Monday, October 30, 2017

Changing Faces With AR and AI

The combination of Augmented Reality (AR) and Artificial Intelligence (AI) has led to a cosmetics chain enabling customers to experiment with virtual make-up, and the animation of single still images into photos with moving facial expressions.

Virtual Cosmetics App

Back in March, the new ‘Virtual Artist’ app was first unveiled to the tech world. The app is now being used by French cosmetics / beauty brand Sephora to engage customers and allow them to try out and experiment quickly and easily with the company’s beauty products without needing to physically apply any of the actual products.

Photo Overlaid With AR Make-Up
Sephora’s ‘Virtual Artist’ app, which is used in some of their stores on iPads (available to customers as a  smart-phone version) allows customers to try-on virtual make-up. The app, which was developed in partnership with AR company ModiFace, scans a photo of the user’s face, maps where the lips and eyes are, and lets users try on different looks.

The app gives users virtual tutorials that use AI and AR to show users (using a photo of their own face) how to contour, apply highlighter, and create winged eyeliner.

The app currently allows users to experiment with lip colours, eyeshadows, and false lash styles, and to add the products they like to an online shopping basket.

Not The Only One
Sephora’s proprietary ‘Virtual Artist’ app is actually joining the tech beauty gadget market a little late, as it follows in the footsteps of other similar ideas such as the HiMirror Plus, which scan users’ faces and recommends products and skin regimens.

Bringing Still Photos To Life
Another recent innovation to hit the news is a face mapping, AR and AI combined system that has been developed by a joint team from Tel Aviv University and Facebook.

The system enables a single still photo of a person / emoji character / painting of a person’s face to be animated with moving facial expressions.

How It Works
To enable the animation to work, the subjects submit a single still image of their face, plus, they film themselves pulling a variety of faces. Face mapping of the still photo as a guide, and the expressions, combined with a ‘driving video’ of another face, and the software’s ability to fill in the invisible gaps in the picture e.g. the inside of a subject's mouth, enables moving facial expressions to be overlaid (using AR), thus producing an eerily realistic image with changing facial expressions and emotions.

Since the system was developed in conjunction with Facebook, tech commentators have speculated the first use of the system will be as part of a fun craze to help engagement with the Facebook platform.

What Does This Mean For Your Business?
It is not difficult to see how, as with the Sephora example, a system that encourages and enables customers to engage with, try out, and willingly widen their knowledge of a product range with minimum risk and hassle could be useful and relevant to many kinds of businesses in different markets e.g. beauty, interior design, furnishings / furniture, and other self / lifestyle / home and garden markets. The ability to enable customers (B2B and domestic) to visually experience and explore products and services like never before offers an exciting opportunity for businesses.

The ability to animate still images in a realistic and engaging way could also feed into multiple industries e.g. marketing / advertising / display / promotions, photography / graphics, greetings and gifts and many more.

The leverage gained from the synergies of combined new technologies could provide exciting business opportunities and areas to develop competitive advantages that are likely to reduce in cost over time.

eBay And Amazon Sellers VAT Warning

MPs have warned Amazon and eBay that their platforms may not be doing enough to prevent many sellers from not charging VAT on their sales, thereby potentially contributing to £1.5bn lost tax revenue for the government.

The VAT loophole was highlighted in a recent report by MPs in the Public Accounts Committee.

What’s Been Happening?
If items are dispatched from UK soil, sellers have to charge VAT at 20%. Amazon and eBay, however, are believed to be keeping some of their stock in UK warehouses in order to provide next day delivery. Some of this stock is likely to be from overseas sellers, and it is believed, therefore, that goods from foreign sellers have been shipped to customers from UK warehouses without VAT being charged. This has enabled some foreign sellers to undercut genuine UK suppliers, and has meant a loss of potential revenue for the Treasury.

Working With HMRC

MPs have criticised an apparent lack of action to date by the big online selling platforms to address the issue, and some critics have also pointed to the fact that Amazon and eBay may actually be profiting from the fraudulent activity of sellers on their platforms by charging sellers a commission.
Amazon and eBay have told the commission that they are working with HMRC to resolve the situation, and that they are engaged in removing those offending sellers from their platforms.

HMRC Criticised
It is not just eBay and Amazon who have come in for criticism by MPs over this matter. MPs have also criticised HMRC for being over-cautious in pursuing what are regarded by many as being VAT fraudsters.

According to the MPs’ report, HMRC could help to stop VAT fraudsters by setting up an agreement with online marketplaces by March next year, and by acting with more urgency in making use of its existing powers.

HMRC has answered critics by pointing out that it had introduced new rules last year specifically to deal with the issues of liability for unpaid VAT by overseas sellers, and that these rules have brought about a ten-fold rise in the number of sellers registering for VAT.

What Does This Mean For Your Business?
This report from MPs and the publicity generated by it are likely to be good news for UK sellers who may have lost out to overseas sellers through simply complying with UK tax law and having to charge higher prices. Hopefully therefore, the report may put pressure on HMRC and big selling platforms like eBay and Amazon that could lead to a more level playing field, and could, of course, generate more much-needed tax revenue for the UK. It is particularly important for MPs to prioritise the issue now with the extra tax complications of Brexit just around the corner.

This may also be a shot across the bows for all large overseas sellers to warn them to respect the laws of the countries that they operate in and to remind them that they are accountable to governments in many of their lucrative markets.

4 Out Of 10 UK Businesses Not Ready For GDPR

A study by DMA group, formerly the Direct Marketing Association, has revealed that more than 40% of UK marketers say their business is not ready for changes in the forthcoming General Data Protection Regulation (GDPR).

What Is GDPR?

GDPR will come into force in May 2018. This new Regulation replaces the EU Data Protection Directive of 1995, and the focus of GDPR is on ensuring that businesses are transparent and protect individual privacy rights. The Regulation from the EU, which consists of 99 articles, covers data that is produced by an EU citizen, whether or not the company is located within the EU, and it covers people who have stored data within the EU, whether or not they are EU citizens.

The DMA Group Study Results
The recent DMA Group Study asked 197 (B2B) and consumer-facing companies their thoughts about GDPR and found that while more than half of companies (56%) feel that they are on track with their GDPR plans, 17% feel that they are behind and 15% still have no integrated plan.

16% of respondents themselves in the study were reported as saying that they felt extremely or somewhat unprepared for GDPR, and 31% felt that their whole organisation was extremely or somewhat unprepared.

What’s The Problem?
One of the biggest concerns of the companies surveyed was about the definition of consent (28%). Consent under GDPR, for example will have to be unbundled i.e. consent requests are separate from other terms and conditions, granular (a thorough explanation of options to consent must be given), named (state which organisation and third parties will be relying on consent), and documented (keeping records of how consent was gained).

Consent will also have to be easy to withdraw, and under GDPR implied consent will disappear. These complications around consent and the possible legal consequences of getting things wrong are clearly a concern for UK companies.
Another key concern and top priority highlighted by the study is the changing of a company’s privacy policy (15%) to take account of the new rules.

Worries about GDPR also appear to be growing in businesses as the deadline looms. The study showed for example, that 64% of marketers believed their organisations will be either very or extremely affected by the regulation, compared with 54% in May.

Some commentators have highlighted a possible positive perspective on GDPR as a catalyst to transform the way organisations speak to customers, and as a way of addressing issues in data protection that they may have had for a long time.

Equifax Reminder
The recent Equifax data breach, where 143 million customer details are thought to have been stolen, and where serious questions have been asked about the company’s conduct in handling the breach, has brought data protection into even sharper focus prior to GDPR and has reminded companies that they have to notify customers of a problem early on.

What Does This Mean For Your Business?

Warnings about the importance of GDPR preparation have been cropping up in the news for more than a year, and successive studies have revealed how businesses have felt unprepared and worried by the complications of the subject, or are simply in denial. One of the key challenges for companies in addition to getting an understanding of consent issues is making sure the technology is in place to help deal with data in compliant way e.g. having the ability to purge or modify data, search and analyse personal data to uncover explicit and implicit references to an individual, or accurately visualize where data is stored because the repositories are not clearly defined. Some technology products are now available to help deal effectively with data, and many tech commentators believe that developments in AI and machine pattern learning / deep learning technologies will be able to be used by companies in the near future to help with GDPR compliant practices.

