Good morning, Data Sheet readers. Robert Hackett, your weekend columnist, filling in for Adam and Aaron today. Since the cats are away, I’ve consulted my trusty buzzword dartboard to see how many fads I might tick off in one go.
Internet of Things? Check. Electric scooters. You bet. Cryptocurrency? Did you even have to ask?
Today I write to you about Helium, a 6-year-old startup cofounded by Shawn Fanning, inventor of Napster (yes, it gets better). The firm, which just raised $15 million on top of $38 million it had already raised, has developed a long-range, low-power wireless protocol for transmitting data. This is not Bluetooth, not WiFi, and no, definitely not cellular. Helium calls its brand of radio frequency communications “LongFi,” because its range is supposedly hundreds of times greater than that of Wi-Fi while remaining affordable, i.e. a thousand times cheaper than cellular. To envelop an entire city “only about 50 to 150 hotspots” are required, the company says.
“We call it the people’s network,” says Amir Haleem, Helium’s CEO, who dropped out college at 18 to play video games professionally, before e-sports were really a thing. (We’re talking Doom and Quake era.) In fact, Haleem met his cofounder Fanning through that scene.
While Helium’s grassroots telecommunications idea may sound kooky, it has already attracted some big name partners. The company is helping Nestle track water levels in its ReadyRefresh coolers inside offices. It is keeping tabs on pets with InvisiLeash. And it is monitoring lost or stolen scooters and bicycles in partnership with Lime. Applications abound anywhere one needs to transmit data on-the-ground back to headquarters.
In order to incentivize people to support the infrastructure, the mesh network that is the heart of Helium’s plan, the company is selling $495 hotspots to consumers. (Er, happy Father’s Day?) These devices, which are said to draw about 6 cents worth of electricity per day, are designed to spit out digital coins every so often. It’s a blockchain “reward system,” Helium says. Presumably, if people take to the idea, these tokens will accrue in value, and consumers will make a profit selling them on cryptocurrency exchanges. Sound familiar?
In recent months the U.S. Securities and Exchange Commission has ramped up its crackdown on blockchain projects peddling virtual currencies. Indeed, the agency is suing a defiant Kik, the struggling chat app, for hosting a multimillion-dollar “initial coin offering” two years ago. Interestingly, Union Square Ventures, a big Kik backer, co-led Helium’s latest funding round alongside Multicoin Capital, a cryptocurrency-focused investment firm. Hmm.
On the matter of the SEC’s antagonism, Haleem echoes the disappointment of fellow cryptocurrency entrepreneurs. “It’s difficult and frustrating in a way because we wish there was clearer guidance,” he says. When asked about his token’s possible value, Haleem disclaims any knowledge, responsibility, or promise. “The process will play out in secondary or other markets and we’re not involved.”
When I suggest to Haleem that he may eventually face a significant competitive threat in the likes of Apple, which just debuted a Bluetooth-beaconing “find my” feature for locating lost iPhones and other products at its Worldwide Developer Conference, Haleem takes the remark as a sanity-reaffirming compliment, rather than as an existential reality check. “It’s a reminder we’re not actually that crazy,” he said. “This is still a thing people need that hasn’t been solved well, that you can’t do with cellular.”
As zany an idea as Helium’s might seem, there’s something to it. Maybe the company isn’t just full of hot air.
Tipping the scales. Helium isn’t the only company dabbling in cryptocurrency; details about Facebook’s digital coin endeavor, Project Libra, continue to trickle out. The latest: the media giant has partnered with more than a dozen companies, including Visa, Mastercard, PayPal, Uber, Stripe, Booking.com, and Argentinian MercadoLibre on the payments technology, the Wall Street Journal reports. The participants are said to be contributing $10 million apiece. Fortune is slated to receive an embargoed briefing from Facebook later today, and we presume it may have to do with this.
Pay your way. As Facebook looks to monetize WhatsApp, the company has plunked down a supposedly “very significant” investment in Meesho, an Indian social-commerce startup, TechCrunch reports. The startup runs an online marketplace that connects sellers with customers on social media, especially via WhatsApp. Meesho’s users are predominantly female and it claims to have more than 2 million resellers on its site
Huawei-t a minute. Huawei is delaying the debut of its foldable smartphone, the Mate X, from June to September. The reason is apparently because the company does not wish to fall on its face the way Samsung did with the release of its malfunctioning Galaxy Fold. “We don’t want to launch a product to destroy our reputation,” a Huawei spokesperson told CNBC.
