Q&A with Elisabetta Romano, CTO at TIM

Elisabetta Romano is Chief Technology and Innovation Officer for TIM and is responsible for ensuring TIM’s technological innovation, the evolution of the networks, and for the Information Technology required to support TIM’s digitization process at Group level. The 5G World team interviewed Elisabetta ahead of the show to gain a sneak peek for what we can expect at our upcoming conference.

TIM invested 2.39 billion euros on 5G spectrum in late 2018 for expansion of mobile network. Why has TIM invested heavily on spectrum? What monetisation opportunities does TIM expect from 5G?

Spectrum is one of the key assets for telco operators.  Through such investment, TIM has secured both the best coverage – with the 700 MHz bandwidth – and the highest speeds through higher bandwidths such as the 3.6 GHz and the 28 GHz, necessary to provide specific services. Business and consumer use cases are increasing every day: constantly growing mobile traffic, increasing demand of dedicated networks for industry automation, and we are seeing the first requirements for guided vehicles both in private spaces or in smart cities.

‘TIM has done a lot of tests on SMART cities, industry 4.0, entertainment, public safety etc sectors’

What new (5G) enterprise services should we expect TIM to bring to market, and why?

Since the beginning of the trials, we have had more than 70 partners in Turin, San Marino, Bari and Matera, including private big and small enterprises, P.A., universities and research centres. I believe that the industrial sector will have the greatest demand first. IoT services, particularly security and video surveillance, will also benefit from the upcoming development of 5G.

What do you expect the consumer pick up of 5G products and services will be? What services should TIM consumers expect?

Of course, ultra-broadband Internet access will be one of the key services.  As we know, video is one of the main traffic drivers, video services like our TIMVISION are growing, also sports events are growing in terms of consumption via the Internet, particularly when on the move.  This said, the availability of new devices and particularly of 5G smartphones is crucial for the consumer segment.

What are the main (market, technology, business, regulatory or other) challenges in achieving 5G rollout and what needs to be done to further unlock innovation in the telecoms industry (globally, in Europe or Italy)?

5G is a ground-breaking technology, which will need several factors being coordinated in order to have a quick deployment. The regulatory framework in Italy is challenging, for example, because of very low EMC limits in comparison to other European countries. Also, the financial commitment is demanding, first to acquire the spectrum, then to roll out the technology, which means that the operators will need to find innovative approaches to infrastructure development.  Then there are the new devices that need to be tested.  Last but not least, 5G demands a new approach in developing the network function and core network: cloud-native microservice based architecture with strong API exposure to enable a rich ecosystem of developers and business partners, is by itself a challenging effort.

You will be delivering a Keynote speech at the 5G World (11-13 June 2019, Excel, London). Could you give us a sneak peek of what our audience should expect to hear from you and what are you looking forward to at the Forum?

I don’t want to reveal too much. I can tell you I will describe our trial experience and how we are working to make 5G real a business development platform, with a new cloud-native architecture that leverages AI and extensive API for both internal to the company and external, open ecosystem development.

It’s your chance to hear from Elisabetta Romano directly at 5G World 2019 which is taking place on 11-13 June, at the ExCeL in London. Register now as a free visitor to join us at the largest 5G show featuring 30+ hours of free content delivered by CxO telco executives like Elisabetta

Silicon Valley doesn’t know where to look in the 2020 Presidential race

Traditionally Silicon Valley has supported Democrat Presidential candidates but, with the resident internet giants increasingly becoming a political punching bag, this might change very quickly.

More specifically, Silicon Valley tends to lean towards ‘progressive’ Democrats. Many of those who would want to be included in this list have been running events in California recently to woo voters and potential donors alike, but these are candidates which have not been friendly to the internet giants in recent months.

Some of those who would call themselves ‘progressive’ Democrats include California Senator Kamala Harris, Massachusetts Senator Elizabeth Warren and New Jersey Senator Corey Booker, all of which have made moves against the technology giants for varying reasons. Harris and Booker have sponsored or supported bills which would place greater scrutiny on acquisitions, while Warren made the outlandish promise to break-up big tech and reverse certain acquisitions.

