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The Combustible Issue of Breaking Up Tech–Futurum Tech Podcast Episode 036
by Olivier Blanchard | March 15, 2019

On this edition of FTP, the Futurum Tech Podcast, we’re going to take a look at monopolies in the digital age and answer the question, should we break up big tech? I’ll give you a clue. The answer is no. We’re also going to take a look at Verizon’s 5G launch, Facebook’s new revenge porn detection engine. We’re going to talk a bit about body area networks and Foursquare. Remember Foursquare? They’re still around and we’re going to take a look at Boeing and the challenge they face with complexity because as we know, complex systems, they can often fail unfortunately spectacularly. All these and more on this episode of FTP.

Our Main Dive

Elizabeth Warren’s presidential run includes a call to break up Amazon, Google, Facebook, and any tech company that generates over $25 billion of annual revenue and looks like a “platform utility” (e.g. Apple and its App Store). While this might work in the world of politics we think its a recipe for disaster in the tech space – another political idea that’s easier or better said than done.

Our Fast Five

We dig into the week’s interesting and noteworthy news:

Tech Bites

Boeing’s human decisions that led to the 737 Max disasters.

Crystal Ball: Future-um Predictions and Guesses

Will other carriers follow Verizon’s low-cost $10/month approach to 5G, or will they milk the market for all they can get as high-speed mobile technology finally starts to emerge as a reality?

Transcript:  

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 Dan Newman and Fred McClimans. We are all here today. How are you guys doing?

Daniel Newman: I’m doing good and we are all here for just one time, although I won’t be here for the entire time. I’m looking forward to jump into the main dive and then hearing and listening later as you and Fred take it home.

Fred McClimans: You’re sort of a half here.

Daniel Newman: I took a halfie. It’s like the selfies I take on airplanes. Ask most people in my life unfortunately at the pace we’re going, half of me is pretty good.

Olivier Blanchard: All right. We’re going to start today’s show with a discussion about breaking up big tech. Then we’ll share some of our favorite tech news stories of the week in our Fast Five segment which could have easily been the Fast 15 this week as there are so much to talk about. Then we’ll follow it as usual by Tech Bites in which we highlight one of the biggest tech-related fails of the weeks. We will end the show with our famous Crystal Ball. As always, before we begin, it goes without saying that this show is intended for informational purposes only and no advice or insights provided here today should be taken as investments advice.

All right, now that that’s out of the way, let’s get into our main topic, breaking up big tech. The reason I bring this up is we’ve had several discussions on this podcast already about tech companies, not necessarily being too big to fail, too big, period, but that maybe we need to regulate big companies or especially big tech companies, especially the Facebooks, the Googles, the Amazons, the Apples of the world that they have too much power, that they too much money, too much influence and that their technologies are so new and so unfettered that we don’t really have as the public as even as democracy’s really good framework for controlling and staying ahead of what these companies can do.

In recent weeks, I’ve noticed that some of the 2020 presidential hopefuls have steered their ship towards this discussion. The general sense right now isn’t so much that these companies need to be regulated, but that they need to be broken up. The discussion is steering itself towards early 20th century antitrust types of discussions. I wanted to just introduce it that way, not to make a political discussion. We have our politics, but this is a business. In the interest of being pragmatic and purposeful, this is not about being partisan, democrat, republican. This is just about identifying actual problems and looking for adequate solutions to those problems with regard to tech and business.

With that, Fred, I wanted to get your feel first and then we’ll go to Dan on where you think this is going, what you’ve heard in the ether when you have time to actually listen to what’s going on outside of doing research and writing research papers and see what your take on this is.

Fred McClimans: Olivier, I think it’s important to understand that these companies, the big tech companies out there, the Amazons, the Facebooks, the Googles, but also many others, IBM, Microsoft, AMD, take your pick, the tech industry is very complicated. It’s very technical. The markets that were all playing in today are by and large relatively new. When I see this wave of perhaps animosity sweeping around some of these companies, yeah, they deserved to be hit a little bit here and there. Google, Facebook, Twitter even, they’ve had some serious issues that they need to correct moving forward here, but what I see more than anything else is the populous way that becomes more emotional. It becomes a rallying cry.

I think if we weren’t in an election cycle right now, we probably wouldn’t be hearing anywhere near the level of noise that we would be otherwise hearing about breaking up these companies. Yeah, they got work to do, but look at the impact that the anti-Amazon campaign had in New York City. They literally pushed back to the point where Amazon said, “Yeah, we’ve got our reasons, but our reasons aren’t strong enough to fight this particular wave of negative sentiment out there.” I see that. Unfortunately, it tends to come from that reaction I think more than anything else.

Think about any monopoly that’s been broken up in the past. AT&T, great example or the old [Mabel] broken up into a number of different regional box, the RBOX. Where are they today? They are more powerful and more dominant than they were and they’ve started coming back together. I don’t see a lot of value in having this conversation publicly about breaking up this companies. They need regulation. They need to fix some significant issues, but it’s a populous wave right now. I think we’re going to be saddled with it for the next couple of years until people really figure out what’s going on here.

