Did artificial intelligence kill the BlackBerry? It did for me.

Recently, Globe and Mail noted in their political briefing newsletter that Samsung's Knox software is deemed to be as secure as the traditional BlackBerry:

"Shared Services Canada, the department in charge of overseeing IT for the federal government, is set to offer alternatives to bureaucrats over the next 18 months as part of “a new approach to mobile service to better serve its clients, use new technology and adapt to changes in the marketplace.” Samsung and its line of Android-powered smartphones was the first to be approved by Shared Services, but only after two years and several tests showed that Samsung’s phones passed military-grade requirements."

In this blog, we've covered Blackberry's steady fall into oblivion. For me, BlackBerry was my first smartphone. I even got excited about the Torch, thinking it was the perfect compromise between the touch screen and the classic keyboard. However, that feeling faded quite quickly after using the device. It was so underpowered and underwhelming compared to the competition.

When looking at the Porter 5 forces that surrounded this once mighty Canadian tech giant, we could say that both Apple's iOS and Android offer better substitute's: better devices, more power, better apps, etc. Essentially, these devices has evolved so much that they bring the power of the PC into the palm of one's head (Samsung's Note 8 is expected to have 6GB of RAM!).   This alone doesn't explain why BlackBerry was ultimately displaced from corporate IT - well before Samsung's Knox became equal-to-BlackBerry in terms of security.

I think there were two key developments that enabled BlackBerry's decline.

The more well known one is the "consumerization of IT" phenomenon: users wanted to use their latest iPhone or Android device instead of the BlackBerry in the corporate environment. Going back to Porter 5 forces this speaks to "bargaining power of buyers": the people no longer wanted to be limited to the "one trick pony" of email and BB Messenger. And they were willing to lobby their corporate IT departments to bring on the Android and Apple devices.

This leads to the second less well known factor.

What allowed consumerization to take place was that Microsoft took an open approach to licensing it Exchange Active Sync. This move paved the way for iPhone and Android to connect their devices to the corporate email server. Microsoft open attitude essentially transferred the power from BlackBerry to the consumer.

But for me it was a little different. Of course I like the apps and GPS that my Android and iPhone bring to me: the ability to read the Kindle, listen to audio books and podcasts without having to carry multiple devices is definitely a productivity. But really it was one particular app that made me able to switch: SwiftKey.

And that's where we get to the artificial intelligence.

I was a big fan of the Blackberry,  primarily because I thought I couldn't live without the physical QWERTY keyboard. But friends who were encouraging me to switch mentioned that Android sported the SwiftKey keyboard which is powered by artificial intelligence. This keyboard is much better for me in terms of learning the words I use when I type than the predictive text feature in its iOS counterpart (which I use for work).


A little while ago, I tried a colleague's BlackBerry and the irony is that my hands hurt. And that's probably because I type a lot less specifically because of the AI approach taken by SwiftKey. As per the native analytics tracker (see graphic below) in my app I have been saved myself over 350,000 taps and am 28% more efficient. 

Today, over a quarter billion people use SwiftKey on their mobile devices. Although a little hidden from the view of analysts and academics, advances in artificial intelligence enabled SwiftKey (now owned by Microsoft) to offer a substitute for the once dominant BlackBerry physical keyboard. And for me personally it was this little piece of exponential technology (along with the relatively giant landscape of the Samsung Note 1) that convinced me it was time to switch.

And like I said, I can never go back.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

Cloud vs corporate IT: Insights into how the share-economy will play out?

When thinking about disruption we often attempt to look to the past for how it will affect our future. However, we can also explore how disruptive tech is impacting our world today.

Consider a recent WSJ article that gave us insights in to how cloud and mobile is disrupting "classic tech":

• EMC, Intel and IBM are being disrupted. The move to cloud and mobile is impacting the ability of these companies to meet earnings expectations. For example, EMC's sales of storage products declined by 10%, while Intel has seen an overall decline in PC Market sales.
• Companies are slashing their workforce in response to such trends. The shift to cloud & mobile is resulting has resulted in the hemorrhaging of 12,000 jobs, or 11% of the workforce, at Intel alone. 
• Overall decline in revenues/profits despite strategic shifts in product mix. IBM's cloud computing business grew 34%, while Intel's data centre business, serving cloud providers grew 9% (for more on this "corporatification trend" see here). However, IBM's total revenue fell almost 5%. Intel had a tough time keeping up with rivals like ARM who posted revenue gains of 22%. This compares to 7% of which the WSJ attributes a chunk of that rise to an acquisition Intel made. 

Reflecting on these trends, is it fair to think of cloud as the original use case for the share economy? 

When we think of Uber, Airbnb, etc., we see how users can use these platforms to monetize their excess or underutilized asset by renting it to others.

However, isn't that also the story of the cloud?

Amazon, Intuit, and other cloud computing companies decided to "share" their excess computing capacity to others. In a sense, we are talking about servers instead of houses, but the concept is really the same.