At this late stage, companies need to press on with and get to grips with GDPR and its implications, perhaps seeking professional advice to highlight which areas are most legally pressing. Taking a positive perspective, not only is compliance with GDPR necessary, but it could actually make sound commercial sense, through providing competitive advantages (because data security is valued by customers), and could have knock-on effects to the cyber resilience of companies.

Companies that have been proactive and moved quickly on this issue could therefore be the ones most likely to minimise the threat of penalties (the law profession is already geared-up to respond to customer complaints), and gain advantages in a marketplace.

Russia Hit By Ransomware

A new type of ransomware dubbed "Bad Rabbit", similar to WannaCry and Petya, has been spreading across Russia, Ukraine and into other countries.

What is Ransomware?

Ransomware is a form of malware that typically encrypts important files on the victim’s computer. The victim is then given a ransom demand, the payment of which should mean that the encrypted files can be released. In reality, some types of ransomware delete many important files anyway, and paying the ransom does not guarantee that any files will be released.

How Does It Infect?

The Bad Rabbit ransomware appears to be spread via a bogus Adobe Flash update and, worryingly, is still undetected by the majority of anti-virus programs.

What Does ‘Bad Rabbit’ Do?
Like other ransomware, Bad Rabbit encrypts the contents of the victim’s computer and asks for a payment of 0.05 Bitcoins / £213 to release the locked data. It is common for ransom demands to be made in the crypto-currency Bitcoin because it is out the control of banks and provides anonymity for the perpetrators.

In order to pay the ransom, users are directed to a .onion Tor domain where, where a countdown on the site shows the amount of time before the ransom price goes up.

Some tech / security commentators have noticed references to Game of Thrones characters in the malware.

What Effect Has It Had?
Bad Rabbit is reported to have hit almost 200 victims, most of which are in Russia and Ukraine, although others are in Turkey and Germany.

For companies that have been infected, whole servers have been locked down, thereby rendering the day-to-day IT-based aspects of the business impossible.

High profile victims of Bad Rabbit to date include Russian news agency Interfax where its subscription services were all made unavailable, the St. Petersburg-based news website, Ukraine's Odessa International Airport where its information system stopped functioning, Ukraine’s Ministry of Infrastructure and Kiev’s public transportation system.

What Does This Mean For Your Business?
For UK businesses and other organisations, it’s a case of always being on the lookout for suspicious emails and updates, keeping security software up to date and regularly backing up critical data. The advice with Bad Rabbit (according to The US computer emergency readiness team), as with other ransomware is to not pay the ransom, as is unlikely to guarantee that access will be restored.

In order to provide maximum protection against more prevalent and varied threats this year, businesses should now adopt multi-layered security solutions. Businesses should accept that there is a real likelihood that they will be targeted and therefore prepare for this by implementing the most up to date security solutions, virtual patching and education of employees in order to mitigate risks from as many angles ('vectors') as possible.

Having workable and well-communicated Disaster Recovery and Business Continuity Plans in place is now also an important requirement.

Southend ... The ‘Smart City’

Southend-on-Sea Borough Council is reported to have signed an agreement with tech company Cisco to deploy its ‘Kinetic for Cities’ platform in order to share the benefits of new digital technologies with its businesses and citizens, thereby making it a ‘Smart City’.

What Is ‘Kinetic For Cities’?
According to the Cisco blog, the Cisco Kinetic for Cities platform is a unified IoT platform strategy and a cloud-based platform that helps customers extract, compute and move data from connected things to IoT applications to deliver better outcomes and services. In essence, using sensors, digital management platforms, and analytics programs for all aspects of a city (including solutions for lighting, parking, crowd, environment and others), businesses and citizens can benefit from the effects of urban innovation, sector-specific solutions, city engagement that the technology provides.

Technology Hub
Through the use of the new platform, it is hoped that Southend can become a technology hub, and this can help it to grow and evolve, in line with the rest of the UK and with competition globally. It is also hoped that use of the digital platform could bring smarter, connected experiences for people who live in, work in, or visit the town.

Already Working In Other Cities
Cisco’s Kinetic for Cities platform is already being deployed in other cities such as Manchester (UK) where it is being used to project explore smart transport and CO2 emissions, in Jaipur (India) where it is helping to improve public safety.

How Will It Be Used In Southend?
At the current time, Southend Council looks likely to use the Kinetic for Cities platform for initiatives such as pilots relating to community safety e.g. building an intelligence hub with IP-based public safety systems for use with CCTV and advanced video analytics.

Also, there are plans to use the platform to help with traffic and parking management, easing of congestion, using the IoT to help monitor improve air quality, and to help manage energy better and bring down consumption, thereby reducing costs and helping the environment.

What Does This Mean For Your Business?

It has taken a long time for many of the potential benefits of the IoT to be realised, or for the IoT to be deployed in a more meaningful and beneficial way than in smart household gadgets. Using technology for the benefit of a whole town / city in this way represents a new kind of rapid regeneration which has the potential to benefit many more citizens and businesses than individual physical projects. Improving a whole town, and how efficiently it functions and how effectively it serves those who work and visit it in terms of experiences and opportunities can only be of benefit to locally based businesses, and can create an environment where businesses are better equipped to compete nationally and globally.

Sunday, October 22, 2017

Major Wi-Fi Security Risk

Researches have uncovered a major flaw in Wi-Fi connections dubbed as Krack, which could be putting homes and businesses at risk from hackers.

The Flaw
Researchers from Belgian university, KU Leuven, discovered that there is a critical flaw in the authentication system used by secure wireless connections.

All protected Wi-Fi networks use an old, four-way handshake (dialogue) system in order to generate a fresh session. With the handshake, the two devices agree a (session) key to use to keep a secure data connection between them.

According to the researchers, the system of random number generation used in authentication can actually be re-used, thereby allowing someone to enter a network and potentially spy on the data being sent in it.

Hackers can exploit the ‘Krack’ vulnerability by tricking victims with a replayed, modified version of the original handshake, thereby making victims reinstall their live session key. This allows the set-up values to be reset which can thereby weaken encryption.

The researchers have found that the flaw means that attackers can potentially hijack a connection, decrypt and inject data, and even forge their own connection.

What / Who Is Affected?
The flaw is in the actual Wi-Fi protected access II (WPA2) security protocol i.e. in the standard itself. This means that there may be millions of routers in customers' homes and businesses that are vulnerable to attack. Service providers and their customers, therefore, face significant risks because of the flaw.

What About Patching?
The flaw, which has prompted a warning by the US Computer Emergency Readiness Team (Cert), can reportedly be fixed using software patches. Industry body the Wi-Fi Alliance is reported to be working with service providers to help develop a patch, and Google has said that it will be patching any affected devices over the next few weeks.

What Does This Mean For Your Business?
This is reminiscent of the problem encountered back in June, when, after an investigative study by Which?, Virgin Media made the news when its (Netgear) Super Hub 2 and Super Hub 2 AC home routers were found to all have exactly the same private encryption key, thus making them more vulnerable to hacks. This prompted the need for a security patch to be rolled out in order to protect large numbers of customers.

The latest flaw in Wi-Fi connections discovered by the Belgian researchers is another example of how, despite taking their own Internet and data security measures, businesses (and home users) can suddenly find themselves unwittingly being vulnerable to attack because of the equipment and software supplied by service providers who they have to trust. Once again, it is outside security researchers who have discovered the flaw.

Thankfully, patching is generally a fast and effective way to shut down vulnerabilities. Keeping up with patching itself is an important part of any company’s ongoing security processes, and the Fortinet Global Threat Landscape Report (back in August) highlighted the fact that 9 out of 10 businesses are hacked through un-patched vulnerabilities, and that many of these vulnerabilities are 3 or more years old, and have patches already available for them.

Cortana Integrated With Skype

Microsoft has added its talking digital assistant ‘Cortana’ to Skype
to provide ‘contextual assistance’, which could help Skype users in their online chats.