Olivier Blanchard: Dan?

Daniel Newman: Yeah, this is posturing. It’s political posturing. First of all, I’d be very interested as we go further into this campaign cycles as to the contributions that come in to these different camps from the tech companies. I think it’s a popular idea, like breaking up the big banks. It sits very well what they start in part of the population and will probably stem some strong emotional ties from voters. The pragmatic or practical approach to accomplishing some break up of these big tech companies is somewhat unachievable and it’s also damaging. Olivier, you and I worked really closely on the Qualcomm intellectual property work. We’re seeing this 5G proliferation.

We’re hearing from our president right now that he does not only want us to lead 5G, but he wants us to lead 6G. Yet, you see all these efforts in courts, both here domestically and around the world to basically damage, to break up, to minimize Qualcomm’s power of licensing, their innovation. This is a microcosm of breaking up big tech, but by taking away the power of these companies, you’re also minimizing investments that can be made into R&D. You’re harming the ability for these big tech companies to continue to lead, not only domestically here in the United States but in the world as technology creators.

That’s one differentiator that the United States maintains. Basically, innovation happens here. It happens here and it happens in Asia, particularly at this point in China, but to a lesser extent in South Korea. It’s not happening in other parts of the world. If we use social concepts to break up the power of big technology companies, you’re not going to see it help you the way you think, but what you will actually see is you will see a regression in investment. That regression in investment will actually harm our position as the leader or at least one of the top two countries in the world in terms of delivering innovation and important standard areas of technology.

While Facebook and Amazon and Apple don’t necessarily contribute to standards the way Qualcomm does, they do contribute to massive innovation areas whether that’s in ecommerce, whether that’s in social media. You have to consider what the actual deconstruction of these organizations would look like. This is not breaking up the phone company into regional phone companies. This is taking a product that is already proliferated globally with no constraints except for internet connectivity in most markets where there isn’t any nationalistic interest in shutting them down.

New products that get everywhere and are distributed everywhere, how can the US singlehandedly control them? Most of these companies by the way domicile here but have multiple offices, multiple data centers. Even if you did try to shut down their power here in the US, their ability to distribute globally wouldn’t really be entirely controlled or sanctioned here in the US. Too much risk, sorry. Like I said, if you guys disagree with me, I’d love to hear why, but either way, it’s a great idea for gaining votes, a terrible idea for execution.

Olivier Blanchard: It’s true. I completely understand the sentiment, the anger and the frustration and even the fear that these companies are too big. We don’t really know what they’re doing. They’re not transparent enough. They’re obviously getting into our data and doing all these other stuff, but we can address that with specific legislation that addresses those specific problem once they’ve been identified. If the issue is data privacy, then let’s create data privacy laws or at least guidelines to give these companies room to move but also define like very specific limits to what they can do. That makes sense. If the issue is … Go ahead, Dan.

Daniel Newman: No, I was agreeing with you. I was going to tell you to come back to me, but one thing I want to mention is Fred said a lot of really intelligent stuff, so I didn’t double up on what Fred said. The regulatory environment is messed up. The hearings you could tell our government has no business trying to intervene right now in big tech because they’re not well enough educated. We need to re-staff our lawmakers who do not understand tech and maybe some of these young junior legislators have a better concept because these are Millennials coming into positions of power to be involved in this who do truly understand the difference between Tim Apple and Joe Facebook. The Mark Facebook, I wasn’t really …I digress, but the point though is we do need regulation, but we need people to actually know enough about this stuff to regulate it because the problem is that the people we’re expecting to regulate it, most of them don’t use it. If they do, they don’t even know the difference between sending pictures of their junk in public forums versus sending it in a private message. They seriously have a long way to go before we can regulate it and that means we sure as crap aren’t ready to actually break up.

Olivier Blanchard: Right, I agree. The thing about breaking up these things like their trust is so strange. I’m surprised that Elizabeth Warren, whether you agree with her politically or not, is pretty sharp. She knows her stuff. I’m surprised to hear this kind of argument coming from someone like her because it’s truly a 20th century mode of thinking being applied, misapplied to a 21st century problem. We’re not going to solve 21st century technology and business issues by going back to the beginning of the 20th century. That time is gone. I agree that there’s a problem.

There’s a generational problem with lawmakers and potentially regulators in Washington, DC or wherever else who are so disconnected from new technologies and from these new platforms that they’re not able to really even think about the problems properly. Therefore, they can’t formulate proper solutions. There was another thing. Amy Klobuchar, if I’m not butchering her name, is also running for president. Her contributions to this conversation is to tax tech companies on their data usage, which I thought was also an interesting and misguided approach to this.

I don’t think we should tax anybody on anything unless we absolutely have to anyway. I’m not even a libertarian, but every time I hear, “Let’s tax somebody to curve a specific behavior,” I get a little bit cringey. I do think that she might be on the right track in a sense that because so many of these companies use our data … Here, hold on, let me refrain this. Companies like Facebook or Google using our data to better serve us and to better serve us ads and services make sense. We use these companies and their platforms for free. We have this implicit agreement that, “Yes, I’ll give you my data. You can use it to help. It helps everybody. Fine, monetize that.”

