NetEvents Blog – Day 1

Keynote Presentation by Dr. Christian Busch, Associate Director, Innovation and Co-Creation Lab, London School of Economics
Connectivity and business model innovation in a rapidly changing world

The first day of the NetEvents Press and Analyst Summit in Singapore opened on Thursday 25 May 2016 with a keynote presentation from Dr Christian Busch. He started by talking about global trends and challenges, with the key issues being cloud computing, artificial intelligence (AI), connectedness, the networked economy, new markets, and new demographics.

The overall theme was how innovation can progress in an ethical manner, using new ways of thinking about organisations and the distribution of power within them.

He touched on technical developments, such as how the smart home, cloud, voice control, AI come together to deliver increased flexibility, simplicity, and collaboration. Talking about the enterprise, Busch said there was a trend towards a sharing economy for customers and companies. This means there is no need for ownership of things but instead, only a requirement for access to them.

In practice, this means collaborative consumption such as the sharing of items from CDs to cars, in ways that are already happening in smaller communities across the world in both developing and developed economies. The world is full of idle resources, he said, and we should be able to share more – such as idle manufacturing resources and building site cranes.

Busch then updated Maslow’s hierarchy of needs, which he described as self-centred and linear, in that people wait until until money has been made before deciding to do good works. Billgates was used as an example.

He said he sees another model emerging across the world – the enlightened circle of needs – which means not being too self-centred, and not waiting for time to elapse so as to undertake a behavioural shift to doing good while making money at the same time. It’s about action-driven purpose, in other words putting purpose before product, he said.

How to go about it? Busch said it was about building values within an organisation, a culture of learning not failure, championing others, not competing with them. From the point of view of governance, an organisation needs to work around new business models. As an example, he cited mobile operators who co-operate when it comes to sharing masts but compete at the retail level.

Busch said that we need to develop a culture of innovation where people talk about ideas not people or gossip, where effective networks can be built that combine the formal hierarchy with the way that decisions are taken in practice. An analogy is the way that companies accelerate the process of discovery of new compounds – it’s about curating serendipity by putting thinking people together – like chemistry.

After an interview with Jeremiah Caron, Senior Vice President – Analysis, Current Analysis, the conference moved to the first debate session of the event.

Debate Session I — Is the Cloud Ready for Enterprise Planning, Modeling and Analytics – and Are Enterprises Ready for the Cloud?
Introduced and Chaired by Jean-Baptiste Su, Tech Columnist, Forbes
Panellists: Mr. Aman Neil Dokania, MD, Accenture Cloud APAC; Grant Halloran, Chief Marketing Officer, Anaplan; Bernie Trudel, Data Center CTO, Cisco Systems, Asia Pacific and Chairman of Asia Cloud Computing Association; Dr. Christian Busch, Associate Director, Innovation and Co Creation Lab, London School of Economics; Thierry Lotrian, Director – Consulting, Deloitte Touche Tohmatsu

Jean-Baptiste Su opened the debate by talking about value creation, pointing out that the global enterprise cloud services market will grow 23% from now to 2020. He talked about changes, mergers and acquisitions, and growth in cloud service such as PaaS and IaaS. He asked the panel to define cloud computing, provoking a discussion which moved on to talk about the economics of cloud.

For Aman Neil Dokania, Accenture, cloud drives innovation, speed, and competitiveness. It is not about cheapness, but even so, the economics are still compelling because of the flexibility and lack of capital costs that cloud computing brings.

Grant Halloran, Anaplan, said cloud was a paradigm shift – citing the Chromebook he boight for his 12-year-old daughter. Investment is going into eg companies such as Anaplan because of economics – because Wall St values cloud and is prepared to invest in it.

The panel talked about cloud security. Thierry Lotrian, Deloitte, said that security must form part of the strategy for any company moving to the cloud, while Halloran pointed out that there are plenty of good security implementations in cloud, such as Salesforce.

Bernie Trudel, Cisco, said that the network plays a big part in cloud performance, as it about a connecting continuum from the edge to centre of the cloud. He said he saw the CEO becoming more of a technology person as understanding tech is an integral apart of the business, so they need to understand how technology can transform the business and mitigate risk.

The panel session closed after a discussion around regulations.

