all the negative press around smartphone addiction by imagining some historical scenarios that would have been changed for the better with the involvement of a smartphone.

One of those scenarios concerned King Henry the Eighth, who notoriously got through six wives by the time he called it a day. The joke is that if he’d had some kind of dating app at the time he might have been able to make up his mind about them prior to marriage and thus a couple of them could have been spared the chop.

In the build up to Valentine’s Day some bright spark in Three UK’s marketing department thought it might be a laugh to promote this part of the campaign with a tweet entitled ‘Shag, marry or behead’. This was presumably a nod to the ‘kiss, marry, kill’ game and maybe even the phrase used by history students to remember what happened to Henry’s wives: ‘Divorced, beheaded, died; Divorced beheaded survived’.

Now you don’t have to be the most committed social justice warrior to know that Twitter is not the place for nuance or humour and anything that can be taken offence to will be. While the tweet was clearly a joke, there was always the possibility that it could be perceived as some kind of trivialising or even endorsement of domestic violence by someone.

That someone was apparently mumsnet member Jeanhatchet, who flagged up the tweet on the site’s forum. “The 3 mobile network are laughing at domestic homicide in this tweet, Jeanhatchet wrote. “In many of the women killed as a result of intimate partner violence blunt force trauma to or being stabbed in the head is a feature.

“The most worrying thing is …. how did this marketing meeting go? What views were expressed about killing women? How that was funny and would sell more contracts and phones? Imagine those men who sanctioned this and how common their views are that it never registered as a marketing disaster?” Three seems to have taken down the offending tweet by here’s a screenshot of it courtesy of Jeanhatchet. Google is also still acknowledging the original tweet.

3 UK deleted tweet


3 UK deleted tweet Google

That was enough for the Manchester Evening News to get involved, which committed not one but two dogged hacks to the job of writing up this mumsnet post and the rest of the claimed ‘flurry of complaints’ around Three’s tweet. Even their combined efforts weren’t enough to ensure the faithful representation of the discussion thread they were copying-and-pasting, however, with one of Jeanhatchet’s early comments wrongly attributed to  Lolkittens5, to whom she was responding.

Hot on their heels was Labour MP James Frith, who apparently spent most of yesterday working himself up in to an impressive froth of righteous indignation. “This is a disgraceful ad,” he opened. “Misogynistic and violent towards women. The disgrace of it. I hope you’re fined big time for this with proceeds sent to women’s refuges. Utterly shameful @ThreeUK”

Three, of course, tried the standard ‘we are sorry for any offence caused’ defence but, as is nearly always the case, it was too little too late. Apparently emboldened by the 30 likes and four retweets his initial Twitter salvo received Frith doubled down, including the textbook move of calling for an apology and then rejecting it when it was made. He concluded by vowing to grass Three up to the ASA before wrapping up his busy day by retweeting a story about how great his constituency is.

Unperturbed Three announced a new marketing initiative today around London Fashion Week. It’s claiming to have launched the world’s first 5G mixed reality catwalk, It ‘uses innovative start up Rewind and its Magic Leap mixed reality technology alongside Three’s 5G network, which will see the designer’s inspirations come to life on the catwalk,’ according to the press release.

Somehow this involves the son of singer Liam Gallagher and actress Patsy Kensit, who is apparently a world-renowned model and, as you can see below, has inherited his father’s petulant resting face. Perhaps this is intended to distract from Three’s rather weak 5G claims, with vague talk of IoT and AR the only substantiation offered.

3 UK Lennon Gallagher

“Today we are turning up the volume on 5G and bringing it to life for the first time in the UK, right here in the heart of the fashion world,” said Shadi Halliwell, chief marketing officer at Three. “By giving students access to the next generation of mobile technology, they will be able to push the boundaries of learning, innovation and sustainability to create in a way that’s never been possible.”

Halliwell, who presumably signed-off on the problematic tweet, will be hoping this new initiative will be free from controversy, or maybe not. It’s possible that the tweet was made in the hope of a bit of viral exposure, but that seems unlikely when you consider how quickly it was deleted. One thing, at least, Three will have gained from the experience is the knowledge that guerrilla marketing is a very high-risk strategy these days.

Big Apple says no to Amazon

The PR bout between Amazon CEO Jeff Bezos and Democratic Congresswomen Alexandria Ocasio-Cortez has been settled, with the internet giant cancelling plans to open a New York office.

HQ2, as it had come to be known, was supposed to be Amazon’s attempt to expand its corporate footprint, opening a new, secondary, headquarters outside of Seattle. After a year-long search, the decision was made to split duties between Virginia and New York, with each eventually playing home to 25,000 employees promised Amazon. It seemed like an attractive proposition, but political and residential opposition killed the idea.

“After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens,” the company said in a statement. “For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term.

“While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.”

Amazon has been on a year-long road trip to figure out which city would effectively bribe it the most to become the home of the next corporate headquarters. The ‘bribe’ would come in the form of tax incentives and relief for investing in a region, and while this might have looked like a coup for New York and the district of Queens, there has been political opposition.

