Could Facebook compete head on with Amazon?

I recently tweeted that I expect to see Facebook scramble and launch a physical device to capture verbal interactions in the home, as per Google, Apple and Amazon:

And just today rumours started surfacing at CES one is on its way called Facebook Portal. I promise I had no insider knowledge!

The tweet generated quite a lot of discussion about the why, why not, how and benefits of doing so. So here’s some deeper thought on the topic. I actually had a good chat with Paul and Nick about it, which made me think about how this could actually work… it went something like this:

Most people pointed out that Facebook already have ‘messenger’ which listens, and can talk, and that if they have this, and are on pretty much everyone’s phone, why would they need an extra physical device with voice? My thinking is that their core competitors (Amazon, Google and Apple) now have an always on, always listening device we can speak to and essentially ‘order from’ and command to do real physical things from us. My view is that these devices will usher in a new post smart phone (well, in addition to at least) battle for the home. It’s part of the shift to the era of ambient computing. Ambient computing to me, is much like we see in pretty much every future focused science fiction show – we command our technology via voice, often without a screen and it reacts to our needs. In which case it can pervade the entire home (kitchen, lounge room, bedroom, bathroom) and become a node for consumption and problem solving, not just data aggregation and visual suggestion. Of course, Mark Zuckerberg doesn’t mind being late, buying and if needed copying his competition.

On the surface we can see why a voice device makes sense for Amazon, Apple and Amazon, and not so much a social network. here’s where the potential pivot and new revenue stream could come in for Facebook. While FB provides connection to advertises based on very tight data based targeting, the thing advertisers want more than clicks, is orders. Imagine if Facebook could streamline the advertising process and convert it into ordering process of direct selling to their 2 billion residents? It would of course require some back end infrastructure development by FB, but it would be possible. Potentially it could be an addition to their advertising platform – click to ship?

The way I imagine it could play out wouldn’t be much different to the way Alexa works for Amazon, expect that the orders would be direct to the vendor on FB  (currently an advertiser), and instead of the product being delivered via a 3rd party distributor (such as Amazon) – FB could send their vendors orders to be fulfilled via the vendors logistics. Which, if they pulled it off could be a good way to fight back against Amazon without having to build any of the physical infrastructure. This could be an incredibly a quick way to compete with the Amazon Marketplace.

But here’s the kicker, imagine if Facebook developed some kind of API where vendors could plug in their stock on hand and logistics – then they could start turning attention into actual orders and know who buys what and understand the flow of goods and services deeply.

I’m certain their bet with Oculus is too early, while I truly believe that voice devices are the next key battleground. It’s gonna be interesting to see who this one plays out.

If you want a life independent of the evil people like MZ – check out my new book – The Lessons School Forgot. 

The technology shifts you need to focus on in 2018

I’ve always believed the technology shifts we ought focus on shouldn’t be the abrupt, but changes in the tide of consumer behaviour and the economy. The reasons shifts are more important than definitive events is that we have time to react to them, build around the movement and benefit from the change. Disruptive events are all too often the story of yesterday. With that in mind, here’s some thought starters on where we might focus our businesses in the coming year.

Typing to talking: After investing 20 years in being found on the screen, a list, the list will start to evaporate and be replaced with a singular verbal response. There won’t be a first page, just a recommendation. With Google, Apple, Microsoft, Amazon and others investing heavily in voice activated devices the battle for the home, the fridge and entertainment devices will shift from typing to talking. This is a basic requirement before any serious IoT can be deployed, and will also forge a core component of the autonomous transport revolution. If any business relies on the SEO now, then it’s time to start working on Voice Engine strategy for a very fast approaching tomorrow.

Drone Logistics: While the big players have been the core promotors of drone possibilities, expect to see a pivot where a ‘Jo Nobody’ local business starts the process of real deliveries via drone. While regulations are moving fast, the risk for a small local outfit to deliver something just a few km’s away, while illegal, is often palatable to entrepreneurs. I expect V1 drone logistics to be built underneath the radar (surely you liked that pun). The first regular outside of line of sight deliveries will occur while no one is watching this year. Small efforts by micro businesses where both the deliverer and deliveree benefit. The real innovations are less about press releases of possible future innovation and more about two parties solving each others problems using the technology, mostly without permission.

