Edwin Yapp: My Fave 5 of 2016

  • Cloud, telco spectrum, digitisation and artificial intelligence top topics
  • Though new trends, enterprises will leverage them to gain advantage

Edwin Yapp: My Fave 5 of 2016IT’S that time of the year again when we look back at our five favourite stories for the year that has passed. Although I didn’t cover as many stories as the year before, there were still some significant ones.

Here are the five on my list, arranged topically rather than chronologically.

Google’s enterprise cloud play seems rather … cloudy

No one would argue against the notion that Google Inc probably runs the largest cloud in the world and is arguably the cloud computing pioneer. Yet, while from a technology standpoint this might very well be true, it isn’t the first name, nor indeed the second, that comes to mind when speaking about the cloud.

That honour goes to Amazon Web Service (AWS) Inc, followed by Microsoft Corp’s Azure Cloud. But inasmuch as this may be true from the market share point of view, there isn’t a doubt that Google does operate one of the most advanced cloud services on planet Earth. 

So why the disconnect? The detailed arguments are laid out pretty comprehensively in the story so do read on.

 But as unfamiliar as the territory Google finds itself in – that is a catch-up position – few will bet against it failing especially given its culture to maniacally thrive at everything it does.

Already, its cloud chief Diane Greene, brought in to head up this section of the business, has unequivocally said that it is “dead serious about the cloud,” and the company has made some impressive inroads by adding some marquee clients in the course of 2016.

These include Spotify, Evernote, Citi, Goldman Sachs, Coca-Cola, Disney, Macy's, Sony, and even one of its fiercest rivals, Apple. And there were strong rumours that it was on the cusp of snaring PayPal as one of its biggest financial clients, which although to date has not yet been announced.

Google’s differentiator is arguably in its machine learning, artificial intelligence (AI) and advanced analytics strength, which has led customers like Spotify to switch over. In the course of the year, it has added talent to enhance these offerings though its rivals, AWS and Microsoft have also done so.

But beyond competing with each other, one interesting point to note is that all of these hyperscale public cloud providers have a common enemy – old school, on-premise enterprise IT players the likes of Oracle Corp and SAP SE.

Oracle’s Larry Ellison has publically acknowledged that AWS is its greatest competitor while AWS’ Andy Jassy (pic, below) isn’t short of rhetoric for Ellison either. Google meanwhile was a little more diplomatic, with its cloud product chief Greg DeMichillie telling me that “it’s not about public cloud players competing with one another, but more about public cloud versus on-premises players.”

“People want to position it as us [Google] versus them [our competitors]… [So] it’s not about us versus another cloud, but about the public cloud as a whole, taking market share from the existing on-premises [such as Oracle and SAP] business,” he argued.

So it’s game on for public cloud players in 2017. Want to read more on this, try this analysis I did of who the top public cloud players are here.

Amazon Web Services trains its spotlight on artificial intelligence

 

Edwin Yapp: My Fave 5 of 2016

 

Speaking of AI – and its subset machine learning – here’s a name that you can’t dismiss in this brave new world. While AWS is the undisputed leader in cloud computing services because of its massive feature set, trusted security and reliability and years of experience, the world of AI and machine learning is still nascent and up for grabs.

Here players such as Google have some advantages as the search giant has been essentially mining data from consumers since its birth in 1998. Coupled with this fact is that many of Google’s essential services are powered by machine learning and AI.

Services such as Google Translate, Google Text-to-Speech and vice versa, Google Pictures, Google Maps, Google Earth, as well as YouTube’s recommendation engine et al, all depend on Google’s massive work on automation, AI and machine learning.

On its part, Amazon at its recent re:Invent 2016 conference made a big splash of its new AI services. Not forgetting Microsoft too, who has been making inroads in AI with its chief Satya Nadella having talked up the topic in September at its Ignite conference.

Many would know that the Redmond, Washington-based giant has been working AI for some time now with its Cortana virtual assistance and its Tay product, which had a fair share of its teething problems. And don’t forget IBM’s Watson too, Big Blue’s answer to AI and the inroads it has made in this area.

