Reflections

What is the GDPR? It’s the General Data Protection Regulation (GDPR), enforced by the European Union as an EU-wide set of rules governing data privacy in the age of the internet. It came into effect in May last year. The GDPR took four years to debate and compose (mostly by privacy-conscious German lawyers) and consists of 99 articles and 173 explanatory comments, making it one of the most complex pieces of legislation ever produced by the EU.  Its stated purpose is to "protect all EU citizens from privacy and data breaches in an increasingly data-driven world".   How does it do that? Principally by dramatically expanding the definition of what counts as data; by compelling organisations to secure consumers' explicit consent to various forms of communications and data storage; and by beefing up penalties for data breaches and non-compliance.  Until last year, EU citizens' rights over their personal data (everything from addresses and health records to credit data) were enshrined in a directive that hadn't been touched since 1995, when the internet was still in its infancy.  GDPR rightly expands the definition of data to include photos, posts on social networks, and IP addresses which identify your computer when you access a website. Moreover it covers virtually any organisation that collects data about EU citizens, anywhere in the world.     What must companies do? Companies can no longer hide their requests for consent to store or use our data in endless terms and conditions and legalese, or use pre-ticked boxes.  Instead, people have to opt in.  Under GDPR, consent to allow our personal data to be used must be unambiguous, freely given, current, and for specific purposes.  Moreover, commercial organisations or other institutions that handle large amounts of personal data must appoint a data-protection officer and design their systems around the need for privacy.     What rights do consumers get ? Consumers, or ‘data subjects ‘ got several new rights.  They can access data held on on them within a month, free of charge.  They have the "right to be forgotten" by making an organisation erase data, and the right to be notified within 72 hours if their data is compromised — and to get compensation more easily.  For organisations, the fines for non-compliance are much bigger under the GDPR: a maximum of €20 Million or 4% of turnover, whichever is the greater.  It is fair to say that the EU has handed a loaded gun to the national regulatory agencies whose job it is to enforce the rules.   What’s the scenario post GDPR ?  GDPR has greatly increased the number of data breaches reported to the authorities by companies and organisations.  Across the first nine months of GDPR 206,000 cases were recorded, which included 95,000 complaints and 65,000 data-security breach notifications.  That is a valuable trove of information about customers whose personal data has been compromised, and for regulators and technology designers trying to understand and mitigate the root causes of breaches. However, it's much less clear that GDPR has had much impact on corporate fines for mishandling personal data.   Across Europe, in the first nine months national data-protection agencies in 11 countries had levied €56 Million in fines. That sounds impressive, but the vast bulk of that figure was a single € 50m French levy on Google in January. Clearly, GDPR is a work in progress and so far the vast majority of firms are not being fined for failing to protect customers' data, and any fines levied have hardly been onerous.  Critics also say that the first year of operation has borne out their worst fears about the potentially damaging effects of GDPR.   What are the fears of a flawed GDPR ? The activists worry that GDPR is cumbersome, outrageously costly to comply with, and over time is likely to entrench existing oligopolies while discouraging new investment in potential future champions. This is a crucial point wrt Data primacy and data sovereignty.  In other words, it increases the power of the biggest players, such as Facebook and Google — who can easily afford the compliance costs and have used their market power to pass on some costs to others — while making life much harder for smaller players and new entrants.  For example, a study last November for the US thinktank the National Bureau of Economic Research reported a 17% fall in venture-capital funding rounds for tech firms in Europe after GDPR came into force, and a fall of almost 40% in the overall funds raised.  Meanwhile, in the UK Google and Facebook's combined share of the online advertising market has risen over the past year to 64%, compared with 59 % in the US.  Realistically, it's still very early days in terms of evidence gathering, and regulators promise that some more big fines are in the pipeline.  But for now, the jury is very much out.

The acclaimed tamper-proof ledger put wheels on blockchain taking it everywhere from healthcare to insurance . AI is the basis for cryptocurrencies such as Bitcoin and now Libra. But its open and versatile nature could perhaps be its undoing – in quantum computing there is a battering ram that could break the blockchain defences. That risk is palpable and the consequences dire.  Quantum computers can store more information using less energy than traditional computers, which means they can rapidly perform complex calculations.  Unlike normal computers,  quantum machines can go down multiple paths simultaneously in their problem solving.  As a result, it is tens of thousands to millions of times faster than current computers – and more power means tasks such as breaking encryption becomes easier, potentially exposing critical data and sensitive information.  As early as 2016 attempts by a team from MIT + the University of Innsbruck led to a quantum computer that – they claim – if successfully scaled up – could break RSA encryption, a widely used algorithm .  This is the standard encryption. securing everything from text messages to eComm. Given this news, one can only imagine what’s happening in non academic ,commercial or intelligence establishments. The blockchain is particularly vulnerable because it has a single point of failure .  Once breached , all the blocks are freely available for invasive appropriation  from criminal mafias to undercover agencies to gather.  Today they are encrypted, hence secure. Once quantum computing gets cheap enough, there could be huge leaks of blockchain data that is potentially being secured into a captive reservoir now.  In 2018, Google unveiled Bristlecone, a chip with 72 qubits that the company believes could soon reach “quantum supremacy”, bringing mass-produced quantum computers to market.  The biggest locks on our doors are as safe as the key that gently turns and opens the treasure cave to those who seek fortune and more.  Now let’s look at the hype. Who is to assess the magnitude of the change that is upon us ?  Is blockchain an imminent reality that is commercially viable now?  We may soon realise that much of our excitement about this technology is overblown. Every geek news encountered has AI in it.  Products and services are being "reinvented" with AI at their core.  There is huge investor interest in AI data plus intelligence means new solutions to problems. But who is judging if the AI being sold as nirvana is not some ready made algo slapped on existing data ? Investments in these companies will grow when AI is made to work in a commercially scaled way. The return is when you turn a theoretically viable product into a commercially scalabale and safe one. The question to ask the current AI hype builders is whether AI is ready for real-world robustness ? The direction is set and the momentum is irreversible but the real magic will happen when early failure make the smart followers scale to commercial giant status.  We will live in an era of AI – risk and hype apart. That’s a certainty.