This is your brain on blockchain. Another enterprise blockchain pilot is underway. This one has IBM, KPMG, Merck, and Walmart teaming up to track prescription drugs through their supply chains. The alliance aims to satisfy regulations coming out of the U.S. Food and Drug Administration, which is seeking means to electronically audit the industry.
Where the chips fall. U.S. chipmaker Broadcom reported lower than expected revenue for the second quarter and cut its guidance. The company attributed the pullback to the U.S.-China trade conflict and restrictions on Huawei, which is impacting demand.
I got 5 on it. The share price of Fiverr, a freelance marketplace for gig economy workers, nearly doubled–lifting 90%–upon the stock’s debut on the New York Stock Exchange. The company reported $36.1 million in net losses on $75.5 million in revenue in 2018.
FOR YOUR WEEKEND READING PLEASURE
A few longer reads (and watches) that I came across this week that may be appealing for your weekend reading pleasure:
America Is Stuck With a $400 Billion Stealth Fighter That Can’t Fight (The Daily Beast) | Here’s something the public didn’t know until today: If one of the U.S. military’s new F-35 stealth fighters has to climb at a steep angle in order to dodge an enemy attack, design flaws mean the plane might suddenly tumble out of control and crash.
Inside A Tech-Free School Where Tech Executives Send Their Kids (CNBC) | The Waldorf teaching philosophy is used at more than 1,000 institutions in 91 countries, including 136 schools in the U.S. Technology and screens aren’t used at all through 8th grade, and are scarce even in high school.
I Wrote This on a 30-Year-Old Computer. And It Was Awesome. (The Atlantic) | Everything about this computer is loud: The groan of the power supply is loud. The hum of the cooling fan is loud. The whir of the hard disk is loud. The clack of the mechanical keyboard is loud. It’s so loud I can barely think, the kind of noise I usually associate with an airline cabin: whoom, whoom, whoom, whoom. This is the experience a computer user would have had every time she booted up her Macintosh SE, a popular all-in-one computer sold by Apple from 1987 to 1990.
The Curse of the Ship of Gold (Narratively) | How a brilliant scientist went from discovering a mother lode of treasure at the bottom of the sea to fleeing from authorities with suitcases full of cash.
FOOD FOR THOUGHT
The Aristocrats of Motordom. Why did the internal combustion engine win out over the electric motor? That’s one of the questions Dan Albert, an automotive journalist, ponders in his new book tracing the history of the automobile, Are We There Yet?. In the following excerpt, published by LongReads, Albert surveys early iterations of these self-propelled machines–including the incredibly peculiar Jesuit rat car of 1672–and asks why it took so long for the invention to take hold.
Rather than looking in vain for an ur automobile or the mythical figure who invented it, we should instead ask why the technology was taken up when it was. Why did the American automobile suddenly seem like such a good idea in the 1890s? Within the space of a few years, not one or two odd inventors, but dozens, began showing off experimental autos…. Inventors were coming out of the woodwork. They dreamed up contraptions and Americans bought them. By 1899, commentators and industry experts saw that the motorcar was destined to revolutionize American life in profound ways.
IN CASE YOU MISSED IT
Does LaCroix Contain Toxic Chemicals? Here’s What Two Separate Lawsuits Allege by Andrew Hirschfeld
Amazon U.S. Online Market Share Estimate Cut to 37.7% From 47% by Matt Day and Spencer Soper
Fintech Unicorn Monzo Is Expanding Into the U.S. by Lucinda Shen
Uber Investors Are Wary as It Rides Into the Helicopter Business by Anne Sraders
Why Bird Wants To Buy Smaller Electric Scooter Rival Scoot: Term Sheet by Polina Marinova
BEFORE YOU GO
Ye Mirror Blacke. Fears of human-enslaving A.I. robots got you down? Here’s a little lighthearted fun to ease you into the weekend. This Luddism-parodying College Humor sketch reimagines Black Mirror episodes as taking place in medieval times. See how books, plows, crossbows, and yokes will doom humanity. As one woman in the video puts it, “Well, technology will truly be the ruin of us all.”
Methinks the lady doth protest just the right amount.
