Can Bitcoin Go Mainstream?

moneyWhat’s the future of Bitcoin? That’s what I’ve been trying to work out in my latest feature for IT Pro in Hong Kong. As always it’s a topic everyone seems to have an opinion on, although not many are prepared to stick their neck out too far.

The main issue is that most countries have adopted a “wait and see” approach to the crypto-currency, which puts it a bit in limbo. Very few have banned it outright – not even China or Thailand, as is commonly reported.

Usually in these cases, it’s merely restrictions rather than total prohibition that have been instituted.

For Frost & Sullivan analyst, Vijay Narayanan, IT leaders in public and private sector organisations could face “new challenges, responsibilities and opportunities” if the cryto-currency can establish itself.

“While corporates are likely to build upon the Bitcoin technology to deliver new products and services, governments may find new methodologies to execute its mission from a view point of a law enforcer and regulator,” he told me.

“Bitcoin, in the future, further could revolutionise the way firms conduct business. As Bitcoin as a form of payment is expected to mature, it is likely to create an ecosystem of firms that will support retailers and end consumers in storing, accepting and exchanging bitcoins as a mode of  barter of goods and services.”

However, he argued that for Bitcoin to go mainstream if must become more stable, and “resolve issues pertaining to trust and security” – only this will give the markets the confidence they need to adopt it more readily.

Quocirca founder Clive Longbottom agreed that the currency’s price volatility has been its undoing in the past, claiming that only those who value anonymity are really keeping it going from an end user perspective.

“Most governments are publicly trying to say that Bitcoin is a passing fad that will not last, while shitting themselves behind closed doors as to what crypto-currencies mean to global trade and how that can be effectively tracked, taxed and manipulated.  It is more than likely that there have been deep discussions between governments and central and global banks to try and find a way to control any spread of crypto-currencies, but obviously, without a completely different thought process behind it all, these will not get anywhere,” he told me by email.

“It is difficult to regulate something where there is no true controlling body as such and all transactions are controlled by an overarching network. It is too easy for people to bypass any controls, so transactional charges and banking charges cannot be easily applied. As such, I think that we will see a few poorly thought out and implemented attempts to put in place some level of control, which will fail – unless Bitcoin itself suffers more problems.”

As to the future – well I suspect that Bitcoin and digital currencies in general will fail in themselves to see the mass adoption predicted for so long, mainly because most people are perfectly happy with existing currency systems. Where it could become more popular is in countries which already have weak and volatile currencies, but I doubt this will give it the momentum it needs.

Whether something bigger and better – and easier for ordinary users to ‘grasp’ – will eventually evolve from these platforms, is the great imponderable.


It’s finally time for governments to get all cloudy eyed.

cloudI’ve just finished a piece for a client charting the progress of cloud computing projects in the public sector around the world and I’ve got to say, it makes pretty miserable reading for the UK.

Despite the launch, to great fanfare, of the G-Cloud project a couple of years ago, awareness among public servants seems pretty low still and sales not exactly setting the world alight – G-Cloud vendors brought in £217m in July, rising to just under £250m the month after.

That said, we’re a small country, and things are looking up. The technology is mature enough and use cases are starting to spring up all over the place, which will speed adoption. However, long term outsourcing contracts are still impeding the development of cloud projects, according to Nigel Beighton, international VP of technology at Rackspace – a G-Cloud vendor.

“The public sector’s move to the cloud is still in its infancy, and I applaud what Liam Maxwell and the whole G-Cloud team are trying to do. But it will take time,” he told me via email.

“Over the past few years the cloud has matured and grown, and is now able to do just about everything you need it to do. For public sector agencies that are yet to make the move to the cloud, one of the main benefits is that it offers great flexibility and that they won’t be locked into one provider. There are also many parts of the sector that are hit with large peaks in their service at certain times of the year, and they could really benefit from a pay as you go, or utility, cloud-model.”

