Telefónica has created a global unit, known as the Chief Digital Consumer Office (CDCO), which will champion new digital products and services, paying particular attention to the smart home.
Led by Chema Alonso, the team will aim to drive forward the Aura AI digital assistant, as well as continue the creation of the ‘fourth platform’. The initiative will help take Telefónica into the digital era across several areas, but there does seem to be particular attention being paid to the smart home ecosystem.
José Montalvo will become Chief Data Officer, with a primarily focus on the development of the fourth platform project, including integrating new products and services such as Aura onto the platform. David del Val will become Director of Core Innovation, with a particular focus on edge computing. Antonio Guzmán is the Director of Digital Home, tasked with overseeing the development of the smart home and digital services ecosystem.
These are only a few of the names, but it does appear Telefónica is hoping to create a standardised smart home ecosystem for the markets which it currently operates in. This is an incredibly intelligent approach to creating value in the future, and with its global presence, Telefónica can provide competition to other players who are attempting to create a platform to control the smart home ecosystem.
This initiative builds on progress being made in the smart home following the announcement of a partnership with Microsoft at Mobile World Congress last year.
Alongside Microsoft boss Satya Nadella, Telefónica CEO Jose Maria Alvarez-Pallete launched the fourth platform initiative in attempt to own the smart home ecosystem, seemingly learning from the ‘walled garden’ business model which has been so successful for the likes of Facebook.
In this model, Telefónica leverage its relationship with the users, creating a platform for third parties to offer products and services. Telefónica will of course offer its own services, such as content, but why not create revenue by monetizing the link between the user and other companies in the digital economy.
While the smart home is still emerging as a viable segment in the digital economy, this is a very intelligent move from Telefónica . Connected objects are becoming more common, as there will need to be a focal point to manage this ecosystem, but also guarantee security. Telefónica has a trusted relationship with the consumer, a recognised digital assistant and the power of Microsoft as a partner. This is not a guarantee, but at least Telefónica is trying something new under the threat of the connectivity industry becoming commoditised.
The UK Government has unveiled new rules for the growing consumer connected objects segment, forcing the ecosystem to take a more rigorous and conscious approach to security.
The new law has been drafted by the Department for Digital, Culture, Media and Sport (DCMS), focusing on three requirements for the manufacture and sale of connected objects in the UK:
- Devices must have unique passwords and no ‘factory reset’ option
- Reporting functions for vulnerabilities must be created by all manufacturers
- Consumers must be made aware of the minimum length of time security updates will be received for the products at the point of sale
Although connected devices have been flooding onto the market in recent months, the security credentials of some are questionable. There are likely to be many reasons for this, though the pursuit of profitability is likely to be sitting at the top of the list.
Security is a growing concern for the general public in an increasingly digital society, though the risks are still greatly undervalued. It would be safe to assume only a small number of consumers would genuinely veto a purchase due to digital security concerns, and in the absence of consumer pressure for greater security, the Government is seemingly forcing the hand of the IoT ecosystem.
“We want to make the UK the safest place to be online with pro-innovation regulation that breeds confidence in modern technology,” said Digital Minister Matt Warman.
“Our new law will hold firms manufacturing and selling internet-connected devices to account and stop hackers threatening people’s privacy and safety. It will mean robust security standards are built in from the design stage and not bolted on as an afterthought.”
The industry on the whole has been gradually moving towards the concept of ‘Secure by Design’ though the question is whether this progress is fast enough to prevent serious consequences. And to be fair, consumers are becoming more aware of the risks of a digitally orientated society. However, the fact that data breaches and leaks still occur validates the argument that security attitudes are not evolving fast enough.
“Smart technology is increasingly central to the way we live our lives, so the development of this legislation to ensure that we are better protected is hugely welcomed,” said Nicola Hudson, Policy and Communications Director at the National Cyber Security Centre.
“It will give shoppers increased peace of mind that the technology they are bringing into their homes is safe, and that issues such as pre-set passwords and sudden discontinuation of security updates are a thing of the past.”
