@mhoye: The Internet Of Things You Don’t Really Own

Being based in Berlin, I cannot help but look at the music industry every so often. It certainly doesn’t help that the Berlin Music Week is happening.

And we all should look to the music industry every so often, because a lot of battles have played or are currently playing out there that eventually spill over to other industries. Music had to deal with disbanding way before it hit the newspapers, and with monopolistic distribution infrastructures way before Amazon became a thing in eBooks. And given their greed, they’re also the folks who seem most stuck-up when it comes to “intellectual property” rights, and licensing.

I haven’t “owned” music in a long time.

Access means licensing

When I moved from Heidelberg to Berlin, I sold all the CD’s I still had. And even though I’ve invested into a good LP-player when I got to Berlin, my Vinyl collection isn’t actually shaping up at the pace I initially had hoped. Nonetheless, I consume more music than ever.

I haven’t “owned” music in a long time, because in most cases, I get a license to listen to music, rather than ownership over a physical copy of a piece of music.

This is how we deal with what the industry likes to call “content” nowadays. We don’t own it. We own licenses to it.

This change happened, because the underlying structure changed. Instead of physical objects, music turned into data. Files on your computer. On those files on your computer, you never really own. You just have a license to store them, and to play them. So when I listen to music on my stereo, it plays on the stereo that I own, but I don’t really own the music.

Terms and Conditions may apply

Here’s an interesting thought-experiment: With the new intelligent, smart door-look, which relies on the manufacturers server infrastructure to communicate with your mobile phone to reliably establish, what happens when you run afoul some asinine provision in that service’s Terms of Service?

You own the physical product. There is a lock on your door, that you can remotely control from your smart phone. But you cannot use the service anymore, so it’s functionality, that added benefit that you originally bought it for, is essentially meaningless.

If you take, for instance, the slew of smart fitness tracking devices. Be they manufactured by Nike, Fitbit, Jawbone or Withings, they all don’t just do tracking. Their real value lies in the connection to a web service, which allows me, as a user, to track my workouts, compare that with my friends, give me aggregate analytics, etc. That use, of course, is bound by Terms of Service, and a whole slew of other legalese, and means, in essence, that I only really own a thing on my wrist. The functionality that I bought it for resides on their servers. I only have a license to use it. But should I ever run afoul of any license restrictions, that object, that fancy thing on my wrist that I paid good money for, is essentially useless. It’s a Thing I Don’t Really Own.

As A User, I Want To Own My Stuff

A while back, Amazon-users suffered an ironic incidence: Unauthorized copies for George Orwell’s 1984 had been distributed as eBooks via Amazon’s Kindle store. After the rights-holders complained to Amazon, the company decided to remove all purchased copies from any Kindle, including notes and all.

How do we ensure that the same situation doesn’t happen with the users of fitness tracking devices, smart door locks, or intelligent heating systems? One way would be to move as much smartness to the edge, that is, the devices themselves. That of course is not always practical, given the restrictions that most connected devices operate under. And it’s often not desirable, as those devices benefit from aggregate data analytics which combines the data from several units.

Another would be to force companies to service users who bought their devices. But as every purchaser of DRM-protected music from the Microsoft Zune-Store will be able to attest to, this is not a guarantee for users.

Ultimately, nothing will beat open standards and interoperable systems. Service portability – being able to control my intelligent heating system with whichever service provider I so chose – is the only meaningful solution to this. The alternative would be heavy-handed regulation or upset users. Both scenarios no vendor could currently like.

I’m still waiting for the first accident involving an “autonomous vehicle.” Not because I want this particular set of technologies to fail, but rather because it will set off a discussion that currently is only playing out at the sidelines in Special Interest Groups and Industry Consortiums but which really needs a broader focus and much broader input.

The question at the heart of the first accident with a self driving car is going to be: who is to blame?

Who is to blame?

Was the accident triggered by a malfunctioning algorithm that controls the car? Bugs are everywhere and unavoidable, after all, and who is to say that the software driving your car should be without fault? Or was the accident cause by the traffic infrastructure sending the wrong signals? Maybe the traffic light signalled red, but the electromagnetic signal that the car relies on was configured wrongly.

Maybe there was interference on the radio-frequency spectrum. Maybe even intentional interference. Did the car manufacturer integrate the software that drives the car correctly? And what about attendant data? Did the GPS unit report wrong information and the car thus misjudge the velocity it was travelling at? What about the driver? Did they enforce some kind of out-of-bound situation that the car just wasn’t able to cope with?

So really, who is to blame?

Early warning

The ensuing discussion around that question will be instrumental in shining a light on the coming world of the internet of things. Because that self-driving car might just be an isolated incident, but at the same time is an early indicator of a much broader trend: networked and pervasive actuators.

