Assinment

InnovationandDisruptioninTechnologyWeber2.pdf

TECHNOLOGY

JOURNAL OF FINANCIAL SERVICE PROFESSIONALS | MARCH 2019

42

Innovation and Disruption in Technology by Richard M. Weber, MBA, CLU, AEP (Distinguished)

Vol. 73, No. 2 | pp. 42-46

ABSTRACT

Twenty years ago, we obsessed about Y2K

and wondered if that dreaded digital anoma-

ly would brick our devices and hurl us a figu-

rative 100 years back in time. While the tech

industry accelerated in the 1990s and then

temporarily stalled out in the dawn of the

twenty-first century, even futurists failed to

anticipate the opportunities and disruption

brought about by exponentially expanding

digitization. “What—you’re not using your

electric toothbrush’s remote toothpaste dis-

pensing app on your iPhone 27 XLS?”

Netscape introduced the first general-use inter- net browser in 1994, expanding far beyond AOL’s “you’ve got mail” and providing ubiquitous access to anyone with a personal computer to the World Wide Web via the internet. Of course, there was no Ama- zon, Google, Facebook, or YouTube with which to occupy ourselves. Barely 5 years into surfing the net, many of us were caught up in the Y2K frenzy—would we fall off the technological cliff due to the failure to account for four-digit date notation in our digital databases? While we survived the digital world’s transition to the year 2000, few could have anticipated the benefits from the likes of yet-to-be introduced smartphones, gigabit broadband, WiFi, streaming, Uber, and Ins- tagram, and the resulting disruption that invariably accompanies the benefits of technology. From those early days of the useable internet we’ve evolved from the essence of digitalization through near teraflop speed of processing 1’s or 0’s to the brink of subatomic deployment of the quan- tum world’s simultaneous use of 1’s and 0’s.1 (For a mind-bending but practical introduction to quantum theory, browse on the phrase “Schrödinger’s cat.”) As we look forward from the last year of the twenty-first century’s second decade, let’s consider some of the more noteworthy innovations, and dis- ruptions likely to affect us in the near future.

TECHNOLOGY

JOURNAL OF FINANCIAL SERVICE PROFESSIONALS | MARCH 2019

43

5G Broadband (Innovation) Many readers will recall the era of dot-matrix printers and dial-up modems processing data so slow- ly that you were grateful when a website’s homepage only took a minute to fully materialize, line-by-line, on your low-definition orange and black cathode ray tube (CRT) monitor. Today’s home and business-based delivery of gigabit data speeds is fed to routers for computers and other wired devices via Ethernet cables—or broad- cast via WiFi. Outside the cocoon of router firewalls, mobile devices enjoy an equivalent wireless deliv- ery technology known as 4G broadband. Both will transform dramatically in 2019 with the introduction of 5G—an exponential improvement over current broadband technology, so much so that it may even- tually replace wired/Ethernet connections.2

In the shorthand of signal strength, consider your relief when you see five bars on your smartphone’s in- dicator of connectivity as you attempt to view a 1.5 GB movie or download a similar size file with 4G service. The comparable download under 5G occurs 20 times faster.3 Full deployment of 5G will take a number of years and will likely be first introduced in major metropolitan areas as the infrastructure of transmitters and repeaters are installed—and as Ap- ple, Samsung, LG, and other major manufacturers upgrade smartphones and computers with the neces- sary receivers. Key implications for 5G include benefits well beyond our mobile phones. There’s a near future in which automobiles are not only autonomous— but the efficiency of autonomy is made possible by real-time, seamless communication between cars negotiating efficient roadways with no stop signs or signals (“After you”—“No, that’s ok, you go first!”). Further consider the expansion of the Internet of Things (IOT) in which 20 billion devices world- wide are expected to be online by 2020, representing a doubling of installed devices in just 3 years.4 “We architected 5G to comprehend all of those. That was never done with any previous generation of cellular.”5

With 5G, Qualcomm’s director of 5G market- ing Sherif Hanna indicated, “…We’re truly trying to aim for a world where you don’t have to think twice about adding cellular to any object. There’s gonna be a low-power, low-cost option for anything you can imagine. Why would I make this tracker work only with Bluetooth, when I can throw a 5G modem in there, and now it’ll work anywhere in the country?”6

Not only does 5G have the possibility of allowing all computers and devices to transmit and receive al- most instant streams of data and entertainment, but it may well replace the need to bring wired connec- tivity into homes or businesses. In the not-too-distant future, all connectivity may be wireless.