This is perhaps the risk which is being faced today. As these devices are just making their way into mass market purchases, new customers are being engaged, and perhaps these new customers are not technology-enthusiasts. Some might consider purchasing a TV today as no different from a decade ago, therefore not appreciated the risk which a gateway to the internet creates.
The question is whether this is the best approach to ensure security?
The consumer IoT space is an incredibly fragmented and embryonic ecosystem. There are a huge number of inventors attempting to create the next big thing and companies attempting to embed connectivity into everything or anything. It is a lot of moving parts and plenty of opportunity for something to go wrong.
Some companies might go out of business, and therefore stop offering security updates. In the mad rush to get products to market, some elements might be overlooked. And of course, there are those who will simply ignore the rules.
This might sound negative, but it is reality. The Government is not doing anything wrong by suggesting this new law, it is certainly progress to force more security conscious products onto the market, but there are of course challenges to be aware of also. But as with every challenge, there is an opportunity to be the good guy.
Security solutions for digital products are nothing, anti-virus software has been around for decades after all, but security platforms to manage all connected objects inside the home are not common. This is not to say products should not be ‘Secure by Design’ but added layers of security, and a proposition which helps manage the complexities might well be a product more digitally aware consumers would buy into.
In creating these new rules, the ecosystem is being forced down the right path, while it promotes the concept of cybersecurity in the minds of the consumer also. The more aware, and afraid, the consumer is of the dangers of a digital society, the more likely they are to spend money. The question is, who could create a platform to address this area? The telcos are in a strong position, but you can bet Big Tech is already investigating.
Facebook has reportedly hired ex-Microsoft employee Mark Lucovsky to oversee the development of its own operating system to reduce the dependence on Google’s Android.
While many have tried and failed to muscle in on the Android dominance in the OS world, Facebook has largely sat back to benefit from the success of Google. That said, according to The Information, in hiring the man who co-authored the Windows NT operating system Facebook is attempting to break-free of the Android shackles.
Although there is no official confirmation from the social media giant, it does make sense. Facebook is not going to be fighting Android for a share of the mobile OS segment, though it allegedly wants more control of its own fate when it comes to the Portal and Oculus portfolios.
“We really want to make sure the next generation has space for us,” Facebook’s Head of Hardware Andrew Bosworth said during the interview.
“We don’t think we can trust the marketplace or competitors to ensure that’s the case. And so we’re gonna do it ourselves.”
With the Portal smart home devices, VR head Oculus and AR glasses codenamed Orion, Facebook is creeping more and more into the physical world. It might not be the traditional stomping group for Zucks and co. though these are emerging environments where the rules have not been written yet.
What is worth noting is this is not the first time Facebook has attempted to create an OS. In 2013, Facebook launched an OS which ran on some HTC phones, but it should not be under-emphasised how much of a disaster this way. It was a catastrophic failure.
However, the playing field is slightly different now. This is not an OS which is trying to replicate the Android experience on mobile, Facebook is attempting to define its own experience on these devices and dictate its own product development cycle.
Apple, Amazon and Google are joining forces with the Zigbee Alliance to form the Connected Home over IP project to create universal standards for the smart home ecosystem.
The aim of the project is simple; get ahead of the game and reduce the potential for ecosystem fragmentation in the smart home. With Apple, Amazon and Google on board, the working group has access to the worlds’ most popular virtual assistants and can drive towards creating a framework which encourages interoperability and compatibility.
“Our goal is to bring together market-tested technologies to develop a new, open smart home connectivity standard based on Internet Protocol (IP),” Google’s Nik Sathe and Grant Erikson wrote on the company’s blog.
“Google’s use of IP in home products dates back to the launch of Nest Learning Thermostat in 2011. IP also enables end-to-end, private and secure communication among smart devices, mobile apps, and cloud services.”
While it might seem slightly unusual that the internet giants are attempting to collaborate without being forced to, the bigger picture makes it a bit more logical.
