 The signal from the noise, it's the Cube, covering Interconnect 2016, brought to you by IBM. Now, your host, John Furrier and Dave Vellante. Hey, welcome back everyone. We are here live in Las Vegas for IBM Interconnect 2016 exclusive coverage for SiliconANGLE Media. This is the Cube, our flagship program. We go out to the events and extract the signal from the noise. I'm John Furrier, my co-host Dave Vellante, Scott Amix, who is a managing partner at Venture First, CEO at Amix Plus. Futurist, thought leader, conversationalist, soon to be Ted Talker, welcome to the Cube. Thank you very much, John and Dave. Appreciate it very much. So, I love talking about the future because it's a prediction today and if you're wrong, everyone will forget that you made it without social media now, they'll know and they'll call you on it, but the future is unwritten right now. We know that the digital transformation is causing a lot of angst. Certainly on the startup side, unicorns are becoming no more unicorns, you got Uber out there, you got all kinds of things happening, identity, cloud, all points to one thing. These are major infrastructure replatforming going on. Data is now a critical development element in all aspects of stuff, whatever that is, IOT or apps, and the consumer, user or client, however word we use, has expectation changes. They want things differently. We have a 12-year-old kid up here who's a genius programmer. The world's changing. You know it's changing. How do you think about that? Your job is to figure that out. What's your take on this? Probably a good starting point is, let's first talk about it from a framework. So, one of the frameworks that's emerging is this notion of personal empowerment economy. So, we've heard about the shared economy, we've heard about the network economy, but the personal empowerment economy addresses something that's very important, which has to do with, it's my data and it's for my benefits. Now, one of the things that's very important from a framework perspective is, you've probably heard about the book Flourish, right? Flourish is a very interesting book because unlike the traditional psychology that typically works on how to minimize the bad, meaning the fact that I as a human being are have certain issues and sufferings as just the nature of humanity, what Flourish talks about is this notion of positive psychology, meaning how do we start to empower ourselves? How do we take our human condition and go at a higher level through motivation, through encouragement, through ambition? And it has several pillars, some of which is fulfillment, happiness, engagement, relationship. So, one of the things that's very important is, and you're probably asking the question, how does this relate to Watson IoT or the Internet of Things? It actually has everything to do with the Internet of Things and Watson and artificial intelligence because every one of those pillars can start to be now quantified. So, in other words, I can start to quantify through cognition and emotion and behavioral and context how you're feeling about something, the fact that you've been interviewing non-stop continuously for the last... You know I'm tired. Yeah, exactly, right? And that may be through your pupil dilation, that may be through the skin temperature or it could be your posture level, for instance. There's a lot of things that we can pick up on. Right, exactly. And with the recent reliefs or the announcement of some of the cognition that's coming out of Watson, such as emotion, really what we call affected computing that talks about the mood aspect, the voice aspect, the visual aspect, it gives us a lot of information. So, the future has to do with self-quantification of ourselves. Now, that's a very powerful and important message because when we start to self-quantify ourselves, it does several things. One is, it gives us a sense of awareness. Awareness about our environment, awareness about our relationships, awareness about the content that we consume. Second piece of it is, it gives opportunities for brands for better targeted messaging. Huge. So, let me get down to a little bit more practical sense. So, let's talk the example of advertising. We know that advertising as a whole is broken. Why is it broken? Because there's so much information out there that the consumers have more knowledge than the brand. They piss off the users. They piss off the users, there's more information. Frankly, us as consumers, we know more than sometimes even the brands. So, it is a paradigm that's fundamentally broken. Why is it broken? Because it's a push mechanism. No longer can we assume that by just simply pushing and disseminating through Omni-Channel, that just because you're seeing an advertisement or a creative ad, that you're going to respond to it. So, let me give you an example. Let's talk about the example of Mars, which is a big conglomerate that owns Twitter. I mean, Twisters, and... They might own Twitter. They might own Twitter. They might own Twitter. They might own Twitter. Great company. We're the prime company. Yeah, yeah, fantastic. All the candy bars, right? So, their