Read more here:: fortune.com/tech/feed/
R-Style Lab has been listed #2 among Top IoT developers in Clutch Leaders Matrix, a leading B2B tool for mapping top-performing companies in a particular area.
(PRWeb June 14, 2019)
Read more here:: www.prweb.com/rss2/technology.xml
The UN Panel on Digital Cooperation presented last week in New York its final report, and an old question is back on the international agenda: Could the global Internet be ordered by a reasonable arrangement among stakeholders which would maximize the digital opportunities and minimize the cyber risks by keeping the network free, open and safe?
Since the days of the UN World Summit on the Information Society (WSIS/2002–2005) dozens of commissions, task forces and working groups have proposed declarations, compacts and frameworks which meanwhile fill a whole library. Some of those documents were useful, as the Tunis Agenda (2005) and the NetMundial Declaration (2014), others are forgotten. The Internet Governance Ecosystem is a very dynamic space and in a permanent status of change. A quarter of a century ago, the Internet was seen mainly as a technical issue with some political and economic implications. Nowadays, it is a political and economic issue with some technical components. And the global digitalization does not stop with artificial intelligence, the Internet of Things and 5G at the horizon.
Insofar, UN Secretary-General Antonio Guterres did the right thing in July 2018 when he appointed a high-level panel of 20 experts with a mandate to look into the latest digital developments, to analyze the illnesses of today’s cyberspace and to propose how to cure some weaknesses of the Internet. The group was led by an American woman — Melinda Gates from the Microsoft Foundation — and a Chinese man — Jack Ma from Internet giant Alibaba. Now, after one year of discussion, the group came forward with another proposal: A Declaration for Digital Interdependence. Like many of its predecessors, the final report presents an excellent diagnosis. Whether the recommended therapy will meet the same high standard, however, is another matter.
Moving forward into a digital disaster?
The Internet world is vulnerable. This is part of its history. The fathers of the networks wanted one thing above all: to send data from A to B without limits and borders. Security was not a priority. Insofar, the Internet pioneers did not differ from the pioneers of the automobile world. Only when the number of car crashes escalated, thousands of people died, and considerable economic damage arose, legally binding traffic rules were introduced, safety barriers were built on highways and vehicles got seat belts, airbags, and catalytic converters. Yet still, 1.2 million people die every year on the road.
The Internet is not about life and death. The Internet is about power and money. But even there, dysfunctions of the network can cause high damages, divide societies and drive the global economy into a ruinous downward spiral. And the consequences of the pollution of our mental environment, of incitement, censorship, and surveillance can be seen in the recent cultural decline of our political debates. Can democracy survive the Internet, asked Nathaniel Persily from Stanford University already in 2017. And this was and is a good question.
With nearly five billion people online and trillions of objects connected, the one world we live in with its 193 jurisdictions is a global village, regardless of the recent waves of neo-nationalism and the building of new borders. And since everything is connected to everything, the windows of vulnerability grow with each further growth of the network. No one can predict exactly what the consequences of deploying an autonomous, Internet-based weapon system will be in a hybrid war. Nobody knows what will happen if sand gets into the transmission of the free flow of data, which is seen now as the oil of the 21st century. And nobody knows what will happen if IP addresses and domain names are confused and servers and routers no longer do what the internet protocols tell them. The UN panel’s wake up call is very clear: If you let everything go, mankind is marching into a digital disaster that can have worse consequences than climate change.
For a new multilateralism
The experts — including French Nobel laureate Jean Tirole, former Swiss President Doris Leuthard, Estonia’s ex-Foreign Minister Marina Kaljurand, the father of the Internet Vint Cerf and former ICANN’s CEO Fadi Chehade — give five recommendations: Everyone should be online and enabled by 2030 to benefit from the advantages of the digital age. Human rights, security and trust in cyberspace should be strengthened, and appropriate mechanisms for global digital cooperation created. The implementation of the recommendations should be based on nine universal values as, among other things, respect, humanity, transparency, sustainability and harmony. Everyone should commit to a “Declaration of Digital Interdependence.” And for the envisaged “mechanisms of digital cooperation,” three models will be put up for discussion.
That sounds good, but it also seems like a little bit of the wheel was just being reinvented. However, if you look more closely, then you must pay tribute to the group that in these turbulent times they put forward proposals that can shake the foundations of the stalemate of international politics indeed — at least in the medium term. Yes, the devil is in the details, but in the 47-page report, the innovation is also in the nuances.