The likes of Google, Apple and Amazon are looking to make more money from the software and services elements of the smart home ecosystem. This is an admirable quest, though for money to be made there needs to be mass adoption of smart home products.
As it stands, smart home devices manufacturers are facing a conundrum. Either, spend a lot of money to make sure devices are compatible with all the different smart home ecosystems which are developing, or pick a winner and risk losing out on customers who will exist elsewhere. By creating universal standards for the smart home ecosystem, the manufacturers will theoretically be more encouraging to engage in this emerging segment.
What is always worth remembering is that while the likes of Google and Amazon currently sell smart home devices, there will be a lot more money for these companies on the software side when smart home products are adopted on scale. This is their bread and butter after all, with a plethora of existing relationships already in place. Looking at Apple, this is a company which manufactures premium devices, but has some very aggressive ambitions in the software and services world. This is where CEO Tim Cook envisions growth for the company in the future.
Ultimately this is a good sign for the industry. Collaboration is a word which is thrown around so much nowadays it is almost meaningless, but when it results in universally accepted standards to drive interoperability and compatibility, there is something genuinely exciting to look forward to.
Our latest industry survey reveals a an optimistic outlook, largely bolstered by the launch of 5G commercial service, but also helped by innovations and progress in other quarters of the industry.
The newly published Telecoms.com 2019 Annual Industry Survey Report, produced based on the responses to the eponymous survey, took an overview of the industry landscape over the last 12 months and projects to 2020 and beyond. There is a perceptible optimism among the respondents. 57% of them think 2019 has either been good or excellent. Meanwhile, more than three quarters of the respondents are looking forward to a positive or very positive 2020.
“The waiting for the commercial launch of 5G finally came to an end this year,” said Scott Bicheno, Editorial Director of Telecoms.com. “Hardly a day would pass without us reporting some kind of 5G news, either new technology breakthrough or new business initiatives. Improved performance of many telecom companies including operators has also helped improve the mood of the industry, so have the exciting continuous innovations both on the technology and business fronts.”
The report also digs deep into the most pertinent topics of the industry, including 5G rollout and its next step prospect, opportunities and challenges of digital transformation, IoT and communication service providers’ role, and the modernisation of operating and business support systems (OSS/BSS).
The single biggest change in the industry landscape over the past year was apparently the launch of commercial 5G service in different parts of the world. Although so far, the most marketed service is high speed internet access, including on mobile and fixed mobile access, B2B services, including 5G serving other vertical industries, will clearly feature much stronger the near future.
“The success of 5G, including end-to-end network slicing, mandates a unified view across layers and domains, built upon understanding network and service topology and relevance to customers and devices,” commented Dr. Konstantinos Stavropoulos, Solution Marketing Lead, EXFO. “5G mandates actionable insights and intelligent automation to detect and resolve or to predict and prevent customer- and device-impacting issues in real time.”
Meanwhile, there is strong consensus among the respondents that telecom companies need to undergo big transformation to unleash the full potential of new technologies, primarily because the old business model, centred on connectivity provision, is losing values.
“The telecoms.com survey has been for several years the annual health check for the industry. It provides the real insight into what the industry really thinks and cuts through any hype and hyperbole. The results show the good, the bad and sometimes the ugly prospects,” said Martin Morgan, VP Marketing, Openet. “Thankfully this year there’s been more good than bad and the outlook is refreshingly positive. As the results showed the industry has turned a corner: digital transformation is well on track, new revenue streams are opening up and 5G is being rolled out.”
IoT is one of those industries that connectivity is only a small piece on the whole value chain, and telecom operators expect, and are expected, to play a much stronger role in the ecosystem.
