The smart home platform war pits logistics against context

Alexa takes on Google Assistant in the fight to control the next computing platform.

It’s been a decade since the iPhone launched, beginning the race to win at the mobile web. Somewhere around 2012 the big internet and computing companies looked up and realized that the next wave of disruption was heading their way with the smart home. In response, we saw Google spend an insane amount of money buying Nest in 2013, Apple launch but fail to deliver HomeKit in mid-2014 and Amazon debut the Echo at the end of 2014.

Meanwhile, Microsoft was still transitioning to a cloud-based services model and failing to win over mobile users with Windows Phone. IBM was doubling down with its Watson platform and Facebook was proving that it could sell ads on mobile phones, buying WhatsApp and also investing in AI. It also started research into internet access that may prove prescient as net neutrality rules fade away.

Why the history lesson? Because after years of positioning, it has become clear how the next consumer computing paradigm will play out. The race this time isn’t around a computer or mobile OS, it’s around a digital assistant. Or more specifically, an AI that will travel on top of devices, specifically a phone, a home, a car and likely wearables.

Once you choose one, you’ll have Alexa, Siri, Google, Bixby or whatever platform in all corners of your life. It will assist you with mundane tasks, answering questions and maybe even driving your car. The device underneath won’t necessarily matter. Each assistant should eventually be something you can buy and enable in the form of software. And it’s possible that because the data gathered from your relationship with the digital assistant will be so valuable, you may not have to buy your smart helper. You may just download it.

Today this market is defined by the so-called smart speaker. Amazon is winning this race so far with estimated sales of roughly 20 million Echo devices through September of 2017 according to Consumer Intelligence Research Partners data. That same analyst firm estimates Google has sold 7 million Google Home speakers. Meanwhile, Apple delayed the launch of its HomePod smart speaker from December to early in 2018.

Microsoft has an assistant named Cortana which is embedded in Windows 10 and a third-party speaker made by Harman Kardon. Cortana is also available on iOS and Android through an app. Yet, this is basically a race between Google and Amazon. And while it won’t be a winner-take-all situation like Android and Apple have managed to divide the mobile world, only a few companies will win.

Any AI layer sitting on top of myriad devices that communicate using different radio standards and don’t have a universal device schema to define the device will require developers to build hooks into the AI. Even though Amazon and Google have provided skills for developers to easily hook into their platforms, developers aren’t going to want to support many platforms.

Which then leads us to think about what will make a great AI assistant. If I carry the mobile OS war analogy forward, what will be the means by which the AI platforms deliver the most innovation and value? With the mobile OS war, it was the App Store. Apple’s decision to let developers play on its phone and build startling new functionality helped drive adoption of the platform. Do you remember how awed you were when someone showed you the Star Walk app on the iPhone?

Today Amazon is winning the digital assistant market because it was first to hit the market with a form factor that’s accessible and useful, playing music and handling digital tasks like setting a timer or checking your calendar on command. If you think of a digital assistant whose expertise is in affecting change in the real world, either by taking care of household tasks like changing dials on thermostats or channels on the television and restocking the pantry, then Alexa is going to win.

No tech firm can compete with the logistics and distribution system Amazon has, and the smart home first-mover advantage helps tremendously.

But if we view a digital assistant less as something to fetch and carry for us and more as a butler who can anticipate our needs and smooth our lives ahead of us, then Google is going to win. Thanks to its massive knowledge graph, Google can already answer more questions, more fully than Alexa, and Google is adding smart home features that mimic Alexa at her best and even offer new functionality based on context.

For example, in Night mode, the Google Home can determine that people are likely to be asleep and will automatically lower the volume when it responds to a question. If your digital assistant needs to be a butler, context and deriving intent from that context will be king. There Google will win.

Both Google and Amazon have understood a huge lesson from the mobile OS war that will be essential in building digital assistants. They need to play with a large ecosystem of developers, device makers and service providers.

As for Apple, it’s pretty clear that it is following along where it sees the platform war going, but it so far has proven difficult to work with by companies trying to integrate with the HomeKit platform, thus alienating its ecosystem. Siri, its assistant, isn’t very good at understanding what people want to do or even the questions they ask, making it frustrating by comparison to use for basic questions and for completing home tasks.