There’s another use of data that’s more transactional where these companies collect their data and then sell it to third parties for various reasons that are not directly involved with advertising or content creation or services. I think that there might actually be a case to make users, owners of their own data and to charge a fee, basically for users to get a percentage off of whatever these companies make off of every transaction that they make with third parties that leverages our data. What do you guys think about that idea?

Fred McClimans: Actually, Olivier, that’s interesting. A couple of things come to mind. Not too far and in recent past, probably within the last week or so, I heard a story on a podcast about a company that is setting itself up to be the broker of information for medical studies. They’re doing this with DNA information and their basic model is you have consumers that have lots of DNA and you have researchers that would like to have lots of DNA. We know the issues with companies like 23andMe just taking that data and selling it out there.

What they’re doing is they’re saying, “We’re going to talk to the researchers and we will find specific studies that they are engaged in where they need a particular type of DNA and then we’re going to mash that up against two individuals and say, ‘Here’s the deal. We’ll pay you $50 to spit into this tube. You give this lab the right to use your DNA for that. You benefit from it. You’re getting paid for it. You can track where that data is going.'” Maybe there’s a way to monetize some of that out there.

There’s another thought that there are a number of companies out there now looking to see how and this is something that’s been talked about at least 2017, how you could apply something like blockchain to the tracking of personal data. As data is created, it’s tagged with your particular ID. If everybody buys in, you can see who’s using it and you can find a way to monetize or at least track it and say, “Okay, this particular piece of data, I’m now turning it off.”

Olivier Blanchard: I like that.

Daniel Newman: Yes.

Fred McClimans: There’s some interesting stuff.

Olivier Blanchard: That’s opt in. I like.

Daniel Newman: That’s super interesting. I think they’re framing a new area called digital custodianship. Essentially in the future of privacy, we’ll come to down to being able to opt in and opt out in a much more on-demand fashion. Meaning it’s not it’s not such a tedious process of figuring out where you’ve been opted in to because you opt in once, you don’t realize you might have opted in to eight, nine, 10, 11 different things. You opt out a single time, it’s like you can only opt out of one of those 11 things concurrently.

One interesting point that I want to bring up about that idea, Olivier, is managing your data as a way to tax is provocative, but we have really entered a world and I say this for many stages and on many different interviews, every company is a tech company because of data. Great concept, but how are we going to demark technology?

Because Amazon is not really a tech company unless you’re just talking about the Cloud AWS business. The rest of it is an eCommerce company. If you’re talking about companies that do eCommerce, there’s a lot of eCommerce companies. Is DICK’s Sporting Good a tech company? DICK’s online, it’s a big eCommerce platform, uses technology in heavy significant ways to sell products and services. DICK’s-

Olivier Blanchard: It doesn’t Alexa though. Amazon is a-

Daniel Newman: What I’m saying is the very … What percentage of their revenue is actually made of the sales of high-tech goods versus the rest of their business portfolio? Where do you demark? Where is the end of tech?

Olivier Blanchard: I think we can change the language if we really want to and call them platforms as opposed to products and services. There are different types of company. Their platform company-

Daniel Newman: Right. Is Fitbit a tech company? A company that makes wearable monitor. I just mean like, where does it really start and end? That’s going to be a really interesting area to discern how you’re classified and then what’s going to happen as companies that are on cusp of being classified as tech don’t want to be classified as tech anymore. They want to find a different angle because they’re not going to want to pay the tax.

Olivier Blanchard: The way that it’s being cursorily defined now by these proposals is you have to be a tech company and you also have to be above $25 billion in net worth or something. There’s a category and there’s also a size range that makes you a target for those types of additional laws.

Fred McClimans: That would be interesting. I mean if they put that cap there for $25 billion. First off, I’d be really curious to know because I’d heard that number as well. Is that revenue? Is that market cap? How do they define that? Secondly, put that cap in place and I guarantee, sharp business people will figure out a way to ride right underneath that cap.

Olivier Blanchard: I think that if you create that cap, it forces or at least it incentivizes these companies to break themselves up as opposed to giving the government to do it for them because then you find ways to keep your size small by fragmenting.

Fred McClimans: It doesn’t break them up. They just create a bunch of smaller companies underneath them.

Olivier Blanchard: Which we don’t want either.

Fred McClimans: No, that doesn’t do anything to really control data. Look at all the data that Facebook collects on people every day when they’re online, but the amount of data that they collect on people that’s not Facebook data is also huge. They’re one of the largest buyers of third-party data out there that they integrate with everything they have out there. I wouldn’t be surprised to go out there, peek in to the dark web a bit, look at all the data that’s already out there about consumers, about brands, about businesses that has been stolen. That starts to make its way back in as well. Even if you turn off your own data and start taxing that, there’s this whole wealth of data that’s just sitting out there.