Security Breaches (Disruption) What do Yahoo, Marriott, Friend Finder Net- works, and Equifax have in common? They represent the five largest security breaches in modern times. (Yahoo had the distinction of the top two breaches in separate instances.) These breaches collectively exposed more than 4.5 billion individual customer records and personal data.7 Marriott’s disclosure in November 2018 was just the most recent revelation of the apparent in- ability to securely protect our personal and financial data. While many would cry, “Enough already!” we should anticipate that data breaches are now a fact of life and will continue in magnitude and disruption. Our attention should be directed to how we can min- imize the hassle and possibility of identity theft—in- cluding the theft of banking and brokerage accounts:

• Use complex and unique passwords for financial accounts—and change those passwords at least every 6 months.

• Use a password vault to manage passwords. • Employ two-factor authentication whenever possible. • Monitor financial accounts for unusual activity. • Subscribe to at least one credit bureau service for

notification of unusual activity. • Freeze your credit record with at least one of the

credit bureaus. • Don’t overlook nonfinancial accounts—espe-

JOURNAL OF FINANCIAL SERVICE PROFESSIONALS | MARCH 2019

44

TECHNOLOGY

count, 353,710,754 products were available from Amazon and Amazon Marketplace, not including books, media, wine, and services.12 Beyond shop- ping, however, is the popular Alexa interactive device, eerily enabling colloquy similar to Cap- tain Kirk and the Starship Enterprise’s computer. Beyond answering your inquiries about today’s weather or starting your favorite music playlist, does she eavesdrop on everything we say? You can see what Alexa actually records by checking the Alexa app on your phone. And, you can “…de- lete any queries through the app’s history feature as well as remove any Amazon device from your account (thus deleting all of its associated data) through the My Devices page on the web.”13

• Microsoft is similarly providing information about the data it collects through its Windows 10 oper- ating system and such popular applications as Mi- crosoft Outlook, Word, Excel, and PowerPoint.14

• Review Alphabet’s Google privacy policy and manage what it’s doing with your information.15

Apple Watch (Innovation) As life continues to imitate art (see the Journal’s July 2016 Technology Column “Where No One Has Gone Before: When Science Fiction Inspires Technol- ogy”), the newest generation of Apple Watch at least, in part, mimics Star Trek’s tricorder as it tracks your heart rate, exercise routines, and most recently and remarkably can perform a Food and Drug Admin- istration-approved electrocardiogram (ECG), provid- ing through its iPhone app an irregular heart rhythm notification.16 But be careful about tossing it on the bed while heading for the shower; you may have a surprise knock on the door if you ignore the watch face’s message, “It appears you have taken a fall. Are you all right? Should medical help be summoned?” As previously reported in this column, when the first Apple watch was introduced in 2014, heart study data gathering is much broader and easier with the universe of watch wearers volunteering to be moni- tored, and we anticipate cardiologists will begin to

cially buying accounts such as Amazon, as well as travel affiliations that allow the use of airline and hotel points.

I Divorce Thee, I Divorce Thee, I Divorce Thee (Disruption) Closely associated with mitigating data breaches is knowing what information sites actually are gathering and storing—and the degree to which our right to pri- vacy is honored or abused. The Big Five—Facebook, Apple, Amazon, Microsoft, and Google, otherwise known as FAAMG—not only had a 2018 end-of-year cumulative market cap in excess of $3.76 trillion—but more concentrated market clout than has ever existed in a free-market economy.8 Much of this clout comes from the terabytes of information gathered about you. Yes, you—you there in the kitchen, blithely assuming you’re living a digitally anonymous life while querying Alexa for the best fudge recipe! More transparency about data retention and use is finally emerging, largely because of the European Union’s General Data Protection Regulation adopted in the EU in 2018. Just what does FAAMG know about you? The following resources may help you discover how much they know—and how to extract yourself if you think they know too much:

• Facebook doesn’t sell your data, but sells access to your news feed, which has turned out to be at the heart of the recent controversies surround- ing Facebook.9 Those who would express their displeasure can vote with their feet by carefully extracting themselves from the network of site logins and other interconnected services.10

• Apple Corporation is under the least amount of scrutiny within FAAMG, and was one of the first to provide an online resource to see what data it is retaining. Sign in to your Apple ID account page on a Mac, PC, or iPad. Then scroll down to Data and Privacy and select “Manage your Data.”

