Archive for IT Infrastructure

Record Levels of Investment in UK AI

A Tech Nation Report has shown that AI investment in the UK reached record levels in the first six months of the year making it the third biggest market in the world for AI investment, just behind the US and China.

Surge

Crunchbase figures show that AI investment in the UK reached £859.29m in just the first six months of this year, compared to £825.85m for the whole of last year.

This latest surge in AI investment marks five years of consecutive growth and a massive six-fold increase between 2014 and 2018.

Also, AI start-ups in the UK raised almost double the amount of those in the rest of Europe combined.

Why The High Investment Levels?

The AI investment growth can be attributed to several factors, not least:

  • A rise in the number of start-ups with 50 or fewer employees.  These account for 89% of the UK’s AI companies.
  • The Department for Digital, Culture, Media and Sport (DCMS) £1bn AI sector deal to put the UK at the forefront of the AI industry, including almost £300m of new private sector investment, as part of the UK government’s Industrial Strategy (announced November 2017).  This initiative was intended to establish partnerships between government and industry in order to increase productivity.

Challenges

Even though the figures show that the investment trend is going in the right direction, UK-based companies hoping to make the most of AI face some clear challenges including:

  • A tech skills shortage and a so-called “brain drain” in the UK and across Europe as top university tech students are tempted to work further afield e.g. in the U.S.  Also, Brexit fears in the UK have deterred some European specialist tech workers from staying.
  • Challenges in scaling up their businesses so that they can become competitive in the global market.

Small Pool

These challenges to the growth of AI companies mean that there is only a relatively small pool of UK AI-focused companies that have been able to make the step to scaling-up and competing on the world stage.  AI companies in other countries such as China, by contrast, tend to have larger workforces e.g. 53% have more than 50 employees.

There is also a relatively small pool of people in the world who can contribute to cutting-edge AI research.

Benefits and Threats of AI

AI offers many benefits to businesses such as cost and time savings (greater productivity and reduction in errors), the ability to make better use of resources (AI handles repetitive jobs and bots handle common questions).

Many people are, however, concerned that the growth in AI will mean a loss of jobs e.g. Gartner figures show that AI could eliminate 1.8 million jobs.  It should also be remembered that AI could create 2.3 million jobs by 2020 (Gartner) and that if the large-scale introduction of AI follows the pattern of temporary job losses followed by recovery and business transformation, the combination of human and artificial intelligence could provide exciting news competitive advantages for businesses.

What Does This Mean For Your Business?

The investment in AI within the UK is promising for the tech sector, the economy, and for the future of the UK in the global tech market, provided that UK-based AI companies can tackle the challenges of being able to scale-up and successfully find the human tech talent at a time of skills shortages.

AI may cost jobs in the shorter term, but it may also bring new strengths and opportunities to businesses and could transform the way we are able to work for the better.

London Gets 10 Million New Landline Numbers

Telecoms regulator Ofcom has announced the introduction of 10 million new 0204 landline numbers for London in a move to keep up with a growing demand fuelled by Broadband connections.

Running Out

There are only 500,000 of the 30 million (020)3, (020)7 and (020)8 numbers left to be handed out and Ofcom says that these remaining numbers are being allocated at a rate of 30,000 each week!

Broadband

In addition to the fact that numbers from the existing groups will be used up within the year, the new numbers have been created to help feed demand for fixed-line broadband.

For example, an ISPreview survey from last year showed that only 14.5% of respondents still used a landline phone service for making most of their calls and 67.2% said they’d get rid of it if the service if it wasn’t still needed by ISPs for home broadband.

It is still very difficult in the UK to avoid paying for line rental as part of a broadband service. This is because most broadband connections are ADSL which requires the use of Openreach phone lines to transmit data.

Full fibre broadband, however, does not require a phone line but it is not widely available, and some providers will still ask you to take a landline as part of the package.

Data Usage

Landlines have been used more in recent times for data.  For example, Ofcom figures show that in 2018, the average household used 240GB of data through fixed broadband, compared to 23GB in 2012.

Landline Calls In Decline

Even though landline calls are in decline, Ofcom says that UK customers still spend 44 billion minutes making landline calls every year.

