Sunday, November 29, 2015

Bill Gates, Pope Francis and the Challenge of Climate Change

  • This week, at a climate change summit in Paris,  Bill Gates will announce a multibillion-dollar fund to support clean energy research and development (+130  global leaders will attend including Barack Obama - U.S, Xi Jinping - China, Angela Merkel - Germany and David Cameron - U.K.)
  • Gates said in a July blog post, “I think this issue is especially important because, of all the people who will be affected by climate change, those in poor countries will suffer the mostHigher temperatures and less-predictable weather would hurt poor farmers, most of whom live on the edge and can be devastated by a single bad crop. Food supplies could decline. Hunger and malnutrition could rise. It would be a terrible injustice to let climate change undo any of the past half-century’s progress against poverty and disease—and doubly unfair because the people who will be hurt the most are the ones doing the least to cause the problem.“
  • Separately, Pope Francis said the Paris summit “represents an important stage in the process of developing a new energy system which depends on a minimal use of fossil fuels, aims at energy efficiency and makes use of energy sources with little or no carbon content … It would be sad, and I dare say even catastrophic, were particular interests to prevail over the common good … we are confronted with a choice which cannot be ignored: either to improve or destroy the environment."
  • Note: the National Oceanic and Atmospheric Administration recently reported that, “the first 10 months of 2015 comprised the warmest such period on record across the world's land and ocean surfaces.” 
MY TAKE
  • Climate change summits often result in watered-down resolutions or unmet objectives, but Gates' funding effort (which puts his money where his mouth is) could drive improved momentum for sustainable solutions.
  • While many climate change efforts focus on energy alternatives such as windsolar and geothermal, addressing the challenges of fossil fuels will likely require 1) advances in new technologies (lithium batteryhydrogen fuel cell, etc.), 2) reconsidering the nuclear power option and 3) various forms of carbon taxes.
  • Given the broad use (and economic appeal) of fossil fuels, climate change efforts will continue to confront many challenges - including differentiating between "feel good projects" and projects that make sense.  

Sunday, November 22, 2015

As Growth and Regulation of Drones in the U.S. Increase

  • Last week, Intel Corp. senior vice president for new technology Joshua Walden provided testimony to the U.S House Energy and Commerce Subcommittee on Commerce, Manufacturing and Trade that included “It has become increasingly clear to us that UAVs [Unmanned Aircraft Vehicles], like cars and watches, are a computing platform of the future. Applications and services enabled by this new connected UAV ecosystem will spur significant economic growth and will be driven by innovations in UAV technology … [however] a federal government approach that is overly prescriptive regarding the deployment of new hardware and software will deter the private sector’s ability to invent and compete in the marketplace.”
  • Testimony by Association for Unmanned Vehicle Systems International CEO Brian Wynne included "[Unmanned Aircraft Systems] will have a significant impact on our economy, as the industry is poised to be one of the fastest-growing in American history. Our economic impact study found that during the first decade following UAS integration into the National Airspace System, the industry will create more than 100,000 high-paying jobs and provide more than $82 billion in positive impact to the nation’s economy. Under the right regulatory environment, there’s no question these numbers could go even higher.”
  • Finally, a Federal Aviation Administration (FAA) task force submitted recommendations for registering drones that could help manage the increase in drone usage in U.S. air space.
MY TAKE
  • With drone growth expected to exceed 1 million units sold in the United States this year, the FAA and other regulators will likely face many challenges as they seek to manage the growth of commercial and recreational drone operator, while minimizing the potential of collisions and privacy violations.
  • Many new solutions will leverage robotic, augmented reality, geospatial and communication technologies – this process will likely drive a convergence among “smart” land, air and sea transportation services.
  • Because many new drone purchasers will have minimal aviation experience, there will be many post-sales business opportunities including training and repair/maintenance services.

Sunday, November 15, 2015

The Impact of On-Line Trade

  • Last week, comments from select business leaders during their quarterly conference calls included Terry J. Lundgren, CEO of Macy - “we had a very tough quarter, and we are clearly disappointed … we believe that the retail industry is going through a tough period that we seem to experience something like this every five years to seven years or so, and this one feels familiar in that regard….this is a management team that has navigated through difficult times in the past and we've done so successfully…we use these times to reset our ambitions and determine how we're going to win and where we're going to play.”
  • Nordstrom co-president Blake Nordstrom -”Beginning in August, we experienced a slowdown across our full-price and off-price businesses…While we haven't seen a meaningful change to our customer growth metrics, we did see a decline in our transaction growth relative to the first half of the year. As this softness continued, we've been able to quickly respond, ending the third quarter with inventory aligned with our expected sales plans. As we head into holiday, we don't anticipate a measurable change in current trends and we've made appropriate adjustments to our operating plans.”
  • Cisco Systems CEO Charles Robbins -” Q1 was a very strong quarter across the board… [but] I recognize that our Q2 guidance … is below what the market had expected. In Q1 we saw lower than expected order growth, driven largely by uncertainty from macro and currency impacts, primarily outside the U.S.”
MY TAKE
  • Regarding U.S. retail sales – While U.S. consumer spending may be slowingMacy’sNordstrom and other traditional retailers are likely facing increased competition from on-line retailers.
  • Notably. on Friday, the U.S Commerce Department reported that retail trade sales increased by 1.2% from last year, but nonstore retailers (on-line) increased by 7.1% As traditional retailers increase their on-line presence to compete with Amazon and other on-line retailersoperators of shopping malls will have to continue to adapt to these changing market dynamics as well.
  • Regarding Cisco Systems – The firm has significant global presence and market reach, but it must adapt to: 1) increased foreign competition – including China, 2) consolidation of networked resources into data centers managed by GoogleFacebook, AmazonMicrosoftIBM and others, and 3) the management approaches of its new CEO.   

