Archive for the ‘Technology’ Category

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There is a university, its location is not well known, maybe you travel there from platform nine and three quarters at King Cross, but it is called the School of Technology Phobia.   While we don’t know the location, it does seem likely that the University of Luddites is nearby. Graduates from the former of these institutions have been busy during the last few days, pouring their scholarly ideas across the ether. As a result, shares in Apple look like they are on helter-skelter, hurtling towards the earth.

That may be little unkind. That is to say unkind on Apple. It remains the world’s largest company and its shares did not so much as tumble, as reverse some of the stellar gains seen in recent months. But for the ladies and gentlemen whose cynicism led to the shares falls, the words are not all unkind at all.

Shares in Apple fell, and they fell quite sharply this week, as the company revealed truly stunning results. Revenue was up 112 per cent, sales into China doubled.  If the Apple share price falls after results like that, one wonders what might happen if it had an normal set of results

Apple’s problem is that it is the world’s biggest company by market cap. When you are that big it is hard to grow. Apple needs products that command high retail prices and it needs to sell them in droves. That’s why some think it will be turning to cars next, or even into the world of energy generation and storage.  The iPhone did alright in Apple’s latest quarter, in fact sales were up 35 per cent. According to the school of thought most people sign-up to, a 35 per cent rise in sales of any product is considered pretty exceptional. It is just that when it comes to Apple, it seems many analysts and investors went to a different school, the one mentioned above.

One day, but we have no idea when, smart phones will stop selling. Maybe it will occur when Moore’s Law runs out of puff, maybe it will occur when smart phones are replaced by chips that sit inside our heads. So while Apple enjoyed revenue topping £13.2 billion in its latest quarter, and its valuation to projected earnings is nothing alarming, cynics fret that one day it will run out of road.  Contrast that with Exxon Mobil, Apple’s main rival for the tile world’s largest company, it specialises in a product that the world will always want, namely oil, or so goes the argument.

As it happens, with technology advances in renewables, energy storage and synthetic oil there is no guarantee the world will always want Exxon Mobil’s core product. Apple, however, has another advantage. To explain why we need to look at psychology.

When it comes to paying for stuff, our purchases are likely to be greater if there is distance.  It also helps if things are easier.

If you were to tuck into pizza at the local Pizza café, and you were charged by the bite, you might soon get fed up. Setting aside the inconvenience, with each bite you will be thinking about the cost. So you pick you your fork, move the pizza to your mouth, and quickly tap in your pin number authorising another 30 pence. As you munch away, you will be thinking about the cost. Dan Ariely prosed the pizza idea to explain the concept of the ‘pain of paying’.

Other research shows that people who live in apartments in New York spend more on their laundry if they pay by tokens than by coins. The same psychology explains why casinos provide customers with chips – They spend more money that way.

For similar reasons, we spend more when we use a credit card than when we use cash. The lower the ‘pain of paying’, it appears the more we pay.

Now consider Apple Pay. It will be to the ‘pain of paying’, what morphine is to a headache. Apple Pay will make money for retailers, and Apple will be paid handsomely for this by them in return.

Now consider the Apple watch. It’s odd, isn’t it? When was the last time you used a pocket watch.  Wrist watches replaced pocket watches because they were more convenient. Odd then, that critics of the Apple Watch, which is after-all— a computer to sit on your wrist, don’t get why it is had advantages over a pocket smart phone. There is another benefit. As Daniel Kahneman illustrated in his book Thinking Fast and Slow, we can be quite impulsive. If spending money involves touching our wrist, and if that money is then distanced from our bank account by Apple Pay, we are likely to spend more

It is just another reason why we need to listen to graduates from the schools of technology not, technology phobia.

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In their new book entitled iDisrupted by John Straw and Michael Baxter, the two co-authors claim that only 19 of the world’s 100 largest companies in 2012 will still be in that list in 2042. However, it says that even this bold claim may be understating how things will pan out.

Throughout history, new technologies have had a disruptive effect on businesses and the economy, proving fatal to some well-known companies. In the new book, iDisrupted, the authors claim that the rate of fatality is set to increase.

Of the top 100 global companies identified in 1912, 29 companies had experienced bankruptcy or similar; and 48 had disappeared by 1995. Eastman Kodak was one of just 19 companies that stayed in the list during these years, yet at the start of the 21st century, with the onset of digital cameras, home printing and photo sharing websites, it too fell victim to the rise of new technologies.