Debate Session II — Protecting the Enterprise Means Protecting the Cloud and the Network – Where’s the Opportunity?
Introduced and Chaired by Nikhil Batra, Research Manager – Telecom, IDC
Panellists: Sunny Tan, Head of Security, SE Asia, BT Global Services; Ashok Vasan, Vice President, Digital Transformation – Asia Pacific & Japan, CA Technologies; Andy Solterbeck, Regional Director – APAC, Cylance; Brendan Leitch, Director of Marketing, Asia Pacific, Ixia; Peter Lunk, VP of Marketing, Menlo Security; Frank Wiener, VP Marketing, Wedge Networks

Batra presented market research around cloud security, opening with a dramatic analysis of the highly publicised hack of Ashley Madison, a website for those looking to have an affair. He said 37m accounts had been hacked, with 9.7GB of data including names, addresses, and credit cards.

With IoT, Batra said, hacks have much bigger repercussions. Examples included hacked cars, where a connected car means relinquishing control to technology, and drones which have fallen out of the sky. He saw security solutions shifting to a more proactive approach, with security representing 12-15% of cloud spending today.

Andy Solterbeck, Cylance, said the capabilities of cloud security service providers were orders of magnitude more sophisticated than those of enterprises. The problem is that the attack surface is the network endpoint – where 95% of all attacks start.

Ashok Vasan, CA, said that his company provides security and digital transformation in the cloud. Hybrid cloud is the future, he said, and its multiple entry points mean that identity management is critical. Application and services developers need to build security into their services, he said.

Brendan Leitch, Ixia, said security in the enterprise means managing end user devices and enterprises need high levels of granularity and visibility of cloud-based data. He pointed out that most large enterprises are not ready to put production apps such as Oracle databases and other transactional systems, along with SSL decrypt systems into the cloud.

Peter Lunk, Menlo Security, said some customers are still providing complete access to everything to some administrators, and the first thing is to close those accounts down.

Frank Wiener, Wedge Networks, said his company has virtualised security software to protect the cloud. Larger enterprises are definitely ready for the cloud, he said, but SMEs don’t have resources to do that. And the threat landscape and attack surfaces are changing as enterprise boundaries have dissolved. He agreed that endpoint security was essential but that but a security layer in cloud was just as necessary, which is where service providers can help.

Sunny Tan, BT Global Services, said customers expect security to be there, they also ask us to resolve security problems. He agreed that the attack surface is changing and that customers are now asking about the Internet of Things.

Wiener said the service provider is in ideal position to inspect packets flowing to/from a device so we work with them, allowing them to offer Security as a Service.

Solterbeck said the IoT challenge is that it is a low resource environment, in terms of power and items such as memory. To secure that environment means security must be embedded in endpoints to mitigate the spread of malware.

Vasan said the IoT isn’t fully understood yet. As an example he cited smart TVs, which have an operating system and connectivity, which means vulnerability extends right into the OS. He said the open API culture drives digital disruption but it also opens up devices and potentially the enterprise to the Internet. So those devices need to be securely governed and managed.

Leitch said he saw some verticals adopt IoT aggressively such as hospitals – they take on their own testing of endpoints and connectivity, similarly airports in Asia which invest heavily in sensors for baggage and aircraft. Car makers are very cautious, he said, and only interconnect audio first.

Wiener said there are a lot of implications to the IoT with very critical issues in areas such as infrastructure like dams and cars. People are looking at hijacking control, communications to a device – are they consistent with what’s expected for a particular device. The IoT is an area of evolution, is not mature, and constant change is to be expected.

For Cylance, Solterbeck said that current approaches are not working. Our Dust Storm report found Japan’s infrastructure was compromised so we need to shift the approach fundamentally, he said.

Vasan said that it is difficult to conceptualise what testing needs to be done, and the cost is huge – for example, if a commercial aircraft is one of the Things, so we need to simulate the environment. This goes too for water control devices, medical devices, cars etc., nd this in turn means we need realistic test scenarios.

Leitch said that all device makers do testing before shipping. But while they test devices and the architecture, that’s not enough. We say people need testing – how are they organised, do they respond to attacks, what plans so they have and how do they execute against that plans, etc. so people testing is that last level of testing, he said.

Bryan Gale, Vice President Product Marketing, Cylance is ‘In the Hot Seat’ with Manek Dubash, NetEvents’ Editorial Director, pumping the bellows
The next session saw Bryan Gale, Cylance, give a quick 15-minute demonstration of his company’s security technology, aimed at demonstrating that it is better at trapping malware than any of the top anti-virus vendors’ products.