While Warren’s promise might end up meaning very little, we suspect there is too much of a focus on popularity instead of practicality, she has been the focal point of some criticism. Texas Representative Beto O’Rourke, another confirmed candidate, poked fun at Warren’s approach instead suggesting the digital economy should be more tightly regulated, avoiding the difficulties of breaking up incredibly complex, private organizations.

The prospect of new regulations is certainly a better option for the internet giants than Warren’s alternative, however O’Rourke is a bit of a difficult horse to back right now. Looking at O’Rourke’s website, it offers little (in fact, zero) insight into potential policies, but if you want to buy a t-shirt this is the place to go.

Of course, regulatory reform is top of the agenda for many of the potential candidates, and the technology industry is a hot topic here as well. Let’s start with the positives.

The majority of the candidates on show were supporters of net neutrality, battling against FCC Chairman Ajit Pai’s mission to undo the protections. Of the potential candidates, Washington Governor Jay Inslee might steal the crown here.

California might have grabbed the headlines for introducing localised net neutrality rules, potentially paving the path for a constitutional crisis, however it was Inslee who was the first to put pen to paper. Washington’s localised net neutrality rules were introduced in March 2018, six months ahead of California.

More positive news focuses on the Lifeline Program, an initiative which helps poorer families access broadband options. This is another area which felt the fury of Pai’s administration, though several of the candidates opposed the cutting of funds. Warren, Vermont Senator Bernie Sanders and New York Senator Kirsten Gillibrand are three candidates which would support the Lifeline Program.

Former Maryland Congressman John Delaney is another who would want to shake the infrastructure game up. Sticking with the rural digital divide, Delaney is proposing the formation of an Infrastructure Bank, with funds of $50 billion, to help close the virtual chasm. This might sound attractive, but Delaney shares the same anti-China rhetoric as President Donald Trump. And that has been working out really well.

Should one of these individuals win the keys to the White House, the FCC could be in-line for yet another shake-up.

Now onto the negative side of regulatory reform. The privacy and data-handling activities of the internet giants have come under a lot of scrutiny and criticism over the last few months. This is unlucky to change, and perhaps will become a lot more aggressive as politicians search for PR points. This is a popularity contest after all.

Almost every candidate is calling for more regulatory reform, pulling down the curtain which hides the data machine fuelling the sharing economy. No-one who is involved in the data sharing economy, internet giants and telcos alike, want too many of these practises exposed as it would lead to public backlash. The industry has allowed the education of the general public to fall too far behind technological developments; any bold revelations will be scary.

Two candidates are setting themselves out from the pack with bold regulatory change, Minnesota Senator Amy Klobuchar and tech entrepreneur Andrew Yang.

Klobuchar’s idea is to introduce a digital dividend on participants of the sharing economy. A levy would be placed on any company which transfers personal data to a third-party, penalising those who monetize data. Those who collect data and use it internally, current or new product development for example, would not be included in the tax.

Yang on the other hand is perhaps proposing the most revolutionary idea; Universal Basic Income (UBI). Effectively, every person over the age of 18 in the US would be entitled to apply to receive $1,000 per month. Yang claims one in three jobs is under risk from automation and AI, therefore the money will help people compensate for this.

The UBI would be funded by consolidating all welfare payments for efficiencies, a new value added tax (VAT), new revenues through increased consumer disposable income and improvements to other areas such as healthcare. However, we suspect this would not cover the outgoings, so it would not be unfair to assume a tax would be placed on those companies benefiting from automation.

Another development mid-way through last year was an attack on the state sales tax regime which the eCommerce giants have enjoyed for so long. These rules would effectively end tax avoidance benefits so many national players have enjoyed by locating head quarters in states like Delaware. Gillibrand, Sanders, Warren and Klobuchar were Senators to voted in favour of the state led digital sales tax.

What is worth noting is policies are still in their early days, and the genuine lobbying from industry will not have started yet. Who knows what the headline policies will be in the run-up to the 2020 Presidential Election, but the Democrats aren’t looking as Silicon Valley friendly as previous years.

