On this episode of the Futurum Tech Podcast, we talk about Microsoft contractors listening to audio of Xbox users and the fact that that’s rapidly becoming our new normal, VMware’s giant acquisitions of the week, Qualcomm’s stay of execution, and Oracle suing Oracle. You heard that right. All that and more on this edition of Futurum Tech Podcast.
Our Main Dive
We have to talk about privacy issues and invasion of privacy way too much these days, as it happens all the time now. Recently it came out that contractors working for Microsoft listened to audio of Xbox users in order to improve the consoles voice commands. Not only did they listen to audio, it was sometimes recorded. Talk about an invasion of privacy!
Our Fast Five
We dig into this week’s interesting and noteworthy news:
- Facebook privacy “change” is kind of a shell game
- VMWare makes two significant acquisitions in one day, in advance of VMWorld Event
- Qualcomm gets a stay of execution
- Amazon is changing it up with return process
- Oracle sues Oracle, or something like that
Apple has issues, lots and lots of issues
Crystal Ball: Future-um Predictions and Guesses
What is going to happen with all these privacy issues? How are consumers going to be protected? Can we expect Congress to act and create some type of Consumer Privacy Act? Will tech companies try and get out in front of it? It’s going to be an interesting ride.
Olivier Blanchard: Welcome to this week’s edition of FTP, the Futurum Tech Podcast. I’m Olivier Blanchard, Senior Analyst with Futurum Research and joining me today are fellow Futurum leaders, Shelly Kramer and Ron Westfall.
How are you guys doing today? Shelly first.
Shelly Kramer: I’m great, thanks. Always a pleasure to be here.
Olivier Blanchard: Excellent. Ron, how are you?
Ron Westfall: Thumbs up. It’s Friday.
Olivier Blanchard: Thumbs up, it’s Friday. I hear that. Okay, so, we’re going to start today’s show with a discussion about consumer privacy and a whole new branch on the tree of problems that we’re having to deal with in our new normal of our entire life being monitored by somebody out in the ether. Then we’ll share some of our favorite tech news stories of the week in our Fast Five segment. Followed by Tech Bites in which we highlight just one of the biggest tech-related fails of the week, there are usually more than one. And we will end the show as always with our Crystal Ball.
However, before we begin, it goes without saying that this show is intended for informational purposes only. And no advice or insights, no matter how great they sound, provided here today should be taken as investment advice.
Okay. Now that that’s out of the way, let’s talk about privacy. We were discussing before the show all the different topics that might make a really good Main Dive today. And there are a lot of really cool items and some of them we moved to the Fast Five because they’re really important but they’re fast to get over. But the one that struck us and that really kept sticking was the fact that in our new normal, in our digital economy, includes a progressive loss of privacy that we’re not necessarily apathetic to but unable to really do anything about.
And one of the reasons for that is that we don’t necessarily always know exactly who is doing what with regards to our privacy and invasions of privacy. We just have this general sense that if we’re surrounded by technology as we are, we are being monitored. Our conversations are being monitored, our searches are being monitored. Basically, it’s a mix of algorithms somewhere in the background and humans sort of looking at what we write, what we talk about, what we view, our patterns and of behavior and so on. But specifically, the fact that a lot of this stuff is not automated and even though it’s anonymized for the most part, it still involves a whole lot of human beings on the other side of the technology or the device that we’re using, monitoring our behavior online and offline. And specifically, the growing theme of third-party contractors working for companies like Facebook, Google, Apple, listening in on our conversations.
And we had an event this week where internally, we were having a discussion about a tool, a collaboration tool specifically. I didn’t do any searches on this tool on any of my devices, right? I didn’t Google it, I didn’t click a link, I didn’t visit the page, I never typed in the name of this tool. The only time it was mentioned was during a conference call. So, it was a verbalized mention. And within 24 hours, I started seeing ads for this particular tool on my phone, specifically on Facebook, as sponsored posts.
So, after this longer monologue than I expected, I want to start with you, Shelly. Give me your reaction or some thoughts on the growing problem of third-party contractors, human beings that you and I don’t know, we’ll never get to meet them. Just randomly listening in on us through our devices, whether they’re our smart home appliances, our phones, the applications that we use, our computers, possibly even through our cars. What’s going on with this?
