2015, a year so incredible!

2015 felt like a year, that was in a hurry to deliver. Why? firstly, boy it flew. I heard this amazing phrase at work the other day that seems so true as I reflect on the year past. Very nicely said.

“The days are long, but the years are shorter”

However as I recollect my thoughts, I do believe there were many developments that stood out for me. I would like to share them with you, as I re-start my blog after a good 7 year break.

#1 Fin-tech is as much hype as it is actual disruption

I have read much about it, I have heard a lot about it from “experts” and I have been experiencing it first hand as well. To put it in a nutshell, while you cannot deny the fervour of activity going on in this space, there is much more hype to fin-tech than meets the eye. I love bitcoin, blockchain and many other financial technology platforms that hold great promise for the future of financial services. However, lately there has been a steady rise in the fin-tech coverage by all kinds of media. This is amplified by social media where fin-tech influencers are constantly shaping opinion, sharing articles and providing opinions. Many times I have been disappointed by collection of logos, and predictions and articles that can only be described as clickbait. I sense a hype machine, perhaps no conspiracy but more so because that seems to be the hot topic right now.

Tech is not new to financial services, however the likes of Google, Facebook have brought massive scale computing to the use of masses and have done so in a way that puts customers at the centre. It is true that banks haven’t been quick to catch up. Traditionally however, what makes the banks so successful and long lived is the very customer trust and relationships that must be extended into the digital world. Fin-tech are clearly trying to capitalise the digital experience differential.

There are some technologies such as blockchain that are capable of fundamentally disrupting money and the business of money. Blockchain de-centralises the transactions and verification of transactions thereby vastly improving integrity of permanence and authenticity. However the technology has failed to garner widespread “trust” so far from the general public. People do not care whether its blockchain or a donkey that carries their FX transaction across the border. What they care about is the trust, speed, convenience. This is not a problem that technology can solve. Building a brand that people can trust can take time, and the new players operating within our industry must be patient, while the established ones should be capitalising their existing “right to play”.

Another key observation I have is that while the fin-tech startups claim to “unbundle” the banks and create a great seamless experience, commercial longevity of such a model could be questioned. The lacklustre revenue growth in many fin-tech startups is a testament to this fact. There is lots of room for innovation however the capital and risk heavy nature of the business isn’t going to change overnight. Its generally been very hard for FinTech to chase profitability.

One thing is granted though, any kind of disruption, perceived or real will force incumbents and new players to think ultimately about the customer. Therefore, in any case the customer will win! that is the best thing about all this.

# 2 Drones, artificial intelligence, and information security have shown  paradigm changing potential.

Sheer number of drone related products this year has been extraordinary. The regulatory and safety chaos and response that ensued is quite natural as well. While I have struggled to see a real world, highly scaled out and commercial application beyond aerial videos and some gimmickry around drone deliveries, I believe the technology holds promise in the medium term and we might begin to see some differentiated applications in 2016.

Artificial intelligence has come of age. Granted, there is no “fundamental” progress in terms of solving for the true AI, however deep learning and massive scale distributed computing has opened applications not possible before. Right from Tesla’s auto pilot mode, to google’s translation app (I used it a lot while I was in Brazil) are a proof. The amount of investment and attention that AI will get in 2016 will only go up. I do believe in some doomsday scenarios presented by some luminaries, I think we really need to be careful while dealing with true machine intelligence; human beings could certainly become a casualty here.

Thirdly, can you even recall how many businesses got hacked in 2015? My god, the notion that your information is never truly secure on the internet should be a forgone conclusion! This year I saw a couple startups claiming to offer IT security solutions that even “quantum computers” won’t be able to break. While it may be easy to ridicule the premise of quantum computers breaking the encryption codes; it is not completely outlandish and we all know instinctively that the day is not far away when someone figures out how to break the stuff that has not been broken yet. The industry needs renewed focus on IT security needs to invest in this or be ready to be vulnerable in future.

#3 There are still doubts lingering around the sharing economy model

AirBnB and the issues it has faced with revenue growth & occupancy of the properties on its platform, or Uber and its legal problems galore highlight that the advantage “digital platforms” provide is not necessarily a panacea. You cannot deny the amount of cash the platforms are drawing in, both as investments and revenue. I do worry though as to whats next for these businesses, competition is emerging already like mushrooms, and all over the place. Can competing on price help? how do you differentiate or maintain competitive advantage in the digital age? Everybody seems to be believing in “winner takes all” philosophy; I wonder if that’s the right attitude. 

#4 Digital music streaming has gone mainstream, finally!

I can’t seem to meet anybody who still sync’s their songs from iTunes. Tale of the times. Hey, despite impressive performance and arrival to the party of Apple Music (Apple’s latest streaming music service), I still prefer the intuitive design of Spotify. Sorry Apple!!

#5 We are all heading “Back to the future”!

It almost seems like we are fast forwarding to the future at an unprecedented rate and scale. Genetics (did you know there are a few high profile startups working on age reversing), food engineering (have you tried synthetic beef yet?), all pervasive fitness trackers (there is one in your iPhone you know), discovery of higgs boson (although scientists are still confused between supersymmetry and parallel universes), rockets that go to space and land back on earth, I mean come on! All this within a year? I think I will never finish this blog post, but you will agree with me that 2015 has been an amazing year for technology and advancement of science. Remember,  Maslow’s pyramid talks about self-actualisation. I believe the world is segmented into people who have achieved, all the lower layers of the pyramid and are now trying to push the envelope and there are others who are still dealing with perils of our civilization.

We still have massive problems such as terrorism (is anyone thinking about a tech solution to terrorism?) ; there is global climate change, inequality and disease all over the world. While we have taken some decisive steps in the direction of lasting peace and stemming our climate from boiling over, much more needs to be done. and I want to leave you with a beautiful picture from one of my travels this year. Look at the serenity and beauty of our world, we need to do more for our mother nature give back more than we take from her.

Wishing everyone a very happy and prosperous 2016!

 

 

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