Sunday, November 8, 2015

The Reality of Virtual Reality

  • Last week, as the New York Times launched its virtual reality application NYT VRmagazine editor-in-chief Jake Silverstein said, "By creating a 360-degree environment that encircles the viewer, virtual reality creates the experience of being present within distant worlds, making it uniquely suited to projects … that speak to our senses of empathy and community." (Note: the content was developed using Immersion Media’s IM360 platform and is accessible via the websmartphones and the Google Cardboard viewer.
  • Separately, when announcing a virtual reality collaborationAssociated Press Director of Interactive and Digital News Production Paul Cheung said, "Virtual reality is an intimate platform that allows the audience to experience the journalist's unique perspective of the story” and RYOT Chief Operating Officer Molly Swenson said, "We see the future of news as immersive and action-oriented. Philosophically and technologically, virtual reality is the best tool we've found for helping people really understand and connect with the headlines they read every day.” (Note: RYOT's media efforts include creating documentary-style virtual reality films.)
  • In addition, while discussing corporate earnings, Facebook CEO Mark Zuckerberg said, “Virtual reality has the potential to be the next computing platform that changes all of our lives. It's important also to recognize that this is going to grow slowly, like computers and mobile phones when they first arrived. So we're committed to Oculus and virtual reality for the long-term … and with Oculus, we're in a great position to begin delivering a new generation of shared immersive experiences, we plan to ship the Rift headset early next year” 
  • and Nvidia Corp. CEO Jen-Hsun Huang said, "We built the premier platform for VR for both PC gaming as well as professional graphics. As far as financial is concerned, realize that the shipment hasn't really started yet and I think it's prudent to wait and see. But my expectation long-term is that VR is going to be a very powerful growth driver for us."
MY TAKE
  • Virtual reality technology often is associated with computer games, will increasingly be applied in many other areas including educationentertainmentscientific research and communication.
  • The complex nature of developing and delivering virtual reality content will require new types of hardwaresoftware and content creation skills – some are in limited supply, some do not exist yet.
  • While Facebook’s Zuckerberg and Nvidia’s Huang suggested that initial growth may be slow, the business opportunities are likely significant – and will attract many investors and innovators.     

Sunday, November 1, 2015

The City of San Francisco and the "Internet of Things"

  • Last week, the City of San Francisco announced a one-year pilot project with France-based SIGFOX to deploy a low-cost, low power Internet of Things (IoT) network.  This environment should connect various devices (streetlightssmoke detectorsparking meters, etc.) to the Internet and allow them to communicate with each other.
  • San Francisco Mayor Ed Lee said, “Creating a network of this kind, the City will be able to attract new startup companies, strengthen existing businesses and provide more jobs, economic growth and continuing prosperity for our residents.”
  • San Francisco chief information officer and executive director of the Department of Technology Miguel A. GamiƱo Jr., said, “We’ve built a citywide network that’s intended for IoT applications, but it’s not driven by a specific use case. Our approach is to build the environment, a living, breathing, IoT-ready city that can then be taken advantage of by really great creative minds that are working in this area.”
  • San Francisco’s chief innovation officer Jay Nath, said “The pilot is two-fold: One is for the city government to understand how this technology can be incorporated. Two, is this a great tool for entrepreneurs? Are they able to build new products and services? Those are the two things we'll be looking at.”
  • Note: SIGFOX’s technology, which is extensively used in France and Spain, is expected to be deployed in New YorkBostonLos AngelesChicagoAustinHoustonAtlantaDallas and San Jose in the coming months
MY TAKE
  • As the Internet expands beyond a mix of desktop/laptop computerssmartphones and tablets accessing webstreaming and other cloud based services, there will be many new types of applications (addressing agriculturehealthsecuritylogistics, etc.)  which will incorporate many new devices.
  • Connecting these new IoT devices (home appliancestransportation vehiclescomponents on the energy grid, etc.) will likely raise concerns about privacy - the “Big Brother” effect, cost effective network management and data security.
  • Bottom line – IoT innovation will likely be brisk and the biggest challenge may simply be keeping up with the pace of change.