Growth

Allocating new numbers for London is not new.  For example, the 01 code for London, which lasted from 1958 to 1990 was replaced by 071 (inner London) and 081 (outer), which then became 0171 and 0181 five years later.  In 2000 the inner and outer codes for London were replaced by the number 020 for both.

What Does This Mean For Your Business?

London is the commercial centre, as well as the capital of the UK and its continuous growth coupled with the advance of communications technology, has necessitated the addition of several different codes over the years.  With the current speed of allocation of the existing number business and households need news codes soon, and the first blocks of ‘(020) 4’ numbers will be allocated to telecoms providers in the autumn, after which the new numbers will be issued to other customers by the end of next year.

One-Third of Major VPNs Owned By Chinese

A recent survey by VPNpro has revealed that almost one-third of the most popular VPN services are secretly owned by Chinese companies that may be subject to weak privacy laws.

VPN

A ‘Virtual Private Network’ (VPN) is used to keep internet activity private, evade censorship / maintain net neutrality and use public Wi-Fi securely e.g. avoid threats such as ‘man-in-the-middle’ attacks.  A VPN achieves this by diverting a user’s traffic via a remote server in order to replace their IP address while offering the user a secure, encrypted connection (like a secure tunnel) between the user’s device and the VPN service.

Based In China

The VPNpro research found that the top 97 VPNs are run by only 23 parent companies and that although 6 of these companies are based in China and offer 29 VPN services between them, information on their parent company is often hidden to users.

Metric Labs Research Last Year

The results of the VPNPro research support the findings of an investigation by Metric Labs last year which found that of the top free VPN (Virtual Private Network) apps in Apple’s App Store and Google Play, more than half are run by companies with Chinese ownership.

What’s The Problem?

The worry about VPN services being based in China is that China not only tightly controls access to the Internet from within the country, but has clamped down on VPN services, and many of the free VPN services with links to China, for example, offer little or no privacy protection and no user support.  Weak privacy laws in China, coupled with strong state control could mean that data held by VPN providers could be accessed and could enable governments or other organisations to identify users and their activity online, thereby putting human rights activists, privacy advocates, investigative journalists, whistle-blowers, and anyone criticising the state in danger.  For other users of China-based VPN services, it could also simply mean that they could more easily be subject to a range of privacy and security risks such as having their personal data stolen to be used in other criminal activity or could even be subject to industrial espionage.

China, Russia, Pakistan and other states whose activities are causing concerns to Western governments all appear to be less trusted when it comes to hosting VPN services or redirecting Internet traffic through their countries.  For example, in February this year, US Senators Marco Rubio (Republican) and Ron Wyden (Democrat) asked the Department of Homeland Security to investigate governmental employees’ use of VPNs because of concerns that many VPNs that use foreign servers to redirect traffic through China and Russia could intercept sensitive US data.

What Does This Mean For Your Business?

The reason for using a VPN is to ensure privacy and security in communications so it’s a little worrying that some of the top VPN services are based in countries that have weaker privacy laws than the UK and are known for strong state control of communications.

Fears about security and privacy of our data and communications have been heightened by reports of Russia’s interference in the last US election and the UK referendum, and by the current poor relations between the Trump administration (which the UK has intelligence links with) and warnings about possible espionage, privacy and security threats from the use of equipment from Chinese communications company Huawei in western communications infrastructure.   Also, in the UK, there is a need by businesses and organisations to remain GDPR compliant, part of which involves ensuring that personal data is stored on servers based in places that can ensure privacy and security.

It appears, therefore, that for businesses and organisations seeking VPN services, some more desk research needs to be done to ensure that those services have all the signs of offering the highest possible levels of security and privacy i.e. opting for a trusted paid-for service that isn’t owned by or a subsidiary of a company in a state that has weak privacy laws.

Criminal Secrets Of The Dark Net Revealed

Recent Surrey University research, ‘Web Of Profit’ commissioned by virtualisation-based security firm Bromium has shown that cyber-criminals are moving to their own invisible Internet on the so-called ‘dark net’ to allow them to communicate and trade beyond the view of the authorities.

