Behind the iPad’s sluggish sales

By | April 25, 2014
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Sameer Singh offers some possible reasons for the fall in iPad sales: 

Pocketable vs. Tablet Computing | Tech-Thoughts by Sameer Singh: “With this background, the sudden decline in iPad sales may have been caused by a combination of the following factors:

  • Most high-end consumers who need iPads already own them (and as some analysts have pointed out, replacement cycles are long) 
  • Large screen smartphones have made media tablets somewhat redundant, i.e. the iPad is no longer a ‘necessary’ purchase for ‘phablet’ owners 
  • The iPad is priced out of the market segment that still finds media tablets ‘necessary’ 
  • Upmarket movement is limited because tablet use cases still haven’t evolved to cannibalize more productivity-related computing tasks (I may have overestimated the pace at which this would occur)”

To which I’d add: 

The iPad is in some ways closer to a PC than a phone in its utility vs luxury ratio. People upgrade their phones because they’re visible accessories, something that says something about the person holding it. Computers have barely hit that bar, and maybe iPads — especially since users usually cloak them in a stand/cover — don’t quite make it either. So unless there’s a really compelling performance/spec reason to upgrade, most don’t bother.

I’ve not seen data on this, but anecdotally most people I know get an iPad and then settle, rather than upgrading when the next one comes out. Of course the lack of telco subsidy for most iPad purchases adds to this. 

It’s not that iPad isn’t a great idea, but it turns out that the smarter move in a way has been to increase the size of the phone (phablet) rather than shrink the size of the computer (the iPad), at least in terms of getting people to upgrade. 

All at sea: global shipping fleet exposed to hacking threat

By | April 28, 2014
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[Original link: this one includes links to the source material where available]

(Reuters) – The next hacker playground: the open seas – and the oil tankers and container vessels that ship 90 percent of the goods moved around the planet.

In this internet age, as more devices are hooked up online, so they become more vulnerable to attack. As industries like maritime and energy connect ships, containers and rigs to computer networks, they expose weaknesses that hackers can exploit.

Hackers recently shut down a floating oil rig by tilting it, while another rig was so riddled with computer malware that it took 19 days to make it seaworthy again; Somali pirates help choose their targets by viewing navigational data online, prompting ships to either turn off their navigational devices, or fake the data so it looks like they’re somewhere else; and hackers infiltrated computers connected to the Belgian port of Antwerp, located specific containers, made off with their smuggled drugs and deleted the records.

While data on the extent of the maritime industry’s exposure to cyber crime is hard to come by, a study of the related energy sector by insurance brokers Willis this month found [PDF] that the industry “may be sitting on an uninsured time bomb”.

Globally, it estimated that cyber attacks against oil and gas infrastructure will cost energy companies close to $1.9 billion by 2018. The British government reckons cyber attacks already cost UK oil and gas companies around 400 million pounds ($672 million) a year.

In the maritime industry, the number of known cases is low as attacks often remain invisible to the company, or businesses don’t want to report them for fear of alarming investors, regulators or insurers, security experts say.

There are few reports that hackers have compromised maritime cyber security. But researchers say they have discovered significant holes in the three key technologies sailors use to navigate: GPS, marine Automatic Identification System (AIS), and a system for viewing digital nautical charts called Electronic Chart Display and Information System (ECDIS).

“Increasingly, the maritime domain and energy sector has turned to technology to improve production, cost and reduce delivery schedules,” a NATO-accredited think-tank wrote in a recent report. “These technological changes have opened the door to emerging threats and vulnerabilities as equipment has become accessible to outside entities.”

TIP OF THE ICEBERG

As crews get smaller and ships get bigger, they increasingly rely on automation and remote monitoring, meaning key components, including navigational systems, can be hacked.

A recent study by security company Rapid7 found more than 100,000 devices – from traffic signal equipment to oil and gas monitors – were connected to the internet using serial ports with poor security. “The lines get blurry, and all industries and all technologies need to focus more on security,” said Mark Schloesser, one of the authors of the study.

Mark Gazit, CEO of ThetaRay, an internet security company, said an attacker managed to tilt a floating oil rig to one side off the coast of Africa, forcing it to shut down. It took a week to identify the cause and fix, he said, mainly because there were no cyber security professionals aboard. He declined to say more.

Lars Jensen, founder of CyberKeel, a maritime cyber security firm, said ships often switch off their AIS systems when passing through waters where Somali pirates are known to operate, or fake the data to make it seem they’re somewhere else.