In iDisrupted, co-authors John Straw and Michael Baxter claim that many of the industries we currently see as strong, such as oil, car manufacturers, banks and energy companies, could also be heading for the corporate graveyard within the next few decades.  They say that only 19 of the world’s 100 largest companies in 2012 will be in that list in 2042. However, even this may be an understatement.

Straw states: “The big corporate success story of the 20 century related to oil companies, but  just because they flourished in the 20th century, this does not necessarily mean they will flourish in the 21st century.” The rise in electric cars, self-driving cars and advances in solar power and energy storage, will all play a part in the energy industry as we currently understand it

Baxter, aka The Money Spy adds: “In our book, we try to explain why it is that technology is set to change the world like it has never been changed before. This is exciting, but it is also scary. There will be winners and losers, and some of the world’s largest companies will be amongst the losers.”

iDisrupted is a book about disruptive technology, how it will affect business, jobs, the economy and even what it is to be human.

iDisrupted –  Disruptive technology: changing the human race forever – will be available in all good bookshops and online from November 2014 or visit www.idisrupted.com for more details.

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A new book entitled iDisrupted: Disruptive technology, changing the human race forever looks at how technology will change the economy, business and even the human race. One of the technologies it cites that will have a huge impact on the world is Virtual Reality. Despite it first appearing in the 1980s, we are now on the cusp of seeing Virtual Reality’s existence and use in our daily lives in a way that will change us forever.

Hype has been building about Virtual Reality since its conception, but with high prices, small screens, cumbersome technology, and initial disappointment in the technology, many individuals have had their doubts about its impact. However, a new book written by John Straw and Michael Baxter, iDisrupted claims that, thanks to recent evolution in this technology, we will soon be holding face-to-face meetings in Virtual Reality as well as viewing holiday destinations, carrying out online shopping, and watching movies, and of course playing video games.

Combine the improvements in video, sound and computer graphics  with other advances, such as Leap Motion, which enables users to control their computers by the wave of their hand, with technologies that can fool our brains into perceiving smell, touch and taste, and the original dream of Virtual Reality is set to become reality.

Co-author Baxter, aka The Money Spy, says: “In our view, there are three stages in the story of new technology and how it is received by the market. There is the hype phase, the sceptical phase (as we react to what appear to have been unrealistic promises of the previous phase), and then the transformational phase, as previous innovations converge, create wealth, and – in the case of the period we are set to enter – lead to an acceleration in innovation. We are poised to enter the greatest transformational phase ever.”

John Straw added: “With the massive changes in technology that are about to occur, iDisrupted is a book that seeks to open a debate on what is surely the most important topic of the age, but which is barely discussed. Technology threatens society, but could be hugely beneficial. It is time we laid down plans to ensure it affects us in a positive way.”

Now available to purchase via Amazon, iDisrupted is a book about disruptive technology, how it will affect business, jobs, the economy, and even what it is to be human.

For more information about iDisrupted visit www.idisrupted.com

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Wearable technology: they say it is the next big thing. What are you going to wear today? Oh I think I will don my T-shirt that helps my breathing, my pants that make me more virile, and my new shoes that count how many miles I have walked in a day. What about you? Oh I am planning to wear my new suit. Samsung has made its first big move, and it seems as revolutionary as a new TV for the 21st Century that can show colour images. If this is the latest example of technology that is set to change the world, and turn some of the world’s biggest companies into something much bigger, then I have this new concept you will love; it is called sliced bread. Yet for Apple – the company that for a very short while was the biggest firm in the world last year – we can draw a quite different conclusion. Samsung’s half-hearted step into the world of smart watches shows that once again a spectacular opportunity awaits its US rival.

Did you ever read Douglas Adams? You may recall that some of the regular jokes in his ‘Hitch Hikers Guide to the Galaxy’ series were those that described humans as so primitive that they still thought digital watches were a smart idea. For a while, back in the late 1970s and early 1980s digital watches seemed like a step towards a future envisaged by Isaac Asimov and Aldus Huxley. As an aside, if you took an exam in the early 1980s – and yours truly took many – and you shared the examination hall with engineering students, then every hour, on the hour, beeps rang out across the room. That was in the days when engineering was on its way out, and James Dyson’s dream of creating an engineering-led revolution seemed as likely as the idea that one day our digital watches might be replaced by telephones.

The new Samsung watch was released yesterday. It looked as elegant as a brick tied to a wrist, as useful as a spare appendix. It can make phones calls if you lift your arm up, it can take pictures, check emails and receive texts, but it can only do these things if you have your Samsung smart phone with you.