Pop up bots: While bots pervade our every internet moment and make most of the technology we touch, we can expect bots to pop up where humans once stood this year. It won’t be a swarm, but we can expect to see a few humanoid style robots stand where people recently have, doing the repetitive task they did. At first it will be a curiosity, a marketing bit, some retail theatre, but it will be real. When robots can do backflips, it wont be long before they pull long macchiatos. Maybe your business can get the lead and win the early PR race – which is what it will be in 2018 at a commercial level for those not actually manufacturing the bots.

Crytpo Bubble Expands: Bitcoin had a year of growth to rival any financial bubble in history, at one point the rise was 20 fold in 12 months. I’ve been a believer in crypto currency for a long time. And I still am, but the underlying value of any product, service, asset class, or investment does not preclude it from getting overpriced (read bubble). The problem isn’t the price itself though, bitcoin could end up worth a million each for all i know, but that rapid adoption creates a rush at the door, and inevitably not everyone can get in or out – it creates a natural bottle neck of supply – the asset ends up with rapid confidence gains and losses, and sometimes it falls rapidly and doesn’t recover. Remember currencies are based on trust. My view is that bitcoin has shifted from a currency to a store of value – for now. So here’s the prediction bit. The crypto mania will continue into this year, and given those pushing up the price are generally people afraid of missing out, the rush will shift from being about bitcoin to about whichever currency ‘seems cheap’. It’s impossible to price an asset which has no yield and is based only on confidence and demand. Expect to see Ethereum, Ripple, Litecoin, Monero and others experience similar gains this year to bitcoin last year in a dotcom style boom. And just like that boom, a crash will happen, though I’m not sure when. The FOMO investors will exit, and crypto currency will re-emerge some years later and create the revolution it promised. Probably with some new coins, and some of the stalwarts. Side note: it took Amazon until 2007 before got back to  it’s year 2000 dotcom boom share price and now it’s on its way to be a trillion dollar company. The core skill we need in times like this is understanding if we are investing or speculating – both of which can be valid, so long as we know which game we’re playing. In the interim, we can expect to a serious shift of focus into the importance of the underpinning technology of the blockchain.

BlockChain technology pivot: Businesses will start to understand that blockchain technology can do much more than cryptographically track currency. It’s the equivalent of a 1989 internet era for blockchain, and the time is now to experiment with the technology and build something using it. The Google search you need to make is here: “How Blockchain technology can be used in [insert your industry]” – The more you dig into it, watch videos and understand the technology, you’ll see it has the potential to reframe the internet in many ways – and we need that to challenge the current internet oligopoly, and their quasi-unauthorised privacy trading market. A blockchain knowledge upgrade is a journey worth taking. I agree with Nic Hodges that we’ll see innovation on it this year outside of currency.

Regulation not a dirty word: People will start to realise that regulation is not the enemy, but an absolute requirement for a civilised and opportunity based capitalist economy. Here I’d like to make the delineation that there is good and bad regulation:

Bad regulations: Ones which protect industries and companies.

Good regulations: Ones which protect people.

It’s easy to forget that regulation can create entire industries and new revenue streams, open closed industries and allow for increased competition. Think work place health and safety – it not only made life better and safer for working people, but forced innovation in many realms. Opportunities to protect consumers against the big 4 are starting now – via regulation and via those prepared to innovate against their failings.

Virtual reality & Augmented Reality B2B pivot:  While the leaps being made in virtual and augmented reality are astounding and create incredible possibility, the big companies investing in the technologies (Microsoft / Facebook) will realise it will be many years before we have any serious adoption of these at the consumer level. Google’s move to warehouses and factories with Google Glass will be the start of these technologies infiltrating work as we know it. The beauty of this shift is it gives humans an upper hand against independent AI. We will become the technology and work with it. Expect to see people working in all areas from retail to manufacturing to distribution wearing various forms of facial augmented technology. We’ll also see the start of augmentation centres pop up – places we go to to get work done, or be entertained using high end AR & VR rigs – even Haptic Conferencing. Don’t expect to see it any time soon in anyones kitchen or lounge room. I believe this is the realm of ambient computing, and we should never forget a new technology needs a substitute, and I can’t see us substituting our current in home behaviour to don tech rigs at home. It will first need to infiltrate our worlds of work first – just like most technologies do. (Yes, we’ll still see VR / AR in basements with gamers!)