Shipping companies contacted by Reuters generally played down the potential threat from hackers. “Our only concern at this stage is the possible access to this information by pirates, and we have established appropriate countermeasures to handle this threat,” said Ong Choo Kiat, president of U-Ming Marine Transport, Taiwan’s second-largest listed shipping firm by market value. The company owns and operates 53 dry cargo ships and oil tankers.

VIRUS-RIDDLED

A study last year by the Brookings Institution of six U.S. ports found that only one had conducted an assessment of how vulnerable it was to a cyber attack, and none had developed any plan to response to any such attack. Of some $2.6 billion allocated to a federal program to beef up port security, less than 1 percent had been awarded for cyber security projects.

When CyberKeel probed the online defences of the world’s 20 largest container carriers this year it found 16 had serious security gaps. “When you look at the maritime industry there’s extremely limited evidence of systems having been breached” compared to other sectors, said CyberKeel’s Jensen. “That suggests to us that they’ve not yet been found out.”

Michael Van Gemert, a security consultant to the oil and gas industry, said that on visits to rigs and ships he has found computers and control systems riddled with viruses. In one case, he said it took 19 days to rid a drilling rig en route from South Korea to Brazil of malware which had brought the vessel’s systems to a standstill.

“The industry is massively in need of help, they have no idea what the risks are,” he said.

The main ship navigation systems – GPS, AIS and ECDIS – are standards supported by bodies such as the International Maritime Organisation (IMO). Indeed, that body has made AIS and ECDIS mandatory on larger commercial and passenger vessels.

Researchers from the University of Texas demonstrated last July that it was possible to change a ship’s direction by faking a GPS signal to dupe its onboard navigation system.

Marco Balduzzi and colleagues at anti-virus vendor Trend Micro last month showed that an attacker with a $100 VHF radio could exploit weaknesses in AIS – which transmits data such as a vessel’s identity, type, position, heading and speed to shore stations and other ships – and tamper with the data, impersonate a port authority’s communications with a ship or effectively shut down communications between ships and with ports.

In January, a British cyber security research firm, NCC Group, found flaws in one vendor’s ECDIS software that would allow an attacker to access and modify files, including charts. “If exploited in a real scenario,” the company concluded, “these vulnerabilities could cause serious environmental and financial damage, and even loss of life.”

When the USS Guardian ran aground off the Philippines last year, the U.S. Navy in part blamed incorrect digital charts. A NATO-accredited think-tank said the case illustrated “the dangers of exclusive reliance upon electronic systems, particularly if they are found vulnerable to cyber attack.”

“Most of these technologies were developed when bandwidth was very expensive or the internet didn’t exist,” said Vincent Berk, CEO of security company FlowTraq.

NO QUICK FIX

Fixing this will take time, and a change in attitude.

“Security and attack scenarios against these technologies and protocols have been ignored for quite some time in the maritime industry,” said Rapid7’s Schloesser.

Researchers like Fotios Katsilieris have offered ways to measure whether AIS data is being faked, though he declined to be interviewed, saying it remained a sensitive area. One Google researcher who has proposed changes to the AIS protocol wrote on his blog that he had been discouraged by the U.S. Coastguard from talking publicly about its vulnerabilities.

Indeed, AIS is abused within the industry itself.

Windward, an Israeli firm that collects and analyses AIS data, found 100 ships transmitting incorrect locations via AIS in one day – often for security or financial reasons, such as fishing boats operating outside assigned waters, or smuggling.

In a U.N. report issued earlier this year [PDF] on alleged efforts by North Korea to procure nuclear weapons, investigators wrote that one ship carrying concealed cargo turned off its AIS signals to disguise and conceal its trip to Cuba.

It’s not clear how seriously the standards bodies treat the threat. Trend Micro’s Balduzzi said he and his colleagues were working with standards organisations, which he said would meet next year to discuss his research into AIS vulnerabilities.

The core standard is maintained by the International Telecommunications Union (ITU) in association with the IMO. In a statement, the IMO said no such report of vulnerabilities had been brought to its attention. The ITU said no official body had contacted it about the vulnerabilities of AIS. It said it was studying the possibility of reallocating spectrum to reduce saturation of AIS applications.

Yevgen Dyryavyy, author of the NCC report on ECDIS, was sceptical that such bodies would solve the problems soon.

First, he said, they have to understand the IT security of shipboard networks, onboard linked equipment and software, and then push out new guidelines and certification.

Until then, he said, “nothing will be done about it.”