Silicon Valley’s grip on innovation is loosening – KPMG

Silicon Valley is up there with Wall Street as a driver of US economic dominance, but this leadership position is increasingly coming under threat, including from those pesky Europeans.

As it stands, California still maintains that position as Utopia for technology enthusiasts and innovators. There are numerous reasons for this, ranging from culture to cash and climate, but this lofty position is no-longer looking as attractive as alternative cities woo the next generation of economic disruptors.

KPMG is one company which is predicting the downfall of Silicon Valley. After conducting a survey, the consultancy claims 58% of respondents believe the global centre of innovation will have moved out of Silicon Valley over the next four years. Other US cities are of course lodging a challenge, New York, Austin and Boston for example, though Europe and Asia are also having a poke.

Looking at the top ten alternatives which could lead a challenge, New York ranks first, while Beijing, Tokyo, London and Shanghai feature in the top five. Taipei, Singapore, Seoul, Boston and Austin complete the top ten, but there are several other European competitors floating around.

There are numerous factors which KPMG has taken into account, and some of these will start to play heavy on the Silicon Valley case. With 5G being hyped so considerably over the last few years, most of these cities will be on-par when it comes to infrastructure, but you also have to consider the local talent pool, immigration laws, cost of living, availability of private and public investment, mass transit systems and the attractiveness of a city to millennials.

A separate Medium post from investment manager Byrne Hobart is another which is predicting the downfall of Silicon Valley as the global centre of innovation. Hobart questions whether the culture of innovation is dying out in the region, with the money men seeking more stable and predictable investments, but another interesting point is the ‘cost of existing’ as he puts it.

“As long as higher rents raise the cost of starting a pre-revenue company, fewer people will join them, so more people will join established companies, where they’ll earn market salaries and continue to push up rents,” said Hobart.

Not only does the high cost of living prevent talent from joining start-ups, the preference for established companies and the lucrative salaries further pushes up rent, compounding the problem further. This also prevents lower-income earners in other segments living in the region (arts, fashion or media for example), restricting diversification and making it a less attractive region for liberally minded individuals, the type of person the success of Silicon Valley was built on.

When researching the availability of technology jobs across the US, there are of course numerous regions which are growing faster year-on-year than Silicon Valley, though this would be expected considering the overwhelming focus of tech in the Valley. However, cities like Seattle, Austin, Denver and Huntsville are increasingly home to more technology companies, and when you factor in the more proportionate cost of living, it might be an appealing alternative.

Another very interesting development over the last couple of weeks takes place in France. The French government has recently announced an overhaul of visas for employees working for a tech company, making it easier for talent to be recruited internationally. Considering the anti-globalisation and isolationist trends we are seeing in the US, this is development worth taking note of.

There are now 10,000 start-ups that meet the requirements to access the French Tech Visa and hire foreign employees more easily. These visas cost €368 in administrative fees, is valid for four years (and is renewable) and allows employees to switch jobs during this period. The visa also extends to family members. Just as the US is making it more difficult to hire talent, the French government is attempting to empower start-ups to go an seek the best innovators around and attract them to the country.

As far as a challenge to the Silicon Valley dominance, Europe is putting itself in a very strong position. Not only are many of the cities affordable, they are attractive to millennials (culture, arts, history) a key demographic for technology success moving forward. The European Union also creates a wider society and economy, helping organizations grow in multiple markets and source talent from a wider pool.

Another factor to consider is the focus of these regions. Another KPMG research note suggests US companies are looking towards AI as a market disruptor, while IOT is attracting the interest of European companies. Perhaps this suggests a split in the innovation pool, with AI hubs being focused in North America, while IOT dominance could be wrestled across the pond to Europe. R&D is driven by customer needs and demands, therefore this is not an impossible conclusion. Interestingly enough, Japanese companies are leading the demand for robotics, another potential fragmentation of the innovation pool.

Silicon Valley is not going to disappear, but its dominant position is not only being eroded domestically, but internationally. The technology ecosystem is of course going to evolve over the next few years, but who knows where the global hub of innovation will be; there are a lot of candidates putting their hands up.