Ocasio-Cortez was the spearhead, objecting to the billions of dollars’ worth of benefit the internet giant would realise, all at the expense of the tax payer. Opponents to the development also questioned how much of a benefit Amazon would be to the city, as many locals would not be qualified for the newly created positions.

Although there are arguments on both sides of the equation, you have to wonder whether this is a short-sighted move from a politically naive representative. Firstly, New York has not shown itself to be particularly welcoming to technology, the fastest growing segment of the global economy. And secondly, just because people are not qualified for these roles today, doesn’t mean the generations of tomorrow won’t be qualified.

Starting with the first point, many cities across the US are attempting to make their own region appear more attractive to technology companies. This is always for the same reason; politicians and bureaucrats recognise the growth potential of the technology industry and the greater impact this can have on the city. In taking such a strong and aggressive stance against Bezos, New York has given itself a slight technophobe image.

Of course, what is worth noting is the city should not be taken advantage of. This is what many feel Amazon has done, using the immense promise of jobs, investment and prosperity to bleed the city dry. Whether you look at the tax incentives as a pragmatic move or abuse of the system depends on your political swing, but there are fair arguments on both side of the equation.

The second point of opposition is down to the jobs which will be created. Many have suggested these would not be suitable for the local population of Queens, instead outsiders would stream into the area, potentially bringing with them higher house prices and pretentious coffee shops. There is certainly some validity to this position, though you have to wonder whether this is short-sighted.

The first generation might not be the most qualified, but in bringing a new type of job to the area, future generations have another target to aim for. Companies like Amazon also like to run initiatives like coding clubs in local schools, offering young students an opportunity to learn a future-proofed skill which might not be available to them otherwise. There is also secondary employment brought to the district because of the presence of Amazon.

Amazon is also a leader is the quickly prospering field of artificial intelligence. Although engineering and innovation for AI would almost certainly be based in Silicon Valley, the presence of such a massive office in New York would allow the city to create a hub of excellence for AI. Considering the role this emerging segment will play in the future, this is potentially a massive missed opportunity.

There are arguments on both sides of the equation, but we believe this is a short-sighted campaign of opposition. More effort should have been made to renegotiate the terms, as much more is lost than gained with New York snubbing Amazon.

Why digital transformation requires people to change as well as technology

It's a proven fact, digital transformation is not possible in a large enterprise organisation where legacy middle-managers do everything within their power to resist any change to the status quo. A lack of culture change will typically result in no meaningful progress.

According to Gartner, a proactive and adaptive culture is a critical asset and some CIOs will likely play a role in establishing the right mindsets and practices within their organisations. Gartner predicts that by 2021, some CIOs will be as responsible for culture change as chief HR officers (CHROs).

Organisation change management goals

“A lot of CIOs have realised that culture can be an accelerator of digital transformation and that they have the means to reinforce the desired culture through their technology choices,” said Elise Olding, research vice president at Gartner. “A partnership with the CHRO is the perfect way to align technology selections and design processes to shape the desired work behaviors.”

The mission and values of an organisation usually fall into the remit of HR. According to the Gartner assessment, the partnership between IT and HR can shed light on how IT can make technology and process design decisions that foster the intention of the desired organisational culture.

Enterprise architecture can adopt principles that align to the cultural traits, and when business analysts design processes they can create them with the intended traits in mind. Therefore, IT supports the way an organisation behaves in cooperation with HR.

However, culture change is a process. This means that there will be barriers to digital initiatives -- in peoples’ mindsets and practices. “A great way to jump-start culture change and enable adoption of new technologies and processes is the culture hack. Start with a small, motivated user group and use it to showcase fast wins and results,” Ms. Olding said.

Change is a perpetual work-in-progress

A recent Gartner survey found that 67 percent of organisations have already completed culture change initiatives or were in the process of doing so. The reason for many of those initiatives was that the current culture has been identified as a barrier to digital transformation. But overcoming the obsolete thinking of employees is very difficult.

“In 50 percent of cases, transformational initiatives are clear failures and CIOs report that the main barrier is culture,” said Christie Struckman, research vice president at Gartner. “The logical conclusion is that CIOs should start with culture change when they embark on digital transformation, not wait to address it later.”

Why change requires diversity in thinking

Organisations today need better decisions made fast, ideally at the front line. To achieve this objective, teams must consist of multidisciplinary, diverse members with the autonomy and accountability to act and to realise financial targets. Diversity & Inclusion (D&I) is critical for the success of those teams.

That being said, D&I initiatives will only contribute to business results if they are scaled properly and actually reach frontline employees. Enterprises often overlook extending D&I programs, such as unconscious bias training, to frontline employees.

Numerous technologies can enhance the scale and effectiveness of D&I programs, such as by diagnosing the current state of inclusion, developing leaders who foster inclusion and embedding inclusion into daily business execution.

D&I initiatives are an area where CIOs and CHROs can cooperate easily and effectively. For example, CIOs can champion empowerment behaviors, as they already gained a lot of experience with agile development and product teams working together.