What Kind of Assistance?
The idea is that the digital assistant can use its AI to pick up on what is being said in a Skype chat and then help to provide relevant information on that subject. This could be anything from (depending on the content of the chat) relevant restaurant option suggestions, movie reviews, and suggestions of smart replies and responses. According to Microsoft, Cortana will enable users to respond to messages in Skype without needing to type.

Your Digital Secretary
The addition of Cortana to Skype means that it will also be able to pick up on conversations about scheduling events, and will then be able to set up a reminder that can be sent to all of your devices. This will see Cortana acting like a kind of virtual secretary, able to ‘listen’ to and take note of all of your plans. This could have obvious benefits in making sure you don’t miss important appointments / events, and that you are able to improve business planning and organisation.

Cortana As Your Contact
The Cortana / Skype bundle will also mean that the digital assistant can be added as a contact in Skype. This means that you will be able to chat with it as you would other contacts, and use it to answer questions, suggest restaurants, check flights, give the weather outlook, and other information.

Setting It Up
Users will be able to easily set up Cortana in Skype on mobile devices by tapping Cortana on their chat screen, and by agreeing to allow Cortana to use the user’s location and IM conversations in Skype.

The Rollout
According to the Microsoft blog, Cortana in Skype will be ‘gradually’ rolled out, starting from 9th October, to Microsoft’s Android and iOS customers in the United States first.

What Does This Mean For Your Business?

This alliance of Cortana with Skype is another important competitive step in the battle for leadership in the voice-controlled / ‘Voice First’ market and will help Microsoft to achieve its aim of making Cortana available for its customers everywhere and across any device.

In September, Microsoft also announced that it was working in partnership with Amazon in a bid to put a lot of pressure on competitors, gain distribution and overlap, and to enable their respective AI digital assistants to work together in a move to create an open way to communicate and interconnect with AI platforms.

As consumers, figures show that over a one-third of us (in the US and the UK) use digital assistants weekly (the equivalent to Netflix’s adoption level). This is a trend that is set to continue. For example, Ovum forecasts the native digital assistant installed base to grow from 3.6 billion (from last year) to 7.5 billion active devices by 2021. As long as digital assistants are able to add and provide real value, and tangible benefits, more people will be willing to try them, and to integrate them willingly into their business operations e.g. Skype calls. The market is still in the early stages though, and with Google currently predicted to dominate, we are likely to see many more announcements for many more applications and integrations of digital assistants into devices and platforms in the near future.

Alexa Now Recognises Multiple Voices

Amazon’s Alexa AI digital assistant is now able to tell the difference
between the voices of different users in the same household, thus enabling the Amazon Echo to handle multiple-user profiles in a convenient way.

Following Google
This latest development from Amazon follows Google Home’s rollout of multi-user support in the UK back in June. Google Home can, therefore, already deal with 6 different user accounts and voices in a single unit. Each individual user-account responds to each individual user’s voice, and delivers tailored calendars, playlists and preferences to whichever user is speaking to that unit.

Don’t Need The App
Although Alexa could already handle multiple user accounts before, it required the use of an app and a confirmation code to do so. Now that everything can be operated by Alexa being able to successfully recognise multiple voices and deliver tailored services accordingly, it puts the Amazon Echo back in competition (in terms of features) with Google Home.

It has been reported that the new feature is compatible with Flash Briefings, shopping, Amazon Music’s family plan and Alexa to Alexa calling.

Teaching Alexa
Just as with Google Home, the AI element of Amazon’s Alexa needs to be taught the difference between the voices of its different users in order to operate successfully for multiple users based on voice alone. This involves each user selecting “Your Voice” in the mobile app, and repeating a series of demo commands to Alexa.

Teens Use, Parents Pay
The Alex multi-voice recognition announcement follows hot on the heels of Amazon’s announcement that an expansion of its Household subscription means that 13-17 year-olds can shop on its site through the app, and using their parents' payment methods (provided that their parents have set a spending limit or approved each purchase). There is speculation among technical commentators that this is an area where Alexa (and its multi-voice recognition) may be employed in the near future.

What Does This Mean For Your Business?
This is another example of the fierce competition that is currently taking place in the new and rapidly evolving ‘Voice First’ market, which is currently being led by Google, but there is some competition from Microsoft with Cortana and now Amazon. Both Microsoft and Amazon, for example, managed to miss the smart-phone revolution but are concentrating efforts now on becoming serious competitors in ‘Voice First’ revolution.

This story is also an example of how technologies are being merged / combined, copied, collaborated on (Microsoft and Amazon), to enhance / augment, add value to, and better monetize existing services e.g. Skype incorporating Cortana, and the possible addition of Alexa to other Amazon services.

The widespread use of mobile devices and apps, the introduction of (and heavy investment in) AI and robotics into many aspects of products and services by market-leading companies now means that businesses have extra threats and opportunities. As workers, automation led by AI is also likely to alter the nature of jobs, and may mean that more people will need to seek more education / lifelong learning, and be more accepting of the need for change and frequent adaptation in their working lives.

Drone Hits Passenger Aircraft

A remotely piloted drone struck a Skyjet turboprop passenger plane as
it made its approach to land at Jean Lesage Airport in Quebec, Canada last Thursday.

What Happened?
The drone craft, which was being operated by a person as-yet unknown, was reported to have been flying at a height of about 450 metres / 1,500 feet and at an estimated 3,000 metres from the runway at the airport. As the Skyjet passenger aircraft came in to land, it was struck by the drone causing minor damage to the aircraft. Fortunately, the aircraft, which was carrying 8 passengers, was able to land safely.

Interim Rules In Place
Interim ‘Transport Canada’ regulations (to be approved next year), first introduced in March and amended in June, make it a violation for recreational drone to be flown within 5.5 kilometres from an airport, and 1.8 kilometres from a heliport without having special permission. Drone operators must also not fly their drones above 90 metres in height. Violation of the current regulations can warrant a $25,000 fine.

Accident Waiting To Happen
According to Canada’s Federal Transport Minister Marc Garneau's office, 1,596 drone incidents were reported to Transport Canada in 2017, 131 of which were deemed aviation safety concerns.

This was, however, the first time that a drone had actually struck a passenger aircraft in Canada, and Mr Garneau is reported as saying that it could have been "catastrophic" if the drone had collided with the engine or cockpit.

Worldwide Problem
Drones flying too close to airports have now become a problem worldwide. Back in July, for example, a drone being flown dangerously close to Gatwick airport in the UK meant that four Easyjet and one British Airways flights had to be diverted.

Drone Photographer Punished

In another incident in Essex back in August, a 28-year-old man from Kirby Cross was apprehended by police, after flying his drone too close to a railway station. The man was reportedly trying to use the drone to get photos of a Tornado steam engine, and was reported for a breach of his Air Navigation Order. According to the Police, the man had flown the drone within 50 metres of other people and property out of their control. Legally, a drone should not be flown within 150m of crowds or built-up areas.

The man was punished by way of an agreement contract with Essex Police, and was given a community resolution.

New Rules in the UK

In the UK, new government rules mean that drones weighing 250 grams and above now need to be registered online. Owners of these drones will also have to take safety awareness tests to determine their knowledge of UK safety, security, and privacy regulations. The government hopes that these new rules will help to develop accountability among drone owners and encourage them to act responsibly.

What Does This Mean For Your Business?
Drones are part of a new industry where the technology and products have been developing before the law has had an opportunity to catch up. Drones clearly have many productive, value-adding, and innovative business uses, and they have been tested and tipped for wider use in the future by brands such as Amazon for parcel deliveries. A move towards autonomous vehicles and new transport technologies means that drones currently have a bright future when used responsibly and professionally. The fact that drones are widely and easily available (with minimal restrictions) to individuals as well as companies, as shown by the many aircraft near misses, indicates that most people would welcome the introduction of regulations that contribute to public safety. It is important, however, that any new rules take account of the rights of the majority of responsible drone users, and don’t restrict the commercial potential of drones.

Staff Sue Morrisons Over Personal Data

5,518 former and current Morrisons employees are suing the company in
the High Court over failing to protect their personal data after it was posted online by a rogue employee with a grudge.

What Happened?