What Is The Dark Net?

The dark net describes parts of the Internet which are closed to public view or hidden networks and are associated with the encrypted part of the Internet called the ‘Tor’ network where illicit trading takes place.  The dark net is not accessible to search engines and requires special software installed or network configurations made to access it e.g. Tor, which can be accessed via a customised browser from Vidalia.

Deeper

Infiltration and closing down of some of the dark net marketplaces by the authorities are now believed to have led to cyber-criminals moving to a more secure, invisible part of the dark net in order to continue communicating and trading.

How?

Much of the communication about possible targets and tactics between cyber-criminals now takes place on secure apps, forums and chatrooms.  For example, cyber-criminals communicate using the encrypted app ‘Telegram’ because it offers security, anonymity, and encrypted channels for the sale of prohibited goods.

Diverse Dark Net Marketplace

Posing as customers and getting first-hand information from hackers about the costs a range of cyber-attacks, the researchers were able to obtain shocking details such as:

  • Access to corporate networks is being sold openly, with 60% of the sellers offering access to more than 10 business networks at a time. Prices for remote logins for corporate networks ranged from only £1.50-£24, and targeted attacks on companies were offered at a price of £3,500.
  • Phishing kits are available for as little as $40, as are fake Amazon receipts and invoices for $52.
  • Targeted attacks on individuals can be purchased for $2,000, and even Espionage and insider trading are up for sale from $1,000 to $15,000.

Corporations Targeted

One thing that was very clear from the research is that cyber-criminals are very much focusing on corporations as targets with listings for attacks on enterprises having grown by 20% since 2016. The kinds of things being sold include credentials for accessing business email accounts.

Specific Industries

The research also showed that cyber-criminals are moving away from commodity malware and now prefer to tailor tools such as bespoke versions of malware as a way of targeting specific industries or organisations.  For example, the researchers found that 40% of their attempts to request dark net hacking services targeting companies in the Fortune 500 or FTSE 100 received positive responses from sellers, and that the services on offer even come with service plans for conducting the hack, and price tags ranging from $150 to $10,000, depending on the company to be targeted.

The industries that are most frequently targeted using malware tools that are being traded on the dark net include banking (34%), e-commerce (20%), healthcare (15%) and even education (12%).

Researchers also uncovered evidence that vendors are now acting on behalf of clients to hack organisations, obtain IP and trade secrets and disrupt operations.

What Does This Mean For Your Business?

The dark net is not new, but some commentators believe that the heavy-handed nature of some of the police work to catch criminals on the dark net is responsible for pushing criminal communication and trading activity further underground into their own invisible areas.  End-to-end encrypted communications tools such as Telegram mean that cyber-criminals can carry on communicating beyond the reach of the authorities.

The research should show businesses that there is now real cause for concern about the sensitive, informed and finely tuned approach that cyber-criminals are taking in their targeting of organisations, right from the biggest companies down to SME’s.  This should be a reminder that cyber-security should be given priority, especially when it comes to defending against phishing campaigns, which are one of the most successful ways that criminals gain access to company networks.

Law enforcement agencies also need to do more now to infiltrate, gather intelligence, and try to deter and stop the use of different forums, channels and other areas of the dark net in order to at least prevent some of the more open trading of hacking services and tools.

School Enlists Chinese Help To Upgrade To Enhanced Wi-Fi

The Lytchett Minster School in Dorset recently made the news among IT commentators after demonstrating how it could overcome the connectivity challenges of its rural location, cut costs and increase efficiency by upgrading its on-site network with Chinese company TP-Link’s enhanced Wi-Fi.

Challenges

As recently featured by Computer Weekly, the school had to contend with a rural campus location and the resulting poor connectivity, next to a grade II listed 18th century manor house, and a rudimentary system of ageing individual home-user access points (APs) mounted in school corridors which required users to disconnect and reconnect when roaming around.   Also, the old wireless network was not voucher-based and was insecure (the pre-shared key could be compromised), which meant that staff had to reset each AP’s password individually (with remote authentication dial-in user service help) and users had to keep reconnecting each of their devices to the network.