Raise the bar of expectations to achieve real change

CEOs must force the required internal collaboration across their leadership team, and remove those people with closed minds. Some people will never change, unfortunately.

The IT department must partner with HR to set up progressive programs for monitoring, measuring and enhancing the inclusion of people with open minds that embrace change. Gartner research shows that meaningful inclusion strategies can improve performance by over 30 percent in diverse teams. Raise the bar of expectations; achieve real change.

Interested in hearing industry leaders discuss subjects like this? Attend the co-located IoT Tech Expo, Blockchain Expo, AI & Big Data Expo, and Cyber Security & Cloud Expo World Series with upcoming events in Silicon Valley, London, and Amsterdam.

JP Morgan launches its own cryptocurrency but don’t get too excited

JP Morgan has created the first cryptocurrency to be backed by a U.S. bank but you can’t buy any and it’s not obvious what the point of it is.

“The JPM Coin is based on blockchain-based technology enabling the instantaneous transfer of payments between institutional accounts,” said an announcement based on gibberish-based grammar. In essence this seems to be a digital mechanism designed to speed up the movement of money within JP Morgan’s systems, nothing more.

They gave the exclusive to CNBC, which also got to chat to Umar Farooq, head of JP Morgan’s blockchain projects, who likes to start his sentences with ‘so’. “So anything that currently exists in the world, as that moves onto the blockchain, this would be the payment leg for that transaction,” he said. “The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this.

“Money sloshes back and forth all over the world in a large enterprise. Is there a way to ensure that a subsidiary can represent cash on the balance sheet without having to actually wire it to the unit? That way, they can consolidate their money and probably get better rates for it.”

So in essence JP Morgan is offering to exchange their client’s dollars for cryptocurrency tokens representing exactly the same amount, which it reckons they’ll be able to move around more easily. This is quite a different concept to something like bitcoin, which has seen massive fluctuations in its value against the dollar. One JPM Coin will always be worth one dollar.

JP Morgan’s Q&A sheds a bit more light on the matter. It has much more in common with stablecoin than cryptocurrency in that it’s strictly pegged to the dollar, so it’s basically a digital IOU. The big difference is that JPM Coin is private and only available to JP Morgan institutional customers. Once again: the main point of it is to reduce settlement times, nothing more.

Right now JPM Coin is still in its prototype phase and the stated use-case feels like a bit of an anti-climax for people hoping this signifies the next phase of the cryptocurrency revolution. Maybe the such a public endorsement of the technology by a big establishment name will catalyse something, but it’s unlikely to be the kind of total financial autonomy for the individual dreamt of when bitcoin first arrived on the scene.

Nokia plugs AI to get MWC ball rolling

Nokia has announced the launch of its network of Cognitive Collaboration Hubs which will aim to bring telcos and enterprise into its realm to work on a series of AI usecases.

Fitting very well into Mobile World Congress’ ‘Intelligent Connectivity’ theme, the network based on a similar Cloud Collaboration Hubs, focusing on developing cloud-based capabilities. While artificial intelligence has been praised as one of the saviours of connectivity and a justification for 5G, the usecases are relatively simplistic, this initiative will aim to correct this.

“Network operators are eager to deploy AI to improve network operations and strengthen customer relationships,” said John Byrne, Nokia’s Service Director for Telecom Technology & Software, Global Data. “Nokia’s Cognitive Collaboration Hubs can help accelerate those plans by providing a space for operators, partners and enterprises to co-create new AI solutions utilizing a mix of data science and telco domain expertise.”

One example of these usecases is Driver Behaviour Analytics, a service which aims to analyse driver performance and road conditions. The data and insight can be offered to governments to help improve driving conditions, delivery companies to aide with logistics or insurance companies to more accurately price premiums. Such a system has already been trialled by the Dubai Police.

“Nokia Cognitive Collaboration Hubs are yet another step in the expansion of our data analytics and AI services capabilities, which are widely recognized as industry-leading,” said Dennis Lorenzin, Head of the Network Cognitive Service Unit at Nokia. “Building on our data science and telco expertise, we are helping our customers apply AI technologies to improve their operational efficiency, prepare their networks for 5G, and generate new revenues.”

This is perhaps the area where many are struggling right now; generating new revenues and creating new services for the data-driven era. The most simplistic was to implement AI is relatively obvious, buy an automated bit of software and sack the employees were roles have been made redundant, but the search for value creation is much more difficult than operational efficiency.

The usecases which are being discussed today are of course of value. Self-correcting networks which can identify difficulties will improve customer experience, as will building a profile of users to improve experience, but these are examples of improving what you already have. The reason internet companies secured the lion’s share of profits in the 4G era is because they sought to create new value and revenues which didn’t exist before. The telcos need to start doing this.

It will certainly be interesting to see the usecases which emerge from the Cognitive Collaboration Hub, but for now it serves as an excellent way for Nokia to plug itself under the increasingly popular AI buzz.