Tech and Business, Telco

Connectivity Explosion

After two decades of increasing use connectivity continues to explode for the home/office, for the individual, and now for inanimate objects. New technologies being deployed like AR/VR, AI, cloud, Blockchain and IoT only promise increased connectivity needs and requirements. 5G, Fiber, Edge Computing and softwarization present a clear path to fulfilling these exploding needs over the next decade. Prepare for a world in which everything is connected at ultra-high bandwidth, securily, automagically and with ultra low latency: it will have its advantages, but we will also have to fight Orwellian nightmares.

Connectivity continues to explode

It has been already almost two decades since the internet boom and bust. Quaint 48kbps and 56kbps modems that loaded the initial text versions of Yahoo! have been replaced by homes connected at hundreds of megabits per second (x10.000 from 1997) and smartphones routinely reaching tens of megabits (x1.000). Load times of minutes have given way to trying to reduce hundreds of milliseconds of a web page or app load. Progress has been staggering and cost has plummeted. The cost per Mbps for consumers is at least 99,98% lower in an internet connection comparing the late nineties with today.

We can expect this explosion to continue. All projections of connectivity use point towards continued exponential growth. Taking Cisco for the 2016-2021 period, it is projecting a tripling of internet data, at least a doubling of speeds, more than three connections per capita and close to two thirds of the world connected.

We can imagine this predictions being fulfilled just with streaming video and file sharing. However, customer needs will go even forward. New emerging technologies have increased needs and requirements for connectivity:

  • VR/AR represents an order of magnitude increase in content size compared with video, and it has interactivity making connectivity make or break. The amount of data that needs to be send bidirectionally for AR and VR will strain even today’s connections. And latency will need to be reduced below 100ms to avoid degraded user experience and motion sickness.
  • AI requires great quantities of data, including live video and audio feeds as well as huge datasets to be effective. Integrating AI seamlessly in customers lives also requires extremely low latency so the lag between command and response is not perceptible. Connectivity and data security becomes critical in a context in which we are continuously monitored and commands can control the real world.
  • Cloud is increasingly distributing computing and storage, requiring connectivity to tie it back together in a way in which the distributed nature of the system is invisible to both human and machines. Connectivity needs and requirements (i.e. latency, security) to make apparently simple tasks, like editing a document remotely, work seamlessly are still significantly greater than what we have today.
  • Blockchain’s key problem at this point is scalability, and scalability has to do with network performance. A blockchain is a distributed system and as such requires the network to make it work effectively. To run our most critical trust infrastructure on the blockchain would require extreme bandwidths together with low latency and first rate security.
  • Finally, IoT, the connection of all things to the internet, is itself a tremendous connectivity challenge. Not so much in terms of bandwidth, but in terms of latency, power consumption, architectures that allow millions of connected things, and the security to protect us from cybercriminals.

Overall, the connectivity explosion for the next decade will not only mean much greater speeds and capacities, but will also provide lower latency, lower power consumption, greater security, and greater scalability in number of connections.

Telco technology is ready for the challenge

Given this extreme wave of connectivity needs coming, is telco technology ready to cope with them? The answer is a clear yes. The industry has pulled together to create technologies and standards with significant runway in terms of performance and flexibility to meet the challenge.

Fiber will underpin all connectivity. While it hasn’t been widely appreciated yet, fiber deployments taking place across the world are equivalent to the paved roads that allowed our automobile-based economy. We are moving from copper, equivalent to earth roads, to fiber, equivalent to paved roads, and we are doing it quickly and efficiently. Some countries like Japan, Korea or Spain are almost finished in their transition. Fiber infrastructure has the potential to take us very far, with GPON technology already capable of several orders of magnitude of improvement of our average speeds with negligible latency and much lower power consumption and line faults.

5G is built on fiber and softwarization. 5G is the latest industry buzzword and it represents the next standard for mobile communications. This standard is already built with fiber and softwarization in mind. Beyond gigabit speeds we can expect 5G to deliver millisecond latency, much greater flexibility in network architecture, and another level of security through network slicing. While speed and latency in 5G will be evolutionary with 4G, 4,5G and 4,9G, its architectural flexibility and the security provided by network slicing provide a paradigm jump similar to fiber.

Edge computing will optimize latency, bandwidth and data security. Increasing bandwidth, reducing latency and improving security and privacy in the last mile access with fiber and 5G won’t be enough for many applications. The datacenter needs to be closer to the customer, both for performance and data security. Fiber, softwarization and improved datacenter technology is making it possible to deploy “mini-datacenters” in telecom infrastructure or even at the customer’s home or office to make this real.

