Why the Apple vs. the FBI case is important

This morning’s Observer column:

No problem, thought the Feds: we’ll just get a court order forcing Apple to write a special version of the operating system that will bypass this security provision and then download it to Farook’s phone. They got the order, but Apple refused point-blank to comply – on several grounds: since computer code is speech, the order violated the first amendment because it would be “compelled speech”; because being obliged to write the code amounted to “forced labour”, it would also violate the fifth amendment; and it was too dangerous because it would create a backdoor that could be exploited by hackers and nation states and potentially put a billion users of Apple devices at risk.

The resulting public furore offers a vivid illustration of how attempting a reasoned public debate about encryption is like trying to discuss philosophy using smoke signals. Leaving aside the purely clueless contributions from clowns like Piers Morgan and Donald Trump, and the sanctimonious platitudes from Obama downwards about “no company being above the law”, there is an alarmingly widespread failure to appreciate what is at stake here. We are building a world that is becoming totally dependent on network technology. Since there is no possibility of total security in such a world, then we have to use any tool that offers at least some measure of protection, for both individual citizens and institutions. In that context, strong encryption along the lines of the stuff that Apple and some other companies are building into their products and services is the only game in town.

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The Wille E Coyote effect

Benedict Evans is at the huge annual mobile phone gabfest in Barcelona. On his way he wrote a very thoughtful blog post about the world before smartphones, and why Nokia and Blackberry didn’t see their demises coming.

Michael Mace wrote a great piece just at the point of collapse for Blackberry, looking into the problem of lagging indicators. The headline metrics tend to be the last ones to start slowing down, and that tends to happen only when it’s too late. So it can look as though you’re doing fine and that the people who said three years ago that there was a major strategic problem were wrong. You might call this the ‘Wille E Coyote effect’ – you’ve run off the cliff, but you’re not falling, and everything seems fine. But by the time you start falling, it’s too late.

That is, using metrics that point up and to the right to refute a suggestion there is a major strategic problem can be very satisfying, but unless you’re very careful, you could be winning the wrong argument. Switching metaphors, Nokia and Blackberry were skating to where the puck was going to be, and felt nice and fast and in control, while Apple and Google were melting the ice rink and switching the game to water-skiing.

I love that last metaphor.

In a way, it was another example of Clayton Christensen’s ‘innovator’s dilemma’. It’s the companies that are doing just fine that may be most endangered.

It’s a great blog post, worth reading in full. Also reminds us that mobile telephony was much more primitive in the US than it was in Europe (because of the GSM standard over here), and that Steve Jobs and co really hated their ‘feature’ phones as primitive devices. Evans sees something similar happening now with cars. It’s no accident, he thinks, that tech companies (Apple, Google) are working on cars. Techies hate cars in their current crude manifestations, whereas the folks who work in the automobile industry love them. Just as Nokia engineers once loved their hardware.

The new sun in the tech universe

This morning’s Observer column:

The Christmas holidays are the time of year when different generations of the family gather around the dinner table. So it’s a perfect opportunity for a spot of tech anthropology. Here’s how to do it.

At some point, insert into the conversation a contemporary topic about which most people have strong opinions but know relatively little. Jeremy Clarkson, say. There will come a moment when someone decides that the only thing to be done to resolve the ensuing factual disputes is to “Google it”. Watch what happens next…

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The hardware that breaks the commoditisation rule

Insightful column about the iPhone phenomenon by Farhad Manjoo: The nub of it is this:

In many fundamental ways, the iPhone breaks the rules of business, especially the rules of the tech business. Those rules have more or less always held that hardware devices keep getting cheaper and less profitable over time. That happens because hardware is easy to commoditize; what seems magical today is widely copied and becomes commonplace tomorrow. It happened in personal computers; it happened in servers; it happened in cameras, music players, and — despite Apple’s best efforts — it may be happening in tablets.

In fact, commoditization has wreaked havoc in the smartphone business — just not for Apple. In the last half-decade, sales of devices running Google’s Android operating system have far surpassed sales of Apple’s devices, and now account for the vast majority of smartphones in use.