“The 2019 survey highlights that IoT investments are well advanced today with the majority of respondents having already started to introduce services, and smart cities, utilities and industrial/manufacturing topping the list of prospective verticals,” said Ann Hatchell, CMO of Incognito Software. “Achieving excellent IoT service quality coupled with operational efficiency is clearly top of mind for CSPs and IoT providers. The research reinforced the importance of remote device management in delivering extensive automation in zero-touch provisioning, automated device discovery, and access to data telemetry to improve business intelligence and monetization opportunities,” added Hatchell.
New opportunities, presented by 5G and other new technologies and new business models, require both the network-facing and the customer-facing support networks to catch up with the change. It is encouraging to see that an overwhelming majority of the respondents recognise the demands for modernisation.
“In recent years, B2B enterprise monetisation was overshadowed by the focus on consumer monetisation which demanded digitalisation in a highly price-sensitive and data-focussed market. B2B enterprise monetisation has been allowed to fall behind in terms of service experience, efficiency and personalisation,” commented Gary Bunney, CEO of MDS Global.
“With the advent of 5G, a growing SME market and the exploding IoT market, this has to change. There are increasing requirements for ‘designed-for’ B2B BSS platforms, delivered as a cloud service, which enable cost-efficiencies and dedicated service delivery. Business demands new digital engagement tools designed for efficient and personalised interaction with enterprise markets, resellers and partners.”
German security research consultancy Security Research Labs has dropped a security bomb on Amazon and Google, questioning the competence of security features and reviews.
As with all these revelations, the vulnerabilities were shared with the two companies prior to being made public. The hacks which have been discussed this week have now been addressed by Amazon and Google, though it does demonstrate the awareness consumers need to acquire should these devices maintain their presence in the living room.
“Alexa and Google Home are powerful, and often useful, listening devices in private environments,” the firm said in a blog entry.
“The privacy implications of an internet-connected microphone listening in to what you say are further reaching than previously understood. Users need to be more aware of the potential of malicious voice apps that abuse their smart speakers. Using a new voice app should be approached with a similar level of caution as installing a new app on your smartphone.”
Although there is no such thing as 100% secure anymore, the competency of Amazon and Google has been called into question here. Vulnerabilities are nothing new in the digital economy, though the simplicity of some of these hacks are a little bit embarrassing for the internet economy’s poster boys.
The first hack is quite remarkable in the sense it is so simple. Security Research Lab created an application using the normal means and even submitted the application for review by the Amazon and Google security teams. Once the application had been green lit, the team went back in and changed the functionality, which did not prompt a second review from either of the review teams.
In this example, Security Research Lab created a fake error message to replace the welcome message to make the user think the application had not started properly, for example ‘this application is not available in this country’. After forcing the speaker to remain silent for an extended period of time, another message is introduced requesting permission for a security update. During this second message, the user is prompted to change his/her password, which is then captured and sent back to the Security Research Lab.
It is often said the simplest ideas are usually the best, and this is the same in the hacking world. Phishing is one of the most simplistic means to hack an individuals account via email, and this approach from Security Research Lab is effectively a phishing campaign translated to the voice user interface.
Amazon or Google would of course never ask a user for their password in this manner, but we suspect there are many users who would simply go with the flow. According to a Symantec security report, 71.4% of targeted attacks involved the use of spear-phishing emails so the approach clearly works. And now it can be applied to the voice interface.
While losing your password is a worry, the second hack unveiled by Security Research Lab is a bit more nefarious.
Once again, the application designed for the smart speakers are altered after the review from the security teams at Amazon and Google, however it is to do with when the speakers actually stop listening to the user. By introducing a second ‘intent’ which is linked to a command for the smart speaker to halt all functionality, the session can be extended.
In short, the device continues to listen and record its surrounding, before sending the data back to the attacker. This is obviously a very simplistic explanation, for more detail we would suggest following this link to the Security Research Lab blog.
Both of these examples are remarkably simple to introduce as the security review function of both Amazon and Google looked to be nothing more than a box-ticking exercise. Changes are seemingly ignored once the application has been passed the first time, offering a lot of freedom to the hacker. Both Amazon and Google will now have introduced new processes to block such attacks and improve the security review system, though it does appear to be a massive oversight.