Over in China there is no such reticence, mainly because many public sector bodies have no existing legacy contracts/infrastructure to encumber them. I remember EMC’s Greater China boss saying as much a couple of years ago in Hong Kong and it’s still true, according to Frost & Sullivan’s Danni Xu.

She said the central government threw RMB 1.5bn (£150m) at public sector cloud development in the five major Chinese cities in 2011. Then local governments – many with more money than some countries – followed suit: witness Guangzhou Sky Cloud Project, Chongqing Cloud Project, Harbin Cloud Valley Project and Xian Twin Cloud Strategic Cloud Town Project. An ecosystem similar to that which has grown up in the UK, US and elsewhere, has developed around this new investment, she told me.

“The formation of a more complete cloud ecosystem has benefited local enterprises and local government in many ways. With plenty of cloud offerings available in the market, the public sector itself has also emerged as an important spender for cloud services, among the various vertical sectors,” Xu said.

“For instance, the Ningxia municipal government works with AWS on building a large-scale data center in the region. Meanwhile, it will also leverage Amazon’s platform to deliver e-government services in the future.”

Forrester analyst Charlie Dai counselled that most public sector projects in China are still private cloud based, at least when it comes to SoEs.

“The government is also trying to strengthen the control and regulate the market,” he added.

“The China Academy of Telecommunications Research of the Ministry of Industry and Information Technology (MIIT) launched official authorisation on trusted cloud services (TRUCS) for public cloud early this year.”

Quelle Surprise.

What is obvious, in China as in the UK and elsewhere, however, is that we’re only at the beginning of a very long journey. Whether it takes 10 or 50 years, the cloud is ultimately where governments around the world will look to in order to work more productively and deliver public services more efficiently.


Hong Kong’s online TV shambles

hong kong skylineI’ve just finished a feature slightly out of my comfort zone – Hong Kong’s online TV market, or lack thereof.

The Chinese SAR has a huge appetite for net TV – you just have to get onto an MTR, visit a dim sum restaurant or try and get past a local ambling on the pavement whilst staring at their phablet, to realise that.

The former colony also has an ideal set-up – 4G is commonplace; the locals are pretty tech-savvy early adopter types relative to the rest of Asia; and broadband penetration is amongst the highest in the world.

Yet thus far it still doesn’t have its own online TV service. Hongkongers have to get their content from mainland China or further afield to satisfy their lust for internet telly.

Local entrepreneur Ricky Wong tried his best with HKTV but hit a brick wall in the form of a government shamelessly protecting the vested interests of the region’s incumbent broadcasters.

It’s a shame because this model of broadcasting, whilst probably never fully replacing traditional modes, will definitely come to play a major part in our content consuming lives over the next decade.

Gartner’s Terick Chiu explained to me that it’s not just the online TV players and content producers who stand to benefit.

“In their efforts to drive engagement with consumers, both incumbents and new entrants are likely to invest in the technology of second-screen applications. These applications are built on top of automatic content recognition (ACR) technologies, which enable an application to detect content metadata — usually contained in a digital watermark — and synchronise the application with the on-screen programming,” he said.

“For service providers and advertisers, these second-screen apps will become an important element of the future of TV, given their ability to provide an ongoing stream of information about consumer preferences and interests. These apps also enable a form of e-commerce or ‘embedded merchandising’, which links a viewer to products/services that are featured in video programming”.

IDC’s Greg Ireland, meanwhile, argued that internet TV would “usher in a new wave of competition” in the broadcast industry – which should spell good news for viewers.

“One item to watch is how these services, or other new services, emerge as ‘true’ competitors to traditional pay TV,” he told me. “That is, will any begin to license linear content and offer a pay TV service of live and on-demand content entirely over the internet?”

It’s going to happen sooner or later in Hong Kong, as around the world, so the government might as well get out of the way and let it happen now.