Shelly Kramer: Well, I think that the… Actually, also the thing that you didn’t mention is that as soon as you started seeing those targeted ads, you messaged me with the, “Holy crap, can you believe this?” But the specific news that we started this conversation talking about was about something that was reported that Microsoft has had contractors listening to audio Xbox users speaking in their homes. And when questioned about this, Microsoft reported that it was supposed to improve the console’s voice command features. Makes sense, right? Natural language processing can’t get better without listening, I guess. I don’t know, whatever. But this is on the heels of other reports that contractors listened to Skype calls and listened to audio recorded by Cortana. And we know that Amazon workers listen to Alexa and we know that Google has people listening to train its voice assistant. The reality of it is, I think that this is a big deal and it’s not a big deal.
The reason I think it’s a big deal is because it’s like, “Oh my gosh, can you believe this is happening?” And people like us who are probably more knowledgeable about some of this technology sort of beat the drum about what a big deal this is. But I think for the ordinary, average human being, they are not paying attention and they really don’t care. They want to use their Xbox, they want their Xbox to work really well. They want to use their Google Home, they want to use Alexa, whatever. And as long as it works, they’re not thinking about what’s behind the curtain. So, I’m not sure that that’s going to change.
Olivier Blanchard: Yeah, I don’t know. I think it’s part of the problem that on the one hand, we don’t really know what’s going on. On the other hand, we have so many things in our minds and so many things that occupy our day, that worrying about what some strangers somewhere might be listening to on our device is not that important. And especially if you have like a quiet lifestyle and all you’re doing is just playing video games and putting fried chicken in your microwave twice a day.
Shelly Kramer: What’s wrong with that?
Olivier Blanchard: There’s nothing wrong with that. Exactly.
Shelly Kramer: That’s what I do.
Olivier Blanchard: That’s the point. It’s kind of, yeah, that’s what I did today. So, although the air fryer is a better choice to reheat fried chicken, by the way. But it’s like this notion of, “I’m not really doing anything and I’m not doing anything embarrassing most of the time. So, who cares?” Right? So, I’m going to put this to Ron. Ron, where do you think the line is between people being accepting of this because it’s annoying and it’s scary and it makes you uncomfortable but ultimately, it’s not harmful. And the kinds of abuse of this listening, I don’t know, culture that does tip into potential abuse. Like ransomware stuff, blackmail, people really creeping in on your personal life. Where does that line get drawn? And when does it start becoming a problem, in your opinion?
Ron Westfall: Yeah. No, it’s going to be with us for quite some time into the foreseeable future. And there is a Back To The Future element here in terms of what our citizens are willing to tolerate in terms of striking that balance between their privacy rights and enabling a better product. And something as simple as, for example, a supermarket loyalty program that, case in point, you can simply opt-in to say, “Yes, I want to sign up for the loyalty program so I can get 10 cents off my bananas. And I’m giving you permission to monitor my food shopping habits and so forth and therefore get better deals, better values.” And what we can anticipate, at least if they’re going to be smart about this before legislators come in with heavy-handed solutions, is being more proactive about opt-in capabilities.
It’s like, “Hey, you’re now using this new Xbox feature.” And you then decide whether or not to opt-in for monitoring as part of this new feature. So it could be pretty straightforward of people saying, “Yes, I’ll give you permission because I like this application, I like the service, and I’m willing to have monitoring with the legal means to go ahead and enjoy this.” Or it can also include an incentive, like, “Okay, we understand that by adding a monitoring request, this is something that after you to go an extra mile or megabit” or whatever you want to call it. And therefore, people will again have that incentive, again, that discount incentive to do it.
Otherwise, yeah, we can bet that this will give legislatures in certainly North America and Europe and other parts of the world more reason to say, “Okay, yeah, we need to step in and pass laws that make this more restrictive.” That can then actually curtail the innovation capabilities of the major suppliers here. And potentially, AI can offload some of this. It’s not quite there today. But AI engines can actually offload having to actually listen to humans and your real-world interactions to enhance capabilities like auto-translation and so forth. And so, yeah, there is relief around the corner, whether regulatory or technological. But the meantime, there’s some common-sense steps that these players can take to make this less menacing and more acceptable to the general public.
Olivier Blanchard: Right. No, I totally agree.