Back in 2014, Andrew Skelton, who was an auditor at the head office of Morrisons in Bradford, leaked the personal details of almost 100,000 staff. Mr Skelton is believed to have deliberately stolen and leaked the data in a move to get back at the company after he was accused of dealing in legal highs at work.

Although Mr Skelton was jailed for jailed for eight years in 2015 over the incident, and Morrisons was awarded £170,000 compensation against Skelton, lawyers for the employees whose data was stolen and leaked are now arguing that they should also be compensated.

What Kind of Data?
The data, which was stolen, sent to national newspapers, and posted on data-sharing websites by Skelton included details about staff salaries, bank details and National Insurance numbers.

It is estimated that the data breach cost the company more than £2m to rectify back in 2015.

Upset and Distress
In the recent case in the High Court, Jonathan Barnes, Counsel for 5,518 former and current Morrisons employees argued that they were victims too, and should therefore also (like Morrisons) be compensated.

Mr Barnes argued that due to a failure by Morrisons to keep staff personal safe, upset and distress was caused to people whose personal data had been posted online without their consent (and knowledge at the time).

The basis of the case is, therefore, that Morrisons may be responsible for breaches of privacy, confidence and data protection laws, and may have exposed employees to the risk of identity theft and potential financial loss.

The action at the High Court will last two weeks and is essentially concerned with liability. No decision has yet been made.

What Does This Mean For Your Business?

With so much focus on attacks from the outside by hackers and scammers, it’s easy to forget that attacks and data breaches / leaks can come from within. Businesses may not be aware that insider attacks top the list of threats to data and systems, and because (as in the case of Skelton) certain employees have legitimate access to sensitive and valuable company information, the risk is potentially huge. What makes this risk particularly hard to manage is the fact that trust needs to be placed in employees in order for them to do their job, although their motivations are hard to predict, anticipate or control. It is also likely that, as in the case of Morrisons, insiders can select the most sensitive of data, and inflict the worst kind of damage before the company even knows about it.

Businesses should, therefore, at least be aware of the threat, and try to restrict access to sensitive data to only those people who need access to it, to build in some monitoring and checking, and to build this kind of scenario into Business Continuity and Disaster Recovery Plans.

Cash From Cloud Bigger Than Expected

A Gartner report shows evidence that revenues from the public cloud
look likely to grow by 18.5% this year, and could top $260 Billion.

Public Cloud
The ‘public cloud’ refers to the service whereby companies / individuals can access virtual machines (VMs), applications or storage over the Internet on a pay-per-usage or free basis.

Technical commentators have noted that the market for cloud services is growing much faster than most other IT markets today, with much of the growth coming at the expense of more traditional, non-cloud offerings.

Big Growth Areas - SaaS and IaaS
The Gartner report shows that the big revenue growth areas this year are Software as a Service (SaaS) and Infrastructure as a Service (IaaS).

The greater than predicted rise in SaaS revenue for last year ($48.2 billion) is a key driver for the healthy forecast in public cloud revenue for this year, where software revenues are expected to reach $58.6 billion by the end of the year.
IaaS has also seen bigger than expected revenue growth, and Gartner predicts end of year revenues of $34.7 billion, which would be a massive 36.6% increase on last years’ end-of-year figures. Many technical commentators believe that IaaS is likely to be the fastest growing area of cloud computing over the next 5 years.

Amazon is the leader in the IaaS market with 44.2 % of the market, and has a much larger share than its closest rival Microsoft. Google has also gained momentum in the IaaS market with Azure.

PaaS Too
Even though Platform as a Service (PaaS) was one of the least profitable areas of the cloud last year, revenues for these services are forecast to rise significantly by 2020, and there are expectations of an increase to $20.8 billion this year (compared to $9 billion last year).

PaaS refers to the provision of a platform and environment that allows developers to build applications and services over the internet. The PaaS services are hosted in the cloud and can be accessed by their users via their web browser, thus providing ease and convenience to a hitherto more complicated and costly area of computing.

What Does This Mean For Your Businesses?

The general trend over the last year or so has been that the hybrid cloud has been the preferred enterprise strategy, while public cloud adoption has been growing, and private cloud adoption has flattened-out.

The growth in public cloud services, as shown by the Gartner report, is something that is happening worldwide, and it is being driven by digital business initiatives, data centre consolidations and application migrations to the cloud.

Now that businesses are less fearful of the early perceived risks of a move to the cloud e.g. security concerns, and are starting to realise the key benefits that cloud services offer (flexibility / adaptability, reduced costs - no need to purchase / upgrade in-house hardware or employ the expertise to manage it, security and reduced risk - including backup and recovery), it is not surprising to see big growth in its uptake by all kinds of businesses.

Monday, October 16, 2017

How Your Phone Can Depress You

Research by Nottingham Trent University has revealed that mobile phone
alerts can have a negative impact on your mood, especially if they're work-related and or non-human notifications.

App Research
The research, which was carried out to study the way people interact with the notifications on their phone and how they impact mood, was conducted by using an app called NotiMind which participants downloaded to their phones. The app collected details about the phone’s digital notifications, plus information about each participant's self-reported moods at different points in the day over a five-week period, and involved the sending of half a million notifications.

The collected data showed that one-third of the participants suffered negative effects on their mood from their phone notifications, such as feeling hostile, upset, nervous, afraid or ashamed.

Most Negative
Phone notifications which related to non-human activity e.g. Wi-Fi availability and the working of the phone itself were found to be the ones that had the biggest negative impact on someone's mood. Not surprisingly, work-related alerts (especially when several arrived) ranked a close second when measuring negative moods.

Why Negative?
The researchers noted that the disruption, distraction, and competition for attention that phone notifications bring, as well as the source (e.g. work-related) are contributors to negative feelings in recipients.

Most Positive
Those notifications which had the most beneficial effect on moods were found to be messages from friends, especially when several of these notifications arrived at once. Friend-related notifications were found to create a sense of belonging and feelings of connection to a social group in the recipients.

Emojis Help
Another interesting finding of the research was that the inclusion of emoji characters in notifications was found to lift the mood of recipients. This is particularly significant for the world’s fastest growing language in all forms of communications because they transcend traditional language barriers, and they help to quickly and easily communicate the emotional content of a message.

What Does This Mean For Your Business?
Most of us now have smart-phones, and the many apps compete for our attention, and the many different kinds of notifications that we receive privately during the course of our day at work disrupt our work and affect our moods. This means that modern businesses are likely to be affected by more constant and low-level disruption than in the past due to notifications and workers responding and reacting to them (often putting work aside to do so). It is also important to remember that being connected to (and being able to deal with) general life matters (without having to take time off to do so) can have a positive effect on workers.

In terms of how businesses communicate with their staff, customers and other stakeholders, this research could be valuable in terms of helping to structure notifications so that they will be received in a positive way. For example, knowing the best time of day to send notifications, not sending too many in a short time, linking messages to social / human subjects, and including emojis could help businesses to communicate in a more beneficial way with their public.

Are You Unwittingly Making Crypto-Currency?

Scammers are secretly installing 'mining code' in websites so that they

What's Happening?
Hackers are operating a popular scam which involves installing 'mining script' code such as Coin Hive into multiple web pages without the knowledge of the website owners. The scammer then gets multiple computers to join their networks so that the combined computing power will enable them to solve mathematical problems. Whichever scammer is first to solve these problems is then able to claim / generate cash in the form of crypto-currency.

If, for example, a website is able to get one million visitors a month, and if the Coin Hive Web Miner for Monero (XMR) is used, it could generate an income of £88 in the Monero crypto-currency.

What Is Coin Hive?
Coin Hive is crypto-currency mining software written in Javascript, which sends any coins mined by the browser to the owner of the web site. If you visit a website where it is being used (embedded in the web page), you may notice that power consumption and CPU usage on your browser will increase, and your computer will start to lag and become unresponsive. These slowing, lagging symptoms will end when you leave the web page.

can use the computers of website visitors to help them generate digital cash or 'crypto-currencies'.

Cloud Being UsedThere are reports that this crypto-currency mining scam is now being extended to target cloud-based computing services. If hackers are able to break into a cloud account they can harness a huge amount of computing power and use multiple machines to try and generate more income.

