Internet of Things... A European Prophecy

This just out from the European Commission: "Internet of Things: an action plan for Europe".

My apologies to the authors, but it seems to be a recital of various technological innovations concerned with RFID and the semantic web, attempting to link them to various pet EC initiatives in vague, mystical terms under a Pythonesque EU slogan. It concludes:

"As this document has described, IoT is not yet a tangible reality, but rather a prospective vision of a number of technologies that, combined together, could in the coming 5 to 15 years drastically modify the way our societies function."

Rather reminds me of this:

I guess it's all an attempt to put governments at the centre of the innovation process. What that will do to innovation is anyone's guess. Bizarrely, I see the EC is already requiring an opt-in before your milk can tell your fridge that it's past its use-by date. Lest you be "taken unawares by the new technology."

Please facilitate, don't regulate. You will only slow the pace of innovation.

Digital Britain

I should start my take on the "Digital Britain report" by making one thing clear: the fact that the government has issued the report is itself a Good Thing. The government does have a role to play in fostering and facilitating the growth of the digital world.

In that respect, the most important message in the whole document is this:

"We are at a tipping point in relation to the online world. It is moving from conferring advantage on those who are in it to conferring active disadvantage on those who are without, whether in children’s homework access to keep up with their peers, to offers and discounts, lower utility bills, access to information and access to public services. Despite that increasing disadvantage there are several obstacles facing those that are off-line: availability, affordability, capability and relevance."

However, the terrible news is that the detail of the report is merely a cascade of top-down recommendations to institutional problems, rather than a genuine attempt to clear the obstacles to every one of us seizing control of our dealings with government, banks, utilities, broadcasters and others.

Take the word "relevance" in the above quote, and consider the following passage that Technollama has extracted:

“The popularity of X-Factor and Britain’s Got Talent shows the enduring drawing power of content-creating talent that few people possess. The digital world allows more of that talent to find its way to more consumers and admirers than ever before. But it is not wholly democratic: some have the talent to create content; many others do not. As throughout history, there need to be workable mechanisms to ensure that content-creators are rewarded for their talent and endeavour. And the need for investor confidence is key. User generated videos can be hugely popular, but there remains a healthy appetite for big movies costing many millions to produce.”

It's a sad reflection on the government's understanding of digital Britain, that "X-Factor" and "Britain's Got Talent" are not only seen as "relevant", but also epitomise Britain's "content-creating talent". It is deeply insidious for the government to claim that the digital world is "not wholly democratic". This is view of the online world is simply false. The digital world is much, much more important, relevant and creative than is suggested, and hugely democratic - much more so than this government would like. Television and user-generated video platforms are merely a part of a co-operative mix of many different types of web site that are increasingly inter-linked and intertwined, enabling access to a huge range of content in different formats from different people at different times on different platforms and networks, depending on where people are and what they're doing. "X-Factor" is just one pixel on a much larger screen.

So let's not allow a few television shows to be the Trojan horse for a bunch of protectionist measures for Britain's beleaguered entertainment institutions.

Just because television has "gone digital", does not mean that TV content is a proxy or yardstick for all digital content. Similarly, the fact that a few record companies have made uncorroborated guesses that they'll make £1bn less in CD sales over the next 5 years, must not colour our view of file-sharing or distract us from understanding the value of Net Neutrality. Their digital music sales increased by 28% in 2007, after all. And they aren't the only people relying on the digital media to release music. Furthermore, several studies on the impact of file-sharing appear to negate the assertion that file-sharing adversely affects creativity.

It is great that the government has demonstrated a willingness to foster the growth of digital Britain. But it is also extremely disappointing that the "vision" is for us all to be glued to a screen watching wannabes singing other people's songs.

FYI, I've extracted the government's proposed "Actions" below, and may comment in more detail on some of them later:

• The Government will look to Ofcom to formalise the Consortium of Stakeholders to drive a new National Plan for Digital Participation.


• The Government will ask the Consumer Expert Group to consult and report on the specific issues confronting people with disabilities’ use of the Internet in Digital Britain.


• The Government will write to the Channel 4 Board asking it how it can further contribute to driving Digital Participation.


• In order to ensure the delivery of the Universal Service Commitment, we will establish a delivery body – the Network Design and Procurement Group – at arm’s length from central Government.


• The Caio Report recommended relaxation of regulations on the installation of overhead lines to lower deployment costs.The Government proposes to launch a consultation, by Summer 2009, on the impact of any amendment to the Code governing this.


• The Government intends to consult on the proposal for a general supplement on all fixed copper lines for a Next Generation Fund.