Shelly Kramer: I’m sorry if I could pipe in here too and say that the reality of it is, these things are already covered largely by these gigantic tech companies’ terms of service. When the Microsoft thing was being written about, Microsoft said, “We’ve long been clear that we collect voice data to improve voice-enabled services and that this data is sometimes reviewed by vendors.” I would venture a guess that you’re going to find language along those lines in about anything in any terms of service, which none of us read. I’ll wrap this up by saying that I think, again, I’ll go to my point about ordinary average human beings and your point about eating fried chicken and doing nothing but living your ordinary life.
I was waiting in line to board a flight, I think it was in Dallas a few months ago. And they announced that they were integrating facial recognition technology into the boarding process. And people were like, “Oh, whatever that is.
Okay, fine.” I thought, “Isn’t this interesting?” They’re not asking you if you want to do it. They’re just telling you that they’re using facial recognition tech as part of the boarding process. And I think that’s a big deal. They didn’t really ask my permission. And some of the comments that were happening in line with me is that people were saying, “I don’t care. I haven’t done anything wrong. Why do I care? I’ll put my face in that database. It’s fine.” So, I feel like that’s really the viewpoint of a lot of people, whether it’s about facial recognition or monitoring of what we’re doing online. It’s almost too much to care about.
Olivier Blanchard: Right. Yeah, I think there’s an education piece here that’s missing. Because from a legislative standpoint, no one has really addressed this. Congress and basically, the legislative bodies, period, are always many years behind technology evolution. So, if we translate this into like digital transformation, what these companies are able to do is basically get ahead of any legislative response by at least half a decade. So, they’re always going to be ahead of the curve and so they’re going to own the conversation. And it’s a lot easier to just go along with the flow, right? And say, “Well, okay.”
So we’re in a process that’s already very regimented by TSA, by Homeland Security, by the airlines themselves, the airports that like everything is physically structured to move you from point A to point B to point C to point D in a very “this is your turn, you do it now, you do it this way or we will remove you from this flight.” Because traveling through air with airlines is now a matter of national security. Like even going to the bathroom is a question, a matter of national security. And so people accept this. I think there’s a difference between submitting yourself to facial recognition when you’re crossing the U.S. border and you’re at a DHS checkpoint where they want to make sure that you’re not on a terrorist watch list. And there is that. You get up to the screen, you scan your thing, it gives you a ticket with your picture on it, whatever. Fine. But for internal flights when you’re just going from like Charlotte to Atlanta, you should have an easier way to opt it out.
So to circle back to what Ron was talking about with the opt-in opt-out here thing, I think that the default for the tech industry now has been zero transparency. It’s as opaque as they can possibly make it, even though there might be language somewhere in the fine print of the 35-page terms of service document that you just check the box and don’t read. And it might not even be that clear even if you were to read it. So, the lack of transparency industry-wide to me is a problem and it’s deliberate.
The other thing is that the default whenever these companies have to react to bad press is to create opt-out mechanisms as opposed to creating opt-in mechanisms. And I think that’s a shift that we’ve seen in the last few years that’s dangerous because it used to be opt-in. For instance, a really simple way of completely turning this around where companies like Google, Amazon, Apple, everybody, would still be able to monitor our conversations for quality to help really tweak their AI transcription and voice and language analysis systems would be to create an opt-in system that used to be really popular with every tech technology user. And it was called beta testing.
I’m old enough to remember a few years ago, especially in the gaming world, where it was really cool to be a beta tester. You would apply for a program if you want to be a beta tester for this particular game or this particular feature. And it would be super simple to create a beta testing model for this monitoring system. Do you want to opt into this and be a beta tester for language transcription, for quality control for AI? And people would say yes. Maybe not everyone but it would solve this problem from a PR standpoint. It would solve it from a legislative standpoint. It would prevent Congress from having to act and maybe overact and get in the way of actual better quality AI controls.
So, I’m not really sure why these tech companies are not actually going with this model and using basic psychology that’s been proven to work over the years with technology users. And why instead they’re trying to be opaque and misleading and just shifty about it. It doesn’t really make sense to me. That’s not even good business. So, like 30 seconds for Shelly, 30 seconds for Ron. Last thoughts and then we have to move on.
Shelly Kramer: Well they haven’t done anything, Olivier, because it works really, really well and they’ve made billions of dollars keeping it as is.