The report sends a clear message that cyberspace needs some rules. However, the language of “smart regulation” is an interesting one. The group makes clear that the time of traditional international treaties, negotiated behind closed doors, is over. Of course, UN Secretary-General Guterres argued in favor of “Multilateralism” when he presented the report in New York. And he rejected any form of “Unilateralism” that carries the danger of fragmenting the Internet. But the UN Secretary-General also made it clear that the future of multilateralism must no longer be a matter for governments only, but also a matter for all non-state actors from business, civil society, and the technical community. His engagement for such an “innovative multilateralism” is reflected in the report which states clearly that “multilateralism” and “multi-stakeholderism” coexist and complement each other.
This statement reflects the truth of the Internet Governance Ecosystem. However, the reality is that many governments still prefer to bargain with each other. Of course, the multi-stakeholder principle is not new. It was launched at the UN World Summit on the Information Society in 2005. However, most governments have not yet gone beyond lip service with which they support the model “in principle,” but ignore it, when it comes to hard decisions. The “sharing of decision making,” as proposed by the WSIS definition of Internet Governance 15 years ago, is more the exception than the rule in Internet policymaking. Which government likes to share its power?
Insofar it is difficult to imagine, in the current world situation where we have technology wars among cyber superpowers, that such a participatory Internet Governance model, as envisaged by the report, has a realistic chance to get implemented soon. However, one can read the proposals also an agenda for the 2020s. History tells us, that the political pendulum is swinging backward and forward. And it is useful to have in bad times a plan for the good times. Nobody can exclude, that the wind, which is currently blowing in the direction of political confrontation, can turn in a different direction in the next decade. And the 2020s will be a decade of growing digital interdependence.
The proposals for a new global mechanism for digital cooperation are of a similar caliber. The report offers three options: 1. A distributed co-governance architecture, 2. A Digital Commons Architecture and 3. An extension of the Internet Governance Forum, called IGF Plus.
The IGF was created by the UN World Summit in 2005 as a multi-stakeholder discussion platform. The IGF has no decision-making capacity. Over the years, the IGF became useful as a reservoir of collective wisdom and a place for the clarification of many factual issues. However, it remained a paper tiger, because of no procedure channels for ideas that emerge at the IGF into the intergovernmental negotiations.
In 2005, when the IGF was established, the ITU was nearly the only intergovernmental organization which had a special interest in Internet issues. In the meantime, however, there is a multitude of intergovernmental Internet negotiations: the UN is dealing with autonomous weapon systems, state behavioral norms, and confidence-building measures in cyberspace. The WTO has started talks on digital trade. The UN Human Rights Council discusses freedom of expression and privacy in the digital age. ILO, WIPO, UNESCO, OECD, Council of Europe, OSCE, NATO and many other intergovernmental bodies have digital and cyber issues on their agendas. Even G7 and G20 are discussing now rules and norms for the development and the use of artificial intelligence. And although everything is connected to everything on the Internet, these negotiations take place in isolated interstate silos. Trade negotiators have little to do with arms control negotiators. And governmental bureaucrats sitting in the Human Rights Council have no real clue about the future of AI.
This, of course, is a significant deficit of the current system. An IGF Plus could help to bridge the existing gap between discussion and decision, to interconnect — probably via liaisons — these intergovernmental negotiations and to open doors for non-state actors to participate in an adequate way in this very decentralized negotiation processes.
Towards October 2020
The UN panel was wise enough not to push for quick adoption of its recommendations. Antonio Guterres announced the kick start of a global discussion process intending to raise awareness of the urgency of enhanced digital collaboration. A newly appointed UN Technology Envoy should help him with this. However, he also mentioned a deadline: October 24, 2020. This is the 75th anniversary of the founding of the United Nations and this would be a good date for the adoption of something like a “Multistakeholder Digital UN Call”, with commitments not only from the 193 governments of the UN member states but also from the main stakeholders from the private sector, civil society, and the technical community.
