No, self-driving cars are still not around the corner

March 20, 2018

Self-driving carAutonomous cars have been a hot topic for a couple of years now. It is indeed a very interesting and complex technical challenge connected to potential resolution of very serious problems and innovative use cases. But it is also about culture and liability which I believe always takes very long time to cope with.

The tragic news that a car in an autonomous trial in US killed a woman yesterday can’t be a surprise to anyone. There has been a lot of accidents with autonomous cars before, traffic is very dangerous and cars kill people every day. Each accident is followed up carefully to understand what happened, why and who is to be blamed for what. Traffic rules, law, policies, insurances, vendor responsibilities etc are in place to help deal with these tragic events. Here is the core problem with autonomous cars – when a car make a mistake, who is liable? And, do I want to meet self-driving cars on the road or fly airplanes without pilots?

Already in the Reuter article we start to see arguments about who owned the software in the car, which brand it had, if the car actually did anything wrong or if a person driving would have been able to avoid the collision. Also that the woman seems to have walked outside the crosswalk, that she had a bicycle and that she might have been homeless. But truth is that it is unclear who is responsible and for what.

I remain convinced that we will not have self-driving cars on normal roads together with other traffic and in normal speed until you and I are ready to have our kids walking to school meeting those cars. My best guess is not before 2030. And given that “rain, snow and ice are particularly challenging for autonomous cars” maybe we just should forget about it in Sweden.

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Even if we can, maybe we shouldn’t…

February 17, 2018

sky-earth-galaxy-universe.jpgInternet has enabled a new type of business opportunity where an internet based “business system” is used to collect, organise, manage and market a lot of small and local businesses or individuals, across boarders. Popular examples today are taxi, food delivery and renting of private homes. This is obviously a very efficient way of re-organising a business (think replacing hundreds, thousands or millions of business systems and people) and it provides the users with some really neat new features (think use the same taxi app wherever you go, get rated drivers and pay automatically from your credit card). It also provides the people who actually deliver the services advantages (think efficient marketing, rated customers and maybe low barriers to start their business). The most common issue raised by Uber drivers and hotels that I have been talking to lately is that the commission is high (maybe 20-25%). No wonder that investors are working hard to figure out who the winners will be in different market segments.

The hotel booking market is another one where the internet giants have added great value and taken over huge parts of the global market. I use Hotels.com and others might use Booking, Momondo, Trivago, Expedia or Agoda to name some. But few are aware that almost all are owned by Expedia or Priceline (Expedia has spun out TripAdvisor to Nasdaq so let’s leave them out for now) who together turn over some $20B with some 40.000 employees. Expedia and Priceline control over 90% of external hotel bookings in Sweden (Sydsvenskan Oct 2017). The combination of price pressure and high commissions makes life difficult for hotel owners and many fear the next recession.  

I’m missing a sober debate about these types of businesses because it is easy to see potential problems around the corner. Very successful internet services tend to have very little competition when market dominance is created, and economies of scale and strong internal currency based on their stock market valuation makes it almost impossible to build an alternative. Monopolies or oligopolies and market economy don’t go hand in hand, which is why this is serious. Another area to consider is how these businesses impact the local society. Just because we can create an internet “business system” for renting out apartments globally, it might be that it goes against laws, culture and objectives in a local community. On that note I’ve come across neighbours who find the building they own together almost turned into a hotel, parts of cities where schools, shops and such services have closed since too few locals remain, tax related issues and sometimes very low salaries and poor working conditions. When Uber Pop was shut down in Sweden 2016 at least 60 drivers were reported convicted for illegal taxi driving (I’ve heard some lost their driving licenses) and I hope that Uber helped them in a similar way a local employer would have had to do. A journalist from Breakit worked two weeks in May 2017 for Uber Eats in Sweden and after 18 hours of bicycling and 172 km on his own bike he made around $5/hour before tax (the compensation has been changed after the publicity). Does these internet businesses have the same objectives as we have locally when it comes to sustainability, work ethics, city planning, social responsibility, equality, privacy, tax and so on? Our national tax systems are not ready for global internet companies (Sweden is supposed to lose hundreds of millions of $ from them) and the international bodies including EU have not sorted this either.