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.

Europe is missing the tech trick

Technology is constantly being billed as the saviour of sluggish economies, but as the industry continues to grow Europe appears to be struggling to evolve.

The claim comes in the form of Atomico’s latest report, The State of European Tech. The venture capitalist firm has been producing the report for a number of years now, though with the 5G bonanza creeping closer and closer, the importance of this edition is perhaps compounded. Companies and governments need to have a technology-first mentality to realise the potential, though it appears Europe is slow off the mark.

The research itself is very in-depth, and we would encourage those with a bit of spare time to have a proper investigation, as we are only going to focus on a couple of key data points. The two images below set the scene for us quite effectively:

Graph One

Graph Two

As you can see, growth in the technology industry is outpacing traditional industries, though economies on the whole around Europe are still heavily dependent on more traditional segments. This might not necessarily be the worst landscape, though as you can see from the image below, the reliance is being placed on the industries which are slumping at best, and declining at worst. Unfortunately, the telcos are some of the worst hit, owing to the disruption poured all over the industry by the OTTs in recent years.

Graph Three

There will of course be numerous reasons for the failure to capitalise on the opportunities which are being laid out in front of us, the skills gap is one, digital divide another and perhaps government policy should shoulder some of the blame, though the situation isn’t as bad as some would think. There are shoots of potential emerging across the continent.

Starting on the investment side, Atomico points to the depth of investments being made across the continent in technology businesses. So far in 2018, $23 billion has been invested in Europe’s technology ecosystem, a $5 billion boost compared to 2013.

Looking at the workforce, Atomico claims there are now 5.7 million professional developers in Europe, up by 200,000 on 2017. What might surprise some is this number easily surpasses the 4.4m in the US, a number that stayed flat year on year. With the US the historical leader of the technology world, but facing a challenge from China, the workforce is certainly there for Europe to make a dent in this increasingly profitable bonanza.

Both of these facts will perhaps create more opportunity than is evident on the surface. Being heavily reliant on traditional industries is not a perfect position, though should there be an ambitious attitude the burgeoning technology world can of course enhance these businesses. This does depend on what most would consider risk-adverse managers, business leaders and policy makers spreading their wings, but the potential for disruption, evolution and growth is certainly there.

Democrats eye up Bill of Rights for the Internet

With Silicon Valley seemingly not doing enough to empower the consumer in the digital era, Congressman Ro Khanna is working on new proposals to more tightly regulate the technology industry.

Congressman Khanna, the Democratic representative of California is suggest a new Bill of Rights for the Internet, which would provide more rights for the consumer in controlling how personal information is collected, transferred and utilised. The aim here is simple; pull the balance of power over to the side of the consumer.

While this does sound like a logical idea, the technology industry has largely slipped through the legislative grey areas for years, before such proposals could even be considered the Democrats would have to win the November mid-term elections.

The idea for the Bill would focus on the following principles. Individuals should have the right:

  1. To have access to and knowledge of all collection and uses of personal data by companies;
  2. To opt-in consent to the collection of personal data by any party and to the sharing of personal data with a third party;
  3. Where context appropriate and with a fair process, to obtain, correct or delete personal data controlled by any company and to have those requests honoured by third parties;
  4. To have personal data secured and to be notified in a timely manner when a security breach or unauthorized access of personal data is discovered;
  5. To move all personal data from one network to the next;
  6. To access and use the internet without internet service providers blocking, throttling, engaging in paid prioritization or otherwise unfairly favouring content, applications, services or devices;
  7. To internet service without the collection of data that is unnecessary for providing the requested service absent opt-in consent;
  8. To have access to multiple viable, affordable internet platforms, services and providers with clear and transparent pricing;
  9. Not to be unfairly discriminated against or exploited based on your personal data; and
  10. To have an entity that collects your personal data have reasonable business practices and accountability to protect your privacy.