Olivier Blanchard: Guys, just to close the segment, let me refrain the question a little bit. We’ve established that we don’t want to break up tech companies, big tech or small tech. We don’t want to break them up. It’s silly. It won’t accomplish the goals that we hope to accomplish, however, legislation might if it’s properly focused. In your opinion and I’ll go to Dan first because he has to run, how do we help lawmakers and regulators become more technology fluent and understand this space well enough that they’re then capable of proposing legislation that might actually solve some of the true addressable problems that we’re facing?

Daniel Newman: I’ll try to do this in the one minute I have before I have to bounce, but it comes down to education efforts, transformational efforts and investments. We’ve got trillions of dollars running through our government.

We’ll pulling money out of education. We need to put money into education. We need to leverage the ecosystem of universities, of research labs of the high-tech companies. Let’s tax in a way where it’s more beneficial to government. Have these high-tech companies help educate the staff of Congress people, the lawmakers, our intelligence professionals, people in this space.

The government doesn’t lack high-tech people. It lacks coordination. It lacks orchestration. It lacks collaboration. The people who know about tech aren’t the people involved in making the laws. There’s very little access and information that flows between those. We need to add more positions and invest in more people in government that are really there to access and analyze what tech is doing and then provide feedback to the government. Like I said, if you’re a hundred constituency of just that many that provides that data, that could make a huge difference in terms of wrapping up and analyzing each of these companies and constantly delivering updates. Then you need lawmakers willing to consume.

They need to be willing to listen, willing to learn and willing to participate. Let’s face it. Those that have been around a long time, it’s old dogs. I’m not sure they’re willing to learn new tricks, but this is an awesome segment. Thanks for having me on as always and I appreciate it. I almost make some of those calls, but I don’t even know, but overall I’m always honored to work with you guys on this show. I’m going to bounce off, let you finish the show. I can’t wait to listen to the rest. I’ll see you guys soon.

Fred McClimans: You got it. Travel safe.

Olivier Blanchard: What about you?

Fred McClimans: What about me?

Olivier Blanchard: Fred, my friend, how-

Fred McClimans: I’m the one that’s still-

Olivier Blanchard: Now, that it’s just the two of us, how do you think … What Dan said was really interesting, but how do we specifically create a mechanism by which lawmakers become more technology fluent and more capable of …

Fred McClimans: I’ll tell, as Dan was working through his thought process there, he said a couple of things that triggered a memory of Sy Syms. Do you remember Sy Syms?

Olivier Blanchard: Yes.

Fred McClimans: The discount suit, clothing … Great phrase that they use to sell business, “An educated consumer is our best consumer.” I’ll flip that around and say, “An educated politician is our best politician,” and if we’re going to politicians that are driving policy. By the way, there are a lot of really smart tech CEOs, tech executives that, yeah, they have their misguided moments as well, but politicians, I think that we do have to raise that level of awareness.

As Dan said, there are a lot of politicians where we can lead a politician to water and you can’t necessarily make them drink.

If we can find the people that are advising them, if we can find the politicians out there, one of the senators for my state here, Virginia, Mark Warner, a really sharp guy, comes out of the tech space, I’ve had the opportunity to meet and talk with him in the past, he gets it. He’s one of those guys that is plugged in that has the focus on that. I think we just need to find more of those politicians. We need to elect more politicians that are tech savvy that think analytically. They have a good critical thought process without being critical of everybody else.

We need to find those individuals and reach out, work with them directly. Over time, maybe we are able to influence a little bit of the level of discussion when it pertains to tech. Because the idea of breaking up monopolies here, I think that’s become the common phrase because it’s the easiest thing to get people to rally around. It’s big and you can stand back and say, “Look, I get so complex. We haven’t figured it out yet,” as opposed to, “Here’s a specific set of policies that we’re going to put in place to regulate data, data privacy, data aggression, data resale.” It’s a lot easier to do, but it actually requires a lot more thought upfront.

Olivier Blanchard: It’s an abdication of competence when I hear stuff like that and it’s unfortunate. I wonder if at least temporarily, not forever, but if Congress does need some kind of congressional technology oversight committee where you have a team of maybe Millennial members of Congress who get together and discuss this and have hearings and formulate at least the kernel for some of this new legislation, for some of the old dogs. I don’t know-

Fred McClimans: Maybe as simple as getting existing politicians, especially some of the legacy politicians. Look, take an hour a week. Spend some time with your kids. Spend some time with your grandkids, whatever the case maybe, learn the tech. Have them show you what they’re doing and understand the impact that it’s having.

Olivier Blanchard: My concern is that if we only rely on tech companies training the staff of members of Congress, it’s just going to end up being just another layer of lobbying. They’re not necessarily going to get the type of information.

Fred McClimans: There are some good initiatives in play, the Cyber Moonshot that is getting pretty deep into figuring a framework for how we can kick start cyber security in the United States. I know some of the people involved in that, they’re incredibly sharp. They’re advising government, but the government is not just in position to necessarily listen as intently as we might like. It’s something that we need to address. If I could figure out a way to educate, I’m there.