Softwarization will make the network liquid. Finally, the telco network is being digitized, with specialized hardware losing importance to edge computing and network software. Once the network is softwarized it becomes much more flexible, as happens in all transition from atoms to bits. This is the silent transformation that makes all the other technologies so powerful.

In summary, technology is ready. The only risk some countries might face is making the deployments economically unfeasible through regulation. A natural monopoly like telecommunications needs and benefits from regulation. However, some regulators, especially in the EU, have shortsightedly prioritized short term consumer price reduction (making the 99,98% cost per Mbps reduction a 99,985% reduction) vs. industrial policy for innovation and creation of the infrastructure for the long term economic growth and leadership. The EU hasn’t created any of the Big Techs, has almost managed to destroy its technological lead in mobile with Nokia overthrown in handsets, and the equipment providers are under siege from China and Korea’s much more long term focused industrial policy.

How will the next wave of connectivity change your life and your business?

Picture a world in which connectivity is so ubiquitous, powerful and secure that it can basically transfer all information (including live 360 video) instantly. Private secure connections can be created and decommissioned in milliseconds, completely through software. Processing and storage capacity in the edge allows to perform most computation and storage really close to where the information is being generated, without having to surrender ownership of the data.

A physical store might have even greater data granularity than ecommerce, understanding and analyzing continuous video feeds without compromising user privacy. A doctor might be able to experience a patient fully even if she is hundreds of kilometers away and call on a specialist for support if needed, without sensitive health data being in danger. A teacher might be able to take students into an immersive trip into whatever is being studied, with students attending physically or virtually and having real-time personalization adequate to their level of understanding. This is only some of what we can imagine now, but as the internet and the smartphone revolutions showed our current imagination is a poor guide to what could happen.

Of course, there are also dystopian scenarios already being deployed and many others that can be imagined. China’s social credit system with complete monitoring and censorship of citizen’s actions in the digital and physical world will only be further empowered through the new wave of connectivity. This kind of 1984-like monitoring is in conflict with western values like privacy and freedom. And we shouldn’t only fear state actors, the last months have put companies like Facebook or Google on the spotlight for similar reasons.

So prepare to take advantage of the instant ubiquitous connectivity, but also prepare to fight against whatever intrusions it starts to allow on our hard won rights. As Bill Gates famously said: “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.”

Blockchain, Tech and Business

Exponential Technological Revolution #4: Digital Governance

blockchain techjuice
IMG: Techjuice

This post is part of the 6 paradigms shifts beyond digital series.

 

(En Español aquí)

With Digital Governance we move into 4 to 6, paradigm shifts that will impact our values and sense of meaning. Digital Governance means making trust digital. It substitutes human based adjudication and decision making, with a digital decision and adjudication system that implements laws and contracts in code. This means substituting our shared fiction of law and property with an actual implementation that will enforce it directly.

Some of the most wildly successful creations of the human mind have been surprisingly ethereal. Laws (Hammurabi Code 1754 BC), money (Lydian Lion 600BC), contracts (first stock company 1602AD). They are “shared fictions” that give incredible cooperating power to large groups if they are believed and enforced. They are fictions because their enforcement mechanisms are not tied to the physical world, but rather dependent on the shared belief on them. If people stop following a code of laws, lose faith in a joint stock company or stop believing in a given currency its magical potency banishes. Digital governance holds the promise to turn these shared fictions into digital realities which will enforce themselves, boosting belief and ensuring compliance.

Digital Governance has its roots in Digital technology and Intelligent Processes. Beyond that, Digital Governance builds on two critical technologies that give it its power. First, cybersecurity and cryptography which are two disciplines that are at the heart of how digital governance can be achieved. We need a wholly different level of security and reliability to transfer our governance to the digital realm. Second, is Blockchain or Distributed Ledger Technology (DLT). Blockchain Technology is a new way to store data and code that, through cryptography, allows decentralized and tamper-proof storage of information and execution of instructions. There are many different implementations of Blockchain technology, Bitcoin and Ethereum are the most well known. However, the relevant thing is how Blockchain technology allows solving effectively the problem of digital collaboration and information sharing even in a totally distributed scenario without trust between participants. We can expect Digital Governance to evolve to leverage Integrated Reality heavily, as it needs to implement its decisions in the real world.