Of course, many of these principles are ideas which should have been implemented before the internet ball got rolling. Now it is travelling at such a speed it might be difficult. Another factor to consider is the power of the internet giants. These are massive organizations, with heavy-hitting financial punches and an influential lobby. They won’t like the idea of such principles being written into law, so expect some notable resistance.

But first, to even consider such proposals, the Democrats would have to win the mid-term elections. All 435 seats in the House of Representatives are up for election, though 147 and 182 seats are considered safe for the Republicans and Democrats respectively. A further 51 will probably be won by the Republicans and 10 by the Democrats. The interesting battles are the ones which could go either way; 42 of these are currently held by the Republicans and 3 by the Democrats. A majority here has been set as a target, though to pass any new legislation, the Democrats would also have to win the Senate over.

In the Senate, 35 out of the 100 seats are being contested. Three of the contested seats are considered safe for the Republicans and 14 for the Democrats. 2 will probably be held by the Republicans and 8 probably held by the Democrats. 8 seats, four of which are held by either party, could go either way. Here it still looks like the Republicans will maintain control, dampening the potential for any new technology regulations.

The internet giants should have more regulations dictating the field of play, though with the current political landscape it does look like that will be difficult. Even if the Democrats win in the House, a scenario which some believe to be realistic, a Republican Senate will mean gridlock for future legislation.

We’re blindly walking the path to digital monopolization – think tank

British think tank ResPublica has claimed current competition law is not fit for purpose, and runs the risk of companies such as Google and Facebook creating digital monopolies and ultimately a losing position for the consumer.

In its latest report on the industry, ‘Technopoly and what to do about it: Reform, Redress and Regulation’, the think tank argues competition law needs to stop privileging big business and focus on the benefits of small businesses and market structure. The team is pointing towards the ‘kill in the crib’ emerging trends, with the super-powers of tomorrow acquiring any business which is deemed a potential threat in the long-run. Of course this is standard business practise, but without a more stringent view on what should and shouldn’t be allowed, acquisitions could lead to the death of competition.

“Digitalisation and the new world of Big Data are already conferring vast benefits… Not such good news are the new threats that digitisation poses to competition and the weakened capacity of insurgents to be lode-bearers of the new,” the think tank warned. “Investment in patents, copyrights and computerised systems has become a new form of intellectual capitalism.

“The company that gains first mover advantage (with the creation of the fastest growing network of digital users) is the company on the way to establishing a monopoly position, which can be further entrenched – as monopolies have always been – by buttressing that position through making its services as distinctive and non-reproducible as possible. If unconstrained by competitive alternatives, there is a danger that these companies can eliminate all potential competition through acquisition strategies.”

This is of course not a new argument, but we are starting to see the negative benefits of such dominance. Revenues are only widening, meaning the predatory nature of the major players will continue to increase as well as the vast amount of cash being thrown into R&D departments. We don’t think the argument of ‘they’ll be more innovative because they have more money’ offers much credibility, Facebook and Google are entitled to spend the billions however they please, but such a strangle hold on the consumer means more than reduced competition; it means less variety.

Such a dominance over revenues will mean a less stable business for the traditional media players, some of which are already facing the threat of extinction. The social media giants have already stated they do not wish to have editorial control over the news content on the platforms, though they will continue to fight fake news, threatening the ability for the general public to remain informed.

“The ‘Fantastic Four’ (Google, Facebook, Amazon and Apple) are now widely recognised to be dominating the technology sector and controlling the media,” the report states. “They have wrapped the planet with their platforms and inhabit all, or almost all offices, schools and homes. Their impact on communication is pervasive and the consequences for freedom of expression and press freedom is only now becoming clear.”

The main threat for ResPublica seems to be the suitability of current legislation. This is of course not the first time the readiness of the red-tape maze has been questioned, but it certainly is worth continuing to ask the question until it is answered. There does seem to be a lot of busywork taking place, but few governments or bureaucratic bodies seem capable of tackling the internet giants in the complicated, and often unruly, digital landscape.

“This is an exciting time in the sector, as companies seek to exploit the potential of AI, which could double economic growth rates in industrialised countries like ours – But the dominance of the current behemoths puts this at risk,” the report states.