Please don’t get me wrong! I love Uber, Hotels and Airbnb and use them frequently especially when travelling between countries. And I love technology driven innovation. But I do believe we have to take control over the society we live in, ask questions, discuss and ensure it becomes and stay what we want it to be. So even if we can, maybe we shouldn’t do everything technology allows us to do.


Corporate Innovation – Here we go again!

January 17, 2018
Corporate InnovationThe rapid growth of Internet some twenty years ago brought massive innovation across countries and industries. Creative and ambitious people of all sorts gathered around the opportunity followed by enormous amounts of money, people leaving their established employers for startups and a gold-digger style era.

Web, Startups and VC’s was all of a sudden words used by the masses and in almost no time we had thousands of startups and hundreds of VC’s in Sweden alone. A couple of years down the road came the enterprise response: corporate innovation. Companies started their own VC’s, incubators and M&A activities, but some years and a lot of dollars later most of them realised that this wasn’t as easy as it first appeared. Finding the right companies to work with and integrating their solutions in the existing operations was just two of the challenges that often were singled out as difficult. Another common issue was the objective of the investments in startups: strategic or financial. Both are equally good reasons but require very different efforts and skills. At this time I was working as a partner in a VC with experienced people from the industry focusing on wireless technologies – receiving a lot of calls from enterprises who wanted us to take over their portfolio of startups.

Now, roughly ten years later, Corporate innovation is back! This time it’s the two new buzzwords IoT and Digitalisation that are driving the renewed interest. But let’s step back and look at what this really is, and maybe demystify the two terms a little bit.

IoT is all about connecting the real world to the Internet where we already have people and organisations. It is harder to connect physical things to the Internet than developing services in cyber space which can be rolled out across the globe in almost no time. And it’s even harder if those vehicles, ventilation systems, machines or dishwashers are already out there and have to be retrofitted with connectivity. Still the development follows the same phases as when we connected people and organisations to Internet – connectivity, operational value and strategic value – so we can learn from history.

Digitalisation started in the fifties and is nothing new. Enterprises have digitalised bits and pieces of processes with some value. It’s like building a bridge with the last few meters missing. But the real value appears when a process is fully digitalised – when the real world, IoT, is included. Smart electrical meters are fine, but of little value as long as the energy companies still print the bills to send home to their customers. But more importantly – we can apply turbo mechanisms like machine learning to a fully digital process and that suddenly changes everything.

Digital Transformation is what it’s all about and this is a journey which has to start and continue in-house with our own people and processes. It is nothing one can buy from a consultant or from M&A activities – there are no short cuts. If you don’t have the right culture and processes to support the transformation you urgently have to change, top down. It is a well-known fact that people and processes, rarely technology, cause the problems of change. Technology driven innovation has to happen in small sharp teams, but massive value creation requires large established organisations. Corporate innovation programs are needed but startup activities are only going to work if they are implemented well and seriously backed by the entire organisation, top down.

500 Startups recently released a study among more than 100 corporate executives and found these five best practices for working with startups:

1. Build credibility by solving the short-term problems of their stakeholders. As a result, their stakeholders listen when they approach them with disruptive ideas.

2. Take a portfolio approach and de-risk their innovation efforts by running many startup experiments.
3. Set specific innovation objectives that guide the kinds of startups they look for and how they work with them.
4. Remove the red tape and create a fast-track process for working with startups.
5. Understand that partnerships are a two-way street and figure out how to add value to their startup partners.

I like the five points above, but would add a more generic one: M&A, incubation, acceleration and innovation programs are all difficult to master, so partner with organisations who already have figured it out. And remember that the best way for a fantastic startup to become successful is to help them work with several customers and not only with you.

