Wednesday, 30 September 2015

Heap's Giant Leap!

Another great discussion about distributed ledgers, this time focused on the music sector, hosted by the Copyright Hub at the Digital Catapult. A quick summary of the discussion along Chatham House lines to protect the innocent.

By now it's clear that people in different sectors are encountering very similar issues that might be solved by distributed ledgers, but each sector tends to have a different set of priorities that might mean one is faster to take advantage of the technology. The fact that the first solutions have been alternative currencies tells you that proponents of distributed ledgers are not shy of a challenge. Now music is to get the same treatment with key events this Friday and Saturday night featuring the release of Imogen Heap's song "Tiny Human" into a distributed ledger for 'hackers' to attempt to spoil the party, followed by a live Saturday night post mortem on what could be improved. No doubt future events will try to perfect the process.

Why music? 

The problems in the music industry (and most other segments of the entertainment market) are pretty well-rehearsed, with just about every stakeholder group (except the consumers, these days) split over whether digital technology is helping all the participants strike the right bargain or robbing them blind. The revenue flows (or lack of them) have been the subject of constant disruption from internet technology, with the advent of P2P file-sharing via Kazaa in 2001 and rewards-based crowdfunding through Artistshare in 2003.

But bigger obstacles to reaching a better settlement for all concerned lie in the notorious lack of data about who really created and/or worked on various tracks and albums; or even about what's really in many 'back catalogues'. Then there's the secrecy surrounding licensing/royalty deals and the snail's pace of royalty collection/distribution - not to mention who sampled what; whether a performance and related video was a private family affair or an attempt to build a public-facing YouTube channel; hacking digital rights management software; and file-sharing. 

A lot of these issues go away if you just focus on creating and dealing with new music in a more efficient way. And few of these issues are exclusive to music itself. They relate to any item whose status changes a lot and where a multitude of different parties are affected but find it hard to get all their systems and processes to talk to one another. 

So this seems another case for getting everyone's machines to share a single view of a marketplace that avoids 'capture' by any single intermediary. In fact, the 'ledger' they all share becomes that intermediary. In that case, all the participants' machines running the same ledger protocol would be able to see and agree who created which music in its myriad iterations and remixes; who has the various types of rights to exploit or consume the various versions; who owes what to whom; and even make payments in the ledger currency.

Will it work? There's only one way to find out - hence Imogen's giant leap on Friday night.

I reckon it'll be all the rage this Christmas ;-)

Thursday, 24 September 2015

This Is Not The Time To Let Bank Management Off The Hook

The CEO of UBS yesterday joined other wolves in sheeps clothing big bank leaders in calling for freedom to make 'honest mistakes' (last year it was the crew at HSBC!). 

This is just a confidence trick. After all, the word "mistake" covers many different types of sin and bank culture doesn't seem to distinguish between honest and dishonest ones, as Andrew Hill of the FT has pointed out. He also cites a memo from JP Morgan's CEO as warning against descending into "a culture of back-stabbing and blame" - but from what I understand that's exactly the culture that already prevails, at least amongst rival managing directors. Emails disclosed in numerous scandals reveal that these are dog-eat-dog environments, full of perverse incentives, where everything from taking the credit for other people's efforts to fiddling records to incurring the odd regulatory fine are just speed bumps along the road to fees, profits and this year's bonus.

Ignorance of exactly what is going on at operational level is another aspect of this confidence trick. Recently, the CEO of government-owned RBS told John Snow of Channel 4 News that he "didn't know" whether there were other major scandals waiting to break. I guess it's a tricky question to answer, but it does highlight the conclusion from the Parliamentary Commission on Banking Standards that these banking groups appear to be beyond management control, enabling those at the top tend to avoid culpability. Remember, too, that many of the recent scandals, like currency market rigging, arose well after the start of the financial crisis. So nothing has really changed since the aptly nick-named 'noughties' (lest we forget Bobby "Dazzler" Diamond's immortal words in 2011!).

And to suggest that regulation might mean big banking groups will tend to take less risk in doing things that customers care about, like lending to small businesses or paying higher returns on savings, is poppycock. They aren't bothering to do this anyway. They just want the freedom to make more money for management, and possibly shareholders. They are simply not customer-led businesses.