In other words it can do some of the things a smart phone, can do, though presumably not as well, but only if you have your smart phone to hand. This begs the question, of course: why not get your smart phone out of your pocket? Are the timesaving benefits of being able to look at your wrist over taking a phone out of your pocket so significant that it is worth spending all that extra money on a smart watch?

But that does not mean smart watches are not a good idea. They need to be better. For one thing they need to be standalone. Sure, they should be connected to the Internet or indeed the Internet of things, but if it needs a control box on your person to make the smart watch work, it does rather defeat the purpose. For another thing, if you are going to wear one of these things, they need to look smart not merely be smart.

They say first move advantage is crucial. Well, not if the first mover move is like this. The only thing likely to be moved as a result is profits turning to losses. This is why design is so crucial. And this is why getting the user interface and the functionality right is so vital.

Samsung’s launch yesterday does not show that it has caught up with Apple. It does not show that the company is more than a follower. What it does show is that no one can yet do it like Apple has done it before.

Maybe the next Samsung watch will be a big improvement. Maybe the Apple watch will be as exciting as wearing a damp squib on your wrist; there is no way of saying for sure. But there is no reason, no reason at all, to think Apple has been knocked off its perch as the greatest innovator in consumer electronics. There are plenty of reasons to think, however, that Apple’s growth has merely hit a temporary lull.

© Investment & Business News 2013

 

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It is the largest corporate deal in history. Vodafone is selling its 45 per cent stake in Verizon Wireless to the Verizon parent company for $130 billion. Management at Verizon says the deal will prove transformational for the US company, but on the whole most comments across the internet suggest markets are worried about the level of debt that Verizon will be taking on. As for Vodafone, shareholders are delighted. Even UK plc should get a nice boost from the deal – although the tax man won’t make much. In fact the reason why both companies are looking interesting can be summarised by two letters, or if you want to make it even more interesting, add a further two.

Vodafone is getting $59.9 billion in cash, $60.2 billion worth of shares in Verizon – worth around 30 per cent of the company – and Verizon’s stake in Italy’s Omnitel. The plan is for Vodafone’s shareholders to get $23.9 billion of the cash, and the Verizon shares. The Inland Revenue will get around $5 billion.

Verizon is raising the money for the cash component of the deal largely via debt. The timing here is important. Right now interest rates are low, and the US firm should not have any major problems raising the necessary at a low interest rate. If it had waited longer, what with the Fed apparently in tightening mood, the interest payments on the resulting debt may have been prohibitive to the deal.

It begs the question: does this idea suggest a bubble? Let’s face it, mega M&A deals often do suggest a bubble. Remember AOL and Time Warner before the dotcom crash? Or if you want to go back further, remember when Saatchi and Saatchi tried to buy the Midland Bank just before the market crash of 1987?

But then again, there are differences this time.

The trend at the moment is towards bundled packages, fixed line and mobile deals. Both Verizon and Vodafone can now focus on building up their networks in their respective territories. In the case of Vodafone, Europe, emerging Europe and Africa provide opportunities – which is why Vodafone no doubt welcomes the Omnitel shares.

But it’s 4G that makes this deal more interesting still. It is 4G that has the potential to be transformational. Up to now, logging onto the internet via 3G was of questionable worth; the speed was just too slow, and unreliable. Some surveys have shown that many users are not that interested in 4G, but these surveys count for very little.

What the end user cares about is what he or she can get. They don’t care if they have 3G, 4G or 28G, but they will care if all of sudden they can get sports content on the move, or they can take part in video conferences when out about and about. As for social media, 4G will make video over Facebook more popular. Users will be willing to pay more for this. The two letters that make this even more interesting are 5G. Samsung says it will have 5G technology available at mass market prices before the end of the decade, at speeds roughly 1,000 times faster than 3G.

Vodafone itself may now be vulnerable to takeover. But in both Europe/Africa and the US the potential represented by 4G and 5G will enormous. In the US Verizon, and over here Vodafone (or maybe its new owner), will have an opportunity to convert this opportunity into big bucks.

Vodafone has already agreed to licence football coverage from BSkyB for use over its 4G Network, but expect much bigger things than that to follow.

© Investment & Business News 2013

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The World Economic Forum has picked out 36 start-ups which it sees as technology pioneers. The companies and their offerings are indeed impressive, and lend more support to the idea often suggested here that we are in the midst of the greatest industrial/technological revolution to date. There is one problem with the list however: none of the companies is British. It is not practical to describe every one of the 36 companies here. For the full list go to: Technology Pioneers 2014

But here is some of the companies picked out by ‘Investment and Business News’ which seem especially interesting.