Aside from the inadequacies shown here by Amazon and Google, Security Research Lab is perhaps demonstrating some of the biggest dangers of the digital economy; a lack of awareness by the general public. Most people download apps without checking the security credentials or reputation of the developer, and the same assumption could be made for growing ecosystem for smart speakers.
Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece Francesca Greane, Content Lead for Broadband World Forum reflects on the growing opportunity for operators and service providers in the connected home market.
New research from Ovum* recently indicated that the consumer market will remain by far the largest source of revenue for network operators ($1.14 trillion by 2023) and while Broadband will account for 72% of this revenue at $800 billion, growth will slow as markets mature. But revenue from digital services is expected to see significant growth.
Indeed, new market analysis reveals how how critical the connected home market is becoming – revenue from digital services such as TV, digital media and the smart home is set to reach $735 billion by 2023*
At this critical time, Broadband World Forum provides the connectivity community with a powerful space in which to learn, network and collaborate. Taking place from 15-17 October in Amsterdam, the event is supported by leading figures from the telco industry including BT, KPN, T-Mobile, NBN Australia, VEON, Altice Portugal and Hyperoptic among others. Senior representatives from leading regulatory bodies such as Ofcom, Anacom and BEREC will take to the stage alongside enterprise heavyweights such as BBC, Disney and Uber.
And, this year, this year BBWF will host a dedicated connected home track which will feature discussions with key operators such as BT, Liberty Global and Comcast, as well as innovative vendors and start-ups. Preceded by a Day 1 workshop on the same topic hosted by revered industry group, Broadband Forum and with keynotes from automotive leaders Renault and Uber, the importance of the connected home and connected industries for telco innovation is right at the heart of BBWF this year.
Julie Kunstler, Principal Analyst at Ovum, specialising in wireline/fixed broadband access, said: “While bandwidth demand is not slowing down among consumers, businesses, and cities, operators are adopting innovative strategies to become the winners in end-to-end applications and services. “Beyond the pipe” is permeating smart home, smart business, and smart city strategies. BBWF is the key conference and exhibition for learning about innovative operators and the ecosystem supporting this major transformation.” Julie will be chairing the keynotes at BBWF on 16th October.
Paul Palmer, Director of Business Development at F-Secure said, “Homes are becoming more reliant on their broadband connection every day, as the attacks against IoT devices grow both in number and intensity. Service providers can prepare for the future by securing the devices and appliances people rely upon most—driving increased loyalty from our customers. At BBWF, the industry’s leaders can turn vulnerabilities into opportunities.
In addition to thought leading content the event hosts a large exhibition which includes the Broadband Forum interop pavilion, two free content theatres hosting a start-up showcase and pitch off, as well as the full broadband ecosystem with key players including Nokia, Huawei, ADTRAN, Intel bringing their latest network tech and demos, as well as emerging start-ups looking to establish themselves in the industry.
BBWF attracts 4000+ attendees each year and 2019 is set to be bigger and better than ever, attracting attendees from 95 countries and every point in the broadband value chain.
Sandra Motley, President of Nokia’s Fixed Networks Business Group, said: “The Broadband World Forum is a premier event that gives operators from around the world access to the latest innovations they need for their network evolution journey. We’re excited to once again be a part of this influential event and look forward to sharing how innovations like intent-based automation can revolutionize the future of broadband access.”
*Ovum Smart Home Services Forecast Report 2018-2023
Want to be in Amsterdam with us? For free access to the exhibition hall, networking areas and 2 free content theatres, register for your visitor ticket here. For full access to the 200+ speaker line up, 4 conference tracks and keynotes, you can book a delegate pass here.
The BBC has announced it will challenge Google and Amazon in the digital assistant market, with its own version built to understand regional dialects.