Digital governance will allow us to fully digitize and automate our money, our institutions and our laws and contracts. This means that we will enter into contracts or enact laws that are defined by specific code, against a decentralized shared registry of assets, money or other information. This contracts or laws will be automatically checked and executed without the need of human intervention, and without the possibility of favoritism, corruption or adjustment to common sense. We can expect this to change money, property and contracts and finally laws and institutions.

Money will change because digital governance will allow the issuance of “gold standard” money which is algorithmically bound to obey certain rules. Throughout history, money has been limited by the trust its creators could generate. Will the US Federal Reserve stick to the gold standard? Algorithmic trust will ensure that issuers have to execute what they commit to. Increasing trust by reducing flexibility, and widening the number of potential issuers once this trust bottleneck is handled.

Contracts and property will change because they are based on the legal system of countries. These legal systems are complex and difficult to enforce. Legal texts also allow different interpretations while “coding a contract” forces to chose a specific interpretation, even if it can have unintended consequences. So-called smart contracts will allow completely predictable contracting arrangements that are independent of legal codes in specific countries and their enforcement systems.

Institutions will be built to deal with the new trustless property, contracts, and money. Institutions can become platforms for smart contracts, money issuance, smart property registries and more, that have substantially more trustworthy and predictable outcomes. This new Digital Governance institutions will be trusted because of their code and might be independent of nation states and even private.

Finally, laws and regulations themselves can become digital. Laws and regulations are notoriously complex and only getting more so. The capability of analog institutions like legislators, legal systems, and enforcement agencies to deal with this complexity is more and more in question. Transforming the legal system to digital governance would allow instantaneous adjudication and complete clarity for all citizens and actors. At the same time, the great risk is that digital governance can have “bugs” that can be exploited with no common sense being able to rein them in. So we can expect to have a human final court of adjudication to deal with this for a long time.

Once these changes are underway, we can expect Digital Governance to fundamentally reshape a number of industries. Financial Services and Insurance will be redefined along with money, contracts, and property. Wholesalers might see their roles significantly streamlined, as trust can be extended to unknown parties. The public sector will be transformed. This might take its time as the public sector can sometimes set its own pace of change, but combined with Intelligent Processes we can expect a radical reduction in the number of government workers dedicated to information processing and compliance. Lawyers will see their jobs change, programming lawyers will come at a premium, and they might be more needed than ever but in a completely different role.

There are at least eight use cases that we are seeing today which will already reshape our world:

  • Private cryptocurrencies offer a decentralized and pre-determined store of value and interchange mechanism.
  • Public cryptocurrencies are cryptocurrencies offered by national banks choosing to issue legal tender with a blockchain infrastructure backing.
  • Initial Coin Offerings are a new token-based funding mechanism for companies and organizations
  • Smart contracts and digital corporations represent perfectly defined and self-enforceable contracts and institutions.
  • Digital registries and markets create autonomous and reliable trusted institutions, both public and private.
  • Digital ownership and access allow taking the middle-person out of marketplaces.
  • Digital Law could be the greatest legislative step forward since the Code of Hammurabi.
  • Digital Government could bring democracy to the digital age and make it competitive in terms of speed and results.
Blockchain, Tech and Business

6 technological revolutions beyond Digital

 

Iceberg
IMG Source: Barbara Avalos via Guillermo Avalos

There are 6 technological revolutions beyond Digital that will bring uncertainty and change to our world in the next two decades. These revolutions are already proven and working and are in the process of being deployed across the world.

 

In the traditional view of technological revolutions, like the one espoused by Carlota Perez in her “Technological Revolutions”, it takes 70 years for each cycle to fully deploy and the next one to come to age. If this were true we would spend the next 30-40 years deploying Digital fully. It would be a time of less uncertainty because Digital is mature and predictable already.

However, there are six technological revolutions that stand ready to cause radical change over the next couple of decades. They will bring most of the uncertainty and change as they start deployment while Digital runs its course. The change they will bring will be more fundamental than Digital, as they will touch our physical reality more deeply, even reaching our bodies and minds. These changes are also obscure for us at this point. We cannot fully imagine them, so they will be difficult to adapt to.

These six revolutions go well beyond just the next extension of digital. All of them are empowered by Digital and build on its complexity. At the same time, they bring very different disciplines to bear:  AI, biology, chemistry, display technology, sensors and actuators, cryptography and even psychology and neurology. All these disciplines transform and extend the potential of digital beyond its current capabilities.