• Amazon is a trillion-dollar global shopping re- source, and accounts for one out of every three shopping transactions in North America.11 At last

JOURNAL OF FINANCIAL SERVICE PROFESSIONALS | MARCH 2019

45

TECHNOLOGY

earphone and speaking portal anchored to the wall. At least then you couldn’t misplace (or pocket dial) your phone! Further:

• Airlines did not yet exist; Lindberg had not yet flown across the Atlantic.

• Automobiles, refrigerators, washing machines, radio, and phonographs existed in extremely ru- dimentary forms and limited access.21

• There were yet to be formal broadcast entertain- ment networks, or even routine programming available to the public.

• The introduction of insulin, penicillin, and vacci- nation against polio were still decades in the future. Widespread use of antibiotics and better sanitation caused the life expectancy at birth to reach an aver- age of 71 in 2016 compared to 48 in 1916.22

What might we anticipate 100 years from now? Jetson-like mobility or virtual immortality? Accord- ing to one futurist’s guesses, technology of the future might include:

• Drones, robots, and androids throughout the workforce, the military, and in homes.

• Genetic modification of humans, and widespread uses of gene therapy. People living decades longer than ever before. Designer babies commonplace, but still an extremely contentious issue, and an emerg- ing class of healthier, stronger, and smarter people.

• Climate change prompting new advances into what is essentially terra-forming. Many will seek to apply these practices on Mars.23

Of course, we can also anticipate iPhone27 will have been the last physical manifestation of hand- held computing after the brain/web interface is in- troduced and adopted by those who could afford the $1.3 million surgery and digital interface. Whatever your view of the evolution and delivery of technology, we’ve experienced the benefits, disrup- tion, and ethical issues fueled by Moore’s Law—dou- bling of computing power at half the cost every 18 months—and it will be intriguing to see how we manage technology in the near and far-future for the benefit or detriment of mankind.24 n

offer 24/7 telemetry services to relay real-time data on behalf of a patient’s heart complications.

Fahgettaboudit—or Not! (Innovation) One of the obvious downsides of the aging pro- cess can be an unreliable short-term memory. Oh— I’m sorry—what was I saying? Retention of detail about new ideas or concepts seems to fade quickly, and most people can only recall 10 percent of what they’ve learned shortly after reading it.17 This could change if your reading material employs the Sans Forgetica typeface. According to scientists at the Royal Melbourne Institute of Technology (RMIT) and its School of Design’s Behavioural Business Lab, “… clean, smooth typefaces typically used in contemporary digital in- terfaces—may be less effective in helping the reader remember information.”18 The lab’s research suggests, “When a piece of information is too easily and clean- ly read, it can fail to engage our brains in the kind of deeper cognitive processing necessary for effective retention and recall.”19 To respond to these observa- tions, the lab created an entirely new typeface that can be used in a word processing program to promote a reader’s enhanced retention: Sans Forgetica is an attempt to address this

somewhat ironic flaw of design. By disrupting the flow of individual letterforms, readers are subtly prompted to increase their focus on the text being communicated. Multiple tests under- taken by RMIT’s Behavioural Business Lab have confirmed that the effect of this is to increase memory retention of the text in question.20

The typeface is open source and can be down- loaded for use in Word, Pages, and other word pro- cessing programs at www.sansforgetica.rmit.

Technology Evolves and Matures One hundred years ago, technology had only re- cently brought electric lighting into homes and busi- nesses, providing barely comprehensible remote audio conversations via an operator and a large box with an