“By tolerating anti-competitive strategies, failure to penalise bad behaviour and make law breakers pay, we are damaging innovation. This is why we propose a pan European approach to dealing with the sector, support for small and medium size enterprises to gain market entry and the use of the states’ purchasing power to ensure greater choice and diversity.”

Nokia’s new Technology Committee – good idea, poor execution

With the dust settled following Nokia’s Annual General Meeting now is the time to look at whether any of the changes will have a meaningful impact on the business.

Nine of the board members have been re-elected, each receiving a handsome payment of at least €160,000, and one new member has been introduced, the former Head of Nokia Networks Sari Baldauf. A dividend payment of €0.19 per share for the 2017 financial year has been set, and all the committees reporting into the board have been settled. Interestingly enough, the business has also decided to introduce a new one, the Technology Committee, but is it worth paying attention to?

The committee currently features six members, Bruce Brown, Jeanette Horan, Louis Hughes, Edward Kozel, Olivier Piou and Risto Siilasmaa, with Kozel acting at the Chair, and a mission statement to review Nokia’s innovation and technology strategies. The committee will meet at least twice a year, with the agenda being defined by the Chair in conjunction with the Nokia management team. The four objectives of the team will be as follows:

  • Provide opinion and advice on Nokia’s approach to major technology innovations
  • Assess trends which may result in disruption or opportunity
  • Evaluate risk and opportunity in the Nokia R&D programme
  • Judge Nokia’s technological competitiveness

When we first saw the news about the committee we liked the idea, but now we are not too sure. The theory is sound, but the execution seems to be poor.

On the surface the concept of an independent technology committee evaluating strategic and R&D decisions is a nice idea. When evaluating your own work, there is a tendency to be biased; a fresh eyes and minds to provide feedback is a sound theory, and could provide alternative thoughts to improve the foundation and direction of strategies. It takes a very mature person to open themselves up to critique from outside influences, but ultimately it can prove to be an excellent way to do business. Unfortunately, Nokia doesn’t seem to have done this.

The current committee is made up of individuals who were already working with Nokia in one form or another, being full-board members or contributors to another committee. This is a fresh perspective on the definition of ‘independent’, as most of these individuals would have already contributed to the Nokia strategy, directly or indirectly, in one form or another.

Brown has been a board member since 2012, Horan since 2017, Hughes since 2016, Kozel since 2017, Piou since 2017, while Siilasmaa is the current Chair of the Board of Directors having served since 2008. Nokia is essentially asking for validation on strategic thinking from its own cogs. Rubber stamping its own work offers questionable benefits.

Secondly, when you look at the individuals who are on the board, you also have to question whether this is the most innovative thinkers available to the business. There is no doubt these individuals are incredibly intelligent and astute businessmen and women, however looking at the CVs raises some questions. Brown is the former CTO of Procter & Gamble Company, Horan was a MD at IBM prior to the positive turnaround, Hughes’ experience was at Lockheed Martin and GM, Siilasmaa was CEO at F-Secure until 2006 before hitting the Board of Director circuit. These will all be very accomplished individuals, but whether this is the right experience to dig Nokia out of its slump and make it competitive again is another question.

Bringing Kozel and Piou onto the committee look like good moves however. Piou was CEO of Gemalto until 2016, while Kozel held various management team positions in the likes of Range Networks, Open Range and Deutsche Telekom over the years. This is the sort of experience which might provide alternative thinking to the Nokia norm, creating more creative and assertive decisions.

Nokia had an opportunity to do something very interesting with the technology committee, but after digging a little deeper it looks like little more than window dressing. We wouldn’t expect anything too revolutionary to come out of this apparent PR exercise.

Trump finishes posturing and squares up to China

President Donald Trump has often proved consistent with campaign promises, and kicking off a trade-war with China is just another example of his reliability.

The Mexican wall is still in the works, a bill to ease gun-carrying rights in schools passed House in December and federal regulations are disappearing faster than a toupee in a hurricane. Protecting the US people from the evil foreigners and their dastardly business ambitions was another which is now moving from dream to reality. Steel and aluminium tariffs are close and now Chinese technology is firmly on the radar.