Olivier Blanchard: Maybe we should start a podcast.

Fred McClimans: Maybe start a podcast and broadcast it … What we’ll do is we’ll use a geolocation and we’ll put some geofences around certain areas where politicians hang out. As they go in there, all the advertisements on their mobile phone would be for FTP, the Futurum Tech Podcast.

Olivier Blanchard: I like it. All right, cool. That is pretty much it for our main topic today. I’m sure we’ll come back to it at some later point because it’s a topic that’s not going to go away. Hopefully, we’ll have more to talk about soon.

Let us switch to our Fast Five segment now. Fred, I’ll let you start. What was the first thing that caught your eye today in tech news?

Fred McClimans: There are a couple of things. We’ve been talking about data here and the importance of that. Let me back flash 2014 or so. Foursquare. Remember Foursquare? That was the check in app on your phone.

Olivier Blanchard: Yeah, I’m that old. I remember it.

Fred McClimans: Hey, everybody used it. Then at a certain point, they split the company apart. They had, I forget the other app, this is going to drive me nuts. It had a little bumblebee on it, Swarm. Swarm was the app. Again, it was going to be an app similar to others that would help you check in to places and would help you find your friends and other interesting things to do. Well, Foursquare is so far out of the news. A lot of people that I run into don’t even recognize or don’t even realize that Foursquare is still around. They’re doing some really, really scary interesting stuff with data.

Foursquare today has become a company where they are the mechanism whereby so many of the popular apps that are used figure out where you are, at what time and who you’re near and what you’re doing. If you use a geo-filter on Snapchat or if you’re using Uber, Apple Maps, Airbnb, WeChat, the list goes on and on. Foursquare is powering all of that data on the geolocation side. They found a really interesting model here. One of the things they did this past week at South by Southwest was they did a temporary trial of something called hyper trending which basically allows you to see a heat map of activity where people are.

Imagine being able to sit in a satellite up above and go, “Here are people moving from this location to this location and they’re swarming around this location here. Now, this group is splintering off over here,” and being able to identify who they are. Now with this hyper trending, they’re anonymizing everything. They’re basing it off of randomized advertising IDs. There’s an interesting play here. People, if you’re interested in tech, take a look at Foursquare. I think you’ll be surprised at where they have actually slowly committed to and the amount of control that this company has over our data in our location today.

Olivier Blanchard: All right, cool. I will check it out. I was not aware of this. Thanks for pointing that. See I learn something even on this podcast.

Fred McClimans: I learn something every day.

Olivier Blanchard: My first Fast Five is 5G related. It’s not because I just got back from like this major Mobile World trip, but 5G-

Fred McClimans: Of course not.

Olivier Blanchard: Of course not, but it is no on my mind and 5G has been long time coming. We’ve been hearing all kinds of stories and promises. It’s finally here. There are basically three components to 5G. You have the infrastructure play where the 5G services actually have to be available. You have a device play which is you have to have phones and devices that actually are 5G capable and 5G ready. Lastly which was the last piece of the puzzle that we really needed is the actual plans, the data plans. How much is this going to cost? What are they going to look like?

As commercial deployments of 5G are underway throughout the United States and as devices that are going to be 5G capable are progressively entering the market and many of them were announced at Mobile World last week or two weeks ago rather, we now have our first look of the actual 5G data plans that are going to be offered in the United States by the Verizon’s, AT&Ts, T-Mobiles, Sprints of the world. The one that caught my eye is Verizon. I think Verizon is leading the way with this. They are announcing they have their first big 5G launch in April, April 11th I think, in Chicago and Minneapolis simultaneously.

They’ll be offering there or presenting or releasing their 5G services. What we know of that so far is that the plans are only going to cost $10 on top of your existing 4G LTE plan for unlimited data. I don’t know if that’s going to last into 2020 or 2021. I’m sure there’ll be adjustments, but it’s really promising to see that not only is Verizon launching 5G service areas in major metropolitan areas in the United States already, but that they already have plans and that they’re very affordable. That was one of my concerns because 5G doesn’t really spread.

It doesn’t really become mainstream unless it’s affordable, unless there isn’t a major financial hurdle for people who might wonder, “Why do I even need this?” The trick here is if you live in an area that doesn’t have 5G yet, don’t get the plan. Don’t pay the extra $10. If you do live or work or travel to one of these areas that’s going to have 5G, you can optionally pay the extra $10 and have access to this unlimited 5G data. That’s it. That’s my first Fast Five. I can’t talk today and I’m very-

Fred McClimans: Let’s do this.

Olivier Blanchard: I’m that excited about it. I’m tongue tied.

Fred McClimans: For my second Fast Five, Olivier, I bet you’ve never heard of a BAN.

Olivier Blanchard: Of what?

Fred McClimans: BAN, B-A-N, a body area network.

Olivier Blanchard: No.