And this goes to my initial point. We are living through the disruptive impacts of cloud and mobile on legacy-tech and we can quantify, analyze and understand its impact.

Given this premise what does this above tell us about the share-economy?

Firstly, better utilization of assets leads to the sale of less assets.  This should be expected as there is a more efficient use of assets leads to  (servers, car, house, etc) less market size as demand remains constant. As I had noted in the post a few months ago, Uberization of the taxicab industry would ultimately lead to a fleet of cars that are owned by a company like Google - leading to a net reduction of cars used by society. GM probably understands this concept as they have invested $500 million into Lyft; a competitor to Uber.

Secondly, it illustrates how the share-economy is subject to concentration of wealth: the cloud computing landscape is dominated by large players, including Amazon, Google and Microsoft. As noted by Douglas Rushkoff in the following video, since these innovations emerge out of the "operating system of capitalism", they inevitably result in the formation of a handful of platforms dominate the industry and capture the lion's share of the profits.


(Also check out his book that discusses this in more depth)

Thirdly, its difficult for behemoths to adjust to these types of shifts. Despite Intel and IBM investing in the disruptive technologies, it's hard for them to adjust to the dynamics of the new economy. This illustrates how much more challenging it will be for those disrupted by such platforms to re-tool and compete in the landscape.

For accountants and auditors, one such platform to watch out for is Gigwalk. As per their website, their value proposition is that by leveraging the 350,000 “professional services” workers (see graphic below) the manufacturer or other upstream supplier can get visibility into the actual retail outlet. For example, Whirlpool wanted to “Audit the presence of its Swash product on showroom floors, communicating back to corporate compliance gaps in real-time”.

And the "starter Store Audit Package" begins at $10.

Creative destruction is not inevitable, but we should learn from the lessons of these tech giants and plan prudently to meet such challenges head on.

Google's Mobile Launch: It really may be about the big data!

Yesterday Google launched "Project Fi" - Google's foray into providing mobile service. As CBC reported the service "will cost $20 US a month plus $10 per gigabyte of data used" (I am still an accountant, trained to find the numbers!). According to the Google blog post on Project Fi, the service will:

• Find the fastest connection: The service will enable the Google Nexus 6 to switch to the fastest mobile connection, whether it's home/work WiFi, WiFi hot spot, Sprint's network or T-Mobile's network.  
• Seamless transition between networks: The above service is not just about data, but also voice: when you transition between networks, you can keep on talking without any disruption. 
• Ties cellphone number to the cloud, not the device: Is this the end of SIM cards? With this service, you can take a call on any device (tablet, laptop, etc.) 
• Refund for unused data: While implied in the CBC article above, Google has structured the plan to refund the customer for the amount of unused data. 

As I had noted in an earlier blog post, one of the possible reasons that Google is entering into mobile world is to get access to mobile data. Specifically:

"the hidden strategic objective is a big data play: what could Google do with the new data feeds? Sure they already get from being able to correlate the information it already gets from their Android devices. However, they will now be able to analyze this data with the additional data that moves through their MVNO network, such as demographic information and location data. What good is this to Google? In a word: advertising. Advertising is still the biggest source of Google's revenue and adding this pool of data to their reservoir can only add to the bottom line."

Although this project is in "user testing" mode, the video indicates that this is not simply a giant "user acceptance test". Specifically, the announcer says "Getting it in users hands and finding out all the new amazing things we can build that will make your lives easier." (Go to 1:34, if you don't have the 2 minutes to spare)


In other words, the service will actively work with the early adopters to target services that work with the users. Of course these services will be a better way to target ads, such as location based advertising or augmented reality.With respect to the latter, you could use your phone to interact with an augmented reality billboard, store, etc. And Google could turn these numbers back to potential advertisers to demonstrate the effectiveness of such technology. In fact, Google (according to the Verge) invested over half a billion in Magic Leap, an augmented reality firm. But let's see how this rolls out.

Google: Business Geniuses?

Just yesterday, I was talking to a colleague about Google's business strategy. As I mentioned on a previous post, Google's move into the phone and ISP markets illustrates it understands the importance of not being reliant on third parties to provide the "last mile" to the consumer. Instead, they need to make in-roads into the space to prevent being elbowed out by other players who want to use their muscle to exert anti-competitive behaviour on Google.

And Google should be afraid of such tendencies.

Contrary to Capitalist mythology, innovation does not trump all. In fact, if it is easier (i.e. more profitable) for the king of the mountain, so to say, to kick upstarts and start-ups off of the mountain, then they will do that rather than innovate. Take for example David Sarnoff of RCA. He worked to crush the FM radio technology - even though it was superior - to his AM radio technology because it would disrupt his business.

Coincidentally, the Globe and Mail reported that Google is making a push into the business arena:

"The tools include the ability to create separate personal and professional profiles on the same phone in an effort to reassure workers worried about their bosses snooping on their private lives. Even though the data is kept in separate silos, Google has created a way for work programs and personal apps such as Facebook to appear on the same home screen for convenience"

It seems that Google has adopted BlackBerry's "Balance" feature that enables it to separate personal and work related apps and data.