Ron Westfall: That’s a good point. And as I was going to mention that to head off that potential crimping of the money machine is going back to the future per Olivier’s suggestion. There are ways to do this and strike that right balance between privacy rights and what legislators could do that could actually really hamper that ability to innovate. It’s really going back into their own DNA, their own history book, and resurrecting the beta testing, and proactive opt-in mechanisms, and so forth. That would be a difference-maker and we’ll see if they’re going to simply do that.
Olivier Blanchard: All right. Thank you. Very good insights, you guys. A great opening segment as always. But now we do have to move on to our Fast Five. So, Ron, since I have your attention, let’s just go ahead and start with you.
You have some news about Oracle. What is that all about? What is going on with Oracle suing itself, maybe, sort of?
Ron Westfall: Right. Yeah. It’s hard to top that headline. And yeah, Oracle and lawsuit are like joined at the hip, at least if you do a Google search. And specifically, the most recent issue, the fact that a special committee of the Oracle board has sanctioned a group of shareholders and sued specifically the Oracle CEO and also founder and chairman Larry Ellison for basically acting not in the best interest of Oracle as a company but in their own self-interest. It’s called a derivative suit because of the situations that arise where the people who are watching the henhouse aren’t doing the best job. And specifically, this is linking back to the Oracle acquisition of NetSuite for $9.3 billion back in 2017 and the fact this acquisition has not panned out well in terms of moving the needle in terms of say, the software-as-a-service market segment.
And an additional background, Larry Ellison was a majority holder in NetSuite. So, when the acquisition was implemented and it was done at a premium over NetSuite’s actual stock price, that did raise eyebrows. And now it’s culminated in this sticky situation where you have the shareholders, led by the Firemen’s Retirement System Of St. Louis. I don’t hear them often in tech. Now they are part of the headlines, basically spearheading this specific lawsuit, so stay tuned. It’s an interesting one and, again, adds to that trend of, “Okay, Oracle and what’s the latest in terms of what’s going on with them, with the lawsuits?”
Olivier Blanchard: Excellent. Perfect. All right, Shelly, you have actually just circled back to our original topic. You have something about privacy as well, right?
But anyway, so what Facebook has done is they are providing more control over to users over their information using a clear history tool and that allows people to delete their off-platform browsing records. They promised this about a year ago. It’s rolling out right now in Ireland, South Korea, and Spain. And then it’ll be rolled out to all Facebook users in the coming months. So, you can use it, you cannot use it, you can choose to continue to allow Facebook to have this history.
One of the things that I thought was interesting is that even if you choose to turn it off, it’s not going to be disconnected immediately. It’ll probably take about 45 minutes. That information will be used for measurement purposes and to make improvements to Facebook’s ads systems is what it says about the Facebook activity that it pays attention to. So, anyway, this is one of those things that I think it’s an important change. I think it’s something that most users won’t really pay any attention to. They won’t take the time to figure it out. A lot of Facebook users are our moms and our grandmas and everything else and diving deep enough to know that they even have this option is probably something that a lot of Facebook users won’t do. I think it’s a good thing. I think people should probably do it. I hope people do it and I’m not sure they will.
Olivier Blanchard: Opt-out is always a lot harder than opting in, isn’t it? So my Fast Five this week deals with Qualcomm. And we have a little bit of an update on the FTC case against Qualcomm, which as you remember from a few months ago, the FTC had ruled against Qualcomm, effectively forcing Qualcomm to have to renegotiate all of its contracts with basically every OEM in the world should they ask for it.
There’s a very controversial decision that on its face didn’t really make a whole lot of sense. And obviously, Qualcomm appealed to the Ninth Circuit and the case was in limbo. We were waiting on a decision, first of all, not yet on the appeal but on the stay. They had applied for a stay to allow the appeal to proceed without any damage being caused to their business and to the 5G ecosystem because of the immediacy of the original decision. And really good news for 5G, for Qualcomm, and also for all the companies that Qualcomm’s deal with because it means they won’t have to renegotiate any contracts with Qualcomm anytime soon, if ever. Basically, it’s that the motion for a stay on Judge Koh’s decision from a few months ago was approved.
