Nokia CEO Stephen Elop’s visit to South Africa came a year after he declared the company’s platform burning. A year later, Nokia is not only revived, but it is listening to its markets and taking the phone wars local, writes ARTHUR GOLDSTUCK.
Stephen Elop takes clear delight in confounding expectations. When he arrived in South Africa for meetings with network executives, media and developers, he also took the time out to do something few global CEOs of major brands ever attempt: he mingled with shoppers.
He may have been surrounded by an entourage of lieutenants and minders, but he was accessible to anyone, had anyone guessed who he was. Of course, given his limited media exposure outside the business world, no one knew. And he liked that just fine.
The low-key Canadian, representing a Finnish-based cellphone giant that has been hammered by innovations coming out of the United States, acknowledges that an understanding of the varied markets of Africa is critical to Nokia’s survival.
For that reason, he focused his trip on two African markets where Nokia is dominant in the overall phone market, but facing powerful competition: Kenya, where Huawei has taken over smartphone leadership, and South Africa, where BlackBerry has done the same.
Kenya in particular is close to Elop’s heart, as it is the hub of development for Nokia’s India, Middle East and Africa operations.
‚The African market is a really special market. There is a real smartphone market in Africa but if course the vast majority of the sales as you look at the emerging economies are across that lower tier of the mobile phone segment.
‚And this is why we announced a year ago the increased investment in those lower price tier devices because of the opportunity to take a smarter phone experience to those consumers that does consume data that does connect the next billion people to the Internet.
‚But it is related to societal development. For example, how can we help with healthcare and agriculture?‚
The high-end, smartphone market is where the critical battle lies, however. It is in high-priced phones that Apple has shaken up the market, and it is the high margins on those phones that has turned it into the most valuable company in the world. Elop sees this price and margin issue as a key challenge for Nokia.
‚When you see that type of price shift, it’s a statement of the competitiveness of what we need to do from a product perspective. So for example in the smartphone segment, a critical reason for us changing our strategy was to say we need to introduce new devices that are more competitive phones that could attract premium prices, higher gross margins and that is precisely what we’re doing. So for example the Lumia 800 is at a price point and with margins that will help us move the average price points in a different direction.
‚That being said, it is always the case and will continue to be the case that Moore’s law and competition drives prices down. So our challenge of course consistently is not only to make sure that we are competing at those lower price points, but that we are adding more value on top.‚
But Nokia is able to do one thing that Apple has yet to learn: take developing markets seriously.
‚To give you the African example and some of what we’re engaged in here on the continent, when people buy a Nokia device at some of the lowest price points, part of the promise they’re buying is not just the device, but also the whole experience that’s delivered with that, including in some countries in Africa healthcare services, in other countries agricultural services, different things that round out that experience. So to compete effectively, you have to be good on the price of the device, but your brand and its value proposition has to stand out from the others and we’re very focused on doing that.‚
There is one market that has not bought into the Nokia value promise, and it is arguably the most important market in the world, given the extent to which it is driving smartphone innovation: the United States. Elop agrees.
‚The North American market is a very important market. If you look at historically what has happened in terms of innovation in and around the mobile sector, many years ago it was centered in Japan and Korea, Europe had a period of time with the advent of GSM and so forth. But more recently with some of the development of the new ecosystems, innovation’s been coming out of the US quite heavily, and therefore it is critical for us to play well in the US and have success there. That is very important.‚
The Consumer Electronics Show in Las Vegas in January marked the beginning of Nokia’s invasion of America. The event saw the announcement that the Lumia 710, the lowest-priced Lumia, was immediately selling through T-Mobile and other US networks. Nokia also announced that the 800 and 710 would be made available through Canadian operators.
‚But the largest piece of news that we announced at CES was the introduction of our third Lumia product, the Lumia 900,‚ says Elop. ‚The Lumia 900 we specifically designed for launch initially in the US. What that means is, for example, the radio technology. In the United States, the two big operators, AT&T and Verizon, are competing on the basis of the speed of their network. So we’ve moved from 3G past 3.5G to full 4G networks.
‚So this is our first ever LTE device, very large battery, front facing camera, 4,3‚ screen, taking the same design principles of the 800 and taking them up in size and scope for the 900.‚
The 900 was introduced at a press conference on the afternoon before CES began. Elop says that this was just the beginning of a buzz that built up during the course of the show. And it led to a major climax for Nokia:
‚The moment that we were most proud of, for the first time in Npkia’s history, was winning the Best of Show award. We had never achieved that before in that market.