As is the case with so many schools, Lytchett Minster School had to make its limited budget go as far as possible in the upgrade.  This meant the need to minimise price per AP and annual licensing fees while getting the best value, efficient and effective wireless infrastructure solution.

Requirements

It was decided that the most important requirements on the school’s list were power over Ethernet (PoE), Radius authentication, centralised management, provision of multiple service set identifiers (SSIDs) and voucher authentication.

TP-Link Chosen

The school chose Chinese company TP-Link to upgrade their on-site network based on features offered, value for money, and the fact that TP-Link builds its hardware itself instead of outsourcing and, therefore, doesn’t charge licensing fees.

Founded in 1996 by two brothers and based in Shenzhen, China, TP-Link is a manufacturer of computer networking products and is now the world’s number 1 provider of consumer Wi-Fi networking devices, shipping products to over 170 countries. 

Change

Changing to the upgraded, enhanced Wi-Fi meant that the old APs could be moved from corridors into classrooms for optimum performance and coverage. The changes to a better enhanced Wi-Fi network also meant that access control lists could issue users with vouchers that restricted network access at the subnet according to core user group, out of hours separate public access SSID could be offered to users of the school’s sports facilities, larger numbers of staff iPads and phones could be used for teaching, and special provisions could be made for the BYOD policy for  sixth form students.

The new system also enabled easier, centralised management of the network with data from each AP being displayed to the IT department on large screens, with no more need to perform network reboots (as these can happen automatically at 6 am every day to avoid disrupting lessons), and the ability to carry out all key tasks from a central interface.

What Does This Mean For Your Business?

This story is an example of how the potential of an organisation (a school in this case) was limited by poor Wi-Fi provision, partly due to its rural location and old, inadequate hardware. The school showed that today, it is possible for a school based in Dorset to choose a Chinese tech firm as a partner to deliver a business-class wireless network solution that meets all operational requirements within budget, and without the extra cost of ongoing licence fees. An enhanced Wi-Fi system of this kind also offers the convenience, transparency and ease of centralised control.

$35 Billion Takeover of Worldpay Boosts Value of Euro Payments Tech Companies

The recent £35 billion takeover of Worldpay by US company FIS has boosted the share value of other European payments technology companies including Worldline, Ingenico and Wirecard.

Worldpay

Worldpay, formerly known as Streamline, was set up as a subsidiary of NatWest bank back in 1989.  It was then bought by RBS in 2002 and re-christened ‘RBS Worldpay’.  Unfortunately for RBS, EU state aid rules meant that Worldpay had to be sold for £2 billion back in 2010 to Advent International and Bain Capital, although RBS Group still retained a 20% stake in the newly independent business.

Worldpay was able to become a big player in payment processing after several moves including buying UK credit and debit processing company Cardsave, launching a mobile card processing terminal which connects to smartphones (Worldpay Zinc), and acquiring SecureNet Payment Systems from Sterling Partners.

Worldpay was listed on the London Stock Exchange until 16 January 2018 after which it was acquired by Vantiv to form Worldpay, Inc.

Worldpay processes 40+ billion payments per year across 146 countries, in 126 currencies.

Largest Ever Deal

The £35 billion takeover of Worldpay by US-based FIS is the largest ever deal in the electronic payments industry and has created a consolidated company with combined revenues of over $12 billion.

Shares Boost

Following the announcement of the takeover, not only were shares in Worldpay up by 13% at one point, but the deal prompted a boost in the value of other payment technology companies. For example, Worldline share value was up 3.1%, and software company Atos, which owns half of Worldline was up 1.2%. The share values of Ingenico (based in France) and Wirecard (based in Germany) also received boosts with the takeover news.

FIS Says

FIS chairman and chief executive Gary Norcross said that the two companies would “combine forces to offer a customer-driven combination of scale, global presence and the industry’s broadest range of global financial solutions”.

What Does This Mean For Your Business?

Market analysts have noted that this acquisition is the latest move in consolidation in the financial software and payments technology sectors where key existing companies are trying to increase their scale in order to compete with new entrants to a market where scale appears to be a necessary requirement to win at payments processing. The deal should also provide new business opportunities for both FIS and Worldpay.