• The Government will have an independently produced guiding technical arbitration on the timing and cost of 900 refarming (and other related issues), paid for by an industry fund.


• The Government will work with manufacturers so that vehicles sold with a radio are digitally enabled by the end of 2013.


• On Digital Radio, the Government has asked Ofcom to consult on a new map of mini-regions.


• Alongside the Digital Britain Final Report the Government is publishing a community radio consultation seeking views on changes to the current licensing regime.


• Alongside the Digital Britain Final Report, the Government is consulting on a proposal to legislate to give Ofcom a duty to take steps to reduce copyright infringement.


• The Intellectual Property Office is considering the scope to amend the copyright exceptions regime in areas such as distance learning and the preservation of archive material and intends to announce a consultation on these later this year.


• The Government launched its copyright strategy


• The Government intends to consult on legislative reform in respect of orphan works.


• The Technology Strategy Board will lead and coordinate the necessary investment for Next Generation Digital Test Beds and has allocated an initial budget for £10m for this purpose.


• The Government will consult openly on the option of a Contained Contestable Element of the Television Licence Fee, carrying forward the current ring-fenced element for the Digital Switchover Help Scheme and Marketing (c.3.5% of the Licence Fee) after 2013.


• We will take the views of the Channel 4 Board on the draft updated statutory remit for C4 Corporation as set out in this Report.


• The OFT will amend its guidance to ensure that in cases relating to local and regional newspaper mergers raising prima facie competition issues the OFT will ask Ofcom to provide them with a Local Media Assessment.


• The Government is inviting the Audit Commission to undertake an inquiry into the practice of local authorities taking paid advertising to support information sheets.


• Commercial public service broadcasting liberalisation, including regional news, analogue licences and advertising minutage


• The Technology Strategy Board has assigned an initial budget of £30 million to advance Digital Britain related innovation.


• The Government will carry out a major test in late 2009 of our ability to manage and recover from a major loss of network capacity.


• The Information Commissioner’s Office plans to consult later this year on a new code of practice in relation to “Personal Information Online”.


• The Government will consult on the penalties that Ofcom is able to impose for contraventions of the Communications Act 2003 and, in particular, the level of the fine it can impose in relation to persistent misuse cases.


• Led by the Contact Council, chaired by the Cabinet Office, Government will take forward proposals for developing a Digital Switchover of Public Services Programme starting in 2012.


• We propose that DCMS, BIS and Ofcom carry out an assessment, to be completed by the end of this year, of the opportunity for bringing together some or all of the delivery agencies either into one body or through a federated structure to achieve economies of scale and greater operational efficiency.

Role of Social Media in Financial Services

There's been a lot of excitement about recent "research" to say that only 10% of people on Twitter are responsible for 90% of the content, based on "a snapshot of 300,542 users in May 2009."

This is excellent news. Because if the basis for institutional people dismissing social media has become this hokey, the online world must have become truly mainstream.

We can stop referring to "Web 2.0" and just get on with it.

Twitter is interesting not because it's Next Big Thing, but because it's another popular way for people to engage with each other, either by publishing your own thoughts or reading those of others, but in a bite size format. The report that "figures from research firm Nielsen Online show that visitors to the site increased by 1,382%, from 475,000 to seven million, between February 2008 and February 2009" against Facebook's 228% growth for a similar period, suggests that it can afford to leave a few people behind.

But are they really being left behind?

You can't analyse Twitter in isolation, or say that it's really competing against anything or anyone. Twitter is not a divisible or competitive "channel" or medium. It's merely part of a co-operative mix of many different types of web site that are increasingly inter-linked and intertwined, enabling access to content from different people at different times on different platforms and networks, depending on where people are and what they're doing. Look at all the platforms or applications that enable people to send and receive Twitter "updates" - including Facebook - http://apps.facebook.com/twitter/.

We can have it all. At once. On one screen.

All of which is to say that Twitter - like any one of the other sub-networks on the Internet - is merely a hint of something much, much larger:

Interestingly, James Gardner, the Head of Innovation and Research in a major UK bank, says that, for banks, Twitter is a stunt. He says it's uneconomic for a bank to communicate through the medium because - I hope I don't summarise unfairly - it's too expensive for banks to create content that's relevant to people at scale. "Surely no one," he says, "thinks Twitter is going to be a channel choice that many customers are going to use regularly".

You mean there are predictable channel choices?!

Human physiology may be reasonably predictable, but human behaviour is not. Anyone who believes we can predict the means by which people will choose to manage their finances will be subject to a rare but cataclysmic event - a Black Swan, if you will - that could send them down the tubes (I've often wondered where "the tubes" go...). In reality, there is no "mass" of consumers, no bell-curve to accurately describe their behaviour to enable us to predict with any precision how each person is likely to behave next. We are merely guessing, because there is a point at which all those highfalutin credit scoring and other "models" break down, as even Lord Turner is now convinced.