The roll-out of distributed sensor networks is just the first step of the Internet of Things — that part, where the Internet learns about the world. Ultimately, though, we want stuff to automatically act upon the information that were gathered, and that means rolling out actuators. That might just be automatic door-locks that open when someone authorised is geographically near, but it might as well be traffic signalling and guidance systems, and autonomous vehicles.

Lawyers love this

However, the big question around that roll-out is one that lawyers love: the question of liability.

Because, when—and it’s going to be when, not if—bad stuff happens, it’s not as easy anymore to determine who fucked up.

As hinted upon earlier, there’s plenty of moving parts that determine how an actuator will react in a given situation, and of course, the more complex the interactions of the actuator with the world, the more complex the surrounding dependencies and conditions that actuator relies on.

It is said that Google’s self-driving car currently generates around 1 GB per second.

But what is ensuring that all that data is accurate? And what happens if you network those cars, that is to say, cars rely on data generated by other cars. There are plenty of attendant considerations to pay attention to: can you ensure data is coming from where data claims it’s coming from? How do you ensure it’s an accurate reflection of reality? How do you make it tamper-proof, but at the same time interoperable? Open even?

Beyond Privacy

We’re currently talking a lot about the privacy implications of the Internet of Things, and in the current political climate, that is one conversation that is about time we had. We should, however, not lose sight of the bigger picture.

We’ve already created systems that are not legible by humans anymore. Kevin Slavin’s talk about “How Algorithms rule our world” hopefully has made the round far enough. All that information that we collect or start collecting about the world – it wants to be acted on. Preferably in the real world. We need to think about liability chains, and data provenance, if we want this to be in any way manageable.

I love it when Alex tells it like it is.

Gartner, a trends research group (or science fiction that costs a lot more to subscribe to) published their yearly Hype Cycle Chart, describing the Internet of Things (which they’ve only started adding to their chart in 2010 after “mesh networks” was doing rather well) as being “more than 10 years away” for the third year in a row. Well I sincerely don’t know what they’re smoking in Connecticut but they should come to Europe more often. Trends researchers have a disproportionate influence on the tech sector and C-suite executives who don’t have time to keep up with what’s going on outside their organisations and rely on outside opinion. This is totally fine, unless that source is living under a rock.

» Against the culture of “meh” and the internet of things. designswarm thoughts

I’ve had my fair bit of frustrations with the Gartner HypeCycle, and she cuts right to the chase. I think the hype cycle as such is a good, intuitive tool for looking at the progression of technology (through the hype, one might add.)

This all wouldn’t be too bad, if Gartner’s predictions didn’t have the effect of self-fulfilling prophecies. If C-Level execs hear that IoT is still 10 years out, they’ll more-likely-than-not defer investment in that space. After all, there’s still time.

Gartner is doing the industry, and their clients whom take their reports at face value, a massive disservice. The infrastructure is being built as we speak, and industry after industry is looking to adopt more computing and communications in their products. Either Gartner have a very narrow definition indeed of what the Internet of Things is, or they’re not really paying attention. I’d love to see their methodology and the reasons why they believe it’s still 10 years out.

Cue Alex again:

We should remember that the people paid to write reports for the C-suite executives in technology will breed the type of opinion that Ken Olson had in 1977.


“There is no reason anyone would want a computer in their home.”

I never really announced it here on the blog, but I’ve been working out of a shared office space in Kreuzberg for the last 6 months. What started out as just a space shared by Peter and Matt turned into more of a shared space for work, collaboration and sparring ideas. And after Alper joined and Chris had a brief run here, it needed a name. Enter the Kreuzberg Academy for Nerdery and Tinkering.

And as KANT, we sat down last week for a one-day content sprint – a concept which is loosely based on the book-sprint methodology and produced our first report.

Intrigued as we are with the wider area of healthcare and fitness, we were looking at current developments and potential implications of technology in this sector. Especially the convergence of the unregulated “fitness”-market and necessarily strictly regulated “health-care” caught our attention, as did the enormous changes in development velocity in these areas. We also looked closely into changing attitudes around patient empowerment, and how Electronic Patient Records are changing the industry.

The report was produced during the course of a day, and as such has been a tremendous exercise in collaboration and a good learning experience.

We quite enjoyed writing this report, and are pretty proud of the result. I hope you find it valuable.

If you wish, you can also download the full report as PDF or ePub

Matt Webb of Berg/BergCloud/LittlePrinter in an interview with GigaOM:

There are three areas that people need to figure out for connected devices: 1) tech, 2) design and 3) business. The technology is being figured out and it feels like there’s no massive innovation that needs to be done there. For the business model, people seem to have a clear idea of that.

The thing that is really missing is the user experience. The thing that people can’t really guarantee is what should the products be? They’re sure there’s something there but they don’t know what it should be and they have no belief that they can make it.