By the way, on the road to the 75th UN anniversary, there is the 14th IGF, scheduled for November 2019 in Berlin. This is a good opportunity to add some more concrete proposals and to test whether the world is ready and open for innovation in Internet policymaking. At the 13th IGF in Paris, November 2018, the French president Macron offered several ideas which produced since that the “Paris Call” to strengthen trust and security in cyberspace and the “Christchurch Call” to reduce the misuse of the Internet for terrorist activities. Good steps, but more steps are needed. Why not use the Berlin IGF and to propose a “Multi-Stakeholder Pact to Protect the Public Core of the Internet”? Such a pact could become the first cornerstone in an emerging cybersecurity architecture which would add substance to the UN panel’s proposal to work towards a “Global Commitment on Digital Trust and Security.”
Written by Wolfgang Kleinwächter, Professor Emeritus at the University of Aarhus
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By Dan Jones Helium launches its P2P IoT hotspot, grabs another $15M in funding, aims to start a non-telco, low-bandwidth network in the US and beyond.
By Paul Budde
“Peak telecom” is described as the maximum point of expansion reached by the traditional telecommunications industry before the internet commoditized the industry to a utility pipe.
I had to think of this when I read the recent outcomes of the famous Ericsson Consumer Lab survey. The company used the result of the survey to counteract market criticism regarding the viability of the telco business models in the deployment of 5G.
It will come as no surprise that Ericsson, as a manufacturer of 5G gear, has given the report a positive spin. However, I remain skeptical about the short-term business models for the deployment of 5G. Once full deployment happens over the coming decade, I certainly can see long-term opportunities. These will revolve around content and apps as well as areas such as IoT in smart homes, cities and energy. However, the question is, will this lead to new financial opportunities for the telcos? Peak telecom questions such an outcome.
What exactly do these broader 5G opportunities mean for the telecommunications operators — the companies who have to build the infrastructure? It is here that we can see that we have reached peak telecom. For several years now, we have seen that growth in the telecom industry is rather stagnant. Profits are still being made but mostly generated by lowering costs. For example, new telecom access speeds are provided at no extra cost to the users. Basically, consumers are getting more for the same price.
There has continuously been the promise of new revenues that could be generated through a range of new telecoms development (internet, broadband, smartphones). The telcos have, however, largely failed to move into the content/app market where the new profits are occurring. Companies such as Amazon, Facebook, Google, Alibaba, Tencent and Netflix have been the primary commercial beneficiaries of these developments.
The Ericsson report mentions that mobile access in congested areas and in megacities is becoming a problem and that 5G will assist here. I agree, but will customers pay extra for it?
It also mentions opportunities for 5G to be an alternative to fixed broadband and for it to become a key technology in fixed wireless networks. There certainly will be niche market opportunities here, but this is a highly price-sensitive market. The economics of mass fixed infrastructure favors it over mobile infrastructure. Any gains here will basically be a substitution of a fixed service they already provide, so the overall net gain for the industry will be neglectable.
The report indicates that 20% of smartphone users are prepared to pay a premium for 5G. The current commercial 5G service in South Korea is charging a meager 10% premium. No doubt, in coming years, through competition even that premium will disappear.
The report indicates that consumers expect new innovation such as foldable phones, VR glasses, AI, 360-degree camera, robotics and so on. All true but it all depends how affordable these products and service will be and again who will develop these next “must-have” products? Here, also, the telcos will most likely be missing out.
I fully agree with the report’s assessment that we have to look at 5G over the more extended period. As mentioned, there are good reasons to believe that once full deployment exists, it will open up many new business opportunities.
However, will this promise be enough for telcos to make the substantial upfront investments that are needed? This without a clear indication if they can extract any significant new revenues from 5G? The more likely scenario is that the digital giants are going to be the ones that will reap the real profits of those innovations.
I stick to my argument that the key reason for the telcos to move into 5G is because of network efficiencies, which lead to lower costs. This is absolutely critical in this peak telecom market.
To end on a more positive note for the industry, there is the first mover advantage with short term premium price opportunities for those who can tap into the early adopters’ market. There is always a group of users who simply do want to have the newest of the newest, whatever the price. The size of this market varies — depending on how “hot” the new product is seen by this market segment — and could be anywhere between 10% and 25%.
This is certainly attractive for the telcos as it allows them to recoup some of the initial investment rapidly. In relation to mobile products and services, this mainly relates to “must have” gadgets and, in particular, the smartphone. The current price (in Korea) of a 5G phone is approximately US$1,500 (AU$2,153), without any outstanding features.
The lack of attractive smartphones could be another negative for some of the early adopters. Time will tell.
Written by Paul Budde, Managing Director of Paul Budde Communication
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