And so, what’s going to happen now is Qualcomm’s appeal with the Ninth Circuit is going to move forward. The stay on Judge Koh’s decision just means that Qualcomm is going to be allowed to continue to operate as it was before the decision. And essentially, it’s a status quo thing. It’s no harm, no foul. If at the end of the appeal process the Ninth Circuit decides that the original decision by Judge Koh should stand, then at that point, those contracts may have to be renegotiated.
But in the meantime, as the case is being heard in appeals, Qualcomm is allowed to continue operating the way it was before, which makes more sense in which it brings a lot more stability to the 5G ecosystem and the tech ecosystem as a whole. So it’s excellent news for everybody. That’s basically it. And if you want to find out more about it, definitely check out our Insights blog. Because we have been focusing on this case for quite some time now and we have, I think, some of the best coverage of it anywhere on the Internet. There you go.
All right, so back to Ron. Big week for VMware, right? Tell us about that. What’s going on with VMware? And there are two huge moves this week.
Ron Westfall: Yes, bully for VMware, I guess you can say. In a more positive though, this is something that will strengthen their competitive position and the foreseeable market. Specifically, it’s their biggest combination of acquisitions to date. Obviously, it’s a total value of $4.8 billion. And in addition to the fact that it’s the largest acquisition move VMware has made, they’re anticipating that this will definitely help their bottom line. For example, it will possibly contribute over a billion dollars of revenue next year. And as a result, we’ll take basically their market position and their hybrid cloud and as-a-service market segments, north of $3 billion. So we can see this is already moving the needle and it will basically cause the competitors to really have to adjust to a VMware-strengthened position.
Specifically, in terms of the companies that are acquired, Carbon Black is an endpoint security specialist and one that has certainly been successful in areas such as compounding malware. And this move is aligning with what we’re seeing in the space. As we know, security is all-important and that security has definitely taken the headlines as we’ve seen with companies like Symantec being acquired by Broadcom and Cylance being acquired by BlackBerry. So there’s clearly momentum in this segment.
And then also in terms of pivoting to Pivotal, this is definitely playing to the multi-cloud administration space. As we know, the industry is trending toward multi-cloud implementations for a variety of reasons. Enterprises require different needs and as a result, will contract with different cloud providers in order to meet them. For example, they might prefer one cloud provider for software-as-a-service need and then require another cloud provider to do infrastructure-as-a-service or platform-as-a-service and so forth. As an additional note, it’s worth pointing out that Dell is a majority owner in both Pivotal and VMware. And as a result of the move, Dell’s ownership of VMware ticks up from 80% to 81% so it’s very much a family affair. It’s definitely clear that the move has Dell’s approval of it. And it will also benefit the mother organization Dell in terms of its overall competitive position. So, overall, that’s a two thumbs up for VMware and for Dell as well as the companies acquired.
Olivier Blanchard: Outstanding. Perfect. All right, so Shelly, close us out here. What is your last Fast Five about? I hear it’s something about Amazon. Amazon’s doing something interesting.
Shelly Kramer: You know, there’s always something going on with Amazon and I’m fascinated by watching that company. So, my topic here relates to Amazon changing its return practices. They did this kind of in stealth mode. I didn’t even notice it until I went to return something in late July. And all of a sudden, instead of printing a label and putting it on a package and dropping it off at my local UPS shipping store, what it told me to do was to print a return authorization, not package it in any way, and drop it off. And they also let me know that I could drop it off at one of those locations or I could drop it off at a Kohl’s store. And I thought, “Oh, how interesting.”
So then, when I went to my local UPS store to drop it off, I was asking about it. And instead of having this huge volume of returns going back to Amazon, all packed in individual envelopes and boxes, they simply take your return and they put all of the returns in a gigantic box and they ship it all to our return center. So I thought that was really fascinating and probably a much-needed change.
What I’m focusing on today is that this is changing everything for Kohl’s. And the reason is that for a lot of people, they have no reason to go to Kohl’s. It’s kind of known for being a discounted seller. It’s not the most sexy, appealing brand. But what is sexy and appealing about it is that I can take my Amazon returns there. And a whole lot of us are buying things from Amazon that we need to return. So, what Kohl’s reported is that since the end of July, it’s in-store foot traffic is up by 24%. That’s a lot. And it’s not surprising. But what I think is fascinating about that is the opportunity that it presents. Because more foot traffic to any location means an increased opportunity to interact with potential customers, to sell them stuff, to introduce people to Kohl’s who might not otherwise be there. So I think it’s turning out to be not only a smart move for Amazon but an amazingly beneficial move for Kohl’s.