With cloud billing services making it hard to detect the scam before it is too late, victims can be left with large bills for servers that hackers have been using for their coin mining.

Measures Being Taken
Many different measures are now being taken by companies and organisations to stop the surreptitious use of mining including:
  • Researchers in Illinois are developing a monitoring system that can spot the signs of mining software e.g. the increased activity in processors when working out the complicated maths problems. The researchers are working with a cloud company with a view to deploying it in their network, and have plans to extend the system to personal computers.
  • Government officials the Crimean council have reportedly been sacked for using mining software on government computers.
  • The creators of the FiveM add-on for the video game GTA (Grand Theft Auto) V have released an update which stops people from being able to add miners to their code.
  • Security service Cloudflare has suspended the accounts of some customers suspected of using mining scripts.

What Does This Mean For Your Business?
The increased CPU usage and slowing down of computers caused by mining scripts waste time and money for businesses. There are some simple measures that your business can take to avoid being exploited as part of this scam.

If, for example, you are using an ad blocker on your computer, you can set it to block one specific JavaScript URL which is . This will stop the miner from running without stopping you from using any of the websites that you normally visit.

Also, a dedicated browser extension called 'No Coin' is available for Chrome, Firefox and Opera. This will stop the Coin Hive mining code being used through your browser. This extension comes with a white-list and an option to pause the extension should you wish to do so.

Coin Hive's developers have also said that they would like people to report any malicious use of Coin Hive to them.

Maintaining vigilance for unusual computer symptoms, keeping security patches updated, and raising awareness within your company of current scams and what to do to prevent them, are just some of the ways that you could maintain a basic level of protection for your business.

Legal Threat From GDPR

Speaking at the recent IP Expo in London, Irwin Mitchell solicitors warned
businesses that focusing too much on consent as a basis for data collection could mean that they miss other options and issues, and leave themselves open to the risk of fines from the UK regulator when GDPR comes into force next year.

One of the key areas highlighted by the speaker from Irwin Mitchell was the fact that obtaining consent will be far more difficult under GDPR, and that the stricter rules around the gathering of consent with GDPR could mean that companies that rely on it entirely face the risk fines.

Under GDPR, businesses will need to demonstrate that they have a basis for transferring and processing user data i.e. ensuring that they have 'legitimate interests' i.e. showing that they are using data for legitimate business purposes and that no privacy rules are being breached.

What About Consent?
Consent where gathering and using personal data is concerned is a notoriously complicated legal area.

When the EU's General Data Protection Regulation (GDPR) comes into force next year businesses will need ‘explicit consent’ to legitimate certain forms of data processing. GDPR will essentially make a number of other changes to the way in which organisations will have to gain consent.

Consent under GDPR will have to be unbundled i.e. consent requests are separate from other terms and conditions, granular (a thorough explanation of options to consent must be given), named (state which organisation and third parties will be relying on consent), and documented (keeping records of how consent was gained).

Consent will also have to be easy to withdraw, and this means that if companies focus too much first on the consent aspect of GDPR as a legal basis for using personal data, it may be at the expense of other options, and could leave them open to legal risks that they had missed.

Complications For Businesses
  • Some of the complications that could lead to some businesses being open to legal threats are that:
  • Under GDPR implied consent will disappear.
  • Terms and conditions can no longer be used as a catch-all.
  • Businesses that rely to some degree on consent as a legal basis will need to redraft their forms to make them compliant.
  • Many current marketing consents are not clear enough, and companies will need to sort through them, make sure they are compliant, and refresh them every two years.

Revealed Gap
For many businesses, trying to prepare for GDPR has revealed just how far behind they have been with data protection practices anyway, and many are still trying to find data that they should have been securing for years. With the clock ticking, compliance is a daunting challenge.

Focusing On The Wrong Things
Some GDPR commentators have pointed out that many companies have been focusing on the wrong things in their preparations for GDPR because they don’t understand the real legal risks.

For many businesses, there needs to be (and there hasn’t been) enough of a focus on the use of technology in their preparations in order to be realistically compliant in time.

Businesses are also not in a position of to see the day-to-day cases in which EU regulators are forming a point of view on data protection.

What Does This Mean For Your Business?
There is now a pervading view that although the legal profession understands many of the ins and outs of consent, and the other important legal matters relating to GDPR, many businesses do not, and there is likely to be a quantum of illegality into May 2018 and beyond.

The whole area of what is meant by consent is so complicated and carries so many new obligations that data controllers should concentrate first on looking at other legal grounds as an alternative to consent.

Businesses could help their own preparations by focusing on how they can use technology to achieve compliance in time for GDPR, but may need to seek the current best legal information and advice to make sure that they are aware of, and are covered for the worst legal risks.

Google's DeepMind To Monetize AI

After years of astonishing AI developments and expensive R & D and staffing
bills, Google now plans to finally monetize its DeepMind AI by embedding it into a host of Google products and services.

Losing Money
Up until now, the expense of AI development work by DeepMind has meant big annual losses. Last year, for example, it made a loss of £94 million, which was partly due to the hiring of experienced and highly specialised technical staff to work its AI development and research.

The hope and intention is, of course, that the AI developments made by DeepMind will pay back with improved products and services and new business opportunities that will generate more revenue in the not-too-distant future.

What is DeepMind?
DeepMind is Google’s London-based artificial intelligence (AI) company which it purchased in 2014 for $400 million. It has been engaged in developing AI with a view to improving Google's products and services with it, and to help in the battle for voice first AI dominance against competitors like Microsoft and Amazon (Cortana and Alexa). For example:
  • Improving Google's voice-controlled virtual assistant 'The Google Assistant' in order to make it sound more natural in products such as the new Google Home Mini.  
  • Developing the algorithm WaveNet, a network for producing better and more realistic-sounding speech. Originally it was thought to be too computationally intensive to work in consumer products (and therefore to be effectively monetized), but work by DeepMind over the last 12 months has improved the speed and quality.
WaveNet is now reported to be 1000 time faster, capable of running at scale, and is, therefore, the first product to launch on Google’s latest Tensor Processing Units (TPU) cloud infrastructure (used to accelerate a wide range of machine learning workloads, including both training and inference).

According to the DeepMind blog, the updated version of WaveNet can generate Google Assistant voices for US English and Japanese across all platforms, thus rendering it more likely to make money for Google.

Ethics Perspective
As well as worrying about how to best make money out of the expensive work on AI, DeepMind is also aware that simply advancing AI and developing ever more powerful algorithms without considering the possibility of hyper-intelligent machines turning on humans would be a mistake, and more than just commercial suicide.

In a recent meeting with the US National Governors Association, for example, Tesla and SpaceX CEO Elon Musk reportedly described ‘Artificial Intelligence’ (AI) as a "fundamental risk to the existence of civilisation.”

With that in mind, DeepMind has set up 'Ethics and Society' which is essentially an ethics committee to look at the real-world impacts of AI with the aim of helping technologists put ethics into practice and helping society at large understand the potential effects of AI.

'Ethics and Society' is able to draw upon the input of a number of expert 'fellows' including Nick Bostrom of Oxford University's Future Humanity Institute and Strategic Artificial Research Centre.

What Does This Mean For Your Business?
AI-based, voice-controlled virtual assistants are now popular in-home devices such as the Amazon Echo, and in the Windows 10 operating system. As one of the really big tech company market leaders, Google, of course, needs to be able to compete in that market segment, but the full benefits of Google's DeepMind work and investment not have been realised yet. After such a large R & D investment, it is understandable that Google now wants the DeepMind project to start paying back by incorporating AI in (and thereby adding value to) existing and new products and services.

The fast development of AI has brought important and real-world concerns about the growth of automation, the changes it will bring to the labour market, and the other potential threats that it could pose.

Most businesses are likely to be affected by some aspect of automation e.g. software or mechanical, in the near future, either themselves directly or via suppliers and stakeholders.

There is, of course, the threat that intelligent machines could be a danger to humans if AI is not properly regulated, but a more immediate threat is likely to be the threat that AI-based automation poses to traditional jobs. There is an inevitability that AI and robotics will alter what jobs look like in the future, but it is also important also to remember that they could provide huge advantages and opportunities for businesses.