creative ad is, you're grouching. You're grouching. You probably need a Snickers bar. Well, when you just push that out to people and it's irrelevant, that's kind of funny and comical, but at the same time, it's incredibly annoying. Now, what happens if we turn that around to an influence model? So, one of the things that you guys are doing, which is hugely important, and I'm glad that I've been sitting here, is the notion of an influence model. So, in a messaging context where a lot of the people are taking the conversations away from Facebook, away from Twitter, into a closed environment for a number of reasons, for ephemeral messaging, for reasons of privacy, all sorts of things, but in a messaging platform, let's say that we start to infuse artificial intelligence that can start to understand your text conversation, your sentiment analysis, the actual keywords or the text that's embedded within the actual text that are being sent. Moreover, as you actually take selfies, as you share photos, we can start to understand facial. We can start to identify objects and images within that, those photos as well as the videos themselves. So, what we're doing is we're actually starting to understand, extract insights from these things that's happening. Now, so let's say that John and I are having a conversation, and I say, John, you know, I'm feeling kind of tired and grouchy, you know, it's after lunch, it's been a couple hours, I could use a snack. And what happens is everything that I've shared and said, AI machine learning picks it up, presents to you branded emojis, could be Snickers, could be M&Ms, could be a Twizzler, whatever it is. And because you know me and you know my preference, and this is an important point, which is artificial intelligence helps to a certain extent, but we need to also add that with a human cross-sourcing component. So, we're gonna give you a subset of choices, and you know me and you know that I like Snickers. So you're gonna share the Snickers branded emoji with me. When I receive that, I say, that's exactly what I want. How'd you know that? Versus- It's a reinforced social relationship. That's right. As well as a branded access to content. That's right. Because what happens is had Mars just sent me inserted an advertisement in our text messaging with a Snickers bar, that's not the same as somebody in my COI that says, Scott, I know you, I've personalized this thing, and I know what you need and here it is. And when I receive that, especially in the form of a branded emoji, it doesn't feel like an advertisement. It feels something like it's a recommendation. Now, what that does is it actually triggers something else, which is up to this point, we've only been talking about brand engagement, but that's great. But how do we push it to more conversion, transaction? Well, this is where I say, show me where I can get a Snickers bar. That's near me. Or better yet, which is an area that we're starting to research and develop is this notion of how do I float this? So both of you use Periscope. Both of you have seen and used some of these things that are kind of ephemeral and real time, right? What if I actually put a bit out there saying, I want a Snickers bar. Anybody within this area in this hallway or lobby sees that and says, you know what? I have an extra Snickers bar. And I'm willing to forego my Snickers bar and give it to you for bitcoins in compensation. It may be enough that I can actually buy another extra Snickers bar. Or take it another extreme. Let's say it's a release of a new iPhone. And you don't want to wait two or three days in line for that new iPhone. What if you can actually float this thing and people in line up in the front says, you know, I'm going to have to buy a couple of iPhones anyways. Why not I just purchase your iPhone and then I'm going to deliver it to you and I get compensated for that. Now, why is this model very important? Because the current model is really focused on Uber shared economy where you have the institution, which is Uber, that owns nothing, no assets whatsoever, right? But who's on the other side? It's the distributed decentralized P2P. It's the people. It's a social network. It's a social network. But who is benefiting from that relationship in that shared economy? The users get a ride. Users get a ride, but who's really benefiting from the monetary compensation? Uber. Uber. Not the drivers. Not the drivers. Drivers make minimal wage. That's right. You got it. And more so along that example, when I speak with some of those drivers in Las Vegas and I tell them that, did you know that GM has just capitalized half a million dollars for driverless cars for Lyft? Do you know what that means for you? Of course, many of them say, I have no idea what that means, but I can tell you what it means. It means that they're going to actually lose the job that desperately need to survive in a few years because they will no longer be needed, but rather driverless cars will replace the human drivers. So in other words, in the shared economy, something is not quite right. When an Uber is highly capitalized and it's at a valuation that frankly