Can Hong Kong build a ‘Silicon Harbour’? Nah, probably not

hong kong skylineI might be back in London now but I’m still keeping one eye on the East. My latest for IDG Connect is a piece on whether Hong Kong can really lay claim to the title “Silicon Harbour”, given its dubious track record of under-investment and the increasing strength of rival Asian cities including Tokyo, Shenzhen, Shanghai and Singapore.

Well, as always, the jury’s still out. There are a lot of good things going on in Hong Kong, as this upbeat infographic shows. It’s politically stable, safe from most natural disaster and you can use the internet freely (unlike in mainland China). It’s also well connected internet-wise and relatively cheap, as Frost & Sullivan analyst Danni Xu told me: “enterprises in Hong Kong using 100 Mbps Ethernet Point-to-Point (P2P) per month are paying only one third the price of a similar set up in Singapore”.

“However, despite these advantages/benefits, Singapore remains popular in certain cases over Hong Kong when it comes to selecting a destination to set up a data centre,” she added. “Google was a prime example of this when its plan to establish a data centre in Hong Kong did not materialise. The cost and difficulty of acquiring suitable land were cited as the key reasons for this.”

It also seems like HK’s key strengths, its value as a financial centre and proximity to China, are also its biggest drawbacks.  This means Singapore and other cities are usually preferred as regional hubs while HK is the choice as a base for firms looking to expand into China. It also means investors can be reluctant to plough their money into untried or tested tech start-ups as the culture is mainly about finance and property.

Forrester analyst Clement Teo had this:

“There are some structural factors may constrain ICT development in HK e.g. its relatively small domestic market and shrinking manufacturing and industrial sector do not provide sufficient incentives to spur technological developments. Moreover, HK needs to divvy up scarce resources – like land, office space and investment funding and talent – among established economic pillars such as financial services, real estates and retail.”

The HK government this year released an ambitious Digital 21 Strategy – the latest in a long line of such policy documents from the SAR – and certainly talks a good game. But I’m still hugely sceptical whether the political will is there to help smaller tech firms – the start-ups and similar which could genuinely turn the city state into a ‘Silicon Harbour’.


Fancy a new role in IT? Here’s what’s on offer in Asia

asiaThe start of a new year is as good a time as any to begin thinking seriously about a possible career move. Given the very early stage of economic recovery in the UK, there are limited possibilities at home, so what about taking the leap to Asia? After all, it’s one of the global economy’s strongest performing regions and in markets like China there are huge sums of public and private money being invested into IT upgrades and infrastructure projects.

Well, I spoke to several recruitment experts in China, Hong Kong and Singapore to get the low down on the opportunities, but also the challenges for job-hunting ex-pat IT pros.

First up is China. According to Michael Page senior manager Joshua Rafter the job market is stable and growing, with pharmaceutical, healthcare, chemical, retail, automotive and technology sectors growing particularly strongly. Skills in demand include business-facing roles such as project managers and business analysts.

Hong Kong is also looking pretty positive, although more so in the commercial rather than the financial sector. Roles in demand there include app devs, help desk analysts, system admins and business analysts/project managers with ERP skills.

Finally, Singapore will continue to be strong, especially in second and third quarters, with business-facing roles again in demand, although Michael Page manager Michael Nette warned me that ex-pats will only be offered local packages.

“For most multinational and local companies there is a strong drive to recruit Singaporean citizens and then look for talented a foreign candidate if local talent cannot be found,” he added. “The Singaporean government has introduced stricter criteria for government issued Employment Passes and Personal Employment Passes.”

The bad news for ex-pat IT pros is that local talent is strong and getting better all the time, so anything under senior managerial level roles will probably be filled by home-grown professionals. What’s more, in China you WILL be expected to speak Mandarin, or at least to have lived and worked in the country for a time previously. Language skills in international business hubs of Singapore and HK are less important (although would still give you an edge), but job seekers will be expected to do their search from over there, so it’s going to take a leap of faith.