With the launch of the HomePod, it feels like Apple missed the overarching strategic play in the future of computing. Instead of intelligence, it’s emphasizing the sound quality of the HomePod. Instead of making the device in a variety of form factors so people can strew them around the home, it’s putting out a single, expensive home for its speaker. In a battle for the soul of our future computer, Apple is emphasizing the form factor and audio output.

The real question is what we want from this new digital soul. Do we want it to act as our agent in the real world as Alexa does, or to anticipate our needs and then change the world around us to fit them as Google is trying to do?

Stacey on IoT | Internet of Things news and analysis

Security And Development Must Work Together To Prevail Against Threats

The Ponemon Institute’s 12th annual Cost of Data Breach Study contained some good news for the world’s business community. Average data breach direct costs continued their downward trend. Between 2016 and 2017, they fell by 10% from $ 4 million to $ 3.62 million per breach and from $ 154 to $ 141 per record.

But the study also found that the size of the average data breach increased by 1.8%, to more than 24,000 records. Taken together, these statistics suggest that companies are getting better at reducing breach-related costs, but they are still struggling with the equally important task of keeping their data and intellectual property safe.

Scott Johnson, director of product management for Micro Focus Fortify, a software security vendor, says companies will remain vulnerable to intrusions until they begin taking security measures at the application level. “The network perimeter is no longer viable,” he says. “While it helps with some security issues, that is not where many of today’s vulnerabilities start or are escalated by hackers.”

Security must begin in the development process

In addition to firewalls, point protection, gap analysis, user training, and other countermeasures, companies need to ensure that security is an integral part of all applications they purchase or develop. “A lot of companies are focused on security for external applications,” says Andreas Gloege, SAP director, quality assurance solutions. “But it is important to remember that about 50% of all attacks are happening on or via internal applications.”

Internal applications are particularly attractive to hackers because they often contain more sensitive information than external applications. When developing internal applications, companies need to enforce a process that compels the IT security and application development teams to work together.

“This approach is not only possible but absolutely necessary,” says Damien Suggs, Saltworks security senior technology security manager. “Security and developers have to understand that they are on the same side. Security can convey this by recognizing a finding of vulnerability that needs to be addressed and then working it through the development process until it is remediated.”

Establishing a formal role for security experts in the development process can help resolve vulnerabilities before new software is released into the wild. This more proactive approach better protects valuable data stores while allowing companies to safely leverage the competitive advantages of ubiquitous connectivity.

Companies must become more security focused

To enhance security further, companies must build security into their corporate cultures. They can pursue this objective by using education and training to create a more threat-aware workforce. Security training for IT staff also should be part of this effort since few technology workers enter the workforce with a thorough understanding of security best practices.

“One of the interesting findings in our 2017 State of Security Operations report was that only one in nine universities offer security courses as part of the requirements for a computer engineering degree,” Johnson says. “That has to change.”

Until educational institutions become more focused on security, companies will have to take responsibility for improving the competency of their technical workers. Third-party security experts can help mitigate this risk by backstopping internal resources on an as-needed basis. These vendors can be particularly useful for threat assessments and identifying vulnerabilities associated with particular systems, applications, and data stores.

Vulnerabilities are likely to increase with IoT

Even as companies act to improve their security posture, they must recognize that no security system is 100% effective. Vulnerabilities are unlikely to go away—especially as the Internet of Things is woven ever more tightly into the fabric of modern life.

As companies build their security-focused cultures, they should communicate that vulnerabilities are defects in applications and not deficiencies in the developers or security staff who are supporting the products. Since these risk factors cannot be completely eliminated, any measures taken to promote security have to be balanced with the day-to-day needs of running a business.

“Security cannot be something that is slowing down the business,” Gloege says. “Security has to be something that comes naturally into what the company is doing.”

Mitigating risk and maximizing efficiency will continue to be significant challenges. To find the right balance, companies must do more than install firewalls and security appliances. They must integrate security awareness into every job description, product offer, and development effort. There really is no other choice.

Want to learn more? Listen to the SAPRadio show “Your Application Security: The Perimeter has Moved,” and check @SAPPartnerBuild on Twitter.

Internet of Things – Digitalist Magazine

ADT wins temporary injunction against Ring’s new security system

Home security from Ring competes with new services from Wink, Nest, ADT and more.