‚Is it a hard battle? Do we have to re-establish the brand and win the hearts and minds? Of course. We’re going to be establishing the beachhead ‚ that’s a word I’ve been using a lot lately ‚ and clawing our way forward and that’s okay, that’s the challenge. But with great products, and a good strategy, we’re going to make some progress.‚
The subtext of Elop’s comments is that Nokia is going to war against Apple and Samsung for a slice of the US market. But there is also a broader, more global war to be fought. The enemy is the iOS operating system of the iPhone, and the Android OS that runs on almost all other phones. Can Windows Phone compete?
‚ We fundamentally look at world as war of three ecosystems. And our focus is on making sure the Windows Phone ecosystem, with us being a major participant in that, is a primary competitor in that space
‚So we’re investing very heavily, whether is in the contribution of Location Based Services for the use of the whole ecosystem or ‚ I just finished a meeting with a group of developers here in SA, and we are investing heavily, as is Microsoft, in the attraction of developers in helping with the transition to Windows Phone.‚
This war will be fought most fervently in the apps markets of the various ecosystems. And, finally, the Windows market is beginning to make headway.
‚There were 6000 Windows Phone applications a year ago. It’s well over 55 000. Its growing at an accelerating rate, so the sense of, is that flywheel beginning to go? Yes, it’s beginning to go.
‚Part of the reason for that is that people see that we’re not just doing a device and seeing how it goes with Lumia. Its like they’re seeing, wow, there’s more and more and for those people who see the future plans, its like wow, we’re really putting the muscle in. You combine that with recognition of the distribution capability of Nokia and the fact that we’re getting into so many countries so quickly with these devices, and that is very attractive to developers.‚
He acknowledges that, in markets like South Africa, the ecosystem war has different flavor, due to the strength of BlackBerry.
‚The dynamics are a little different in South Africa because there’s another competitor that’s quite strong in this country, but we still think its fundamentally it’s about the war of ecosystems and that will come to bear in South Africa as well.‚
However, the real secret weapon for Nokia is not the operating system, but the company’s new culture: of listening.
‚This type of change is one that we know is going to take really hard work. In every session with every group of employees around the world, it’s very much about learn and adjust. So we put these products in the market, and we discover, ‚Äòwow, people love this’, they love our mixed radio capability, they love what we’re doing with navigation, but there are elements of it that we could do better. Learn, adjust.
‚As consumers give us feedback about the things that are important to them, our job is to react, to improve those things, and push through. So what these devices and the software and everything looks like over time will certainly evolve and change. So if there are problems and things aren’t working right, it will change, but we have a foundation of something on which to build.‚
Clearly, Nokia’s platform is no longer burning. But it may well be sizzling before long. And it’s unlikely we will soon see the kind of dramatic shift that followed last February’s ‚burning platform‚ memo. Rather, continual evolution will become part of the Nokia culture.
‚It’s not about making a sharp turns,‚ Elop confirms. ‚It’s about constantly refining and improving and being comfortable in taking that approach. So you will see changes constantly.‚
* The round-table interview with Stephen Elop was conducted by Gadget editor-in-chief and World Wide Worx MD Arthur Goldstuck, TechCentral editor Duncan McLeod, Talk Radio 702’s Techno Byte host Aki Anastasiou, Finweek technology editor and ZA Tech Show anchor Simon Dingle, and Moneyweb production editor and IT columnist Hilton Tarrant.
Read Arthur’s column here about Nokia droppingnstrong hints of entering the tablet market.
* Follow Arthur Goldstuck on Twitter on @art2gee,
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Prepare for deepfake impact
Is the world as we know it ready for the real impact of deepfake? CAREY VAN VLAANDEREN, CEO at ESET SA, digs deeper
Deepfake technology is rapidly becoming easier and quicker to create and it’s opening a door into a new form of cybercrime. Although it’s still mostly seen as relatively harmful or even humorous, this craze could take a more sinister turn in the future and be at the heart of political scandals, cybercrime, or even unimaginable concepts involving fake videos. And it won’t be just public figures that bear the brunt.
A deepfake is the technique of human-image synthesis based on artificial intelligence to create fake content either from scratch or using existing video designed to replicate the look and sound of a real human. Such videos can look incredibly real and currently many of these videos involve celebrities or public figures saying something outrageous or untrue.
New research shows a huge increase in the creation of deepfake videos, with the number online almost doubling in the last nine months alone. Deepfakes are increasing in quality at a swift rate, too. This video showing Bill Hader morphing effortlessly between Tom Cruise and Seth Rogan is just one example of how authentic these videos are looking, as well as sounding. If you search YouTube for the term ‘deepfake’ it will make you realise we are viewing the tip of the iceberg as to what is to come.
In fact, we have already seen deepfake technology used for fraud, where a deepfaked voice was reportedly used to scam a CEO out of a large sum of cash. It is believed the CEO of an unnamed UK firm thought he was on the phone to his boss and followed the orders to immediately transfer €220,000 (roughly US$244,000) to a Hungarian supplier’s bank account. If it was this easy to influence someone by just asking them to do it over the phone, then surely we will need better security in place to mitigate this threat.