Fred McClimans: We do a lot of work in and around the data privacy space, in cyber security. In fact, it’s tough for us to engage with a client where security, encryption, data privacy is not one of the key subjects that comes up in our research and analysis work. One of the issues we have bodies and personal tech and I’m not talking about wearable tech here, but actually implantable tech is that we’re putting more and more things inside our bodies. We’re putting smart pacemakers. We’re putting smart pumps in the brain to regulate fluid, all these things that we’re putting inside of us. Unfortunately, not many of these devices when they were implemented to start were actually secured.

A lot of them use very basic, very high-power communication systems that would allow people to be in close proximity to you and potentially hack or interfere with some of these biotechnical medical systems inside you. A Purdue University group got together and they’ve been working with a technique called a magnetoquasistatic field. What they’re doing is they’re working to actually build an implantable network in your body for people that need implants where the communications is limited to a few centimeters off your skin. It’s really interesting. What really caught my attention here was by embedding this technology by a forced constraint.

You have this very low-power communications field inside your body, how do you power that? It turns out that the power required is significantly less than anything that’s in use today. You can harness movement and motion in the body theoretically to start to power these systems. Because they’ve made them so lower power, it no longer requires massive batteries which means things like where a system can be implemented, options open up. The type of systems, options open up here again.

They’re early on in the technology. They’re trying to figure out how do we commercialize this in some ways, but one of the things I think we’re going to talking about a lot more over the next maybe two to three to four years are these body area networks that medically can do some amazing things for people that really need it.

Olivier Blanchard: Outstanding. I like that. That’s interesting. It speaks to my Cyberpunk.

Fred McClimans: This is my feel-good story of the day.

Olivier Blanchard: Actually, I have a feel-good story of the day, well, it’s not so much of a feel-good story, but it’s something that I don’t know that we’ve ever done here on this podcast. I’ve actually found a positive story about Facebook that I want to share since we usually drop the bus on top of Facebook all day long. This is with regards to a new tool that Facebook is releasing that essentially uses AI I think to more quickly identity revenge porn and get rid of it. Essentially, it’s a tool that detects, and I’ll use the actual terminology that Facebook is using, the tool detects nonconsensual intimate images. I think this is a very welcome addition to the Facebook ecosystem, I guess something that’s very much needed.

I was trying to figure out a way to incorporate another story today which is just the sad horrific terrorist attack on Muslims in New Zealand. Last I checked, there was like 49 dead and several dozen wounded. One of the aspects of the story that struck me is that the perpetrator of this violence was live streaming the attack and using cameras. He posted it to several or at least to Facebook Live I think. It entered up being posted to several other platforms I think, Twitter and YouTube being among them. There was really no way for these platforms to identity that this content was obviously very inappropriate and harmful quickly enough to kill it in real time.

These platforms struggled to identify, find it and take it down. I wonder and I think that if you can train an AI to identify basically revenge porn, unwanted sexual content, I think that you can also train it to identify and shut down that type of content as well, whether it’s in real time or posted in semi-real time. Any acts of violence being broadcast like this or live streams can probably be neutralized very quickly by this type of AI, this type of tool. I think while we’re having discussion about whether or not these platforms bear any responsibility, whatsoever and the type of content that they allow their users to live stream, I also see that there’s an effort by their engineering team to actually remedy the problem.

Fred McClimans: That’s good because it certainly is a problem. When you think about it, this all comes back to data. You got to have a massive amount of data to train the AI system. Starting first just with basic machine learning, going into deep learning and neural network training. You get to the point where the system can train itself and continue to learn somewhat unsupervised, but think about the data points that you can bring to correlate, “Here’s something being broadcast. Here’s data about the political situation. Here’s information from newsfeeds. Here’s information from first responder networks,” all the data that could be brought in to potentially do some good. That’s interesting.

Speaking of data and the complexities that come with data, my last Fast Five is a bit of somber tone. Over the past week, we had the second Boeing 737-800 MAX airplane that went down. It’s increasingly looking like the circumstances are very similar between this crash in Ethiopia and a prior crash about five months back. I mean it’s too early to tell based on what we’re getting out of the newsfeeds and so forth about what is actually taking place here. There are a lot of people that are trying to say, “Hey, it looks like the same exact problem.” It may be and it may not be, but it brings to mind the idea that complex fail spectacularly. There’s never an easy fix.

In this situation here, what we’ve seen is Boeing finally said, “Yes. Look, we’re going to ground all this aircraft.” It turns out that after the first crash, back in 2018, they started working on a fix for the particular issue that they had experienced last year. That fix is still not available yet which tells you a little bit about the complexity of these systems and how difficult it is to simply fix something without impacting everything else in that software and data ecosystem that exists around here. Just to give you a sense for the magnitude here, when you think about Boeing grounding these planes, this is definitely going to hurt Boeing.