($1 = 0.5949 British Pounds) (Additional reporting by Keith Wallis; Editing by Ian Geoghegan)

Meshing and Stacking Away from Disaster

By | April 16, 2014
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I’m often haunted by the folk in Wall-E, the movie where humans have abandoned Earth to trash, a small waste-collecting robot and a cockroach. That’s not the bit that scares me: it’s the space-bound humans who are ferried around on pods, their eyes permanently glued to a screen in front of them.

Is this, I ask my worried self, our future? Or has it already happened?
In some ways it has. But for what it’s worth I think it’s a blip. The future won’t in fact look like that at all.

Right now we definitely have a problem. The problem is that screens have gotten smaller, or rather more portable, more convenient, and the content on them has become so compelling that we risk life and limb to watch them as we walk, stand and sit.

But this is just a phase.

I detect the beginnings of a shift. Not of our behaviour – sadly we’ll always be vulnerable to fixating on any screen with bright colours and movement. But the sheer multiplicity of screens is forcing change on us.

Consider the following: Of the seven hours a day spent gazing at a screen, at least two of those hours are actually watching two or more screens. Millward Brown, a brand consultancy, calls it meshing and stacking.

Whereas before we’d pop off to the kitchen to put the kettle on, now we scroll through our tablet to see what people are saying on Twitter about what we’ve just watched. Then there’s shifting, where we start watching something on one screen, and then finish it on a laptop, a smartphone or a tablet.

This may seem like appalling behaviour, slicing our attention into ever thinner chunks. And in some ways it is, but it means that we’re unlikely to be subsumed by any one screen. And that’s good, because we’re dominating the screens, not them dominating us.

There are other things afoot. Screens don’t need to be big to do big things for us: the latest version of Google’s Android operating system allows the user to stitch together separate photos of a view and then relive the panorama by moving the phone around in the air, the image moving as if the scene was in front of the viewer. It’s a extraordinary feeling, recreating a mural on a screen the size of your hand.

Then there’s something called Spritz, an app that allows you to speed read a book in a viewer no larger than 18 letters. The maker of the app says by shuttling words past your vision at speed 80% of your effort is saved for reading and absorbing. I was pretty amazed; it seemed to work, and makes you think about whether you really need a book-sized screen to recreate the experience of reading a tome.

Then there’s something called Snapchat, where users can send photos to each other which can only be viewed for a few seconds before disappearing forever. It’s hard to see the value in this, until someone pointed out that the value lies in the intimacy of the moment. Users don’t open the picture immediately, preferring to find a quiet, private space to enjoy it. Counterintuitively, by making the photo ephemeral, the app makes the process of viewing it special and the memory of it longer lasting.

Some might say I’m grasping at straws. But I see in these examples the beginnings of a new approach to how we relate to our screens. For sure, some of us will remain their slaves. But for others we may find new ways to derive pleasure from them, whether it’s recreating a vista, reading a tome or viewing a photo.

WhatsApp: Silly Money or New Front in the Platform Wars?

By | March 1, 2014
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It’s been a few days since Facebook announced to the world it had bought WhatsApp. And Rakuten bought Viber. You are forgiven if only one of those names rings a bell. so while I’m at it, let me throw in a few more: WeChat, LINE, KakaoTalk. Nimbuzz. Mig33. Fring. Telegram. Tango.

OK, that’s enough names. But while I’m at it I’ll throw out a prediction: You’re going to hear a lot more of these messaging services in the years to come. That’s because we’re entering a new phase of what we might pompously call the platform wars. One where those with the biggest network win.

It sounds arcane and complicated but it’s not really, if we strip it down to the fundamentals. Phones were always about the network effect. The first phone, for example, was pretty useless, like the first subway station. But the more phones were added to the network, the more useful the network became, and the more worthwhile it was to get a phone and plug it in.

Networks are about communicating. When SMS came along folk loved it because it offered a less intrusive option for the mobile phone; you didn’t have to talk to people to communicate with them.

Messaging applications like WhatsApp are a return to this simplicity. And of course, it’s cheap. So it’s not surprising that more than 450 million people use it.

And this is the thing. Facebook and Rakuten, the Japanese ecommerce company that bought a smaller version of WhatsApp called Viber, want to get as close to you, the mobile user, as they can. They want to get you to buy stuff, or share stuff, or see stuff because that’s how their business models work.

In that sense it’s simple. But under the hood there’s a larger shift at work in the layout of the engine. In the old days, to get close to the user you built a browser. Remember all those wars over the default browser in Windows?