ADT, which was suing Ring after the video doorbell company hired away most of the employees of Zonoff, has won a temporary injunction against Ring. The injunction, issued Thursday night, will stay in effect throughout the remainder of the trial between the two companies, and prevents Ring from selling its $ 199 Protect security system. With the holiday season coming, and competition heating up in the security market, the decision by the Delaware Chancery Court could become a big deal for Ring.

The drama started earlier in March after Ring hired almost all of the employees from Zonoff, a company that made smart home software. Zonoff had raised money from ADT and was working with the security company to build a smart home platform. However,  Zonoff  had been actively seeking a buyer since the middle of 2016. After a proposed acquisition fell through, Zonoff shut its doors. A day later Ring had made job offers to all of the Zonoff employees.

In a lawsuit filed in May, ADT argued that Zonoff had defaulted on a loan repayment and thus was entitled to Zonoff’s intellectual property, including tech that Zonoff had developed for ADT. ADT argued that Zonoff took that tech with it to Ring and it is being used in Ring’s security system.

The lawsuit has been in front of the court for the last few months. On Thursday the injunction was granted by Vice Chancellor J. Travis Laster who said that  “it would be tough” for Ring to argue at present that its current products don’t exploit ADT’s trade secrets.

The news broke on Law360, which has been following the case closely. Ring says that that the lawsuit was an example of ADT trying to delay the launch of a competing product and Ring’s attorney denied that Ring was using ADT-specific technology.

The situation is a mess, but it appears ADT has the judge on its side. ADT in October launched a new security product that combines SmartThing’s hub and software with ADT’s current monitoring. Ring launched Protect in October, adding sensors and a keypad to its outdoor cameras and video doorbell. Also in October, Wink and Nest both launched security products as well. Honeywell followed up this month with an all-in-one security product.

Clearly, companies are viewing security as the gateway to a smart home and everyone wants to fight for their share of the market. It makes sense that ADT has to hop on this trend, even though DIY sensors are a very different product from ADT’s professionally installed, monitored security contracts.  If it takes Ring out of the equation, it can prevent a company that has had tremendous success selling security to consumers from further disrupting the market.

I’m still curious though, what it plans to do about Nest, SimpliSafe, Abode and the myriad other options out there.

Stacey on IoT | Internet of Things news and analysis

The Case Against Agility

Amit S. Mukherjee is a professor of leadership and strategy at IMD’s Singapore campus. He has led technology development teams, served as an executive officer of a public company, and advised CEOs of global companies on strategy and organization design.

Leadership has always required the willingness to move in directions that peers avoid. Great leaders have the ability to convince, or induce, others to follow. Apple Inc. cofounder Steve Jobs, for instance, stared down the derision of analysts and peers when he first opened Apple retail stores. Those outlets attracted millions of consumers who were new to the brand, and have achieved the highest retail sales rates ($ 5,546 per square foot in 2016) of any retail brand. Microsoft and Sony followed Apple’s lead with brand-specific technology retail stores.

Leaders today face a particularly consequential need to question conventional wisdom. They must wean their companies away from three ideas that have anchored technological decision-making for over a decade, but which have become dangerous for our current age. Making this shift will be difficult because the costs will be immediately apparent, while the benefits may not come for years. The three ideas that must go are:

  • Agility, which prizes the ability to rapidly change established strategies, assets, or processes;
  • First-mover advantage, which decrees that whoever introduces a new product or service or technology first will almost inevitably win; and
  • Minimum viable product, which encourages the release of early versions of products or services, letting the market decide whether to give these early versions further support.

The collective output of these ideas is a very strong bias toward accelerating a project’s speed to market. But the broad acceptance of these ideas, which are pronounced sacrosanct by academics and consultants who are mesmerized by startups, is incomprehensible.

While a case can be made for their value to venture capitalists, who want portfolio companies to produce quick returns, the business landscape is littered with examples of how these strategies fall short. Agility can help in volatile conditions, but it is useless, and even detrimental, in uncertain, complex, or ambiguous ones. First mover advantage is demonstrably fallacious: Many exemplar innovators — including Google, Amazon, and Facebook — weren’t first to market. And the idea of a minimum viable product is flawed for many tech products. Should Boeing launch a minimally viable airplane? Should GE Healthcare launch a minimally viable CT scanner?