Yesterday saw the signing of a Memorandum which the spin doctors in the White House say targets China’s economic aggression. 1300 products and services have been reviewed over the last couple of weeks, though the list has not been published yet. Ambassador Robert Lighthizer has been tasked with releasing this list within the next 15 days, though it is suspected there will be a heavy Chinese technology influence to it.

“This has been long in the making,” said President Trump during the signing ceremony. “You’ve heard many, many speeches by me and talks by me, and interviews where I talk about unfair trade practices.

“But we have one particular problem.  And I view them as a friend; I have tremendous respect for President Xi.  We have a great relationship.  They’re helping us a lot in North Korea.  And that’s China [the problem].”

The US has a trade deficit which Trump wants to address, and part of reversing this trend is to put Silicon Valley back on its mantle. While Silicon Valley still is viewed as the place to be worldwide for technology firms, this strangle-hold on the industry has been waning in recent years. Eastern Europe, India and China are just three of the regions across the world which has been making waves in technology, but part of the reason for China’s rise could be deemed as an uneven playing field.

China’s economy is generally protected by the government, as table stakes and working conditions do generally favour domestic companies over international businesses. This does seem to be the playbook when it comes to making an impact on the international scene; generate a ridiculous cash cow in the domestic market before taking advantage of advantageous trading conditions on the global stage. It’s the best of both worlds; just ask Huawei.

Few countries have taken a stance against this apparent advantage Chinese companies have on the global stage, mainly because of the riches which are on offer should you be able to break into China. It is one of the largest and fastest growing economies in the world, the world’s largest manufacturing economy and exporter of goods and second-largest importer of goods. In terms of digital transformation, many of these businesses are behind the curve compared to Westernised economies, and the increasingly affluent and digital aware consumers are prime for profit.

This is where Trump has to be very careful. Yes, standing up to China fulfils one of his campaign promises and inspires US citizens to be the self-appointed defenders of the free world once again, but is this the most pragmatic approach to encourage growth in the US technology sector? We’re not too sure.

When you look at companies like IBM, Google, Amazon, eBay, Intel, Apple, Microsoft and HP, these are not organizations which are going to make the desired profits without looking to the growth economies of the world. These companies, the internet giants to a lesser degree, are looking to economies like China to replace the lingering growth which was previously in the US. Putting walls up around countries will not work out well for the US tech sector; growth and profitability is in the international markets not the US domestic market.

Another interesting consequence of such a trade-war is not just the selling side, but manufacturing as well. It would be perfectly reasonable to assume that as well as blocking trade from the US, the Chinese government would be just as difficult in terms of manufacturing goods in the country as well. This would be bad news for Apple.

On the surface, Apple being unable to manufacture its products in China would be a win for Trump, as it might possibly force jobs back in the US, but it could have a very detrimental impact on Apple as a business. This is a very interesting article which explains the disaster it would be.

In short, for Apple to maintain current profitability levels with the manufacturing process taking place in the US, each unit would have to be sold in the $30,000 – $100,000 range. This is down to capacity. The US does not have the skills to meet market demand, Tooling engineering is an example, meaning supply would be reduced from hundreds of millions to millions. The US would of course be able to generate this workforce, but this would take years. This would put Apple is a very difficult situation.

Tariffs sound fantastic to Trump supporters, some of whom are becoming increasing afraid of the term ‘globalization’, and they do keep the President honest to campaign promises, but it doesn’t seem to be a very pragmatic move. It seems to be a short-term gain for a long-term catastrophe.

Now your correspondent does not claim to be a genius and would assume the people advising the President are more intelligent; surely these scenarios have been examined. Perhaps President Trump doesn’t care about the long-term of the US economy. Logically, we are not too sure how this benefits the US tech sector. The global economy is a thing and there is no going back. Success in a digital world which does not recognise international borders will only come with cooperation. Anyone who thinks trade barriers are going to be a good thing are quite frankly deluded.