That’s all old hat now. The conventional wisdom is that on mobile phones, where all the action is, the chokepoint is the operating system. That’s the software that the device runs, and comes with. That means Apple, with their iOS, and Google, with their Android, are in pole position. If you want to do something, like sell an app, you have to go through their app store. Upset them and you’re out. Oh, and they get a cut of anything you make on their device.

Only hang on a minute.

What happens if the choke point, the place where the rubber hits the user, as it were, wasn’t the app store but, say, a messaging app? Or if you wanted to order a taxi? Or buy insurance?

This is what is happening already, in China, South Korea and Japan. And it’s big, because it threatens to undermine a lot of what these big players, not just Apple and Google, but phone makers like Samsung, and telephone operators, and everyone in the mobile game, has been trying to do.

In short, if you can insert yourself in the what folk call the value chain so all the user sees is you, you’re good to go. And that’s what’s happening with the likes of WeChat, KakaoTalk and Line.

You may not have heard of these guys, and you may not again. But if you think them about in that way you’ll have a clearer idea about why Facebook splashed out $19 billion on their Western equivalent WhatsApp, and Rakuten $900 million on Viber.

Big money. But when you’re elbowing big names aside to get to be the first and only thing the nearly 7 billion mobile phone users in the world interact with, maybe it doesn’t look like silly money.

This is a piece I wrote and recorded for the BBC World Service’s Business Daily program riffing off the Facebook and Rakuten purchases. Podcast here.

You’re Never Alone With a Drone

By | February 19, 2014
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Drones is a bad word to describe the future. We hear drones and we think bombs dropped unseen, we think surveillance and we think somebody talking incessantly about something not very interesting.

But I’m a big fan of drones. Drones are unmanned aerial vehicles and while inevitably the military is ahead in leveraging the technology, and governments are restricting their usage, they represent as powerful an opportunity for the future as the mobile phone.

You average drone is a quadrocopter — a helicopter with four rotors. The design is more than a century old, but it has only been in the past decade that they’ve gotten cheap enough for any tom or dick or harry to have one. Now they can be as small as a butterfly, controlled by your iPhone.

Outside of the military, they’re still somewhat in the domain of hobbyists, but this is beginning to change. Journalists have been using them to cover protests, floods and sports. Oil and gas companies are using them to survey terrain and check out potential leaks. Conservation groups are using them to map terrain and track wildlife and poachers.

This is just the start. Drones could be deployed as sort of flying webcams so drivers can check traffic conditions ahead. Refugee agencies could do rapid surveys of movements of people to assess their needs before they turn up at a camp.

And that’s just by attaching a camera to a drone. You could attach a lot more.

Amazon has half-jokingly released a video showing how a drone could deliver a package. Attaching near-infrared sensors could detect the health of vines and crops. Surveyors could use distance sensors to quickly assess the size of a plot — or even the rooms inside a building.

This is beginning to happen, and in some industries it’s been happening for a while. Regulations are a little slow to keep pace — I spoke to one entrepreneur who moved his startup from California to Singapore because he said it was taking too long for the regulations to catch up with the reality. In Southeast Asia, he says, governments are more receptive to his drone as a service business.

The next step after commercial adoption, I think, is going to be when we as individuals see drones in the same way we see phones. The smartphone was originally just a phone — now it’s pretty much everything but a phone. Think computer, internet device, social tool, health monitor, stopwatch, radio, music player, tv, satnav, TV remote, calorie counter.

We’ll deploy a drone to water the garden, to check whether the bus is on its way, to deliver a pina colada to our spouse lounging by the pool. We’ll send one out to scare away the birds raiding our strawberry patch, to check out storm damage on a chimney, to figure out where there’s a parking spot in a crowded lot. We’ll have them accompany us on walks and runs as a kind of mobile security guard, providing direction, assessing threats and, in the event of rain, an umbrella.

For sure, there are privacy concerns. But we’ve been surprisingly sanguine about the sudden appearance of billions more cameras in our face — either on phones or streetlamps — so it may not take us long to figure out that the skies above us are not empty. We’ll develop ways to block intrusive sensors and cameras. And hopefully we’ll make the most of being able, for the first time in our lives, to be able to look down on ourselves from above.

This is a longer version of a piece I’m recording for the BBC World Service. I no longer upload the podcasts here because of time constraints, but they can usually be found from time to time at the tail-end of the Business Daily podcast available here. While I’m a staff correspondent at Reuters, this is not written for Reuters.