is ridiculous and it's going to start to erode. So we're talking about- This is a zero-sum game. This is a zero-sum game. We have an opportunity for us win-win scenario situations. So you're talking about a win-win economy. Win-win economy that's purely based on decentralized peer-to-peer model, and it also has blockchains fundamentally built into that as well. So basically what I'm saying is, now you have individuals that request their needs and it could be anything. I mentioned Candy Bar, but I could also be a company that said, I don't have expertise in certain machine learning capabilities. So the blockchain to codify that agreement. That's right. It also decentralizes the data transfer, which I wanted to ask because this is something I want to get your thoughts on because what blockchain promises is this notion of a peer-to-peer kind of network. But right now all the data is in silence. So the quote signaling mechanism, say Twitter, is Twitter data. Facebook has their data. So anyone who wants to leverage the data is parasitic to the network. That's right. So, okay. Now there are platforms like CrowdChat that have that container, that have the extraction of metadata for AI capabilities, which we're doing. But still it's very difficult right now to accomplish this. So someone has to break the silos down. Is that blockchain? Is it something else? What's your thoughts? Well, I think it is going to be fundamentally blockchain, but one of the things that I want to talk about is coming back to the consumer side again, is this notion of a private data vault, secure private data vault. So in an earlier panel, I shared an example of a MIT Israeli startup, which is working on multi-party computation. And it has this notion of encryption at the node at the distributed network. But what it's doing is fundamentally, it's taking the data ownership conversation from the proprietary service providers and putting it into a data vault that's just for you. And inside is perfectly encrypted. So the users are brokering their own data for value exchange. For value exchange as well as for protection. Now what happens is, which is very different from the predecessors of this model, it's not just a data vault where others can just simply access it for monetary gain. But rather, it sits in there in an encrypted fashion and when a company, let's say an advertiser or a brand for instance, have a question, they run that question into the system. It runs a query and it returns a result or a model. But it has never had any visibility or access to the data. Now that's a very powerful and important statement, which is in the future, you will not need to actually see the data itself to be able to gain insights. So you said for protection, okay, but the brand has access to certain elements of that data, are you saying? So let me give you an example. So the example is, I have a badge, all of us have a badge to be able to enter to this conference. That's a way for us to authenticate that who we are and we have access and rights to this conference. What we're saying is, when a company, let's say the Mandela Bay, asks a question, does this person have the authority to enter IBM interconnect conference? Rather than giving my personal information around who I am, what company I work with, all these relational aspects, what it returns is, yes, this person is authorized to come into this conference. Mandela Bay as a hotel organizer, receive no information about who I am as a person. And that is how things are going to be presented and processed in the future. Guaranteeing that the edicts of the terms of service are in compliance. And I believe, I would believe that also in the future that this notion of going to events and paying thousands of dollars for content that already exists on the internet is going to be a data transfer paid admission. In fact, I would argue that with blockchain and data, events will be free in the future, except the past is data. My vault comes in, or I pay cash. I mean, would you give your data up for free to get in and not pay for admission? Possibly. I do it at the supermarket. Yeah. So it's a couple of things. And I'll take it a little bit, two different angle. One angle going back to my original premise around personal empowerment economy is that the reason that individuals are going to want to share their data has to do with the fact that is it edifies, it helps them to achieve a self-actualization higher than they would have achieved otherwise. So in other words, one of the things that makes wearables and internet things very interesting from a timing perspective is that before, if you wanted to understand human subjects, you would have to put them in a research environment, videotape them, take notes. They act differently too in that environment. That's right. You would have to read their pulse, the breathing rate, all of these things. But the wearables in particular are giving us a way to quantify those things real time, to seek the truth. And that's important because if you understand research, one thing that's very important is this notion that most of us actually operate under habits, which