A number on the list are working on cures – or at least treatments – in the medical sector. Amongst them are three firms based in Cambridge, Massachusetts. Aghios Pharmaceuticals says: “Cancer cells not only consume more nutrients than other cells, they also process them differently.” Agios believes there could be 50 to 100 metabolic enzymes on which various cancers depend for their survival, from which a new wave of cancer therapies could emerge. Another company, BIND, is working on specifically-designed nanoparticles called Accurins, which are programmed to pass through openings in blood vessels at disease sites and bind to specific types of cells and tissues, such as cancer cells, while avoiding detection and attacks by the immune system. And finally there is Bluebird Bio, which is pioneering a way to correct aberrant sections of DNA that cause disease and are passed from generation to generation. The company has identified a way to harness the natural ability of the human immunodeficiency virus (HIV) – a lentivirus – to insert a modified gene into a patient’s own cells. Bluebird uses its lentiviral vectors to transfer functional genes into a patient’s own stem cells, which are capable of changing into multiple cell types, providing the company with the opportunity of treating a wide range of genetic diseases. Er… so that is using the science behind AIDS to manipulate DNA.

Alphabet Energy (California) has developed technology that generates electricity from heat, in the same way that solar panels generate electricity from light. That is wow(ish) idea, but so is this: Cyberdyne Inc (Japan) has developed a robot suit it calls HAL, which is strapped to one or both legs and is designed to support disabled people, who are learning to walk again.

EcoNation from Belgium produces the LightCatcher, which is a solar-powered sensor system that tracks the lightest point in the sky and controls a mirror that optimizes the amount of daylight coming in. The LightCatcher also diffuses light and reflects heat. It claims energy and cost savings typically range from 50 to 70 per cent.

Then there is one that could be straight out of ‘Star Trek’. Second Sight (based in California) has developed an implant which is surgically inserted onto the retina. The patient wears glasses containing a camera; a small computer, worn on a belt, processes signals from the camera, and an antenna on the side of the glasses transmits them wirelessly to the implant. The implant sends electrical impulses to the brain, causing the patient to perceive patterns of light.

Finally, unPartner, from Aix-en-Provence, France, has developed an ultra-thin, 90 per cent transparent photovoltaic cell. It is designed to enable telephones, tablets, building and vehicle windows, billboards and greenhouses to generate electricity from any natural or artificial light source.

It is an impressive line-up., Maybe it is unfair to point at the lack of UK companies; there is no shortage of innovation in UK, including the discovery of graphene. But unfair or not, let’s ask the question: where, oh where, are the Brits on the list? Let’s hope for better things next year.

© Investment & Business News 2013

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Time was when 2.7 billion seemed like quite a lot of people. That is how many of us are on the internet. But hold on, if the population of the world is around 7.1 billion, what about the remaining 4.4 billion of us? Never fear, Facebook’s founder Mark Zuckerberg has a plan.

Actually, according to the Facebook press release, the plan is to get another five billion people online. It is not clear how Zuckerberg will manage this, given that – according to the maths expressed above – there are only 4.4 billion people on this planet who are not online, and some of them are babies, but hey this Mark Zuckerberg. He is very clever. Maybe he is including family pets or Martians in his projections. More likely he is projecting growth in the population into his targets.

Then again, it is not just Zuckerberg who is at it. He has set up a company called internet.org, which Facebook describes as “a global partnership with the goal of making internet access available to the next 5 billion people.” In addition to Facebook, Ericsson, MediaTek, Nokia, Opera, Qualcomm and Samsung are all signed up to the project.

Some are cynical, and say Zuckerberg is only doing this because he wants more users for Facebook. But so what if that is the case.

Sometimes monopolies can be a good thing. A social media tool such as Facebook is a natural monopoly. It just won’t work as well if some of the people you want to connect with are on a rival platform.

Facebook won’t last forever. History tells us that dominant businesses lose their dominance as technology changes. It is called innovators’ dilemma. Kodak has been a recent victim. It looks as though Microsoft may well be. Facebook will be one day.

But just imagine for one moment what it will be like if the world – that’s the whole world, or at least the human bit of the world, let’s exclude the animal kingdom – was online at the same time, logged on using say 5G, giving them pretty much instant access to all knowledge and anyone else on the internet.

What a very different world that will be. It is one that may be less than a generation away.

© Investment & Business News 2013