- We can ignore all the doom and gloom predictions about the future…
- This Apple upgrade will make all our lives easier
- A security rating scale now exists for our “smart” devices
I wish I had good news to share on the coronavirus, but I’m afraid it has gotten much worse. I prefer to discuss positive and exciting developments in these pages, but when something so significant is impacting the technology markets, I can’t ignore it.
As of yesterday, the number of confirmed cases rose to more than 40,000. And the number of deaths has now exceeded 900. This is now officially worse than the SARS epidemic. And what is striking is that the coronavirus outbreak has occurred within a matter of weeks, whereas SARS spanned 2002–2003.
And we can see the impact of what is happening in the numbers and actions taken by technology corporations. Just over the last few days:
Airbus shut down a factory responsible for 10% of the production of its most popular jet.
Ship traffic through major China ports has fallen 20% since January 20 – clearly an impact on global supply chains.
A wireless semiconductor company has already lowered guidance for its second fiscal quarter due to the “significant uncertainty” from the impact of coronavirus.
Tesla’s Model 3 production in China will be delayed by at least a week.
Amazon withdrew from the Mobile World Congress in Barcelona, one of the largest tech conferences of the year, due to the risk of attending.
I could go on and on.
One thing is clear to me… There will be a material impact on the global supply chains for manufacturing companies and biopharma companies. We’re going to see it hit in the first-quarter earnings announcements in a few months’ time.
While I am very bullish on 2020, I’m keeping a cautious eye on these developments. If the exponential growth of the coronavirus continues and factories remain shut for an extended period of time, there will be a good argument for taking profits, building a cash position, and preparing to buy back in on a major pullback.
I’ll keep monitoring the situation. But for now, let’s turn to our insights…
The age of abundance is here…
For our first insight, let’s take a step back and look at the big picture.
Technology is killing scarcity. I know that’s sacrilege in some economic circles, but it’s the truth.
Right now, we are entering into a golden age of abundance.
While books have been written on this subject like Abundance by Peter Diamandis and Steven Kotler, we’re just going to look at one perfect example today… electricity.
As we can see above, the cost of electricity has plummeted from 479 cents per kilowatt-hour in 1900 to 10.5 cents today. And that’s using constant 2019 dollars for an apples-to-apples comparison. In other words, these figures account for inflation.
So the cost of electricity has plunged 98% in the last 119 years. It’s gone from a luxury affordable only to the wealthy to something nearly everyone on the planet now has access to.
What’s more, luminous efficacy and manufacturing wages have risen at the same time.
Luminous efficacy simply refers to how much light we can produce per watt of power. The numbers show that we can now produce three orders of magnitude more light with the same power input.
And the Affordability Index line in the chart shows the most dramatic improvement. With costs falling and wages rising, electricity has become over 2,000 times more affordable in the last 119 years.
And the best part is, electricity costs will continue to decline…
Solar panels have become more efficient in recent years. Consider Tesla’s Solarglass Roof. It is a roof tile system that captures solar energy from sunlight. It is now possible for the average household to generate enough solar energy to power an electric vehicle and produce most of the electricity needed in the house.
The technology has advanced to the point that I’m taking on my own project…
I’m designing and building my own house using this technology… with a goal of net-zero energy consumption to energy production.
Looking forward, nuclear fusion (not fission) is going to further accelerate the declines in energy prices.
Nuclear fusion replicates the power of the Sun. It is 100% clean energy that can produce power 24 hours per day… with no radiation or nuclear waste of any kind.
And with nuclear fusion, one unit of energy will produce six to seven units of energy. Talking about abundance… It will result in a limitless supply of cheap, clean energy that is completely sustainable.
It’s often good to take a step back and get a bigger picture perspective at how technology is improving our world.
Apple’s latest move will boost cybersecurity around the internet…
Apple just proposed a standard for Two-Factor Authentication (2FA). 2FA is a great security practice that verifies users with two different forms of authentication.
For example, the first would be a username and password, and the second would be something like a one-time code that is sent via email or text message.
Using 2FA technology is a best-in-practice method for keeping important accounts and information secure. In fact, I would go so far as to say that if we are using a bank or brokerage account that doesn’t employ 2FA, we need to find a new bank or brokerage.
Of course, the only potential problem with 2FA is that it can be difficult for people who aren’t computer savvy. For elderly consumers who use the computer sparingly, retrieving a passcode from their email or text messages may be overwhelming.
And that’s where Apple’s 2FA proposal comes in. Apple proposed making the process of receiving and inputting the second factor of authentication automatic.
Apple plans to embed details about the website directly into the text message. That way, when a user is logging into their account, they will get a pop-up message on their phone.
That message will ask if they authorize the sign-in. If they tap the button for “yes,” they are logged into their account automatically. No more searching for passcodes.
If the URL in the web browser does not match the website information in the 2FA text, the login will fail. This could alert users to a potential scam or phishing attempt. Because the process will happen automatically, users won’t be tricked into entering their 2FA code on a false website.
I love that Apple is doing this. To be clear, Apple has no financial incentive here. The company is really doing us all a favor with this proposal.
By largely automating the 2FA process across the web, Apple is creating the kind of simplicity that a mass-market consumer wants. It is also improving the overall experience that an Apple iPhone user will have.
Assuming a new standard is implemented, this will increase the overall security on the internet. And it will especially be important for those who aren’t currently using 2FA because it is too difficult.
Apple will likely be successful with this proposal. Google engineers have already spoken out in support of the standard, and other companies will likely follow. I expect we’ll see this updated 2FA roll out later this year.
This company is creating a rating system for the Internet of Things…
Underwriters Laboratories (UL) is a nonprofit safety certification company. It has impacted all our lives, though most of us have never heard of it.
In fact, if we look at almost any electronic item in our homes, we will find a “UL” logo on the back of it. That’s because anyone who wants to sell electronics must get certified by a nationally recognized testing lab… and UL is the best-known lab. And that UL logo means the company has performed safety testing on the product in question.
UL has been setting electrical standards for a long time now. Believe it or not, UL was founded way back in 1894. It’s a trusted, long-standing name when it comes to the safety certification of electronics.
And now UL is set to enter the digital age. The company just announced that it is creating a rating system for the Internet of Things (IoT).
As a reminder, IoT refers to “smart” devices that are connected to the internet. Smart thermostats, watches, heart monitors, refrigerators, alarm systems, and home security cameras are all examples of IoT devices.
This is an explosive growth market. According to industry forecasts, there will be over 30 billion “live” IoT devices by the end of this year. And that number will grow to 75.4 billion by 2025.
But the problem is, IoT is one of the weakest areas of cybersecurity. And that makes these devices relatively easy to hack.
UL’s rating system will give consumers a way to quickly determine whether an IoT device is safe enough to deploy in their homes.
For its system, UL came up with five different “levels.” They are bronze, silver, gold, platinum, and diamond.
The Rating System
Source: Underwriters Laboratories
Devices with a bronze rating are “good enough” to meet basic standards. On the other side of the scale, devices with a diamond rating are incredibly safe. They include aggressive malware protection and require that stored data not be personally identifiable. And, of course, the middle certifications convey increasing levels of safety.
This rating system will be a great tool for those of us who plan to deploy IoT devices in our homes. While we will still be responsible for setting strong passwords and other similar precautions, these ratings will show how closely the manufacturers of our IoT devices are paying attention to the security of their products.
While these kinds of ratings might seem a bit silly to IT experts, I like UL’s initiative. It’s a commonsense approach for the mass market. I encourage all consumers to check for the UL’s safety rating before purchasing any smart devices going forward.
Editor, The Bleeding Edge
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