Although it is still early days with many questions still to be answered, the working name for the digital assistant will be ‘Beeb’. What, we hear you say (and would you double dare to ask ‘what’ again?), but the state-funded entertainment service will attempt to prove its software engineering smarts match-up to that of Silicon Valley’s finest.
“Around one in five adults have a smart speaker in their home – and millions more have voice-activated devices in their pockets – so there is growing demand from people to access programmes and services with their voice,” a BBC spokesperson said.
“But people are concerned about how these devices use their data. Much like we did with BBC iPlayer, we want to make sure everyone can benefit from this new technology, and bring people exciting new content, programmes and services – in a trusted, easy-to-use way. This marks another step in ensuring public service values can be protected in a voice-enabled future.”
The selling point of the voice assistant is an interesting one. While those on the other side of the pond might want to monetize data collected through digital assistants, the BBC has promised an experience “free of commercial interests”. That might sound attractive to those who do not trust the internet giants with their personal data, but first and foremost, the BBC has to create an offering which is as good, if not better.
The voice user interface is becoming increasingly popular with consumers around the world, though it is another way in which the trust with the consumer can be broken. Few might consider their voice a potential risk, though with banks and other sensitive services using voice for identification and authentication, it will certainly become one (assuming it isn’t already of course).
With the BBC brand viewed by many favourably around the world, this could be an interesting element. The press statement is already laying the concept of trust on thickly, and we suspect this will be an important tool for the communications team in the future. Especially considering Silicon Valley constantly seems to be shooting itself in the face.
Another interest element is the regional dialects of the UK. While we all might sound the same to those from outside the isles, the difference in regional accents is very apparent to a Brit. In offices around the UK, BBC employees will be asked to record a couple of minutes of audio footage to help the team train the digital assistant in the variances of the UK.
The world is changing, and changing very quickly, therefore there is a risk the BBC could be left in the analogue age. Linear TV is dying, and while there might be generations who are sticking with the traditional means of entertainment, it won’t be long before the gathering around the TV is a nostalgic memory.
The BBC iPlayer has proven to be very successful, and this is another way in which the BBC is proving its relevance in the digital economy. What remains to be seen is whether ‘Beeb’ can compete against the smarts and head-start Silicon Valley has.
Canalys is forecasting China to be the biggest adopter of smart assistants by 2023, with an install base of 5.8 billion.
Though the US will claim to be the leader today, over the course of the next four years, Canalys forecasts a boom in China. The team suggests 5.8 billion devices will be installed across the country, twice as many as the total in the US.
“The growing Chinese middle class is relentlessly pursuing a higher standard of living, and smart appliances will play a major part in their vision of the ideal home,” said Canalys Research Analyst Cynthia Chen.
“Appliance makers Haier, TCL and Hisense are changing their strategies to capture the trend early. Even the retailer Suning and smartphone vendor Xiaomi are aiming to disrupt the market.”
This is perhaps where the consumer IOT and smart assistant segments will receive the greatest drive for momentum; adoption from traditional consumer electronics and appliance manufacturers. Companies like Google and Amazon can push new technologies to a degree, but consumer trust will be earned when traditional and credible brands in the consumer product space start integrating ‘intelligence’.
The idea of a smart assistant has almost been normalised, though usage is still incredibly limited. As consumers, we have not given up on the touch user interface, though as more assistants appear on air conditioning units, door locks and refrigerators, the more normalised the idea will become. And it seems the Chinese will be high up on the adoption list.
Canalys estimate each Chinese household will own an average of seven smart assistant-compatible home devices by 2023, with the large appliance category proving to be the biggest contributor to growth. However, smart phones will of course be the main device category for smart assistants in 2023.
“Chinese smartphone vendors, such as Huawei, Oppo and Vivo, are shifting their strategies to create IoT ecosystems with smart assistants, especially targeting homes with smart speakers and smart assistant-compatible devices,” said Canalys Senior Analyst Jason Low. “Having such devices work together seamlessly, especially across brands and platforms, to create new intuitive use-cases remains an industry-wide challenge for vendors around the world.”