So the natural question to ask is whether AWS is defending its turf against its rivals?

Analysts I spoke with are mixed on this. Some say that it could be a defensive move as Google already has such services including image recognition and voice assistance, and that these three new services introduced by AWS compete with what Google has.

Some others felt that AI was still too early to be meaningful, while others countered that it’s a first step to a host of services for the future.

What’s clear is that it’s still early days for AI and machine learning and that there is a battleground ahead. But there is no doubt that these major names are the players that will make a difference as they have the vision, scale, technology, and people to make it happen.

MDEC developing ‘digital maturity index’ for digitalisation

Edwin Yapp: My Fave 5 of 2016

 

Next up is a story much closer to home. Late last year, I had an opportunity to interview  Malaysia Digital Economy Corporation’s (MDEC) chief strategy officer Siva Ramanathan (pic, above), where he revealed that Malaysia is trying to develop an index to measure how mature organisations are in their quest to become digitalised.

Digitalisation is a term used to describe the journey an organisation takes to disrupt their own business models and at the same time re-inventing itself through innovation to develop new products and services to bolster revenue and profits. It does so by using newer digital technologies such as cloud, mobile apps, advanced analytics and the trends such as the connected Internet, also known as the Internet of Things (IoT).

Siva revealed that currently, the country does not have a specific index or metric to measure the digitalisation of organisations, but that MDEC is looking into developing one.

“It’s currently now in the planning stages,” Siva said. “If all goes well, we are going to push ahead with it and have a digital index that measures and tracks how well Malaysian-born and Malaysia-based organisations are doing in going digital.”

Siva explained that the process firstly involves benchmarking and establishing a baseline for the index, which would require cooperating with other relevant governmental agencies and stakeholders. Next is to establish what elements go into the index, how to evaluate organisations, and how to track their maturity.

What I find interesting is that MDEC is trying to take the lead in this area and this is laudable. Developing such an index allows a benchmark to be set so that those who strive to move towards digitalisation will have a target to aim for.

He was also candid in saying that he doesn’t expect this process to happen overnight.

“I’m not going to lie to you and say it’ll happen by next year because it will not,” he stressed.

“This is an ongoing journey for us and it’ll take more than a year as we need to get buy-in from our stakeholders and also work with other relevant ministries – such as the Department of Statistics – as we can’t do this ourselves.”

While I appreciate his candour in the matter, it is with trepidation that I note what he has said. If history were the judge, it can be argued that Malaysia has a knack for leading in terms of conceptualisation of ideas but not been great in making implementation a top notch priority.

Digitisation is so new that there aren’t many case studies to look at or benchmark against. So getting a policy and/ or framework up and running is absolutely the right thing to do.

But how does Malaysia ensure that its industry moves towards digitisation? How will it ensure the inertia against change is addressed, especially in small and medium businesses? How does one ensure that the index will properly measure the state of digitisation? 

What kind of stakeholder involvement does Malaysia need to get to ensure that it moves in a positive direction? How do you get the buy-in of different sectors to move in accord with one another?

There are plenty more questions but these are just some initial ones that need to be answered.

That said, I laud MDEC’s effort and hope that it will be the first step to better things to come and that it will ensure that the index’s aim will not only be ideated but implemented properly.

Three things we’ve learnt from Malaysia’s spectrum reallocation

 

Edwin Yapp: My Fave 5 of 2016

 

This story is by far the most comprehensive one I’ve written about telco and the spectrum redelineation issue for 2016. While the story deals with many complex issues, like the title suggests, they can be summarised into three main ones. They are: Spectrum is everything; customers must come first; and competition should spur more innovation.

The incumbent operators – Maxis Bhd, Celcom Axiata Bhd and Digi.com Bhd – have had their respective spectra for two decades now, while newer player, U Mobile Sdn Bhd, has had its spectrum for about 10 years. The government now wants to shake things up and re-delineate and redistribute the spectra to encourage better services.