If they did something wrong in this year, that’s something that they need to own certainly. The impact also impacts air travelers. There’s no replacement plane sitting out there. It impacts the airline industry because all of a sudden you have all these planes and all these orders for planes that people have been counting on to jump in to the system. I bring this up just a cautionary tale of Fast Fives. I think this is probably the end. If I’m wrong, tell me I’m wrong, but I think it’s the right time to remind people that there’s a lot of great things that can come out of these technologies.

Flying an aircraft today, the aircrafts are much more … the airframes, the airplanes, much more complex in terms of their design, but they’re also significantly safer. We’ve progressed across the years, but we can’t ever lose sight of the fact that again complex systems, when they fail, it’s a spectacular fail in a bad way. I would just put this out there and say to people, yes, we speak optimistically about a lot of these technologies. We talk about autonomous vehicles and what they can do and eventually autonomous airplanes, ships and so forth, but we do at every step of the way, we need to step back and say, “Are we really ready for this or are we pushing dollars ahead of safety and common sense?”

I think that’s an issue that we’ve talked about it a bit in terms of some of the bias that we see coming up in some of these AI systems. I think this is another area where complexity can help in many ways, but it’s not always our friend.

Olivier Blanchard: Correct.

Fred McClimans: Sort of a somber Fast Five.

Olivier Blanchard: No. Actually, it’s a great segue into our Tech Bites segment. I was figuring out if I wanted to make our Tech Bites today about the Facebook outage or that Boeing. In weighing the two, I don’t think anybody died because of the Facebook outage, number one. Two, I think it was maybe a blessing in disguise because despite the fact that Facebook going down also affected many businesses and probably really hurt their sales and their ability to communicate and transact with their customers, it also I think increased productivity by several orders of magnitude within those 24 hours.

Fred McClimans: I’m sure there were kids that saw their parents for the first time in weeks.

Olivier Blanchard: Exactly.

Fred McClimans: There were parents that saw their kids for the first time. No, not too many kids are using Facebook, but Instagram and so forth.

Olivier Blanchard: I got so much more stuff done while Facebook was down. It’s depressing and it made me reexamined my life and my priorities. I think this week’s Tech Bites belongs to Boeing, not so much because of the complexity of the airplanes because I think that their engineers are topnotch and they’re really trying to really solve major problems with their software and hardware. This particular airplane had very specific, not problems but challenges on takeoff obviously that the software was meant to correct. The issue wasn’t that the software was inadequate, that the plane was inadequate. The issue was with humans and human decisions.

Also, I don’t assign any blame to the FAA, but I am shaking my finger at them for having taken so long to ground those planes probably because of more of a political decision or calculus than safety calculus. I think that’s the wrong thing for an organization like the FAA to do. Safety should come before policy. We should mention that there is just like we talked about Qualcomm versus Huawei in the US versus China technology battles over the future of technology in 5G. There is a similar dynamic going on between Boeing and Airbus, the US and Europe with regard to our commercial aircraft.

We see this being played out a little bit with the US, I think having attempted to protect Boeing in light of those types of market dynamics. I think that was the wrong thing to do and I’m glad that was resolved. Tech Bites, not so much on the technology, but on human decision surrounding decisions that affect technology and how it impacts within our lives. All right, with that said, let’s go to our-

Fred McClimans: Crystal Ball.

Olivier Blanchard: Yeah, Crystal ball.

Fred McClimans: I can’t wait.

Olivier Blanchard: My Crystal Ball question of the week and I guess it’s just the two of us is, how quickly will other carriers like AT&T, T-Mobile, Sprint … Actually, let me rephrase that. Will the other carriers follow Verizon down this like $10 a month very affordable additional 5G service layer or will they make the mistake of charging an arm and a leg for unlimited data plans in 5G?

Fred McClimans: I thought for a moment there, you’re going to pull up the Samsung or android versus Apple iOS debate issue there.

Olivier Blanchard: No.

Fred McClimans: Because one is clearly trying to get lower in price and the other is, “Hey, we’re exclusive. We’ve got all this great tech here.” This is an interesting one because investments in 5G, they’re not cheap, not cheap at all. I think that Verizon in this situation seems to be trying to get out ahead of the curve and dictate terms to the rest of the industry. In my mind, the question is really, will Verizon be successful in shaping the products and solutions of the other providers as they come to market? I’ve got to assume that if Verizon is taking this step, they’ve figured out a way to gain the system that they come out on top even if everybody tries to emulate what they’re doing.

They’ve got something in their architecture, something in their rollout that they think creates a little bit of a mote around them for that. That said, I’d be surprised if all the other carriers follow the Verizon path.

Olivier Blanchard: Do you think they’ll go higher?

Fred McClimans: Yeah, I think they’ll go higher. I think they’ll recognize that few of them, three-letter companies out there, they tend to think that they’ve got a strong lock on their client base. They can squeeze that base a little bit to get some significant value out of the organization. You can contrast a little bit of the acquisition strategies. We can say an AT&T and a Verizon. They’re both very active in acquisitions, but I see Verizon’s acquisition strategy is being a more methodical strategy whereas AT&T seems to go for the larger, “Let’s get something massive here.”