For years, observers predicted that Android’s rising market share would in turn lead to lower profits for Apple (profits, not market share, being the point of business). If that had happened, it would have roughly approximated the way the Windows PC industry eclipsed Apple’s Mac business. “Hey, Apple, wake up — it’s happening again,” Henry Blodget, of Business Insider, warned in 2010. And again in 2011, 2012, 2013 and 2014.

None of those predictions came true. While the iPhone’s sales growth slowed in 2013 and 2014, it rebounded to near-record levels later last year, and its profits have remained lofty.

Instead of killing Apple, commoditization caused something stranger — it hobbled Apple’s main competitor in the smartphone business: Samsung, which until last year was gaining a creeping share of the profits in the smartphone business. At its peak in mid-2013, Samsung was making close to half of every dollar in the smartphone business, according to the research firm Canaccord. (Apple was making the other half.)

But the rise of low-end, pretty great Android phones made by Chinese upstarts like Xiaomi — and the surging popularity of Apple’s large-screen iPhones — put Samsung in a bind. In July, Samsung reported its seventh straight quarter of declining profits.

Yep. The reason why the Apple phone defies the commoditisation rule is that it’s not a standalone device, but part of a highly-functional (and useful) ecosystem. That’s why iPhone users who hanker after, say, Samsung’s or Sony’s latest phone think twice before making the switch: do they really want to leave the comfort and ease of the Apple ecosystem. And Apple has just made joining that ecosystem easier — by releasing an Android App that allegedly makes it simple for Android users to take their data etc. across to their brand new iPhones! Given the amount of money Apple makes from the iPhone, it does now look set to become the world’s first trillion-dollar company.

Getting to bedrock

This morning’s Observer column:

The implication of these latest revelations is stark: the capabilities and ambitions of the intelligence services mean that no electronic communications device can now be regarded as trustworthy. It’s not only your mobile phone that might betray you: your hard disk could harbour a snake in the grass, too.

No wonder Andy Grove, the former boss of Intel, used to say that “only the paranoid survive” in the technology business. Given that we have become totally dependent on his industry’s products, that knowledge may not provide much consolation. But we now know where we stand. And we have Edward Snowden to thank for that.

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The future in your pocket

This morning’s Observer column:

If a year is a long time in politics (and it is), then it’s an eternity in communications technology. Fourteen years ago, about 400 million people were using the internet. Today, the number of net users is pushing the 3 billion mark. But that’s not the really big news. What’s truly startling is that 2 billion of these folks are getting their internet connections primarily via smartphones, ie, handheld computers that can access the internet as well as make voice calls, send text messages and do the other things that old-fashioned “feature phones” could do.

This is startling because smartphones are a relatively new development, and when they first appeared less than a decade ago, most of us thought that they would remain an elite consumer product for a long time to come, staples of affluent professionals in the industrialised world, perhaps, but of no relevance to poor people in the developing world who would continue to be delighted with crude feature phones that could just about do SMS.

How wrong can you be? We underestimated both the power of Moore’s law and human nature…

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The phablet controversy

iPad_Mini

Wading through the throng in an Apple store the other day, I had a look at the new iPhones. The iPhone 6 didn’t seem much of an advance on my 5s, but the even-bigger one, the 6 plus, seems odd. It’s far too big to be a credible phone, but too small to be a useable tablet. So why, one wonders, will people buy it?

One answer, I suppose, is that people buy preposterously large Samsung phones, even if they do wind up holding something the size of a dinner plate to their ears. (Or making calls surreptitiously, using headphones.)

Ages ago, I bought an iPad Mini with a SIM card for writing on the move, and kept my phone for texts and the occasional voice call. The Mini has turned out to be one of the most useful gadgets I’ve ever owned. Just big enough to be useful; just small enough to slip into a jacket pocket. The new iPhone isn’t a persuasive argument for abandoning that system. It ain’t broken, so I won’t be fixing it.