“Be stationed in Hong Kong for a extended period. Visiting for only a week or applying for jobs from abroad make it very difficult to secure a role in Hong Kong,” said Michael Page regional director Christopher Aukland. “A lot of expats find roles through networks rather than applying directly – therefore being here in person to network extensively is critical.”

The days of the cushy ex-pat package are pretty much gone, so expect local wage scales and lots of competition, unless you’re lucky enough to get a transfer out here with your current employer. That said the experience gained – both life and work-wise – will be invaluable for future career prospects, so it’s well worth a punt if the time is right for you.

You might even end up never leaving.

 


Singapore bids to snuff out APT fire as threats spell double trouble for APAC

big dataLast week APT and anti-malware firm FireEye announced the creation of a new Cyber Security Centre of Excellence (CoE) in partnership with the Singaporean government. It didn’t make many headlines outside of the city state but I think it’s worth a second look for a few reasons.

First up, FireEye is pledging 100 trained security professionals to this new regional hub, to provide intelligence to help the local government protect its citizens and infrastructure from attack as well as benefitting the vendor’s customers across APAC.

FireEye is one of the few infosec companies I’ve spoken to in this part of the world that is prepared to talk at length about the specific problems facing organisations in the region. More often than not when I try to go down this avenue with a vendor I’ll be told about how threats are global these days and attacks follow similar patterns no matter where you are on the planet.

While I know this is true to an extent, it was nevertheless refreshing to hear FireEye’s APAC CTO Bryce Boland tell me that the reason for building a team in Singapore was to have the necessary local language and cultural skills to deal with specific regional threats.

“We have a lot of countries here, many of which have tense relationships, so we see a lot of that boil over into cyber space,” he told me.

As well as the various hacktivist skirmishes that periodically hit the region, such as those between the Philippines and Indonesia or China and Japan, there are also more serious IP-stealing raids which stems from the fact that APAC represents more than 45 per cent of the world’s patents, Boland added.

As a result, regional organisations face almost twice as many advanced attacks as the global average.

Another reason the news of FireEye’s new CoE warrants attention is what it says about the approach to cyber security by the respective governments of Singapore and Hong Kong.

Although Hong Kong threw HK$9 million (£730,000) at a new Cyber Security Centre in 2012, my impression is that Singapore is more proactive all round when it comes to defending its virtual borders.

It was a view shared by Boland, who pointed to Singapore’s ability to attract and support infosec players looking to build regional headquarters there, as well as its efforts to attract globally renowned speakers to an annual security expo.

In my experience, what few events there are in Hong Kong are poorly attended, attract few speakers from outside the SAR, and rarely provide the audience with anything like compelling or useful content.


Google aborts $300m datacentre plan, but will it be back?

datacentreThe big news from the Orient this week, or at least this small part of it, has been Google’s decision to pull out of plans to build a $300 million datacentre in Hong Kong.

Now the web giant claimed this was due to high costs and the difficulty of getting enough land for its requirements, which at first glance seems fair enough. It ain’t cheap here and land is at a premium in the tiny SAR.

However, the more I think about it the stranger it seems, and here’s why.

  • It’s not short of a bob or two – was cost really the reason for its decision?
  • The project has been trailed way back since 2011 when Google announced it bought 2.7 hectares of land in the Tseung Kwan O Industrial Estate near Sai Kung, although interestingly a link to the Google page on it now results in a 404 error message.
  • At the time, Google said: “We chose Hong Kong following a thorough and rigorous site selection process, taking many technical and other considerations into account, including location, infrastructure, workforce, reasonable business regulations and cost.”

So what’s changed?

Mainland China is admittedly a small market for Google and that probably won’t alter unless there’s an unimaginable change of heart from Beijing. But it knew that back in 2011 when it bought those 2.7 hectares of land that are suddenly deemed not enough.