He said a new approach is needed for solving the endpoint security problem. He said change is difficult due to commercial inertia but 390,000 new pieces of malware arrive every night, with 70-90% of all malware being unique to the organisation under attack. It uses polymorphism so hash lookups and signature detections will fail. Ransomware demands money and backup is the only working solution right now.

Manek Dubash joined him on stage and asked a range of questions about the technology and the company’s business model.

Conference Debate III—The IoT Will Disrupt Everything – Or Will It? You Be the Judge
Introduced and Chaired by Sandeep Bazaz , Industry Analyst, DataCenter and Cloud Computing, Frost & Sullivan

Panellists: Haytham Sawalhy, Head of IoT for APAC, Orange Cloud for Business, Asia Pacific; Ashwin Jaiswal, Head – IT Business Consulting & Practice (Telecom, Media & Entertainment), Reliance Communications; Amit Sinha Roy, Vice President, Marketing & Strategy, Tata Communications; Panitharn Payackapan, Department Director – Service Development & Process, UIH – United Information Highway Co., Ltd.

Sandeep Bazaz reported that there will be billions of Internet-connected devices – 10 per household by 2020 and growing. He predicted that logistics, transport & retail would be the biggest initial users of IoT.

Q: IoT challenges apart from security?
Amit Sinha Roy, Tata, said connectivity; power/battery; standards, ie prioritisation of data – does the smart TV or pacemaker get priority; legal – but what about insurance of driverless car?

Haytham Sawalhy, Orange, questioned what would be the business models, and who would finance the devices.

Q: Role of telco and monetising the IoT?
Ashwin Jaiswal, Reliance, said telcos will help the IoT grow, helped by government initiatives. He said that the way people use technology will change. It’s amazing, beautiful, promising, he said. There will be a variety of business models and usages. As for challenges, telcos will become more aggressive – they have cloud and lots of subscribers – and their role will grow.

Sawalhy said we see opportunities with IoT and big data. We push valuable data to enterprise customers so, for example, we identify tourists in France to understand where they go and what they do. We believe in co-innovation, he said.

Roy said the pay-per-use will be the typical business model – for example, in healthcare remote monitoring – on asubscription basis.

Jaiswal said people are moving to pre-pay billing across the world.

Q: What about risk?
Panitharn Payackapan, UH, said the IoT is like a new restaurant. You try it, and if you don’t get sick, you go back again. So if consumer experience of IoT is good they will return. And when my smart watch exports data to the cloud, and the insurance company finds out that I’m fit, it wil then reduce its premiums.

Q: Will IoT become part of AI systems?
Sawalhy said the IoT is not just about live data but also disconnected data, so AI plays a role there.

Q: Is the network ready to handle IoT?
Payackapan said: Yes, we’re ready. FTTx is everywhere.

Keynote Presentation by Duncan Clark, OBE, Entrepreneur; Author; Board Director, Bangkok Bank (China); former Visiting Scholar at Stanford University, and Founder & Chairman, BDA China
When the dragon awakes…
Duncan Clark recalled the fascinating story of Jack Ma, the founder of Alibaba and one of China’s biggest Internet companies, and about whom Clark has written a biography – signed copies were available after the presentation.

The company started in 1999 – Clark didn’t take up an option to buy shares which he said cost him $30 million. In China, Alibaba fronts 10m merchants. Clark talked through how China is moving from ‘made in China’ to ‘bought in China’. Alibaba owns Alipay (3-4x bigger than PayPal) in China and provides escrow services to give trust. Some 60% of postal packages in China are delivering Alibaba goods.

He talked about entrepreneurial cities in China. China makes everything – from toothbrushes to Apple hardware. Yes the state enterprises sell overseas as well as locally but private enterprise drives the economy.

He gave anecdotes of Jack Ma’s past – his were not rich parents, he set up several businesses which failed. Sold Internet space to hotels to market themselves on the Internet. “An unusual and entertaining fellow.”

Alibaba is now a $200b company. Yahoo owns a piece of Alibaba – the biggest and best investment it ever made? Clark talked about the great culture of Alibaba, a family company – that put the customer first, then employees, then shareholders.

What can Alibaba do – where’s the space for it? Expansion of Alibaba into areas where the state used to be.

Camille Mendler interview
We need to ask what rise of China means for the rest of the world. You need to go there to do business. There’s a new Silicon Valley emerging in NE Asia.

Jack Ma is now investing in the US to help western brands sell into China.

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