The 6 key paradigm shifts that are coming are:

Intelligent  Processes. Digitally empowering with AI helpers all the processes in our world, both business and personal. All our actions will be empowered by virtual intelligences that will record, automate and support our decisions. Software-as-a-service enhanced by AI will be deployed to every corner of our world, eliminating most manual and repetitive tasks and giving us unforeseen wisdom in our decisions. Many processes will take care of themselves as if we had an army of helpful elves at our disposal.

Integrated reality. Fully merging and integrating the digital and the physical world. Recording completely the physical world through sensors, and enhancing its perception for humans through digitally augmented reality. Allowing for programming and action in the physical world by deploying actuators and robots that can do our bidding with the same ease that they do in the digital world today. Eroding the difference between “real reality” and “virtual reality”, as the real is enhanced through digital and the virtual can have a real counterpart.

New Energy-Transportation Matrix. Continuing the journey of more energy and transportation capability per human. Using solar power and storage to make energy practically free and nonpolluting for everyone. Leveraging autonomous transportation to reduce the real and cognitive cost of travel and transport by at least an order of magnitude.

Digital Governance. Using blockchain, integrated reality, marketplaces and AI to make laws and contracts automatic, self-enforcing and intelligent. Substituting human based adjudication and decision-making by code-based laws and enforcement. Reducing the cost and time of the legal system to a fraction and eliminating non-compliance. Substituting fiat money for cryptography-enabled intelligent mediums of exchange. Making corruption impossible, but our governments and companies hackable.

Bioprogramming. The control and programmability of organisms including our own bodies and genomes, allowing to transcend health and access biofabrication. Being able to create new lifeforms and alter existing ones. Making biology the equivalent of web page programming. Impacting life expectancy and quality of life dramatically. Opening up digital ethical questions about reproduction and identity

Neurogamification. The full leverage of our knowledge of our brains and psychological control mechanisms to increase engagement and attention in all settings. Understanding how we can be influenced and motivated. Making superhuman feats of willpower, learning and concentration routine. Revealing advertising and manipulation as the next super-weapon. Opening up difficult questions about free-will and meaning.

The impact of this six can be expected to be astounding, much deeper and broader than what we have experienced through digital. The tail end of digital deployment combined with the big 6 will probably create a world that is difficult to recognize. It might be a world of Abundance, like Peter Diamandis and Singularity University defend, or it might be something else we cannot understand today. For sure, it will bring difficult ethical debates and questions as we get closer to our core as beings.

Companies, individuals, and investors will see the ground shift massively, many losing their position if they don’t move fast enough. The best proof of this is Google’s and Facebook’s obsession with some of these trends. Google’s shift from Mobile-first to AI-first shows the lessons learned from the deployment of mobile and how even a top 5 company feels it needs to transform or die. We can apply the same to the most valued jobs or sectors. Will there be a need for programmers when AIs are being taught to code? What will be the value of gold, the euro or the dollar when you can use cryptocurrencies as a value reserve instead of trusting politicians?

These paradigm shifts are not idle speculations. Rather they are realities that are routinely leveraged in some corners of the world. As William Gibson famously said, “The future is here, it is just unevenly distributed”. What we will see is the extension and perfection of these existing technological revolutions across the economy.

Based on a broad survey of many futurist analysis and trends these six seem the most relevant for the next couple of decades. However, there are another five paradigm shifts that could be relevant in the longer term (20-50 years). Hopefully for many of us still well within in our lifetimes. These additional technological revolutions are Nanoscale Technology, Commercial and Residential use of Outer Space, Mind-machine Interfaces and Integration, Quantum Computing, and General AI/Virtual People. These technology revolutions are still in the theory, science fiction, and initial experiments stage. We should watch them emerge over the next decades.

Tech and Business

Digital is Boring: Mature and Predictable

 

waves
Source: Wallpaper Vortex

We think that digital causes change and uncertainty. However, even if it has a lot of change left there is little uncertainty in it. Uncertainty comes from a new set of paradigm shifts that go beyond information processing and will change our physical world. Digital is the tip of the iceberg, but most change will come from below.

 

We live in tremendous change and uncertainty. The most cited cause for this is “digital”. Digital is the new catchphrase. Digital is what is changing everything. People are trying to become digital. Companies are creating Chief Digital Officers and Digital Transformation Plans. Governments have Digital Agendas.