Fooling the naked eye
We have also seen apps making DeepNudes where apps were able to turn any clothed person into a topless photo in seconds. Although, luckily, this particular app has now been taken offline, what if this comes back in another form with a vengeance and is able to create convincingly authentic-looking video?
There is also evidence that the production of these videos is becoming a lucrative business especially in the pornography industry. The BBC says “96% of these videos are of female celebrities having their likenesses swapped into sexually explicit videos – without their knowledge or consent”.
A recent Californian bill has taken a leap of faith and made it illegal to create a pornographic deepfake of someone without their consent with a penalty of up to $150,000. But chances are that no legislation will be enough to deter some people from fabricating the videos.
To be sure, an article from The Economist discusses that in order to make a convincing enough deepfake you would need a serious amount of video footage and/or voice recordings in order to make even a short deepfake clip.
Having said that, In the not-too-distant future, it may be entirely possible to take just a few short Instagram stories to create a deepfake that is believed by the majority of their followers online or by anyone else who knows them. We may see some unimaginable videos appearing of people closer to home – the boss, our colleagues, our peers, our family. Additionally, deepfakes may also be used for bullying in schools, the office or even further afield.
Furthermore, cybercriminals will definitely use such technology to spearphish victims. Deepfakes keep getting cheaper to create and become near-impossible to detect with the human eye alone. As a result, alt that fakery could very easily muddy the water between fact and fiction, which in turn could force us to not trust anything – even when presented with what our senses are telling us to believe.
Heading off the very real threat
So, what can be done to prepare us for this threat? First, we need to better educate people that deepfakes exist, how they work and the potential damage they can cause. We will all need to learn to treat even the most realistic videos we see that they could be a total fabrication.
Secondly, technology desperately needs to develop better detection of deepfakes. There is already research going into it, but it’s nowhere near where it should be yet. Although machine learning is at the heart of creating them in the first place, there needs to be something in place that acts as the antidote being able to detect them without relying on human eyes alone.
Finally, social media platforms need to realize there is a huge potential threat with the impact of deepfakes because when you mix a shocking video with social media, the outcome tends to spread very rapidly and potentially could have a detrimental impact on society.
A career in data science – or your money back
The Explore Data Science Academy is offering high demand skills courses – and guarantees employment for trainees
The Explore Data Science Academy (EDSA) has announced several new courses in 2020 that it says will radically change the shape of data science education in South Africa.
Comprising Data Science, Data Engineering, Data Analytics and Machine Learning, each six-month course provides vital digital skills that are in high demand in the market place. The full time, fully immersive courses each cost R60 000 including VAT.
The courses are differentiated from any other available by the fact that EDSA has introduced a money back promise if it cannot place the candidate in a job within six months of graduation and at a minimum annual starting salary of R240 000.
“For South Africans with drive and aptitude, this is the perfect opportunity to launch a career in what has been called the sexiest career of the 21stcentury,” says Explore founder Shaun Dippnall.
Dippnall and his team are betting on the explosive demand for data science skills locally and globally.
“There is a massive supply-demand gap in the area of data science and our universities and colleges are struggling to keep up with the rapid growth and changing nature of specific digital skills being demanded by companies.
“We are offering specifically a work ready opportunity in a highly skills deficient sector, and one which guarantees employment thereafter.”
The latter is particularly pertinent to young South Africans – a segment which currently faces a 30 percent unemployment rate.
“If you have skills in either Data Science, Data Engineering, Data Analytics or Machine Learning, you will find work locally, even globally. We’re confident of that,” says Dippnall.
EDSA is part of the larger Explore organisation and has for the past two years offered young people an opportunity to be trained as data scientists and embark on careers in a fast-growing sector of the economy.
In its first year of operation, EDSA trained 100 learners as data scientists in a fully sponsored, full-time 12-month course. In year two, this number increased to 400.
“Because we are connected with hundreds of employers and have an excellent understanding of the skills they need, our current placement rate is over 90 percent of the students we’ve taught,” Dippnall says. “These learners can earn an average of R360 000 annually, hence our offer of your money back if there is no employment at a minimum annual salary of R240k within six months.
“With one of the highest youth unemployment rates in the world – recently announced as a national emergency by the President – it is important that institutions teach skills that are in demand and where learners can earn a healthy living afterwards.”
There are qualifying criteria, however. Candidates need to live in close proximity (within one hour commuting distance), or be prepared to live, in either Johannesburg or Cape Town, and need to be between the ages of 18 and 55.
“Our application process is very tough. We’ll test for aptitude and attitude using the qualifying framework we’ve built over the years. If you’re smart enough, you’ll be accepted,” says Dippnall.
To find out more, visit http://www.explore-datascience.net.