means that purposefully, our brain is designed in such a way that for higher cognition, it actually reserved that. Whereas for things that we've already done, such as driving, it actually places it to habit. Well, the habit is something that can also keep us stuck. So I want to get your thoughts on this notion of marketing to the persona of one. Love it, sounds great. I want to get to know you. But that's just not the end game. There's also the human psychology of being part of a community or tribe. There's the act of being belong. So the exchanges of data, currency, sharing have multiple purposes to your point, right? So I'll get your thoughts on that. Persona one is essentially tailoring something for you, the Snickers bar, but also you are also operating in context to a variety of realities and communities. So if you're in a sports mode, you have your sports community. If you're in academic mode or think tank mode. So as people shift their realities, it's one and group. How do you guys think, how do you think about that? What's the current leading thinking around that dynamic? Because persona one makes sense every month. Oh yeah, I want to know that down to the individual, send them personalized stuff, blah, blah, blah. But then also the word, the community aspects kind of gotten watered down. So what I'm going to say is actually very consistent with the framework that I've been sharing so far. That same self-contamination for the self can also be used for tribal as well as for social and communal. So one of the things that's very important is we're having a dialogue here. And let's say one of you shared just a tremendous joke and so empirically through wearables and other ways of physiological data capture as well as artificial intelligence ways to capture the effect of computing. We can start to identify not only the individual, but us as a unit, us as a tribal unit in terms of how we're interacting and how that's surfacing into a unified cohesive emotion, reaction or context. And that's an opportunity to be able to have very interesting pool mechanism, both from a messaging and marketing perspective. One little piece that I didn't get a chance to talk about is this notion of data exchange and data marketplace. The question that you pose is you have a lot of silo data that's behind firewalls that's not really being shared. And I brought this up during the panel as well, which is the real value of data analytics will surface when you start to go beyond the firm specific data and you start to go within the industry and across industries to have this democratic fashion of data federation. Now, how do we do this? One of the ways that I think it's important is to think about it in terms of Alibaba of data. What is Alibaba? It's a marketplace. What if you actually had a data marketplace and I actually pose this as a challenge to startups? You create an exchange that allows for firms to share their data in the ways that we've talked about whether it's blockchain, whether there's encryption in the form of query perhaps so that they don't actually own the data, the data ownership still resides with those firms as an example, but it opens it up for analysis, combining variables for your multi-variant regression analysis. But what's interesting is that in addition to kind of the tradition of Bitcoin and monetization, what could be very interesting is this notion of extracting out the willingness to pay because it's not just simply an auction or bidding because the way you value this data may be different from us and trying to do an auction approach may not be necessarily best, but rather trying to understand from my perspective what is the value that I will put into this so that we can have an exchange sometimes through a digital currency or sometimes through data to data exchange. So you're firm A, I'm firm B, you're firm C, we may actually be interested in your data sets or certain aspects of it, but what is the right level of equilibrium of data that I can send to you that you sent to me in exchange that makes it a bar exchange? Scott, we got to get your address or Twitter handle and other information that we could follow up with you on. Is there a link you could share on your thoughts? Do you have a blog? Is it on Facebook? What's your preferred platform of choice for communicating your ideas? So you can find me on Twitter at Amix IoT and then the place to find me is amixmikindy.com or amixinternetfthings.com and you can see all the articles that I've written as well, it's been covered from New York Times to Chicago, Tribune and Washington Post. Great to have you on theCUBE. Thank you very much. Great, thank you for the future's perspective. You're like an analyst, you should be doing theCUBE with us. We need more expertise like that. Thanks so much for sharing. Thank you very much, I appreciate it. You're hearing it here on theCUBE about the future. It's radical, it's different, it's going to be changing. This is the reality. If you're not paranoid or self-aware, then you will be hit over the head with the digital transformation. This is theCUBE. We'll be right back after the short break.