Regulation of the growth of AI, and keeping a close eye on the ethical aspects of it are sensible measures, and workers can try to insulate themselves from the worst effects of automation by seeking more education / lifelong learning, and by trying to remain positive towards and adapting to changes.

How much automation and what kind of automation individual businesses adopt will, of course, depend upon a cost / benefit analysis compared to human workers, and whether automation is appropriate and is acceptable to their customers.

Crackdown On Tax Payments By Online Businesses

The European Commission is using the rulings of two cases involving
Apple and Amazon, and reforming the way VAT is collected to make sure that all online businesses pay their taxes.

The Apple & Amazon Cases
The rulings on cases involving Apple’s operations in Ireland, and Amazon’s in Luxemburg are to be used to close loopholes for those multinational companies operating in Europe and seeking to allocate profits to entities not (directly) involved in the provision of the goods or services to which the profits relate, as a means of reducing the amount of corporation tax they pay.

Countries Accused

There have also been accusations that governments appeared to have allowed the companies to channel their profits through companies that existed mainly for tax arrangements from which they stood to benefit.

In Apple’s case, last year the Irish government was ordered to retrieve €13 billion in back taxes by the EC (the European Union's antitrust and competition watchdog). The EC has now taken the Irish government to court for failing to recover the money from Apple, thereby firing a warning shot to other multinationals that they’re not going to let companies (however powerful) off the hook when it comes to taxes owed. The tax bill for Apple is equivalent to 5% of its cash reserve / one quarter's global profit, so could be enough to have an effect.

In Amazon’s case, the EC ordered Luxembourg’s government to recover $250 million from Amazon because Amazon’s reduced tax bill was deemed to be ‘illegal state aid’. This amount equates to a little over the global profit for the last quarter, and is, therefore, a significant amount for Amazon.

VAT Changes

The EC has also moved to close more loopholes where VAT is concerned. These moves could create a proposed new, unified system of value-added tax (VAT) collection across the EU. This could stop companies from ‘jurisdiction shopping’ to pay the lowest rates, and it is estimated that it could help governments recover VAT of up to €150 billion a year (including €50 billion lost to fraud). With this scheme in place, governments in countries where purchases are made could receive revenue, and (cross border) businesses would know the right amount of tax to pay and collect, and could have their compliance costs reduces. The proposed VAT changes, however, are unlikely to be introduced until 2022.

What Does This Mean For Your Business?
These moves and the very public announcement of them last week are clearly designed to send a message to all companies, online or offline, in whichever country their tax liability actually lays, they will be expected to pay their taxes in the EU for sales made in the EU from now on. The fact that the EC has challenged huge corporations and whole countries shows that it is serious.

Hopefully, the proposed new VAT changes will be less complicated and costly for small businesses than the Commission's last attempt to simplify EU cross-border VAT collection with the mini one-stop shop" in 2014.

It is possible to see why, for the benefit of their economies, countries like Ireland may have been reluctant to go after Apple for the money, but for many people, seeing big corporations (with big profits) being held to account like other businesses, the EC’s announcements and actions have a positive aspect to them.

The Commission now has to make sure that the proposed changes help all online businesses not just multinationals like Apple and Amazon that can afford expert help with their tax advice.

Augmented Reality Maps

The Ordnance Survey augmented reality (OS) Maps app
will allow users to see signs identifying UK landmarks in the area they’re looking at through their phone or tablet’s camera view.

Augmented Reality Maps
The new version of the OS Maps app uses ‘augmented reality’ which is the technology that can allow the real-world view to have other computer-generated or extracted real-world sensory input such as sound, video, graphics or GPS data superimposed on it.

The augmented reality aspect is an update to the current app which uses GPS to show users exactly where they are, records their route, and offers them the option to choose a map type from standard overview map, 1: 50k (Landranger), 1: 25k (Explorer) or aerial imagery.

No Phone Signal Needed
Even though the new augmented reality app works on smart phones, it does not need a phone signal, and is, therefore, practical for use in remote places. If users do operate with a data connection, pressing on a label gives the users additional local area information with routes, places to stay and local images from GetOutside.

Using Phones For Navigation
The app is thought to be particularly useful and convenient because many people now use their smart-phones for navigation, and it is part of an app that operates on the user’s existing mobile device.

Where Can You Use It?
The new app is able to operate in 200,000 locations throughout the UK.

Features Identified
The kinds of geographical features that the app displays labels and useful text information about include hills and mountains, lakes, coastal features, woodland, and transport hubs.

Wider Perspective
The app addresses the challenge posed by small phone screen sizes by showing what is on the horizon.

Safer With Paper?
Despite the convenience and practicality of the app, the Digital Product Manager at Ordnance Survey has been quick to point out that, for safety reasons, it is still recommended that people carry a paper map when outside (because they don’t rely on batteries).

Where To Buy?
The app is free to subscribers of OS Maps (exclusively for Premium Users). For non-subscribers, it can be purchased from the OS online shop for £19.99 and then downloaded from Apple iTunes or Google Play.

What Does This Mean For Your Business?
Augmented reality ideas such as this could provide all kinds of opportunities for businesses involved in tourism and tours e.g. cities, holiday / historic / tourist locations, travel and tour companies, galleries). Other opportunities could be in design e.g. allowing consumers to view how a retailer's virtual furniture looks in their room before they buy.

Augmented reality could also provide business opportunities in education and teaching and anywhere that information about culture and the environment is needed in a fast, convenient and portable form (handheld AR equipment).

There are also military applications for AR such as the Heads-Up Display (HUD) used by ground troops, and there are medical uses e.g. to practice surgery in a controlled environment.

Businesses may also be able to use AR for advertising and promotional purposes e.g. apps designed to display information about (and offers relating to) restaurants, shops, and other businesses in the local area of a user.

In short, we are still at the beginning of the AR revolution, and the technology offers businesses and other organisations opportunities that are limited only by the imagination.

Monday, October 09, 2017

UK Moves To Subscription Economy

A recent YouGov survey of more than 2,000 people in the UK, sponsored
by subscription software firm Zuora has revealed that the average monthly spend by UK adults on subscription services of all kinds has tripled in the past year.

A challenging global economy, fierce competition, disruption and changes across many industry sectors, the need to reduce costs and combat piracy (e.g. of software), and the effect of consumers getting used to using their mobile devices to sign up for what they want, when they want (and switch just as easily), plus a shift towards apps and the ease on online payment systems are some of the contributors to what has become a challenge to customer loyalty and retention.
This has meant that businesses have been forced to move away from a product-centric mentality, and to try and create long-term brand affinity based around flexible subscription-based services. This, in turn, has meant that the ‘subscription economy’ has become a reality for many of us.

What Kinds of Subscriptions?
Businesses are now offering a vast range of subscription-based services including:
  • Software - Software as a Service (SaaS) models are now commonplace (no more sending out CDs).
  • Magazines, newspapers and journals - subscription-based services offer huge cost savings, convenience, and environmental benefits in this sector.
  • Cars - car makers are now providing services where customers pay to use cars rather than buying them outright.
  • Healthcare - medical and dental services.
  • Online data storage services - e.g. Google Drive and Dropbox.
  • Telecoms - for example, Norway’s state-owned operator Telenor offers a subscription-based service for businesses trying to use IoT access to technology.
  • Airlines - Surf Air, for example, is offering a subscription-based service in Europe whereby, for a monthly charge (and an initial membership fee), customers can subscribe and receive unlimited flights.
  • Grocery shopping services - now have nearly 2 million UK subscribers.
  • In-car apps - now have 650,000 subscribers in the UK.
  • Beauty and grooming - this includes subscriptions for men’s shaving service, Harry’s, which now has more than 1.3 million UK monthly subscribers.
The Figures
The report shows that a staggering 58 million UK shoppers now subscribe to services, and UK consumers now spend 12% of their monthly disposable income on subscription services. This means that the UK adult population is now spending an average £56 per month on subscription services. 35–54 year-olds are spending the most at £62 every month on their subscriptions, although spending has risen across all age groups and isn’t confined to just millennials.