Need for transparency is the ultimate sign of lost trust

Davos has kicked off this week in Switzerland and with come a lot of blue-sky thinking ideas, but one hit home for us; transparency is a terrible sign for the industry.

The comment came from Alphabet’s CEO Ruth Porter. “You’ve given up on trust if you need transparency,” and it is a very fair point which should be taken seriously. If you have trust, you don’t ask the wizard if you can peek behind the curtain. As soon as you do, you don’t trust the machine and banner wavers all over the country are calling for transparency. This is the position we are in right now, and it will only get worse.

The organizations who are the subject of the transparency demands are the ones who have built up an army of enemies. Uber is a prime example, having mobilized the entire taxi industry against it. Over the last couple of months we’ve seen numerous example of nefarious business practises and questionable personal behaviour. The trust was lost in Uber, the curtain pulled back and a tsunami of headaches hurled its direction.

Porter was the one pointing out the problem, but perhaps she will be facing some uncomfortable questions in the near future.

One of the big problems we see with the industry right now is education. In years gone, companies who were bringing new products to the market used to take the time to explain what these machines did and what the value was to the life of the consumer. Of course, not all of the details were released but there was an effort to comfort the consumer on why the world was changing. Change scares people after all, and this is why reactions to the evolving environment are so passionate.

Technology companies seem to have forgotten how important it is to take the consumer on a journey. There are of course adverts everywhere demonstrating how the technology can contribute the betterment of mankind, but generally what people don’t understand, they don’t trust. Simply showing the benefits doesn’t work, you have to build the entire picture, not just the glossy finish.

This is the challenge the big internet giants are facing right now. Alphabet/Google, Facebook, Amazon, Netflix, eBay, Microsoft or anyone you can think of. They are all falling into the same trap of trying to wow the consumer not educate them. Artificial intelligence is a prime example of this.

AI is an area of the technology industry which has the power to do great things, but it does also need the permission of the general public to capture, manipulate and pass on personal information in ways which might have been considered an invasion of privacy a decade ago. The information age is all about democratising you. Your personal information is everywhere and everyone knows everything and anything about you. Gradually we have come to accept this is a part of the digital economy, but the sorcery behind the curtain could scare a lot of people.

The internet giants are drip-feeding new AI features into products, so slowly and carefully we don’t realise experience and performance is getting incrementally better. Why not take credit you say? Because we don’t ask questions when we don’t realise what’s going on. And when we don’t ask questions, there is no need for answers. Don’t forget, AI isn’t just about improving our experience, it is about finding new ways to enhance advertising numbers and find new revenue sources.

This is where the internet giants are a bit more clever than Uber. Uber launched this new app on the world and it was revolutionary for the taxi industry. Such a significant change was a wonder for the consumer, but it also led to questions as to how it was possible. Uber has cemented its position in the economy, it isn’t going anywhere and will continue to grow, but you could argue the problems it is facing today were brought on by making such a profound change to the world. Like employees suffering with a Thursday morning hangover, Uber really only has one place to lay the blame.

The internet giants are gradually introducing more AI features into the world without explaining to the consumer fully. They are careful never to push technological advancements too far, as this would scare some, and scared people ask questions. Drip feeding new technology into the world is a sensible way to normalise a technology, but it needs to go hand-in-hand with education. If it doesn’t, the wonders hidden behind the curtain will start to stack up.

Before too long, there will be questions. One of the internet giants will do something wrong, or overreach and an investigation will be launched. The curtain will be drawn, and if the drip-feeding without explanation goes on for too long, the sheer volume of information which pours through the curtain will terrify people.

The average person on the street does not understand artificial intelligence, you could argue the vast majority do not, but it is ignorant Joe Bloggs who is filling the coffers of the internet giants with AI-sourced plunder.

Facebook’s Ruth Porter might point the finger at those who are having transparency demanded of them, but this is a bit hypocritical. More needs to be done to educate the world on what personal information is being stored, how it is being whored out to third-parties and what the benefit to the consumer is. Otherwise, the demons behind the curtain will start to develop very sharp teeth.