JOURNAL OF FINANCIAL SERVICE PROFESSIONALS | MARCH 2019

46

TECHNOLOGY

mark-zuckerberg. (10) James Laird, “How to Delete a Facebook Account Perma- nently in 3 Simple Steps,” TrustedReviews.com, December 3, 2018; accessed at: https://www.trustedreviews.com/news/how-to-delete- facebook-account-2950145. (11) Internet Retailer, 2016; http://internetretailernews.blogspot. ca/2016/04/us-e-commerce-at-glance-infographic.html. (12) Infographic, 360pi, https://0ca36445185fb449d582-f6ffa6baf 5dd4144ff990b4132ba0c4d.ssl.cf1.rackcdn.com/IG_360pi Amazon_9.13.16.pdf. (13) Jerry Hildenbrand, “Amazon Alexa: What Kind of Data Does Amazon Get from Me?” AndroidCentral, March 27, 2018; accessed at: https://www.androidcentral.com/amazon-alexa-what-kind-data- does-amazon-get-me. (14) Satya Nadella, “Privacy at Microsoft,” Microsoft, accessed at: https://privacy.microsoft.com/en-us. (15) “The Comprehensive Guide to Quitting Google,” Life Hacker, November 8, 2018; accessed at: https://lifehacker.com/ the-comprehensive-guide-to-quitting-google-1830001964. (16) Richard M. Weber, “Where No One Has Gone Before: When Science Fiction Inspires Technology,” Journal of Financial Service Professionals 70, No. 4 (2016): 43–46. Also: “ECG App and Irregu- lar Heart Rhythm Notification Available Today on Apple Watch,” Apple, December 6, 2018; accessed at: https://www.apple.com/news- room/2018/12/ecg-app-and-irregular-heart-rhythm-notification- available-today-on-apple-watch. (17) Mid-20th century educator Edgar Dale suggested a visual met- aphor of a cone with reading retention the lowest of all memory mo- dalities, accessed at: https://www.td.org/insights/debunk-this-people- remember-10-percent-of-what-they-read. (18) “The Story of Sans Forgetica,” sansforgetica.rmit. (19) Ibid. (20) Ibid. (21) “How was technology 100 years ago?” accessed at: Quora.com, https://www.quora.com/How-was-technology-100-years-ago. (22) Ibid. (23) Jacob Bunker, “What Will the Technology Look Like 100 Years from Now? (Your Best Guess),” Quora.com, June 29, 2016; ac- cessed at: https://www.quora.com/What-will-the-technology-look- like-100-years-from-now-Your-best-guess. (24) Microprocessing capability/speed doubles—and the cost de- creases by half—every 18 months.

Richard M. Weber, MBA, CLU, AEP (Distinguished), is well known by insurance agents for his activities on their behalf in the area of life insurance “due care.” He received the Kenneth Black, Jr., Leadership Award in 2008 in recogni- tion of his “exemplary leadership qualities and significant contributions to the fulfillment of the Society of Financial Service Professionals core values of ethics, education, and relationships.” He is president of The Ethical Edge, Inc., Pleasant Hill, CA, consulting to insurance companies and agents on issues of product expertise and the appropriate use of technology. A past president of the Society of Fi- nancial Service Professionals, Mr. Weber has written hun- dreds of articles and delivered presentations throughout the industry on “…increasing earnings while maintaining high levels of integrity and ethics.” He can be reached at [email protected].

(1) “Teraflop” describes 1012—one million million—computing operations per second. (2) The “G” stands for “generation,” i.e., 5G is the fifth generation of wireless broadband technology. (3) Alex Allegro, “5G: What to Know, Why You Should be Excited, and How it Will Impact You,” 9to5 Mac, December 9, 2018; ac- cessed at: https://9to5mac.com/2018/12/09/5g-explained. (4) Liam Tung, “IoT Devices Will Outnumber the World’s Popula- tion this Year for the First Time,” ZD Net, February 7, 2017; accessed at: https://www.zdnet.com/article/iot-devices-will-outnumber-the- worlds-population-this-year-for-the-first-time. (5) Sherif Hanna, Qualcomm’s (QCOM) director of 5G market- ing, quoted at: https://finance.yahoo.com/news/now-get-5g-cell- networks-152206866.html?src=rss. (6) Ibid. (7) Soo Youn, “Marriott’s Data Breach Is Large, but It’s Not the Largest: These Are the 5 Worst Corporate Hacks,” abcnews.go.com, November 30, 2018; accessed at: https://abcnews.go.com/Technology/marriotts- data-breach-large-largest-worst-corporate-hacks/story?id=59520391. (8) “The 100 largest companies in the world by Market value in 2018,” Statista, accessed at: https://www.statista.com/statistics/263264/top- companies-in-the-world-by-market-value. (9) Kurt Wagner, “This Is How Facebook Uses Your Data for Ad Tar- geting,” recode.net, April 11, 2018; accessed at: https://www.recode. net/2018/4/11/17177842/facebook-advertising-ads-explained-

Copyright of Journal of Financial Service Professionals is the property of Society of Financial Service Professionals and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.