Olivier Blanchard: Excellent. Yeah, no, that’s really interesting. It actually kind of seems like it makes the process more complicated. But I think it actually makes it easier for a lot of people. Especially in maybe more, not necessarily rural areas, but areas that are in between big city and out in the country, certainly for, yeah, a mid-tier city like mine. It definitely makes more sense.
Shelly Kramer: Well, I think it does make it slightly more complicated. I have to think more. I have to go to different steps but I think Amazon doesn’t care. You know what I’m saying? I think this is a move that’s best for Amazon. It’s not best for consumers. They’ve trained us to buy their stuff, to get it in a day or two, and to be able to easily return it. So now they’re changing the game on us and they’re not asking our opinion. We’re just doing it. So sometimes it’s really not easier but we don’t really have a choice because we’re hooked.
Olivier Blanchard: Yes, we are. Amazon controls the world. So, that does it for our Fast Five for this week. That was a pretty good one. And we’re now moving to our Tech Bites, which could have been Amazon this week. We thought about it because we found out that Amazon this entire time was paying its delivery drivers using tips as opposed to just paying them outright. But we can’t really ding them since they’re finally moving away from that model and paying their drivers properly now. However, and it might seem a little petty on the onset, but something that struck me as a big Tech Bite as a fail, especially for a company with so many resources and such a fantastic reputation for design is the launch of the Apple Card. And the reason why, there’s nothing wrong with the card, it’s a good model, Apple whether or not is running out of ideas, becoming a credit card company makes sense from a business standpoint, even though it’s not innovative at all.
But what struck me as a former product manager and somebody who used to actually develop innovative physical products that you had to take out of a box and you could touch and hold and do stuff with, the fact that something as simple as making sure that your physical product is made of a material or has a coating on it that will not be damaged or stained by touching leather or touching denim is one of the most basic checkbox items on a checklist for product manufacturing. It’s actually something that you don’t even have to test internally. It’s something that when you’re dealing with contract manufacturers who make the parts for you, will give you these options. They already have data on what coatings and materials will react to what surfaces and what types of contacts. So, you don’t even have to have a sophisticated in-house quality control system. All you have to do is check that box on the PO.
For some reason, the Apple Card turns out to not be compatible with leather or denim or other typical wallets and clothing materials. And will very easily stain if it comes in contact with any of those things. I thought, for a company that prides itself and has such a great reputation on being the best in technology and basically the best, period, when it comes to product design for consumer goods, not being able to release a simple credit card that doesn’t get stained when it comes in contact with your wallet is to me just mind-boggling and incredibly embarrassing. So both of you, 45 seconds. Actually, let’s start with Shelly. 45-second reaction on the Apple Card. Yes. Go.
Shelly Kramer: You know, I just can’t even believe it. Because not only can you not put it in your jeans pocket, you can’t put it in leather, which is fine. I don’t really use that. But you’re not supposed to put it up against any other cards. And the whole thing is that it’s titanium and it’ll get dirty and then there’s cleaning suggestions. I don’t understand. I don’t understand. It makes no sense.
Olivier Blanchard: Right. How about you, Ron? What do you think?
Ron Westfall: Well. Yeah, and to pile on to add to the hit list, you can’t have the card near a magnet. So, risk having it demagnetized. It’s like April Fools’ Day in mid-August. It’s just that. You have to almost laugh and cry. It’s absurd that the card has so many caveats and limitations that practical, everyday use. It’s almost like, why bother? And so, this will be hopefully a lesson learned for Apple in terms of Apple Card 2.0 and what to avoid. And we can anticipate that they’ll need to follow up on it.
Olivier Blanchard: All right, well thank you very much for that. I think that was like a… It was a gimme. There wasn’t really a whole lot to add to that other than the fact that maybe it’s just a big nothing burger. Maybe nobody cares and everybody’s walking around with stained Apple Cards and it’s just something we shrug at, it isn’t really in fact anything. All right. Assuming that anybody even wants an Apple Card to begin with but that’s a whole different topic.
All right, so now that we’ve focused on our Tech Bites, we finally reached the point where we look forward into our Crystal Ball and try to become futurist for a moment and figure out what’s going to happen. And I like to always go back to the original, the main topic of each podcast and start looking forward a little bit at what might happen.