Some commentators have noted the obvious compatibility of the two companies, and the hope is that deal may mean that businesses will have access to a wider portfolio of services that Worldpay can now provide.

The Web @ 30

It was back in March 1989, 30 years ago, that the World Wide Web as we know it was created by a computer scientist at the CERN particle physics lab near Geneva, Sir Tim Berners-Lee.

From Proposal To Reality

Sir Tim Berners-Lee wrote a proposal in March 1989, entitled “Information Management: A Proposal” which was based upon his vision of having a unifying structure for multiple computers, which by 1991 had developed into the World Wide Web.

The proposal, which was mainly focused on how information could be easily stored, shared, and accessed by CERN staff (and scientists, universities and institutions) expressed concern about “the problems of loss of information about complex evolving systems” and how “a solution based on a distributed hypertext system” could be used to help.  It was envisioned that a web of notes with links (like references) between them could be more useful than the existing fixed hierarchical system.

The Internet, rather than the Web, had existed for quite some time but had been developed for military purposes so that communications in a country could be retained even when some hubs may have been damaged or destroyed.  This early Internet was also used by researchers and computer scientists, but did not have the user-friendly, hyperlinked structure that Sir Tim Berners-Lee created, which he based upon his experience of writing a linked, hotspot-based program for keeping track of software (back in 1980) called ‘Enquire’.

First Website

The first website was hosted on Sir Berners-Lee’s NeXT computer.  This was the computer built by the company set up by Steve Jobs after being ousted from the early Apple company.  The website was dedicated to the World Wide Web project itself.

Public Domain

The first World Wide Web software was introduced to the public domain on April 30th 1993.  With the next release available with an open licence, CERN was able to help provide a huge boost to the growth and popularity of the Web.

Celebrations at CERN

To commemorate the 30th anniversary of the World Wide Web, CERN hosted an event on 12th March 2019 in partnership with the World Wide Web Consortium (W3C) and with the World Wide Web Foundation at which Sir Berners-Lee was the key speaker.

Web Memories

With the web being a relatively new, and constantly evolving part of modern life, many people reading this may have similar memories of using the Web from the 90s onwards.  These memories of the early Web include:

  • Being able to access library archives and records digitally for the first time, rather than actually having to go to a physical library and being able to copy and print off results rather than using a library photocopier (as was the pre-Web way).
  • The popular introduction of ‘chatrooms’ in the early 1990s – the forerunners of social networks.
  • In the late 90s bookshops stocked pocket-sized web directories, which were like mini phone books for the best websites.
  • Very slow dial-up modems using the telephone line, and CD-ROM disks to provide (relatively expensive) connections to the Internet.  Popular paid-for early service providers were AOL and Compuserve, but many people still used paid-for slots in Internet cafes. British ISP Freeserve opened up Internet access to the wider market in 1998 by providing free connections in the UK.
  • Lycos, Ask Jeeves and AltaVista (pre-Google days) were popular search engines in the late 90s, and the popular browsers in the UK were Microsoft’s Internet Explorer, and Netscape Navigator which could also be used as an early website builder.
  • Early animated Gifs were succeeded by the introduction of Flash.  This enabled animation to be incorporated into websites, flash games were created, as were whole cartoon-like websites in Flash. In the beginning, the only problem was that search engines couldn’t read Flash files, and therefore, Flash websites tended to suffer in the search engine results.

What Does This Mean For Your Business?

The evolution of the Web, originally envisioned and brought into being by Sir Berners-Lee, has revolutionized business, not least with email, and the ability to trade and shop online, globally.  In opening up the business world it has created many often unforeseen opportunities but has also opened businesses up to threats e.g. global competition and security issues.

In recent interviews, as well as expressing pride in his creation, and how it was mainly a force for good in the first 15 years, Sir Tim Berners-Lee has also expressed concern about how the Web has recently been used in a negative way to influence election results (the Cambridge Analytica / Facebook scandal), and that it has also shown how it can be used effectively to spread misinformation.  Sir Tim has also acknowledged, however, that the access that young people have had to information (in countries where Web use is not restricted) has created a generation who are more like online activists who are able to challenge and question the decisions of those in power.