While this redelineation isn’t unexpected, speculation was rife as to whether this move was to shore up the government’s coffers due to the fees these operators would have shelve out – to the tune of billions of ringgit – over the course of the next two decades.

The government’s income took a beating in 2016 due to the stress put on its coffers as crude oil prices have plummeted in the past two years. Malaysia’s state-owned Petronas is a net oil exporter and the government heavily depends on oil as a source of GDP (Gross Domestic Product) for the country. The country also had to contend with scandals related to sovereign state-fund 1MDB Malaysia.

We can’t know for sure if this is true but it’s clear that from a technical standpoint, spectrum redelineation was due anyway. The reassignment is key simply because the two bands -- 900MHz and 1800MHz -- are coveted spectra due to their optimum compromise between coverage and capacity.

The lower 900MHz frequency has the advantage of being able to service larger areas compared to a the higher 1800MHz frequency.  The lower 900MHz also means that it can penetrate deeper into buildings much better than 1800MHz.

This exercise effectively gives players a level playing field and a chance for all operators to reset their thinking and start planning for a better wireless future. And that’s what the Malaysian wireless subscriber is looking for – better features, pricing plans, deals, and content they can provide their subscriber base with to give better value.

A second chance for YTL Comms, but how successful will it be?

Edwin Yapp: My Fave 5 of 2016Connected to the previous story on spectrum is the launch of YTL Communications Bhd’s latest LTE network call YES 4G LTE, launched on June 30, making YTL Comms the latest Long-Term Evolution (LTE) operator in Malaysia.

For the record, YTL Comms has been in operations as a telco operator for six years now. In 2010, it launched – with much pizzazz and perhaps a bit of chutzpah too – its WiMax network and made a huge splash at the launch and on advertisements following that.

At that time, YTL Comms’ officials bragged about how advanced its WiMax network will be and how Malaysian wireless subscribers would finally have more value for the money they pay for their mobile broadband services.

Its take up rate for broadband spiked initially but after some years, it plateaued and YTL Comms’ subscriber growth declined. As other competitors ramped up their own LTE packages, YTL Comms’ bet on WiMax – an all but dead technology – began to falter.

And when the Malaysian government began issuing new LTE licences in the 2600MHz band and YTL Comms got a big chunk of that spectrum, some 30MHz of it, the company got a second chance of sorts to revive its fortunes. YTL Comms began building its network and once again launched its LTE network last year to much fanfare on June 30.

But the real question is would it succeed this second time around where it failed the first time?

Some of my main arguments in the story were that being a wireless telco operator these days is much more challenging than before. Customer expectations are greater; competition is stiffer resulting in lower profits; the gestation period to build a loyal paying customer base is shorter.

The worsening ringgit against the greenback and general malaise of the Malaysian economy also don’t help as telcos are pressured to become profitable as soon as possible.

While I welcome the extra competition in the market, industry observers and I myself just don’t see YTL Comms moving the market compared with its rivals in the market.

As a simple test, ask yourself how many people you know own a YTL Comms LTE line and phone to boot? And just the other day, I witnessed one YTL YES 4G retailer closing its doors to the public.

For now, it helps that YTL Comms is a subsidiary of YTL Power, which is part of YTL Corp’s mighty empire, and that it has huge monetary resources to pour into such a venture.

 Still, with so much money invested – something to the tune of US$728 million – in its LTE network, and billions more ringgit in its WiMAX network, there will come a time when YTL Comms would need to start moving to the black to ease cash flow and profit pressures on its parent YTL Power.

Will 2017 make a difference to this? Time will tell.

But in the meantime, try checking out some pertinent questions I have for YTL Comms LTE network, some of which have to date not been fully answered.

 

Related Stories:

Chong Jinn Xiung: My Fave 5 of 2016

Karamjit Singh: My Fave 5 of 2016

Thean Eu: My Fave 5 of 2016

 

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