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If you want to get your year off motivated and creating an independent future – check out my latest book, The Lessons School Forgot – I promise you’ll dig it. 

Have a great 2018, and go make something rad,

Steve.

What won’t change in 2018

There’s lots of predictions every year of what will happen. But before we do that, it’s worth considering some things that won’t change in 2018.

  1. People will continue to use Facebook, and hand over the almanac of their lives, despite its lack of responsibility, and refusal to invest in stopping inappropriate use of their platform. It will continue to create deep echo chambers and division in society. Its leader Zuckerberg will continue to believe that Facebook is, and should be the internet. Remember they’re not a media business, but a technology company, right?
  2. The 4 monopolists (Facebook, Amazon, Google and Apple) will continue to dominate the internet and be joined by a couple of others, possibly Netflix. They’ll continue to point out their small market share in their revenue arenas, while their share of digital infrastructure use and attention will grow further. Their power will increase, with the convenience they provide blinding the populace to the longer term externalities.
  3. Brands reliant on these new infrastructure providers above will continue to take the short term revenue solutions provided (foolishly growing their vegetables in someone else’s garden), while handing over direct connections to their own customers – which they could instead build with some effort.
  4. The jobs and growth narrative corroborated by Government and large corporations will continue to allow them to write laws and tax breaks which suit these new masters of the universe. Like last year, there won’t by any trickle down.
  5. Leading edge thinkers, will continue another year of educating the populace on the current problems and future problems being caused by the above behaviours and that the internet needs saving. These will gain momentum, but probably won’t change consumer behaviour much in the coming 12 months. There will be change, but not until the full cost of these behaviours becomes more evident. Only once events caused by the big few hurt the general population will there be action.
  6. Some big fines will be given to the above companies for violations (Think in billions) but unfortunately they’ll be financial rounding errors against their free cashflow.

Wow – that was dark and semi-apocalyptic – but watch out for tomorrow where I turn this reality into a set of positive actions and prognostications for the future. The year 2018 will be a good one for those who choose it to be, but before anything can ever be improved, we must first admit where we are… a good news post to follow 🙂

Have a great year, Steve.

The new global language we’re already writing

A global economy ends up with many pieces of global infrastructure. Communications system, social networks, sans-nation-state currencies, political forums, international transport to name a few. We are currently in the middle of the transition to a global language, the written version at least. Something seemingly childish is about to entirely transform the written word: emojis.

Before you laugh and close this tab, let’s remember that they were the Oxford Dictionary Word of the Year in 2015, Their usage has resulted in arrests, and we already have 2666 emojis in the Unicode standard. To read at university level in Chinese, one only needs to understand 3000 or so characters. In order to understand this premise more deeply, a revisit of the history of written language is informative, and it will uncover why this claim isn’t all that outlandish.

Our first attempts of written communication as a species started with pictographs on cave walls. The visual below is from Volltorta Gorge, Spain. Some cave paintings with similar pictographs date as far back as 71,000 years ago. The very first analogue emojis. The word emoji incidentally is a literal translation in Japanese meaning Picture Letter.

For much of human history, the written form was visual, obvious and static. This was largely due to the limitations of communication technology at the time. Our tools were limited to cave walls, painted with clay earth pigments. Back then, we used what we had, and had to ensure meaning could be transmitted without a spoken narrative to accompany it. But as our communications technology improved, the written form escaped the cave and millennia of evolution ensued. We used clay tablets and cuneiform script during the Sumerian era. This facilitated transportation of writing. Hieroglyphs in ancient Egypt followed the same pattern evolving from pictographs, as did Chinese scripture. Both are shown below.