What Does This Mean For Your Business?
Consumers in the UK now have a clear preference for on-demand, personalised, and subscription-based access to services. The subscription-business model has officially gone mainstream, and in order to compete effectively, retain as well as gain customers, and to protect customer and brand loyalty, businesses need to look seriously at how they can take advantage of this opportunity by shifting and transforming their business models so that they are in-line with the subscription economy that consumers are buying so heavily into.

One other interesting finding in the report is that a quarter of the UK population predict that they will be subscribing to even more services over the next five years. This should flag-up the importance for UK businesses to look now at how they can best position themselves to get a piece of the subscription pie in what appears to be a trend that is set to continue.

E-Currency A Real Possibility For Sweden

A year after launching an investigation into the viability of introducing
an e-currency, Sweden’s central bank looks likely to introduce the ‘e-krona’ as a government-guaranteed means of payment and a digital complement to cash.

In November last year, Sweden’s central Riksbank, which had been the first to issue paper banknotes in the 1660s, reported a massive drop in the use of cash with the amount of notes and coins in circulation having fallen by 40% since 2009. This trend among the general population, coupled with the increasing digitisation of banking services, forced Riksbank to decide on exploring the real possibility of introducing the ekrona within two years.

Sweden’s Riksbank, like other central banks, currently provides electronic money through accounts to banks and clearing organisations, but only provides central bank money to individuals in the form of notes and coins.
The plan now, therefore, is to create a proposal for the digital currency, and then, in 2018, to explore more of the detail about any regulatory challenges, and about how an e-currency system for all could function in practice in the country.

Among the many issues that the central bank and the government are considering in drawing up their proposals for the possible introduction of the digital currency, is the potential vulnerability of a cashless society in the case of a systemic failure, due to a digital payments market being in the hands of only a small number of commercial players, payment services and infrastructures (as is currently the case in Sweden).

Other issues, such as how the ever-declining use of cash in Sweden will affect society (and certain groups within it), and the infrastructure, and what could happen when there is no central bank money in society, are all being considered.

How Would It Work?

It is currently envisioned that the e-krona could be used for small payments between consumers and companies and could be made available via an account or through an app or card.

The advantages of having the e-krona are cost savings, convenience, accessibility (24 hours a day, seven days a week), and the fact that it would be risk-free because it would still be linked directly to the central bank.

Not New
Digital currencies are not new. The most well known digital crypto-currency ‘Bitcoin’ has seen a large rise in value in recent years, and despite having a ban placed on trading in the currency 2 weeks ago in the Chinese markets (as a way for the Chinese government to gain some control over it), has rallied round and recovered its initial 8% drop in value.
Unlike the proposed e-krona, however, Bitcoin is not linked to any banks, and is generally used by companies, organisations, banks, and investors rather than by individuals (1 Bitcoin = £3238.86).

What Does This Mean For Your Business?
For businesses, handling cash can be costly and time-consuming, and for consumers, the introduction of contactless payments (the closest thing we have to digital currency) has proved to be very convenient and easy to use. In July, for example, Browns of Brockley, an independent cafĂ© in east-London become the UK's latest small business to go completely cashless, preferring instead to take just (mainly contactless) card payments. This move was actually inspired by the owner’s visit to Sweden, and his positive experiences in the near cashless society where he reported that he didn’t have to withdraw money once.

Cash is also declining in use in the UK, and the prospect of digital currencies that could be used by all (not just large organisations or banks) could be a win-win situation for consumers and UK businesses, particularly small businesses. Digital currencies could be a way to help business to ultimately increase efficiency and boost profits.

In the case of Bitcoin, for larger businesses and organisations (and investors) it offers the benefits of freedom from the constraints and controls of banks, speed, convenience and accessibility (borderless, day or night). This kind of currency and its underlying technology (Blockchain) look set to make its easier to do large-scale business in the not-too-distant future.

Google’s Shopping Ads Change

After receiving a €2.42 billion fine from the European Commission back
Google Adwords
in June, Google is now letting other comparison shopping services (rather than just its own Google Shopping) place ads at the top of its search results.

What Happened?
Back in June, Google was deemed to have broken EU antitrust rules, and was handed the EC regulator’s largest fine to date for distorting the market by promoting its own shopping comparison service at the top of its own search engine results, and thereby demoting competitors’ shopping service adds.

Google was given a 3 month deadline to put things right, or face paying 5% of its parent company Alphabet's average daily worldwide earnings, which could amount to an estimated $14m a day. Google must also submit a report on its compliance with the EC’s ruling every four months.

Prior to the decision to fine Google, it was reported that the company disagreed with the EC’s findings, and had argued that Amazon and eBay exerted more influence over the public's spending habits.

Google is now reported to have made changes to how its search engine results to comply with the EC’s ruling. These changes are reported to include:
  • Comparison shopping services being given the same opportunity to show shopping ads from merchants on Google's Search results pages as are given to Google Shopping.
  • Google Shopping operating as though it were a separate business in order to create greater equality in search engine results.
  • The foot of adverts will now visibly identify the comparison shopping service via which the ad arrived, as well as the merchant concerned.
The changes will initially affect shopping ads in Austria, Belgium, the Czech Republic, Denmark, France, Germany, Italy, Ireland, Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland and the U.K.

Critics of Google’s announcement that it has changed things to make it fairer for advertisers in response to the ruling have been quick to say that Google may, in fact, profit from the ruling by being able to charge comparison shopping sites for expensive ad slots when the sites used to appear for free in organic search results.

Also, some commentators have suggested that Google could impose penalties on comparison shopping sites that got it into trouble with the Commission, and that Google should simply let its search engine crawl, index, and rank comparison shopping results in the same way that it does other web pages.

What Does This Mean For Your Business?
Some see this whole situation as a political move at a time where there has been mounting anxiety in European capitals about the influence that the US giant companies known as ‘Gafa’ - Google, Apple, Facebook and Amazon - have on our lives. This has been amplified by the deterioration in European / US trade relations since the start of the Trump administration.

It has to be said though that it is quite an unusual situation anyway whereby the company displaying the adverts to so many people around the world has a less than transparent system for doing so (using its own essentially secret algorithms). Simply because of the sheer volume of adverts that Google sells and displays, having to change the system even slightly in a relatively short time frame may have had a negative impact on Google’s profits. Some commentators have also pointed out, however, that the large fine that Google was given could actually have been twice as large.

If the ad playing field actually does now become a more level one, this can only really be good news for smaller shopping sites, but, although it offers online businesses new opportunities, the change could also offer them new costs too. 

Rudd’s 'War' With Techies Over Encryption

After making critical comments about unhelpful techies while
Data Encryption
answering questions at a fringe meeting at the Conservative Party Conference, Home Secretary Amber Rudd is facing criticism from technical commentators about her apparent lack of understanding about the basics of encryption.

Stopping End-to-End Encryption

After the Westminster Bridge attack back in March, where the attacker was reported to have used WhatsApp, Home Secretary, Amber Rudd (in a TV interview) described a situation whereby terrorists can secretly talk to each other on a formal social media messaging platform as ‘unacceptable’. This led to her publicly spearheading a move to push for the removal of end-to-end encryption model that denies everyone (including government’s) access to message content, and to instead allow specific unscrambled messages to be handed to the government on warranted request, or accessed through ‘back doors’ being built into social media platforms.

Comments At Recent Meeting
During a recent fringe meeting, however, at the Conservative Party Conference, Home Secretary Rudd answered an audience question by saying that she didn’t need to understand how end-to-end encryption works to understand how it helps criminals, and suggested that legislators were "laughed at" for failing to understand the basics of the technology. She also suggested that she faced being patronised, and criticised by techies who don't like to help until "after an event has taken place”.

Techies Reply
The replies from technical commentators have come thick and fast. The main criticism of Rudd’s comments and stance on end-to-end encryption is that end-to-end encryption cannot be simply altered without being completely broken, and, if a back-door is built into an app or social media platform for the authorities, that same back door could be exploited by hackers and other online criminals. Technical commentators have therefore pointed out that although Home Secretary Rudd has said that she doesn’t need to know how end-to-end encryption works, it would appear that the reverse (on a basic level) is true, particularly since she is a leading exponent of calls to stop it.