There was a time when business was wary of big government.  It is the other way around now.  Today Facebook announced that it would launch its own digital coin next year, a potentially revolutionary step that will allow  2.4 billion users to make payments over its network.  This promises to crack open one of the most over regulated industries in the world.  Doing so with its own private global currency, Facebook will allow users to convert from dollars, pounds and other international currencies into this crypto currency called Libra and vice versa.  The coins can be used for all in nature of commerce on the Internet in physical locations and transferring money without needing a bank account.  This crypto currency, being developed in Switzerland is backed by network such as Visa, MasterCard and PayPal.  Others in the ecosystem include Uber, Spotify, eBay, Vodafone amongst a total of 28 companies that are reported to have signed up.  Crypto currency is a been around for a decade now. Bitcoin was created decade ago and several other minor crypto currencies followed but their summative impact seems fairly marginal.  Estimates of the numbers using Bitcoin do not exceed 20–25 million people.  Facebook however is on a completely different scale. Besides 2.3 billion users , Whatsaspp has another 1.5 billion. This user base along with a market value of $500 billion gives Facebook the muscle mass needed.   If Libra becomes the currency used by everyday people it will be an irreversible phenomenon. Despite all its other troubles the market is anticipating this huge breakthrough and Facebook share today stands at $ 180 compared to the $140 at the start of the year.  It will immediately impact traditional banking. Across the world regilar banks are  grappling with ineffective scale, poor legacy technology, weak unemotional branding and ‘low-tech – high touch’ structures.  Their liquidity comes in via the current and savings accounts. Once that is gone , traditional banking will be gone too.  It will also massively erode the power of governments, central banks and monetary sovereignty.  Once a currency has 2–3 billion users across the world no single government or currency can dislodge it.  This is an idea that potentially impacts commerce, governance and democracy as we know it.  And it is inevitable whether done by Facebook,Amazon or Apple.

The concept of singularity – aptly named given its single mindedness – is a concept without any parallel in history for its ambition and scale. It brings together AI, big data, blockchain and algorithms into a digital ecosystem which is limitless in scope.   Potentially , as a design thought, each one of us will be subject to its monitoring and control from the moment we are conceived till when our insurance payout happens after death. We may live on longer as a referencing statistic. Finally, data will make us immortal !  Sarcasm aside, in many ways , concerns over the business impact of singularity in business are misplaced, even alarmist. The density of consumer engagement will increase and data will allow for sellers to push based on predispositions, propensities and probabilities.  But in the socio-cultural sphere,  it is fair to be concerned and alarm.  Singularity in the digital continuum is a powerful means for propaganda and prejudiced misinformation.  The democratic processes is about ‘majority voted choice’ . The norm will be transformed compared to how it was as of now. We will be fed on our biases, exploited for anxieties and the magician’s trick will apply to any card we pull. This will be made possible thanks to continuous data linked personalisation.  The targeting of content based on priori information can/will irreparably disrupt the democratic process  Public scrutiny is revealing that computational propaganda has been successful because the  filtering systems of today’s social networks are fragile. Activity trumps aggregation. The systems are susceptible  to popularity based recency.  Somewhere the ‘wisdom of the crowds’ logic breaks down in this new digital world. On such platforms our intelligence is attenuated not amplified. In large digital groups, collectivism takes the road to regressive thinking.  Power in a democracy is about participation to choose. Eventually those who get chosen wield power.  Corporate power is more pervasive, continuous and better resourced. It also has focused area of interest so gets its narrative in place faster.  There is a criticism that the social web is promoting echo chambers. That we are not on networks that routinely expose us to opposition, disclaimers, contradictions or contrarian points of view.  Artificial Intelligence cannot help us discern truth from fiction .  That we ought to do by ourselves, for ourselves and as ourselves.

The transformation of America at the turn of the 20th century is in many ways at a parallel to what is happening in India today. India has transformed from a rural agrarian-based economy to an urban, industry and services based economy; from a fragile collection of small family business establishments to big established world scale corporations. India has the world’s youngest and largest population which is interconnected on an unprecedented level. Like in America in the early 1900s, in India today there is also a changing mix in terms of business, consumers, regulation, government, and institutions. The most significant factor that changed America at the dawn of the 20th century was its burgeoning population and transforming demographics. In America’s case, this was represented in terms of immigration where almost 9 million immigrants came to its shores between 1900-1909. In India, this is manifest in terms of the change in demographics. Almost 400 million Indians are born after the year 2000. This will transform not only our workforce, popular culture, patterns of consumption but also it will lead to enormous opportunities for business in the form of expanding consumption as well as provision of opportunities for commercialization of technology.

Cyrus Curtis’ publications – the ‘Ladies Home Journal’ and the ‘Saturday Evening Post’ led to the emergence of middle-class culture, give definition to women as purchasers and decision makers and pioneered techniques in advertising and marketing in the early 20th century. In 1904, the ‘ Ladies Home Journal ‘ became the first magazine ever to get to the circulation of over 1 million copies. More than 7500 magazines were started between 1885 and 1905 and half of them failed. Cyrus Curtis was the first to innovate in colour printing and to use two-, three –, four – colour printing. At one time his empire carried 40% of advertising expenditure for all magazines in the US. Curtis allowed content to be a means for target marketing.