Could 5G’s High Frequency Be Dangerous?

5G may be the next generation of mobile internet that could provide new and innovative opportunities and boost to new industries, but there have been some concerns that its high-frequency mmWave spectrum could pose new health risks.

Long-Held Concerns

Ever since there have been mobile phones, there have always been concerns that prolonged exposure to low-energy, non-ionising electromagnetic radiation radio waves, the type used by current mobile phones, could increase a person’s risk of health problems such as developing cancerous brain tumours. This radio frequency (RF) radiation does not have enough energy to ionise an atom or molecule, and therefore, is unlikely to have enough energy to damage cell DNA in a way that would cause cancer.  This is the reason why recent research has shown that it is now believed to be unlikely that radio waves from mobile phones or base stations could increase the risk of any health problems.

Even though it is now generally accepted that normal use of current generation mobile phones is relatively safe, the World Health Organization’s International Agency for Research on Cancer (IARC) has still given a cautious classification of RF radiation as “possibly carcinogenic to humans”.

What’s Different About 5G?

5G is different because it will use 3 Spectrum bands, low-band spectrum (LTE), mid-band spectrum, and what some believe to be the potentially dangerous mmWave high-frequency spectrum.

The mmWave spectrum, however, is still not close to the kind of ionising wavelengths that can cause damage to DNA.  In fact, mmWave high-frequency spectrum technology appears to be quite some way from the maximum human RF absorption frequency of about 70MHz. Also, mmWave will mostly be deployed in a spectrum that suffers from high reflection rates – 24 to 29GHz.  This should mean that any absorption by the body will be confined to the surface layers of the skin rather than the deeper tissue that is reached by lower frequency radiation.

So, Is It Safe?

Based on the science of radiation, and current evidence and limits relating to mobile phone use, there’s nothing to directly suggest 5G mmWave poses a significant health risk, but 5G is not here and in popular use yet, so more research will need to be done on the subject in future.

What Does This Mean For Your Business?

5G represents a great opportunity for business.  Its increased speed and lower latency allow the downloading of films and games in seconds and watching them without any buffering, and this kind of speed will allow all kinds of new opportunities for presentation media e.g. in advertising, on social media and on websites.

Many different types of businesses could benefit from improved connectivity with remote workers or with salespeople in remote areas.

Also, the news from an O2 forecast is that 5G could deliver time savings that could bring £6 billion a year in productivity savings in the UK and that 5G-enabled tools and smart items could save UK householders £450 a year in food, council and fuel bills.

Safety, however, is a major concern for all businesses, but even though 5G will use a higher frequency, there is no compelling evidence to date to show that it would pose new health risks to users.  In the UK, it will be some time before 5G networks are up and running to any significant level, and this means that there will be time for research to be conducted in areas where 5G use is at a more advanced stage.

Large Rises in Amazon’s Web Services (AWS) Revenues, Fuelled By Public Cloud Demand

A massive 45% growth in the revenue of Amazon’s Web Services (AWS) in the fourth quarter has been fuelled by big profits in Amazon’s public cloud arm.

Beats Microsoft & Google In Cloud Infrastructure

The $7.4 billion cloud revenue, which is a jump 45% compared to the previous year, means that AWS is beating competitors Microsoft and Google in the market for cloud infrastructure.  These are the services that businesses and organisations use to outsource their computing and data storage needs.

To give some idea of the scale of the jump in revenue for AWS, these figures mean that it generated more operating income during 2018 than its North American retail operations, and that AWS generated the revenue through $25.65bn in sales (compared with the $141.3bn from North American retail operations).

Central To Success

The operating income for AWS in the quarter was $2.18 billion, accounted for 58% of Amazon’s overall operating income, although there was a slight decrease in AWS’s operating margin.

This means that the cloud business has become central to Amazon’s success in terms of revenue and profits.

More Cloud Regions

Amazon purchased two more new cloud computing regions online in 2018, and it says that it plans to open four new regions and 12 new availability zones within those regions by the first half of 2020.