Google has a website dedicated to this initiative (for the announcement see here). The website also has an impressive list of partners who are working with Google on this. As evidenced by this video, this project had been officially unveiled last summer:



Given Google's eminence in Big Data and Cloud Computing, I am waiting to see how these features will be incorporated into future offerings that were focused on the enterprise.

Google's Mobile Carrier Move: A Big Data Play?

Google  has decided to enter the mobile market. It has deals with Sprint and T-Mobile to operate as a mobile virtual network operator (MVNO), where they will rent the lines from these two carriers. As per the WSJ, there are no details on plans, coverage and other such details.

This is not the first time that Google has ventured beyond its traditional online offerings. A few years ago it began to offer super fast fiber internet and TV services to Kansas as well as other US cities. The move, like this one, attracted much attention because it was seen as something to alter the competitive landscape. However, moves like this shows that there is more to Google than a bunch of engineers who are just interested in building things like this:


Although some may dismiss this as a toy, it is actually an "exponential technology" that will shift fundamentally how society will function. But I digress and that is the subject of a different post.

Hearkening back to business strategy class and the infamous Porter 5 forces model, Google is cutting out a key area of risk: the last mile to the customer. By inserting itself as the mobile operator it ensures that it can deliver its services (e.g. Search, Gmail, Google Docs, etc.) and content (e.g. YouTube) straight to the customer without any interference from the Internet provider.Google could use a strategy like some Canadian cable TV providers,  where they offer a streaming video service (E.g. Shomi) that does not count against the bandwidth. 

But perhaps the hidden strategic objective is a big data play: what could Google do with the new data feeds? Sure they already get from being able to correlate the information it already gets from their Android devices. However, they will now be able to analyze this data with the additional data that moves through their MVNO network, such as demographic information and location data. What good is this to Google? In a word: advertising. Advertising is still the biggest source of Google's revenue and adding this pool of data to their reservoir can only add to the bottom line.

Facebook Home: Privacy fears or a sign of decline?

As reported across the tech news sites, Facebook Home hit 500,000 downloads in the first 5 days. However, techcrunch gave some perspective. It noted that Instagram (which is owned by Facebook) had "over 5 million downloads in six days". So what is holding people back?

One possible issue is privacy. As noted in this previous post, the younger generation is privacy savvy and is opting for apps like SnapChat that don't retain pics and other personal info. So it may be possible that the not-so-hidden-cost of privacy is too high a price to pay. And many commentators have noted that this issue with respect to Facebook Home. As noted in this blogpost by GigaOm's founder, Om Malik, fears Facebook's past privacy issues will be especially problematic if Facebook can capture (and monetize) one location data. As pointed out by CIO.com this can be turned off, but how many people are not going to use the map feature of their phones to keep this private?

On the other hand, is Facebook as popular as it used to be? Speaking to a colleague at work, he notes that his "tween" son is using... (drum roll please)... Google Plus! Yes, that's right Google Plus - the social network that people mocked as a possible Facebook competitor is now being picked up (anecdotally) by the youth. Although this may be anecdotal evidence, Facebook last redesign was viewed by some as an imitation of Google Plus. For Facebook's version of the story check here:

Overall, it's quite fascinating how the social media sites and tech companies wax and wane in popularity. Remember RIM? The company that could do wrong, now is on fighting (one could argue valiantly, but that could be the nostalgia in me talking.) for spot number 3 in the smartphone wars. Of course the biggest giant to fall from the public's favour is Apple with it's stock sliding from a height of $705 to a current price of just under $400.

However, as pointed out by Horace Dediu on this podcast, Facebook has effectively circumvented Google by making this the home screen on Google's real estate. He has good analysis of the whole supply chain, making an analogy of Facebook's strategy to Intel's strategy of "Intel Inside":


Furthermore, GM's back as an advertiser on Facebook. They made an exit last year, but has returned "and will take advantage of Facebook’s new mobile targeting features". So despite the slow number of downloads and potential privacy issues Facebook Home is hardly down and out.

Mobile Access: Canada falling behind India and China

According to a survey from Randstad found that Canadian workers are less connected then counterparts in India and China. According to the article, 76% of Canadians were connected. Although this is the majority, it is materially lower than the level of "connectedness" with counterparts in India and China where 93% of workers were connected. The article lays blame on the exorbitant fees paid by Canadians for the Internet in contrast to other countries (e.g. see this post which compares to the US. Besides the stats, US providers give 2-year contracts instead of 3 year contracts) . One of the factors that contributed to the adoption of the internet was the availability of unlimited dial-up access: users did not have to worry about rates, so they were more willing to adopt the new technology (e.g. users had to pay $20/month for unlimited internet in 1997). So price does matter when increasing the adoption of technologies. With the growth of mobile commerce in places like the UK, Canada could fall behind not just in mobile commerce but the overall development of local apps and mobile services.