It’s more likely that with projects underway in Singapore and Taiwan, Google is concentrating on those first to ramp up its datacentre presence in the region.

We must remember it’s still a baby in the IaaS space when compared with the AWS behemoth.

But I personally wouldn’t rule out a return to the HK project for Google in the future as it looks to grow its Google Compute Engine offering in the future. Rival Rackspace has been steadily building out its operations from Hong Kong, for example, recently launching its first public cloud service in Asia from the former colony.

It must be added that Google already has a healthy complement of servers in the SAR and recently announced a tie-up with the local Chinese University of Hong Kong, so rumours of dissatisfaction with and interference by the local government may be wide of the mark.

However, news of the pull-out will still be a big blow to the Government CIO’s Office as it tries to sell HK over its near neighbours as Asia’s premier datacentre destination.

Recent efforts have included promoting the use of converted factories by waiving various fees and even looking into the possibility of underground facilities built in caves.

If any more PR blows like the Google story start landing next year, it might be time for the HK government to rethink its strategy.


No shanzhai please, we’re Hong Kongers

sincere podiumOne of the most frustrating things about being a Hong Kong technology journalist is having people ask you what the next big tech trends are; what kind of weird and crazy gadgets you’ve managed to track down, etc etc.

The truth is, as I’ve discovered over the past 18 months, despite its famously futuristic neon-kissed city-scape Hong Kong is not where you’ll find such weird and wonderful or early adopter technologies. They don’t even really exist in Japan’s famous Akihabara “electronics town” district either – a spot now filled with maid cafes and adult video shops.

The truth is that for pimped out shanzhai goods like these, you’ll need to go to Shenzhen, just across the border from Hong Kong.

This city, and its Chinese neighbours around the Pearl River Delta, has always been the epicentre of cheap, sometimes illegal but usually grey market goods – whether they be recognisable brand name items assembled or sourced from non-official channels, or white box weirdness from tiny makers you’ll never have heard of.

It’s not as if, as I originally thought, there has been a government crackdown on these items in Hong Kong. You see, they’re not technically even illegal – it’s more market driven than that.

“In Hong Kong the government is not banning these products, it’s that the market is not that big,” Frost&Sullivan analyst Lu Shuishan told me. “Some people are willing to pay relatively low prices for shanzhai goods but the market presence of branded products is just bigger.”

People can afford better quality goods in Hong Kong without breaking the bank, unlike in China where an iPhone can cost a months’ salary and grey market versions of the big brands are sought out by virtue of being cheaper, he added.

According to Forrester’s Bryan Wang, Hong Kongers also benefit from buying more of their phones through operators than direct from retail as in China, with two year contracts boosting their affordability whilst locking punters into lengthy terms.

That’s not to say white box goods have completely disappeared from Hong Kong. On a trip to Sincere  Podium – a three floor mecca for smartphone fanatics in Mong Kok – there were one or two brand names I’d never heard of, like Copicell, Daxian and Shouyue.

However, there were no unusually specc’d shanzhai products, of which Western readers are inordinately fond.

As IDC senior market analyst Dickie Chang told me, skyrocketing local rents are also focusing the minds of traders.

“Dealers need to pay more to cover rental costs, so they will need to think carefully about the products
they want to sell,” he argued.

It seems that the era of the weird and wonderful shanzhai handset, at least in Hong Kong, is well and truly over.


OpenStack: the open source cloud project taking Asia by storm

openstack summit logoCan you guess which city has more OpenStack contributors in it than any other on the planet?  Well, it’s Beijing.

That may come as something of a surprise given the heritage of the open source cloud computing project – NASA and US hosting/cloud giant Rackspace.

However, it’s certainly not a one-off, with several other cities in the PRC also boasting significant numbers of acolytes, including Shanghai which also ranks in the global top ten.

I learnt this and rather a lot more about the project at the OpenStack Summit in Hong Kong this week. It was a conference heavy in symbolism for the OpenStack Foundation – its first ever outside the US and the first since the release of Havana – its eighth major release for building public, private and hybrid clouds.