We created THINGS in Stockholm 2014 to collectively learn “how to transform innovation in small sharp companies to massive value creation in large ones” and have today some 40 enterprises in our efforts and a community of some 200 relevant startups including the more than 50 member companies we have at THINGS. Last year we created Ignite Sweden together with two leading incubators, STING and LEAD, where we tried to find a light version of what we do at THINGS. We ended up arranging 614 manually prepared meetings between 37 corporates and 138 startups in 9 match making events and by now 16 commercial collaborations have been established. Based on the immediate success we just launch Ignite Sweden 2.0 with more incubators and improved preparation and follow-up after the meetings. We had some international corporates joining us last year and are looking to expand that as well.

Let’s make a joint effort to make corporate innovation 2.0 a success! 


From Smart to Great Cities

November 22, 2017
most-beautiful-cities-barcelona-cr-gettyMost cities have jumped on the Smart City train and it is considered an important and good thing to do by virtually everyone. But it is unclear who drives that train, where it is going and when it will arrive. I prefer talking about Great Cities since that is something we all understand, can argue about and contribute to. A Great City to me is a safe, sustainable and efficient city where people are healthy and happy. A place I would like to live in, work in and visit. It takes systematic and continuous innovation to become and stay a Great City, and systematic innovation requires infrastructure and scalable platforms to be in place.

It is obvious that technology is a key tool to continuously make our cities better especially in terms of efficiency, sustainability, safety/security and convenience. These are the key deliverables of IoT so no wonder IoT is hot today. By connecting the physical world to the Internet of people and organisations already in place, IoT enables us to make processes completely digital thus more efficient and ready for “turbo effects” from things like Machine Learning. This drives digital transformation and the impact on people, businesses and cities will be as big as when internet arrived.

But this is not enough to make cities great. It is still primarily human beings living, working and visiting the cities why “core platforms” like decent infrastructure, healthcare, social care and education for all is required. So is an environment where people feel safe and can breathe fresh air, drink fresh water and enjoy their human rights. And not the least enjoy nature, art, design, good food and time with people they love and care for.

With my definition of Smart Cities as Great Cities I unfortunately can’t think of any. Many make progress on the technical side but when it comes to “core platforms” there is a lot more to wish for. The “core platform” we have in Sweden is relatively good which I believe attracts talent and explains some of the quite successful startup community we have, but we have ways to go.


Digital Transformation, not Digitalisation, is what’s new

July 7, 2017

ai-cropped-640x353Digitalisation is frequently used as the name of the game today. But digitalisation, i.e. conversation from analog to digital representation of information, started some 60 years ago and has been going on ever since. When a process is fully digitalised, from end to end, the process will be much more efficient than before. But most processes today are only partially digitalised which is like building a bridge and leve some meters here and there. Let’s take the example of a smart electricity meter, where the collection of usage data is digitalised and hopefully the receiving systems at the energy company. But then the processed details often are put on paper and sent to the customer who hopefully pays in a digital fashion or god forbid calls customer service.

A fully digitalised process is quite efficient but more importantly it is a great starting point for artificial intelligence in any form or shape to be applied. Imagine that we could move the simplest 30% of the decisions in a process from people to computers. What would that mean to your organisation’s cost, quality and speed of execution, and not to forget your competitiveness? What if we could add an algorithm making our system self-learning thus provide qualified decision support for the remaining decisions made by your staff and maybe even advise to your customers. This is what Digital Transformation is about and that is what we should talk about rather than digitalisation. 

It is IoT that adds the last meters of the digital bridge. By connecting the real world to the Internet where we already have people and organisations we can start complete the digitalisation of our processes – a sensor that tells when a door is open, where a car is located, when it’s time to repair a fridge or when the level of carbon dioxide is too high. And this is exactly what the more progressive organisations are working on right now. And since organisations and processes are quite unique there are a huge amount of opportunities for companies to develop algorithms to support specific processes. I already have many members in my alliance for Swedish IoT startups working with machine learning including Ekkono, Watty, Aifloo, CombiQ, BellPal and Imagimob

The effects of Digital Transformation will be massive in all industries and large-scale redundancy will definitely hit white-collar employees as organisations get their act together. I miss awareness and a serious debate about this in Sweden since it limits our chances to come out of this transition strong, the longer we wait to address the challenge.