 

As literacy levels increased, writing morphed – became simplified and deviated further from their pictorial origins. They became easier to draw, quicker to create and less detailed visually. This made them more transferable, flexible and increased the mobility of the content. More people, traders and merchants with average dexterity could draw the symbols and participate in written communications. Eventually, the methods of written communication became algorithmic collages of characters and alphabets to spell out the spoken word with more breadth. It became more exacting in its representation of the verbal form. In all probability, the written form probably evolved to match the technology of the day, papyrus, ink, and later, the printing press.

But since digital communications and tools have proliferated visual language has made a radical comeback. Via a weird combination of globalization, short form communication platforms and the need for expediency, we are now partially moving back to a world of interpretive pictographs. Now that the technology exists where the click of a single button can be translated into an entire sentence or deep emotion, our species has taken to the form with abandon. It is truly a wonderful iteration of the written form. I’m even wondering if we’ve subconsciously found a way to find a written form which can cross language barriers without realising it. An emergent phenomenon designed out of global necessity? While this isn’t the first time we have seen a shared character base which result in different words, (we have this in Chinese and Japanese), it is the first time we’ve seen a global omni-language written version.

The beautiful thing about emojis is that they don’t just translate, they also have a certain malleability and ability to create variety in tone. They can create a sentence structure. But more than anything, they’re a great reminder that language is itself also a technology. The tools we invent have the ability to change the reason we invented them and be repurposed with substitute inputs. The smart phone has the capacity to carry a new set of characters with the rare combination of visual accuracy and simplicity in distribution. The advantage they have is a new type of immediate and mutual understanding which can cross borders. It’s this that makes the switch to an entirely new global form of writing entirely possible. While it might take generations, it isn’t without precedent.

If you liked this post, you’ll dig my new book – The Lessons School Forgot – a manifesto to survive the tech revolution. 

The NBN is bigger than the internet as we know it

The number of people who want slower internet in Australia is exactly zero. The speed we need data transfers to occur at is much fast than our politicians think. The reason for that is simple, we haven’t even invented the technology or industries which will be underpinned by the required connectivity. This is merely the start of the revolution, we are only 20 years into the digital age, and thinking we can even conceptualise how data will be used in the future, and how much of it we’ll need is at best ignorant and in all probability conceited.

Consider this, when oil was first discovered bubbling out of a creek in Pennsylvania in 1859, we had no idea how this material might be used. Maybe for lanterns or heating or maybe even in some machines could use it instead of steam? But the airline industry? That was impossible to conceive as a use case for oil, as was personal locomotion and the plastics industry. Today the airline industry employs over 12 million people directly, and is an important conduit to global commerce.

The NBN is a non-polluting oil well of the future. It should be the conduit to the data economy in Australia. Transfer of data is core to any economy wishing to participate in modernity. Yet, in Australia the NBN has become a political football which is literally risking the financial future of every Australian. I’m flummoxed to hear that the CEO Bill Morrow has claimed that the average Australian (what is average anyway?) wouldn’t require download speeds of greater than 25 Mbps! Either he is deluded, he lacks understanding of exponential technology or he’s towing a political line. Data isn’t about being a techie or young, it’s akin to running water or electricity – In fact, it will probably become a vital remote health care ingredient for our ageing society. Here’s a few things we ought consider, and then start screaming loudly about relating the future of our economy and the technological infrastructure we ought be provided with:

  1. The Governments job isn’t to make a profit out of infrastructure. They should realise that they will profit from new industries built atop of it. They seem to forget the tax we pay (30% min for business) is a quasi joint venture they are the beneficiaries of. They benefit from innovation on platforms, but only when they have the quality the future requires. Besides, it is our money they are already investing on our behalf. Profit centricity is a flawed approach.
  2. Rich Countries are built on rich infrastructure. In less developed nations, the common element is crumbling or barely existent infrastructure. Low quality roads, tangled electrical grids, insufficient education, marginal hospitals. We are squandering the shift as developing nations take their chance and ensure they use connectivity to redefine their economies. Just Google internet speeds by country and see where we rank and some of the surprising speeds of developing markets.
  3. We’ve opened the door to Curve Jumps. There’s a chance that 5G mobile networks will be faster than the jumbled mix of FTTP, FTTN and FTTC NBN Co is now building. The network may obsolete before it’s completed, or even worse, a national infrastructure play could end up being served by global technology conglomerates: Google, Facebook and Space X with their various internet service projects. It’s also possible that 5G mobile networks will circumvent the NBN in cost & speed. By trying to save money, the entire project is at risk.
  4. The future economy lives on the meta-structure. The amount of data we are creating is already doubling every 18 months and we are at the start of the start. All the important innovations of the future will depend on the robustness of technological infrastructure, and will create a new meta -structure of virtual business models which live at a meta level a above the concrete and steel. The trillion sensor economy of the IoT, Desktop manufacturing and 3D printing, Drone based logistics and Virtual Roadways in the sky. All these things require faster than we imagine internet access, unlimited imagination and an ‘over investment’ in the infrastructure.

If we want equal economic opportunity around our big land, then it requires a strong national network, where our regional areas have the opportunity to build a location independent future. Everything humans and governments have ever built that mattered involved taking leaps of faith and investing more than we need now, so we can all benefit tomorrow.

You can listen to my thoughts on the NBN here. And be sure to tune in to 3AW every Monday at 4.30pm as I take on a topic that matters for our future with Tom Elliot.

If you liked this post – you’ll dig my new book – The Lessons School Forgot – a manifesto to survive the tech revolution. 

Why other industries need to call out Facebook’s advertising policy

Let’s for a minute imagine these as Corporate Policies:

Car Manufacturer: We’ll take a car off the road if an unsafe model gets out of the factory and is sold, but we can’t promise all our cars are safe until you start driving them. If you see an unsafe car out there, please let us know. 

Fast Food Outlet: If our pizza has salmonella or listeria, you can return it, but we can’t promise all our food is safe to eat. If you get sick or know someone who did, please let us know and we’ll take the pizza back. 

Packaged Goods Manufacturer: If our shampoo has chemicals that are unsafe and burn your head, we’ll change the formula, but we’re not sure until we sell it if it’s OK. If you see anyone with a burned head, ask them what shampoo they used, and if it’s our brand, we’ll happily take it off the shelf.

This is essentially what Facebook Inc. have just announced as their Global Policy for Advertising. All I’ve done is paraphrase their policy, and changed the product and industry. Here it is below for your reference:

Joel Kaplan – Global Policy VP

“We try to catch content that shouldn’t be on Facebook before it’s even posted, but because this is not always possible, we also take action when people report ads that violate our policy”

Facebook claim it isn’t possible for 2 simple reasons:

  1. Because it isn’t profitable for them to check every advertisement before it goes out.
  2. Because they haven’t been regulated in the same way other media organisations are.

While I understand 2 billion peoples comments can’t be moderated before they’re published, maybe paid advertising on Facebook should be. Facebook at least ought to be held to account financially when their ‘platform’ creates problems for society. Their current MO when anything outside their policy happens is ‘oops, sorry about that’ . They get away with it because society and regulators let them. A good starting point to fix this is to start calling out Facebook for what it actually is – a media company, not a technology business. There is a certain responsibility that goes with being a media company and its resultant influence, yet Facebook continues to flout the responsibility that is incumbent upon such power.  To call it a technology company is ridiculous. All companies employ technology – Boeing and Ford have a far greater breadth and use of technology than Facebook, but at least they admit they sell airplanes and cars. Facebook sells advertisements to their audience, not technology – seems like a media company to me.

It’s also worth noting that the update from Facebook policy resulting from controversy surrounding fake ads and alleged Russian influence on the US election didn’t address the problems of false information, only ‘transparency’ of what was published, promoted and who did it. The extreme targeting possible on Facebook is itself one of the problems. Those likely to spot a misleading advertisement are unlikely to see it. In this sense the promise of transparency is a moot point. A further quote from the statement in relation to advertising via Russian accounts below is quite telling:

” All of these ads violated our policies because they came from inauthentic accounts” 

Not because the information was misleading? And further on…

“Our ad policies already prohibit shocking content, direct threats and the promotion of the sale or use of weapons.”