I’m not sure at this point which approach will be more successful, if the one is better suited to the other, but I don’t see the rest of the industry as an industry following suit here at least not until they’ve learned their lesson.

Olivier Blanchard: I will be interesting. It’s a little bit like nobody except me watches cycling on this podcast, but when-

Fred McClimans: I have watched cycling a few times.

Olivier Blanchard: You’ve probably seen during the Tour de France these massive stages. They’re a hundred miles long. Then in the last 200 meters, the sprinters are up ahead and they’re not accelerating. They’re like staring at each other to see who’s going to make the first move. Then all of the sudden somebody makes the first move and they all race. Then somebody wins. It’s very dynamic in its very last minute, very tactical that way. This is what it feels with these carriers. They’ve been preparing for this for years and years and years and nobody wanted to be the first one out of the gate to announce their plan.

Then essentially Verizon and AT&T came out with their plans almost simultaneously. Verizon went with I think the smart move which is undercut the price, make it super affordable and make it super easy. It’s like, “You don’t have to do anything weird. Once you get your 5G phone, just go ahead and add $10 to it. You get unlimited data through 5G. Bam! Done.” AT&T, if I’m not mistaken, but I think this is how I read it yesterday, AT&T was proposing a plan that was going to be $70 or $75 a month for 15 gigabytes of 5G data which in 5G would go very quickly.

I thought, “Wow! Those two plans could not be more diametrically approached.” If my choice as a consumer between $10 unlimited data with access to 5G or $75 for only 15 gigs from Verizon, the choice for me is very simple. I don’t know if Verizon is going to basically look at 5G as a lost leader for a while just to attract business and monetize later, but it seems like the better choice to me.

Fred McClimans: You just hit on the key to a lot of this in terms of understanding what these different players are doing, monetize. How are going to monetize not just their investment but their business? There’s a distinct difference between somebody saying, “Look, we’re going to increase the cost for 5G, so we can recoup money on that,” versus somebody saying, “Look, 5G. We don’t care what the price is. It’s just simply a delivery vehicle for all the content and services that we’re going to delivery.” Now, it gets more complicated because the cost of content to the customer is going down.

Olivier Blanchard: That’s right.

Fred McClimans: Netflix, but the number of choices that are out there and the ability to stream what you want in a limited size, YouTube TV being a great example there, you don’t need that whole bundle package. You can just go straight over the top.

Olivier Blanchard: The cost of data keeps going down too which is good.

Fred McClimans: Moore’s Law, technology advances, capacity grows. Yeah, that’s an interesting one.

Olivier Blanchard: I should also add one last thing which is that right now because 5G is not available everywhere, actually it’s not really all that available anywhere, it doesn’t really cost Verizon a whole much to do this. I think it’s a great PR coo. I think it sets the stage and it challenges the other carriers to follow suit, but also if Verizon had an established 5G network, if they had already put their 5G antennas all over the US and we’re just ready to flip the switch and we’re doing this, it would be a very different story. With the limited markets that they’re going to be offering in 2019, I think it’s a no risk scenario for them.

Fred McClimans: AT&T and Time Warner, I mean obviously in the throes of merging and trying to figure out what they’re going to do or what the actual tactical steps are for that, but look at Verizon with Fios out there. If Verizon could look at this very easily and say, “Look, we want 5G as low cost as possible because we want to sign people up for our Fios TV Service.” We want them to get their content through us. That’s the way it is.

Olivier Blanchard: Anyway, that’s good 5G is coming. I can’t wait. Thank you, Fred, and thanks, Dan, from a distance, who needed to run.

Fred McClimans: Sure.

Olivier Blanchard: That’s how busy we are. We can’t even like finish a podcast without having to get on a call. Worse problems to have. That does it for this week’s edition of FTP, the Futurum Tech Podcast. Thanks a bunch for listening and don’t forget to hit that subscribe button and catch us next week for another round of news and analyze. Until then, have a great weekend.

Daniel Newman: There will be plenty of tech topics and tech conversations right here on the Futurum Tech Podcast, FTP. Hit that subscribe button, join us, become part of our community. We would love to hear from you. Check us out, futurumresearch.com or Futurum Tech Podcast, Daniel Newman, Fred McClimans, Olivier Blanchard.

There will be plenty of more tech topics and tech conversations right here on the FTP, Futurum Tech Podcast. Please be sure to subscribe to us on iTunes.  Join us, become part of our community. We would love to hear from you. Check us out at futurumresearch.com. We’ll see you later.

Disclaimer: The Futurum Tech Podcast is for information and entertainment purposes only. Over the course of this podcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we do not ask that you treat us as such.

About the Author

Olivier Blanchard has extensive experience managing product innovation, technology adoption, digital integration, and change management for industry leaders in the B2B, B2C, B2G sectors, and the IT channel. His passion is helping decision-makers and their organizations understand the many risks and opportunities of technology-driven disruption, and leverage innovation to build stronger, better, more competitive companies.  Read Full Bio.