Having slogged my way around IT conferences for more years than is healthy for a person of my age, the summit was a first for me in many ways.

First up the new announcements from vendors were kept very much in the background – barely mentioned at all in the keynotes and not publicised heavily elsewhere at the event.

Now that could be the fault of the event PR team but I’d like to think it’s because the Foundation are trying to send a message of inclusivity to the community – that no one vendor should be allowed to use the platform to market its wares so blatantly to a captive audience of over 3,000 enthusiasts.

That’s not to say there was no news, of course, or that the major vendors weren’t using the show to meet customers, get their message out, etc, but it was certainly toned down from the all-guns-blazing razzmatazz of some  industry events I’ve been to.

Part of that no doubt lies in the fact OpenStack Summit is really about bringing the community together to share ideas and best practices on implementations and, quite literally, to sit down and draw up a roadmap for where it is headed next.

It is still very early days for OpenStack versus, say, Amazon Web Services, and there is a certain amount of tension still in the community about whether it should be seeking to emulate the cloud leader or take a separate path of innovation – “letting a thousand flowers bloom”, according to Canonical founder Mark Shuttleworth.

The Rackspace private cloud VP Jim Curry and CTO John Engates I chatted to admitted feature parity isn’t at the same level as AWS yet, but also claimed that itself is a bit of a red herring as few people use all the features in Amazon anyway.

In the end one of the more eloquent and passionate speeches on the open source project came from Red Hat consulting engineer Mark McLoughlin – one of the top OpenStack contributors in the world if rumours are to be believed

“Does anyone think we’re just going to add a handful of new projects in 2014 and then stop? I really don’t think that’s realistic,” he said. “I think it’s going to continue to expand and become a broad umbrella of projects. We need to embrace the collaboration that’s happening under this OpenStack umbrella.”


Google: ‘Start-ups can save the world’

eric schmidt“Entrepreneurship is the solution to all the world’s problems,” according to Google executive chairman Eric Schmidt, who was in Hong Kong today to launch a new program to foster greater start-up talent within the Chinese SAR.

Schmidt’s visit was something of an anti-climax in the end. Media were not invited to ask any questions and what we finally got from the Google man after a half hour delay was less than insightful.

He trotted out the usual argument that more innovation and technical invention will likely gravitate to this part of the world because there is a “numerical advantage” in terms of graduates with degrees in STEM subjects.

Several times he also repeated the notion that “the native underlying Chinese culture is entrepreneurial”.

“We all know this, it’s been true for 1000 years. It’s a great asset of Chinese history,” he said.

The inference here is that the region and its people should be more inclined than most to producing innovative technology start-ups.

However, we heard very little about why that’s simply not happened thus far, in Hong Kong at least, although Schmidt did acknowledge that there wasn’t enough of a VC industry here and that, although entrepreneurial, the locals are also culturally afraid of being “different”.

Google’s announcement today – a program of mentorship and incubation with the Chinese University of Hong Kong – is surely yet another indication that the SAR government has singularly failed to foster the kind of innovation that can start local and grow internationally.

It’s a view I’ve heard time and again – even from successful international technology companies who came to Hong Kong with an impression of a hi-tech city and found instead something much less mature to work with.

The conversations at most local tech conferences I’ve been to are still at a “what is the cloud?” stage. It’s difficult to believe sometimes.

When asked whether Google was thinking of founding a formal incubator project even Schmidt had to admit: “You don’t have a big enough software industry. Your lack of software … will hurt you in terms of your global ambitions.”

The one year project announced today is unlikely to change that much.

We don’t know exactly how much access to Silicon Valley “mentors” and help with start-up costs local entrepreneurs will get as part of the initiative, but at first glance it seems like a pretty good way for Google to cream off some of the best of that limited Hong Kong talent.