Berg’s CEO on the experience of connected devices & avoiding the creep factor — GigaOM

In every conversation I have about Home Automation, which is essentially corporate speak for connected devices in your home, they complain about the immaturity of the market, because their products don’t sell. It’s always hard to explain, then, that maybe their products are to blame, and not the market. It’s good to have people like Matt working in this field. It means that hopefully other companies will wake up.

Mike Loukides for O’Reilly Radar:

I’m sure that the researchers are well aware of the issues. Sadly, I’m not so surprised that the reporters who wrote about the research didn’t understand the issues, resulting in some rather naive claims about what the technology could accomplish.

On Batteries and Innovation – O’Reilly Radar

Notionally he’s writing about battery tech, but from now on this should be the canonical quote to react to sensationalist claims in the technology press.

Stacey Higginbotham for GigaOm:

“Right now big appliance makers only have contact with a buyer once every ten years or so, but with connected devices they could make that three to four times a week.”

The idea of my fridge, my dryer and my dishwasher all conspiring to provide me updates several times a week in some attempt to keep in touch on behalf of Samsung, Bosch or Whirlpool makes me want to run screaming from the internet.

The internet of things may drive you nuts before it makes things better — GigaOm

I guess that’s exactly the reason why all the “Smart Home” solutions big players seem to throw onto the market haven’t taken off. They fail to take into account what users would actually want from Smart Appliances, while the products that do – NEST for example – have a massive trajectory.

This quip from Benedict Evans made the round recently – and it applies here as well:

You can think of people as users or customers – but they’re not yours. They don’t belong to you, and they may barely even care that you exist.

Glass, Home and solipsism — Benedict Evans

You should also check out this presentation by the awesome Claire Rowland on this matter.

It’s a funny time, right now. We’re in the midst of probably the largest international political crisis in the last decade – and nobody seems to care. (And it’s not just because this crisis doesn’t really have a name yet.)

Similarly, we’ve hit 400ppm CO2 earlier this yet. That number is the one that was supposed to the limit. With 400ppm we’d only have a warming effect of 2°C. Similarly, people don’t seem to care.

Maybe that’s just me, but the work I’ve done over the last 5 years on Smart Metering, In-Home energy interventions and raising awareness about electricity issues (be honest: do you know you annual electricity consumption?) bears a striking resemblance to our current situation in terms of cryptography and general information security.

In both cases we’ve developed an environment where the easiest, most convenient option is to not care. We’ve managed to design the default options, those which the vast majority of people will take, to be completely irresponsible.

Whenever I talk about email crypto to people, I hear back the same story, even from the self-proclaimed geeks: it’s too hard, and too unusable.1 And with that defence even they themselves will absolve themselves from their responsibility to care. It’s the same with in-home energy displays: in the odd chance that people were actually interested in the things in the first place, they quickly lost interest, because they couldn’t be bothered and it became boring. Because the default is still to simply ignore the thing.

These are hard problems.

These are really hard problems.2

We need to change those defaults. We need to change what the easy, mindless option is into something more responsible. If you take the “work on stuff that matters”-mantra serious, this is what you need to work on.

  1. It’s as if people had never heard of GPGTools 

  2. Difficult, difficult, lemon difficult 

With Hardware and the Internet of Things all over the media, and at what seems to be the “peak of inflated expectations”, there still seems to be an uneasy relationship of the investment community with this latest cycle in internet technology.

Talking with friends whose startups are currently looking for funding, and with the odd investor who is actually willing to comment on this, it has become clearer to me that most of the investment community hasn’t yet developed an investment hypothesis around consumer IoT startups, that is: they have no idea about the growth potential and liquidity events in this industry. After all, this industry can’t run on Web2.0 business models1. Not only do hardware startups require orders of magnitude more capital2 but it’s more illiquid as well, bound in machining and securing vendors.

But I feel the most problematic point is not that the uncertainty about liquidity events is large – I think the point holding back investors in this space is that they cannot count on a breakaway success that provides an entire fund with returns. Hardware doesn’t follow the model, because it doesn’t have the lock-in, winner-takes-it-all network effects of so many of those 2.0 startups.

So my question is: what are the investment hypotheses VCs currently have about the hardware space? Is there any movement, any desire to get in on the market? Or are we to play with the R&D funds of the big players? Adhere to “Internet of Everything” and “Industrial Internet”?

There’s plenty of very interesting start-ups out there, but as long as they can’t get funding, there’s not a lot of room to manoeuvre, not a lot of leeway to find out what this collection of technologies can be used for other than more efficiency in so-and-so’s supply chain.

I’m really curious about this one. One thing is clear: relying on Kickstarter won’t cut it.3

  1. The parts that can are a very small part of the industry. 

  2. I’m curious how the Seedcamp formula of seed investments in the EUR 25k range will play out with their foray into hardware startups. It won’t cover a lot of ground there… 

  3. See Matt Webb’s Pricing Hardware