The power of making aware

June 1, 2017

It’s common wisdom that what you measure becomes important. That’s how we humans work. A clock makes you focus on time and so on. I consider myself a good driver having been driving 39 years without serious accidents and only a few speed tickets. When my kids practiced for driving license I heard about eco driving and thought that was a great initiative for the youngsters.

In November last year I signed up for the TeliaSense service which promised an easier car ownership through innovative services and features accessible from a nice app. I opted in to an annual inspection service from Bilprovningen, a maintenance service from Bilia and a road side assistance service from Viking which added good value to the car related services and Wi-Fi already in the app. Then in February I got a message that Eco Driving was added to the app and I immediately took a look more out of curiosity than to verify my superior driving skills. What! A big red and angry smiley starring at me! And in that moment I painfully recalled all the times my wife have told me that I’m driving aggressively.
From that day I have looked at the coloured smileys every single day. And guess what, it has changed my driving habits a lot.
I am amazed over my own behaviour! Yes I am a fighter and hate to lose but I would never have guessed that it would take me three months to become a better driver for my wife, my fellow drivers on the road and most importantly for the planet just because my driving was measured from an eco driving point of view and presented in my face.
I have also been presented statistics about what happens to people’s electricity consumption when their consumption is visualised to them and believe visualising individualised behaviour is a really good way to create value from IoT.
I’m working with Springworks who deliver this unique connected car service country by country together with mobile operators like Telia and it feels really good to see all work we do become something as meaningful as this!

Autonomous cars not around the corner

April 26, 2017

KITT_Knight_Rider2The car industry has its challenges. From being the ultimate provider of freedom, personal transportation and quality of life it now is supposed to solve the safety and sustainability issues it created. The very complicated and expensive cars of today are not utilised enough (5,5% according to my TeliaSense app), consume too much space, cause a lot of accidents and impact our planet badly when produced, used and discarded. It’s easy to suggest public transportation as an alternative but as soon as leaving the urban areas that is falling short. Intuitively the solution would include new ways of owning and using cars, electrical engines, even more safety features and cross-industry innovation within the car eco system. And since we can’t wait 10-15 years the cars already on the road must be included at least to some degree.

With this in mind I find today’s focus on self driving cars strange. We have continuous safety improvements in new cars, they are connected and loaded with sensors and most manufacturers have electric engines in some models. Also cars on the roads are being connected using the OBD port and offered services from the car eco-systems. But autonomous cars is what the industry, media and strangely enough IT companies are talking most about. I understand that manufacturers work on self driving cars since it’s a very complex challenge which will take many years to sort out, and it will bring continuous innovation to the cars down the road. But why talking so much about it already today? The technical challenges are big but not what will determine how soon we will see self-driving cars on the road. It’s culture, law and policies!

Take a look at airplanes. They are very complicated to make and fly but self-flying planes are here or at least around the corner depending on definitions. So are we ready for choosing flights with or without pilots? And which one would be cheaper? Imagine the first autonomous car running over a person or two in US, and what the penalties will do to the car maker involved. Some people argue we will have new infrastructure for self driving cars. But with new infrastructure I guess we could be more innovative than making cars without steering wheel.

The SAE (Society of Automotive Engineers) classification for autonomous cars has six levels, from none (Level 0) to fully automated systems (Level 5). Level 3 is a vehicle in which within known, limited environments (such as freeways), the driver can safely turn their attention away from driving tasks, but must still be prepared to take control when needed. Berg Insight estimates registrations of 16,5M new Level 3 cars and 7,8M new Level 4 cars and no fully autonomous ones (Level 5) 2030.

I’m sure we can make very good but not perfect self-driving vehicles a couple of years from now but can’t see them being used on public roads for many years, unless very limited in speed. There has been some early progress when it comes to regulation here and there but I haven’t seen any progress in the field of liability yet. And I guess a generation or two of drivers will probably have to disappear from the roads before it happens.


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