Critics have also pointed out that, even though the Westminster Bridge attacker is known to have used WhatsApp (with its end-to-end encryption) prior to the attack, there is no real evidence to suggest that it was used to communicate with anyone else who was involved in the attack or its planning.

Home Secretary Rudd has also been criticised for previously saying that she doesn't believe that "real people" actually care about end-to-end encryption, despite her highlighting it as an important issue, and for mixing up ‘hashtag’ with ‘hashing’ in an interview on the Andrew Marr show.

What Does This Mean For Your Business?
National security and Internet / data security for businesses are, of course, important issues. Clearly, the technical community (in this case) feels that the Home Secretary should try to understand and exhibit more knowledge about key online security issues, and in order to maintain good relationships and a common purpose, refrain from public criticism of those in the technology industry.

Security and privacy are important in business communications, whether by phone app, social platform, or by email system. Businesses could argue that (political arguments and political personalities and styles aside) UK businesses are now facing really serious risks from cyber criminals, many of whom have already shown themselves to be capable of exploiting situations where there are back-doors in software / platforms / systems, or where there is a lack of adequate encryption. Relaxing security protection (such as end-to-end encryption) for everyone (for the sake of a few) may therefore not be a response that will benefit businesses right now. The debate and the criticism, however, look likely to continue.

US Government Wants Your Data

Reports from Apple and Google indicate that there has been a dramatic
US after your data!
increase in the last year in the number of requests by the US government for user account details.

Requests To Google Hits Six-Year High

Requests to Google are reported to have reached a six-year high in the half of 2017, with the US government reportedly seeking details about 48,902 user accounts. This is a 24% increase in requests over the last six months of 2016.
Although the volume of requests appears to be high, Google has said the number of requests could actually be lower because governments may have asked for the same data multiple times.

Google, Apple, Yahoo, Twitter, Facebook and others release details of government requests as part of (typically) six-monthly Transparency Reports.

What Type of Requests?
The types of legal requests that Google receives for user data, for example, include:
  • Tap and trace orders / pen register requests, to collect data on a person's communication, including dialled phone numbers and IP addresses, in real-time. These have seen a 49% increase.
  • Emergency requests e.g. to obtain information to prevent death or serious physical harm (no legal process required). These have targeted 35% more users.
  • Search warrants. Probable cause must be shown for these, and this year 31% more Google users have been targeted with such requests.
  • Subpoenas. Government agencies can use these to get information about e.g. IP addresses and names associated with Google accounts. 18% more users have been targeted with these this year.
Similar At Apple
Apple’s Transparency Report data shows a similar increase in the number of government requests for user data. Although Apple received 6,432 requests for data (a 62% jump on last year), it reports that it only provided that data in 32% of cases.

Apple reports that increases in user-account requests were mainly linked to phishing investigations, and that the types of account requests it received from the US government centred on things like iCloud content e.g. stored photos, emails, iOS device backups, contacts and calendars.

What About The UK?
Even though the ‘Snooper’s Charter’ / Investigatory Powers Act is now in place in the UK, and the UK and the US are known to share online data gathered about citizens, the number of requests from the UK government for user data has reportedly fallen by 7% to 325, the lowest since 2014.

What Does This Mean For Your Business?

We now live in a post-snowden era where investigators are having to adapt to a world where consumers, and criminal suspects, spend less time on landline telephones, which could be tapped, and more time online e.g. on social media, on encrypted apps (WhatsApp), or using mobile devices that manufacturers are very reluctant to give them access to (e.g. Apple). This means that government agencies quite simply have to go to where the data is i.e. user accounts for Google, and there is very little that individual citizens or businesses can do about it. By law, businesses will have to comply with government requests for user information, while at the same time working hard to make sure that they protect customer data in a compliant way as part of GDPR, and in the UK the Data Protection Bill.

The new government administration in the US has also been very public in its desire to gather intelligence about individuals from social media and other accounts, and to use this information as a way of screening entry into the US. The current UK government has also shown itself to be willing to widen surveillance to the Internet by storing the browsing history or UK citizens (as part of the Snooper’s Charter), and by pushing hard to get ‘back doors’ into popular social media platforms and apps. The trend for more information requests from governments therefore looks likely to continue, and businesses can therefore expect greater pressure to comply with more regulations concerning data in future, and can expect the possibility of contact with government agencies as part of investigations.

EC Pushes Tech Companies To Remove Hate

Technology companies are coming under renewed pressure, this time
European Union
from the European Commission (EC), to take measures to rid their platforms of hate speech and terrorist materials, or face the threat of legislation.

Propaganda Surge

According to the EC, despite a recent increase in the amount of terrorist propaganda, xenophobic and racist speech online, technology and social media companies have not been acting quickly or proactively enough to detect it, remove it, or to stop it from appearing on their platforms.

Code of Conduct Not Enough
Back in May this year, the EC agreed a code of conduct with Facebook, Twitter, YouTube and Microsoft that included a series of commitments to combat the spread of illegal hate speech online in Europe. The code was aimed at guiding the activities of the signatory companies as well as sharing best practices with other internet companies, platforms and social media operators. As part of the code, tech / social media companies agreed to train staff to remove illegal hate-speech material within 24 hours of being alerted to it.

It appears, however, that many European governments feel that more needs to be done, more quickly, and that tougher standards, backed by legislative measures may prove to be a more effective motivator for tech companies.

The EC has, therefore, decided to introduce guidelines and standards for technology companies, backed by the threat of legislation, to ensure that faster and more effective action is taken to stop unwanted material being shared online. The standards include investing in automatic detection technologies, and developing automated tools that can prevent the re-posting of content that has already been removed.

Also included in the standards will be the need for tech companies to set up dedicated points of contact that will allow the authorities to flag up offending content, and the introduction of (as yet not specified) fixed deadlines for tech companies to remove content that could cause serious harm e.g. incitement to terrorist acts.

The standards also call for tech companies to publish transparency reports that will show the number and nature of notices they have received about illegal content.

Following Calls From PM
This latest pressure from the EC follows calls from UK Prime Minister Theresa May who said in a speech to the United nations last month that technology companies must go "further and faster" in removing extremist content, and that tech / social media companies should be aiming to remove hate / terror content from their platforms within a 2 hour-or-less timeframe.

Banning Groups Helps
Recent research by the Georgia Institute of Technology using the Reddit platform showed that banning hate groups from a social media platform causes them not only to abandon that platform (rather than just going elsewhere within it), but also to reduce the levels of hate speech in any group members who stay.

What Does This Mean For Your Business?

The business world works best when customers, investors and other stakeholders have confidence in companies, brands, products and services. Those businesses that supply platforms for, or enable the sharing / distribution free speech of any kind e.g. social media and web companies, have a common (and commercial) duty to provide a safe online environment for their users e.g. by removing hate speech promptly, and by making their part of the online environment particularly safe for children, young people, and the vulnerable.

Surprisingly, given the level of technological expertise and investment in large social media platforms e.g. Facebook and Twitter, they have always struggled to moderate their platforms effectively. Many commentators recognise the importance of free speech, and acknowledge that social media companies need to strike a balance which enables them to remove unwanted content, but not be seen to censor and curb free speech (characteristics of authority and governments), and thereby damage the value of their brands.

It is sadly the case that, in the business world, it often takes the threat of legislation to force businesses to act effectively on standards and guidelines, so this move by the EC may help speed things along.

Online hate speech / hate crimes and bullying are now being widely challenged e.g. Google, GoDaddy, and Cloudflare’s decision to stop serving a neo-Nazi site The Daily Stormer, and the UK Crown Prosecution Service’s move to treat online hate crime as seriously as offences carried out face to face with tougher penalties and sentences for online abuse on social media platforms.

Anything that contributes to a safer online environment can only really benefit businesses as well as society. Businesses and organisations of all kinds can also help the common purpose of minimising online hate crime through education of their staff / pupils / customers / users / stakeholders about their own policies for the treatment of those discovered to be using hate speech e.g. at work (online).

We, as individual members society, can all play our part in making the online environment safe for all by challenging reporting hate speech where we find it, and, although the stance of open rights / free speech organisations such as the ORG is important, so is ensuring that the Internet is a safe place for all.