For all these reasons, the bank CEOs should continue to be roundly ignored.

Guest Post at Open Identity Exchange - A Pragmatic Approach To Distributed Ledgers

The post appears here.

Thanks to OIX for the opportunity to support the initiative.

Tuesday, 22 September 2015

How To Pay A Spanish Speeding Fine From The UK

There seem to be a lot of grumpy tourists surfing the web after their holidays in search of a method to pay their fines. Strangely, the Spanish don't make it easy! I finally cracked it and share the steps below, some of which were the result of a call to the Spanish authorities on the number given on the fine notice, but the links came from surfing the net. Please take care when using the links/urls to ensure you are on the official pages! 
Click here: [note this is reached via , which in turn is reached by clicking the union jack “Is there a fine?” link at].

When the online form comes up, complete as follows:
Under "Document type", click the drop-down menu and click “passport”

Under "Document number", type 000000 - six zeros

“Date of the Report” means the date at the top of the fine notice in the box marked “Fecha Denuncia”

“Record Number” means the number in the top right of the fine notice in the box marked “N. Expediente” – with all dashes and dots removed

For the amount, you must put the total amount of the fine, not the discount for early repayment - the site will then calculate any discount and display it in the next screen, which will also give you the opportunity to pay by debit/credit card.
Drive safely ;-)

Thursday, 23 July 2015

What (The Hell) Is A Smart Contract?

Another good meeting of the BitcoinBlockchain Leadership Forum today, with the focus on practical use-cases for distributed ledgers and grasping at the nebulous concept of 'smart contracts' (links are to my own recent posts on these topics). 

In particular, we saw good, productive tension between Bitcoin blockchain purists who are intent on coding pretty much every element of a transaction into the blockchain; and those who see distributed ledgers as (also) playing a more limited role as just one layer or component in a broader array of gadgetry involved in any contractual scenario.

In my view, both approaches are valid but which 'wins' will depend on the use-case. And the development of the Internet demonstrates the technology will be used in ways no one intended anyway.

So, for my money, the definition of a 'smart contract' needs to be very broad, and I've suggested:
"an agreement performed via any number of applications, devices, networks and messages, which may involve entries in a distributed ledger."
This definition flows partly from a great discussion I had with Alex Amsel of Bitshake recently. I made the point that distributed ledgers seem most useful where a specific item is somehow dealt with or used very frequently and by many people or entities. Alex added a third condition: the participants are running different proprietary software, operating systems and/or devices - in other words they have an expensive interoperability challenge.

So a 'smart contract' might just be written in Word format, or html, and not embedded in a distributed ledger at all. But the subject matter of the contract - the rights to play a song, or rent a shipping container or space on a truck - might be 'hashed' into the ledger, and users' machines could interact using that hash, triggering instructions to pay the contractual amount to a certain account. Multi-factor authentication as one step in the contractual process (e.g. identify checks for anti-money laundering) is another example.

At the forum, there was mention of locating, booking and paying for a car space as another example. This was dismissed by lots of people who said you can already do this without a distributed ledger - the parking space is already entered in the systems of the council's chosen payment service provider. But that means I need to know which municipality I'm in to find the right payment app, download it and register a payment method before paying (I changed cars recently, so I have to re-do all that). And that inaccessibility is partly a function of having to cover the cost of expensive proprietary systems. But if parking spaces were 'hashed' in an openly accessible public ledger, couldn't our smartphones find and pay for them using that code and our own chosen payment method?

Anyhow, the point is not that we necessarily need distributed ledgers to pay for parking or any other specific use-case, but that once people begin using distributed ledgers more widely, tons of other apparently trivial uses become feasible and worthwhile. Conversely, a comparatively trivial but widely shared use-case might unleash more widespread adoption, as happened with text messaging (I'm not suggesting that parking will do it, by the way).

Of course, Bitcoin users will be screaming at their screens by now, if they've got this far. They'll be shouting that Bitcoin has already unleashed distributed ledgers. 

They're probably right.

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