The company widened its base of cloud customers last year, including some big-name sign-ups such as Santander, Korean Air and Amgen.

Not Fastest Growing

Even though AWS has seen significant growth in revenue, Microsoft’s cloud business is growing even faster.  For example, Azure cloud revenue grew by 76% in the latest quarter.

It is, however, perhaps to be expected that the revenue growth rate of a fast-growing company drops off as their revenue base swells e.g. AWS’s has dropped from 78% in 2015 to 42% during the third quarter of 2017.

What Does This Mean For Your Business?

Amazon is clearly a company that has grown very quickly and has diversified (far) beyond its online roots into many areas, including bricks-and-mortar stores (groceries and books), self-service stores in the US, and healthcare, as well as experimenting with innovative new ways to gain an edge in its core business e.g. drone and robot parcel deliveries.  Amazon’s Alexa virtual personal assistant technology and Echo voice-controlled devices have also proven to be very popular in the marketplace.

It hasn’t all been plain sailing though, with the company’s business practices coming under more scrutiny from UK, US, and EU regulators, as well the UK government.

In the business cloud market, AWS is showing strong growth in what is a highly profitable sector as more businesses look to outsource to the cloud, but many market analysts now predict slowing growth and higher spending for Amazon as it tries to compete and fight competitor challenges on many diverse fronts.

02 Outage – What Happened

After last week’s major O2 4G mobile network outage which left millions of customers with no network data access has been blamed on an expired software certificate that 3rd party supplier Ericsson had installed for some customers at business-critical part of the network.

What Happened?

On Thursday last week, O2 smartphone users were unable to use their mobile phone data for 24 hours.  O2, which is owned Spanish communications company Telefonica, has the UK’s second-largest mobile network, which is part of BT, and as well as having 25 million users, it provides services for the Sky, Tesco, Giffgaff and Lycamobile networks (whose networks were also affected).  It is estimated, therefore, that the outage affected around 35 million users in the UK and other parts of Europe (and even Japan’s SoftBank).

As well as the considerable disruption and inconvenience caused to individual customers, there were knock-on disruptive effects for organisations that run connectivity services on O2’s network, including Transport for London (TfL), Shropshire Council and a number of NHS trusts. In the case of TfL, bus information display boards, part of the Countdown Systems network, stopped working at approximately 5 am. Shropshire Council reported problems with its car park payment machines, which use O2 data connections.

£Millions In Damages + Compensation Expected

The scope, severity and duration of O2’s data network outage, and the impact on the company’s reputation as well as on its users have led to reports that 02 looks likely to seek up to £100 million in damages from Ericsson.

Also, O2 has already made announcements about how it plans to compensate customers.  For example, Pay As You Go customers look set to get 10% extra when they top up their phone in the new year or 10% off when they buy data for mobile broadband devices.

Both O2 and Ericsson have apologised.  It has been reported that Telefonica’s UK chief executive Mark Evans has promised a full audit of the problem across both organisations, and Marielle Lindgren, chief executive of Ericsson UK and Ireland has said that the software that caused the issues will be decommissioned.

What Does This Mean For Your Business?

Modern businesses now rely heavily on stable and reliable broadband connections and data network services.  Any disruption to these can be very disruptive and costly to businesses with potentially disastrous consequences.  In this case, a whole day was lost, and the true cost to UK businesses  (and their customers) may be difficult to calculate. For O2 and Ericsson, the incident appears to have caused some damage to their reputations.

As several tech commentators have since pointed out, the incident has illustrated how complex IT infrastructure has become and how, despite this complexity, organisations must stay on top of matters relating to software certificates, particularly those in business-critical systems. This incident also illustrates how problems with machine identities at critical nodes can have a wide-reaching impact on business and the economy.

Some commentators have also highlighted how operators picking up more IoT traffic and the introduction of 5G could mean that businesses are likely to experience more outages of this nature in the future.  The incident with O2 may also make some businesses take another look at their mobile strategies, feel less comfortable putting all their communications through a mobile operator, and take steps to reduce their dependence on any single external point of failure.