Even Twitter could disappear in a sudden puff of user indifference, like others before it.

It's only one hypothesis, but to me the social media reflect numerous trends that seem to signify a (currently) rising desire to structure our personal lives and experiences as each of us sees fit. The commercial challenge that presents is how to facilitate that desire in a highly flexible, adaptable, bottom-up way, rather than dictate how it can be satisfied in a top-down fashion. Brands need to be facilitators, not institutions.

To illustrate this further, I'd suggest that the very complex dynamic process by which individuals might, say, save or invest could (rather crudely) be depicted as follows (click to enlarge):



or this:

In this environment it's an incredibly brave yet foolhardy commercial decision for any business to ignore Twitter. It may as well reach for the Webley now.

Hey, we have the Webby Awards honouring excellence on the Internet.. how about the Webley Awards for businesses that don't get it?

Gold-Plating The Consumer Credit Directive

Yep, the UK's bureaucratic alchemists are at it again, folks. They've taken a leaden, ill-conceived Consumer Credit Directive (2008/48/EC) and extended its application to UK products that are out of scope, "in order to maintain a comprehensive, homogenous set of rules" (see para 1.9), while rigidly interpreting many terms not defined in the CCD to further complicate the awkwardly prescriptive consumer credit regime.

Add to that over 100 pages of impenetrable bureaucratic mumbo jumbo, 68 incredibly complex questions and an implementation deadline of June 2010, and say goodbye to any more retail financial services innovation for at least 2 years while we try to resolve all the uncertainty.

Moreover, the complexity of the one-size-fits-all regime being proposed, save for a 'light-touch' exemption for bank-only overdrafts, will give banks an even greater advantage over non-banks in providing consumer credit. Product development will be constrained by a complex and awkward regulatory regime, leaving many consumers with overdrafts (or loan sharks) as the 'easiest option'. In turn, consumers will be exposed to tighter credit conditions being imposed by banks, who will enjoy an advantage in 'up-selling' their own credit products to the more creditworthy.

Overall, the result will be less choice and poorer value for consumers, and a feast for banks and loan sharks alike.

Gareth Thomas, the Minster responsible, has a lot of explaining to do. But maybe he figures it's all over for him, anyway?

Meanwhile, the so-called "Better Regulation Executive" appears to be sleeping peacefully, secure in the assumption that all this nonsense delivers on a commitment to regulation that is:

• "transparent" - this extended scope was not revealed as the UK's intention when the CCD was consulted upon at EU level.
  


• "accountable" - why should national bureaucrats decide the scope of an EU law?


• "proportionate" - but it goes beyond the scope of the CCD, and is therefore disproportionate.
  


• "consistent" - but it's inconsistent with the CCD, and as such fails to deliver a "harmonised" or consistent cross-border credit market, which the CCD was (misguidedly) intended to catalyse (see Article 22).
  


• "targeted" – far from it, these are explicitly described as a "homogenous" set of rules.

Wakey-wakey everyone...

Is Your Mobile Number in This Directory?

I was stunned to learn from El Reg, that Connectivity Limited, trading as 118800, has "worked closely with the regulatory authorities" in launching "the only directory with millions of mobile numbers" in it. When you want to track down someone's mobile number, you enter the poor unfortunate's details and if 118800 has the number, this crowd will text the person a message to call you.

WTF?! This is hardly innovative or useful to anyone except stalkers and cold callers. If I wanted people to whom I haven't given my mobile number to be able to call my mobile, I'd publish the number myself and they could Google it, or find it on Facebook or wherever. But I don't. And I stopped publishing my home number for the same reason years ago.

Naturally, one of the FAQs is "How the !*&% did you get my mobile number?" (not), and their answer is:

"Our mobile phone directory is made up from various sources. Generally it comes from companies who collect mobile telephone numbers from customers in the course of doing business and have been given permission by the customers to share those numbers."

Well, I'm sorry, but I can tell this crowd right now that NEVER in all my years of giving out my mobile number, did I foresee or intend that I was consenting to its inclusion in this type of service. And I hate that they have put me in a position where I have to go to the trouble of telling them to delete me from their systems.

The Information Commissioner is reported as saying this service is no different to the practice of selling marketing lists. But this is vastly different in scale, accessibility and because the people who sell marketing lists don't text you every time someone buys the list or wants to send you junk mail.

The Commissioner needs to get a grip.

Meanwhile, time to register the mobile number on the Telephone Preference Service.