Apparently advertising false information is OK? No mention of it anywhere… You can read it for yourself here. 

While Facebook promises to create a more open and connected society, it is in reality creating a more silo-ed and disconnected society. When governments first gave out spectrum at the birth of the TV era, it came with the responsibility of providing unbiased news and balanced data on issues affecting society. We didn’t let the idea of innovation or new technology interfere with creating the kind of society we all want to live in.

I think social media is one of the most amazing things to evolve in my lifetime. The power provided through connection and sharing thought has helped me re-invent my career, find like-minds and gain knowledge that just wasn’t available in the mainstream media era. For that I’m grateful.

But it is time that we took its power more seriously. It’s time to add seat belts and brakes to the data vehicles driving our lives and admit that no technology out of control or without failsafes ever benefits society.

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If you liked this post – you’ll dig my new book – The Lessons School Forgot – a manifesto to survive the tech revolution. 

It’s time for digital organics – Algorithms are the MSG of the modern age

Increasingly, our lives are shaped by secrets companies keep. The corporate secret de jour is algorithms.

These secret algorithms are designed to do two things:

  1. Make us like the product more.
  2. Improve the profit of the company via the algorithm.

(Objective 1 is only ever designed to facilitate objective 2.)

No doubt you’ve heard the word ‘algorithms‘ bandied around recently in the media, but unless you’re involved in tech or have had someone explain them to you, it is difficult to know what they are, what they do and why you should care. The definition coming straight at the top of a Google search is a pretty good one:

Algorithm: A process or set of rules to be followed in calculations or other problem-solving operations, especially by a computer.

For the most part, algorithms are a damn convenient tool during an era where the amount of data is literally exploding and we need shortcuts. By the way, an algorithm helped me find that definition too. From the screen print below, you can see the results of Google’s algorithms: a definition inside their search results, hence removing my need to leave Google and go to an online dictionary – aka a competitor.

Rule 101 for Algorithms is pretty simple. They are designed to benefit their creator. If they can serve the end customer too – well, that’s a bonus. The problem of course, is that the customer doesn’t know what they didn’t see and which decisions have been made for them. It’s hard to make an informed choice when the algorithms increasingly make those choices for us via filtered options.

A little over 6 months ago, I wrote about the fact that we will need to open up the black box of algorithms if we want to maintain a democratic society – yes, it’s that important. Before anything physical happens in our world, something informational always happens first.

A recent landmark federal court case in Australia focused on a poker machine called Dolphin Treasure whose manufacturer and casino operator have together been accused of misleading gamblers about their chances of winning. This is essentially algorithms on trial. It’s the start of something much bigger, and we can expect to see our most successful and revered technology companies algorithms on trial very soon. All it takes is a little more understanding by the public, and some front page news of algorithms gone wrong where there is blood on the floor – and sadly, it will happen. In many lower profile cases it has happened already.

Here’s what we can expect to see in the corporations around the world: C-suite level executives to emerge in order to build better algorithms and understand those in the market they need to deal with. Boards will need and put algorithm experts on their roster.

Here’s what we can expect to see from the Ambulance Chasers: Hidden algorithms to be the target of legal cases which deceive and cause financial or physical harm to consumers – a new angle to misleading and deceptive conduct.

Here’s what we ought expect from each other: To educate each other on the good, the bad and the ugly of algorithms so we can help shape a world we want to live in. Like we did with food and other suboptimal corporate behaviour patterns.

Here’s what I’d like to see from entrepreneurs: To launch services that benefits users sans algorithm as a key selling point or algorithmic ingredients on clear display – a new form of Digital Organics… to invent a new market and make the entrepreneurial profits they deserve by doing it.

What we need to remember is that every problem presents a new opportunity for nimble entrepreneurs. For business people who steer technology from its current trajectory to a new path is to say ‘no’, we want and deserve more than what you’ve giving us, and we are going to be the people who do it.

Check out my new book – The Lessons School Forgot – to redesign your own future.