Why Speed-Centric Goals Are So Dangerous Today

These three ideas are highly unsuitable for the emerging digital world. At an organizational level, two trends I discussed in prior articles — distribution of work over time and geography and thought-driven, not muscle-powered, work — are dramatically increasing environmental uncertainty, complexity, and ambiguity. At a technological level, ever-more-interconnected software and software-hardware systems are doing the same. In these conditions, we need more thoughtfulness rather than more speed.

The spontaneous fires of the Samsung Galaxy Note 7 smartphones, which led to the recall of over a million devices, illustrate the danger. “In the Samsung culture, managers constantly feel pressured to prove themselves with short-term achievements,” Kim Jin-baek, who worked at Samsung until 2010, told The New York Times. The company’s relentless focus on speed “focused on maxing out the capability of components like the battery,” noted the Times, leading the company to release a product in which flawed design and inadequate testing afflicted two different types of batteries, which caught fire for unrelated reasons. A bias toward speed over thoughtfulness slowed the diagnosis of the problems and tarnished the reputation of a partner, Korea Testing Laboratory, in the process.

In the near future, every “minimally viable product” developed with “great agility” to seize “first-mover advantage” will carry within it the potential to harm not just a company, but the economy. The internet of things will connect products and services to other products and services, systems to other systems, and companies to other companies. Consequently, our ability to diagnose and fortify failure points will be challenged so much that Samsung’s one-company-and-its-partners crisis will seem like child’s play.

We have seen this happen in a different context. The global financial services industry is the best prototype we currently have of such a hyper-connected world. Its links across products, processes, and organizations enabled the subprime mortgage crisis in the United States to spread with blinding speed. It produced the Great Recession of late 2007 to mid-2009, and ravaged the economies of far-off countries. Experts passionately offered contradictory advice for how to respond, and, for most part, regulatory authorities and even the financial institutions themselves seemed unable to contain the crisis.

While we can’t do much about the organizational and technological changes that are under way, we can reform how we create digital products and services. Executives who continue to blindly follow the siren song of speed at all cost are abdicating the right to be considered leaders. They are no longer making the best decisions humanly possible for their organizations, people, or society at large.

Three Steps to Take Now

As a leader, what should you do?

First, let two questions be your operational guide for new technology initiatives:

  • “If we are wrong, how quickly can we fix this and at what cost?” If the speed and cost for fixing errors and miscalculations are acceptable, by all means proceed with agility, aim to be first to market, or launch minimally viable products. Otherwise, steel your backbone and demand thoughtfulness.
  • “What’s our policy for testing the core idea at each stage?” Establish the rigorous regimen of testing during development. If the core idea fails in a complex, uncertain, and ambiguous environment, the full-fledged idea inevitably will. If the core idea succeeds, the initiative will have earned the right to advance further.

Second, emulate great leaders and craft simple messages making your case. Ask people to justify agility when five-year grandiose development plans are no longer the norm. Tell stories of great innovators who weren’t first to market. Remind people that the idea of minimally viable products originated in efforts to quickly find and fix bugs in stand-alone consumer software. Explain why these ideas are less relevant for apps, distributed software, and software-impregnated hardware. When you think people understand, repeat the messages again.

And third, truly understand that while the failure to be in tune with time will be a failure to lead, doing the right thing may endanger your job. Persist anyway! Goldilocks-like, search for the “just right” middle between speed and tardiness. Speed that impedes thoughtfulness is worse than tardiness: While tardiness can hurt your own institution competitively, excessive speed may land you on history’s list of incompetent business executives. The pain of change will be real, and the value of your foresight may only be apparent when your company escapes the mayhem that others, steered by lesser executives, can’t.

Abandoning the three ideas won’t slow down innovation. Apple’s new products and services aren’t chock-full of bleeding-edge technology, and yet Samsung has been playing catch-up for years. The Note 7 was supposed to make Samsung the innovation pacesetter, but it did the opposite.

Thoughtfully and efficiently created ideas generally outperform slipshod ones. Aspiring leaders will do well to remember this in an increasingly interconnected digital world.

MIT Sloan Management Review

Securing the IoT against cyber attack

The Internet of Things is perhaps the most significant IT revolution of our time in terms of it’s potential to change the way we do everything – from working to shopping. But as its reach and influence on our lives continues to grow, attention must at some point turn from simply what IoT might be […]

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