Digital also means the top 5 companies by market capitalization in the world. Google, Amazon, Facebook, Apple and Microsoft, and their Chinese counterparts Alibaba, Tencent and Baidu.

Digital is a fuzzy term with no formal definition. It can be thought to encompass the integrated impact of 8 technologies that build on each other:

  • Internet. The internet is the decentralized intercommunication of computing devices through high capacity digital channels. The internet was originated as a defense project by DARPA, a USA government agency, and opened to commercial use in the mid-nineties. HTTP is the “language of the internet” developed by Tim Berners-Lee, a scientist at the European CERN. The combination of the internet and HTTP has created “the web” as we conceive it today which is the foundation of digital.
  • Digital Marketing. As with all other human media, the first step for the internet was advertising and lead generation. While internet advertising was born fragmented, it rapidly coalesced to a single major chokepoint, search. Google sprung from leveraging that chokepoint for digital marketing which still accounts for most of its revenue. Digital Marketing has gradually eaten up traditional media in the process.
  • eCommerce. The second step for the internet was taking economic activity online. Selling and buying stuff was enabled by reusing the existing offline payments (credit cards) and delivery (postal and courier systems) infrastructure.  Amazon emerged as the eCommerce juggernaut working on the delivery side. eCommerce is still in the initial steps of disrupting retail.
  • Cloud. Cloud is a centralized computing and storage paradigm that was developed on top of the internet in the first decade of the 2000s using virtualization technologies. Cloud uses central capacity to allow for an optimized use of resources and shared access to information, reducing dramatically the cost of deploying technology. Amazon, Google, and Microsoft are the largest cloud players. Cloud has disrupted the traditional technology hardware business.
  • Big Data. With centralized storage came big data. The possibility of storing and analyzing information at scales which were uneconomical until then. Big Data is the possibility of new ways of data gathering, analytics, and visualization through the cloud and internet. This new richness in data is what has lead to the “data as oil” metaphor. Everything Digital leverages Big Data today
  • Social. Social emerged from the internet, cloud and big data. Once you have a centralized register and direct one to one communication you get social. You could centralize the registry of people you knew (Facebook) and communicate directly with them (Skype). This eventually was transferred to the business realm (LinkedIn, Salesforce Chatter, Yammer, Slack…) and social came to business.
  • Mobility. Mobility followed the PC based internet. It unfettered access from cables and put it in our hands. The effective marriage of mobile phones the Internet and Cloud was accomplished through Steve Job’s iPhone in 2007. Mobility has totally transformed society in less than 10 years and propelled Apple to the number one spot. Traditional internet and cloud players had to adapt to mobility with some thriving (Google, Facebook, Amazon) and others being rendered obsolete by it (Yahoo!, eBay), while others emerged in “mobile social” (e.g. Snapchat, Pinterest).
  • Platforms and Marketplaces. With the new mobile social cloud, a whole new world of possibilities opened with platforms. Creating two-sided markets that linked demand and supply for various sectors in high volume interactions. The last generation of unicorns came from here (Uber, AirBnB, etc….).

Digital is very important and has transformed the world. However, the technologies incorporated in it are “mature” now. The most advanced companies in the world have already adopted them fully and are leveraging them to a large percentage of their potential.  We can see the impact that digital technologies will have, there is little uncertainty left in them. It is a matter of time until this paradigm is fully deployed and its full impact felt.

Of course, there is substantial change left to happen. The adoption curve or the disruption it will cause is not complete. Advertising might be quite far along the path, but other sectors like retail still are feeling the initial impacts. Traditional companies, governments, SMEs and many individuals still haven’t adopted digital, with different estimates of “digital potential” put adoption between 10 and 20%. Even so, this change will be mostly in how we process and relate to information, it has a comparatively small impact on the physical world

Uncertainty and change to our physical reality will come from the new set of paradigm shifts on the horizon. Some are direct heirs of the digital technologies (like Software Processes, Integrated Reality or Digital Governance), others come from a completely different angle but are empowered by digital technology (like the New Energy and Transportation Matrix, Bioprogramming or Neurogamification). All of these new paradigm shifts that come below the iceberg will transform our physical world and way of live and business beyond recognition. Digital was just one paradigm shift. Below the iceberg we have at least 6 new paradigm shifts with others looming beyond in the horizon. These paradigm shifts are uncertain. They will be the sources of surprise and disruption we cannot still predict.