And since our podcast today was mainly focused on this privacy issue of third-party contractors listening to everything we do and looking through our electronic doorbell cameras, my question to you two is what will come first with regard to consumer protections? Will Congress act and create a sort of consumer privacy act? Or will tech companies that engage in these types of operations try to get ahead of it by switching to a more opt-in model like the one we talked about earlier where maybe they just switch to beta testing opt-ins as opposed to default stealth monitoring? which will come first, the legislation or the preemptive move to avoid being required to do it by lawmakers? So, let’s start with you, Ron. What do you think?
Ron Westfall: Well, you know, I’m going to hedge and say it will be a blending of both. It’s not exactly an either-or thing. It’s obviously a complex issue. And there’ll be variations partly on a geographic basis, partly on which part of the government are you talking about? It’s one thing for Congress to pass legislation. And we’re seeing encouraging signs, for example, with IoT cybersecurity and establishing national standards. And I would potentially touch on some of this. Obviously, there’s the executive branch and all the different agencies like the FCC that can actually respond more quickly and requiring the companies to be more effective in respecting our data privacy rights. And in the meantime, yes, we anticipate that these major players of mistakes at hand will want to preempt having some really restrictive legislation crimp their innovation style.
So, as a result, they will turn the clock back somewhat and become more proactive, quite simply. And figure out ways to have users willingly know that, “Okay, I’m being tested. I’m being more aware of it.” In addition to the fine line print when they initially sign on to a service or an application, hear nothing more about this implication. And also, again, the tech aspects, AI might be able to offload some of this anyway, so it’ll alleviate the problem somewhat. And so, yes to both is my answer.
Olivier Blanchard: All right. What about you Shelly?
Shelly Kramer: You know, I think that the big technology brands are going to continue playing the shell game that they play. And they’re going to make moves like Facebook saying, “Oh, we’re making these changes and this is going to make things more private for people.” I think it’s a shell game. I think it’s changes that don’t really make a big impact but sound like they make a big impact. And I think that they’re probably going to take the lead as opposed to legislation really being enacted that is enforceable that will be able to effect change.
Olivier Blanchard: Yeah. Okay. What I think, it’s a little bit of both. So, not to hedge or anything. I think that because these companies have by default chosen to be opaque and misleading about all this and are trying to play a shell game where a lot of the changes they make are very slow to come, very cosmetic, and don’t usually address the core problem. I don’t think that they’re ever going to do this on their own. I think it would take a spectacular change of culture at one or two of these major companies. So that would be Apple, for instance, Google, or even Amazon, really deciding to go to take a different tack and say, “We’re going to be the company of trust and we’re not just saying that. We’re actually going to prove it and switch to an opt-in model.”
It would take that much of a shift to start to move the entire industry in that direction. Especially if that shift, that courageous decision turns out to be a positive for the business itself and obviously for investors.
And so, anything short of that, the government’s going to have to step in and we’re going to need a U.S. version of GDPR that goes a little bit deeper than what GDPR does. And I think that there needs to be a very specific focus on this privacy issue. Not so much of data sharing and data collection but specifically with regard to voice and video of people in their homes, in their offices going on with their day-to-day. It’s inconceivable to me that for people like us who have very confidential discussions with a number of companies and usually have our devices in the room with us, that there aren’t clear protections. It’s almost at this point where I want to start advising our clients to start using skiffs whenever they have confidential conversations with their clients, with potential partners, with each other because of how easily their conversations can be captured through their devices. And that’s a problem that’s bigger than just consumer privacy. But that needs to be addressed, I think, by the government, whether it’s the FTC or Congress or a combination of both.
I think that’s a really good point that you raised, Ron, but I think it’s going to take outside intervention. I don’t think these tech companies will ever volunteer to do this on their own.
So, guys, thank you very much. We have to close it here. And that obviously does it for this week’s edition of FTP, the Futurum Tech Podcast. So, thanks to both of you for hopping on today and listening to me rant and for your wonderful insights. To our listeners, thanks for listening to another week of analysis. Obviously, don’t forget to hit that subscribe button if you haven’t already. And catch us next week for another round of news and analysis of technology. In the meantime, have a great week, everybody.
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