 Yes, you you're actually very lucky that I'm not playing music for you because I'm think I'm a better speaker than I was a musician This unfortunately cannot be evidence because I was busy before the internet before Every single thing was recorded and being made available worldwide on YouTube and other places like this so I Want to kick off and say no when I read the report and the previous of the report when I saw the presentation It really surprised me that one word kept coming back and that word is stagnation It seems like not much is gonna happen And I can't tell you how much of the opposite of that is that what I experience when I work with people It is like an express train. It's like it's like a rocket blasting off. It's not stagnation It's it's opportunities that are coming up right now that we've been discussing for ten years, but they're finally here You know the Internet of Things What's called the Internet everywhere machine-to-machine communications? Mobility what's called big data? The reinvention of money digital money. I Mean all these things if you string them all together you can say that it's extremely exciting times right now For the new things, you know granted, of course The the incumbents are sometimes up for a tough battle like newspapers publishers Anybody remember record labels? Yes, there were also still record labels But so the question is you know, I want to ask first What does the future is do and so in a bottom line? I I kind of look into the next three to five years I try to touch the future this way and I work backwards with my clients So we don't sit here and we say how can we extrapolate from what we do today? We try to travel five years from now and say what is pretty Certain going to happen five years from now give a simple example when I worked in the music business And I was fortunate enough to to meet all the greats musicians and music industry people And I was in San Francisco 1999 a Napster and you remember Napster, you know the downloading software So when it all got started so when it got started basically it was clear then this was 1999 It was clear what people want is to have the jukebox in the sky You know a place where you go to you click a button in the music place that was clear 1999 Was not rocket science. It didn't have to be a futurist So what was the response of the music industry is to say well I but we don't appreciate this idea because it doesn't really jive with our idea of selling boxes, you know units and 50,000 lawsuits later and 50 initiatives like so pie and how dope I know how dopey and all these things later What do we have seventy-four percent decline of recorded music? And what do we have now music in the sky spotify? Simphi finally have it so it's not that hard to actually see into the future and Part of my job is what I call pattern recognition All of you do this every day But it's hard to do when you're actually operating companies is to also think about the patterns of the future and the companies I work with sort of take those patterns and try to work that into business model and I think this is something that is Really happening in all companies now if you want to download my free books and all my other stuff You can go to my website or follow me on Twitter if you are tweeting, which I certainly hope you are so you can hang on to the future So here's the key question I have for you It is a confusing world today I mean think about all this I mean if you are if you're in a business position for example of a newspaper publishing You know that you can't really force people to pay at the same time Advertisers don't come to you and throw money for you at you for your website So the signs are pointing in all different directions and the question that I have when I was looking and preparing of this What is the new road map for Luxembourg and for the businesses in Luxembourg? And is it going to be smooth sailing for money? Unfortunately, I couldn't find any euros. They could only find dollars Or is it going to explode? We're going to have a money ball explosion and the funny part is you know I live in Switzerland and there are so many parallels between Switzerland and Luxembourg and many which ways and I just became a Swiss citizen I'm a German citizen originally and So I feel sort of compelled to look what's happening in Switzerland Luxembourg was very good study I'll go more into this later But the question is also will we actually not just think about money, but will we be happy in the future? What is the gross national happiness index? You know as the state of Bhutan says and what what does that have to do with money and how do we measure success? How do we measure GDP? China has six nine point six percent growth of GDP. Are they more happy are they more successful? So those are questions and I ran across this website and John Luke then they were sent to me and This idea about what's happening in Luxembourg and you know why Luxembourg is good for business And when I was reading this website, I couldn't help think back to a guy named Arthur C. Clarke a science fiction writer from the 40s and he had a very good comment on this website from 2013 The only thing we can be sure of about the future is that it will be absolutely fantastic So if what I say now seems to you to be very reasonable, then I'll fail completely Only if what I tell you appears absolutely unbelievable Have any chance of visualizing the future as it really will happen That's my message you I'm not going to be giving you any recipes today So I have to disappoint you for this I want to be unreasonable and I would like you to be unreasonable because I think the only way to create the future is to Be unreasonable This is so true from the 40s And when you talk to Jeff Bezos you can talk about Jeff Bezos earlier That's what he did right? He was unreasonable Steve Jobs was unreasonable and the Google guys are definitely unreasonable In a positive way I hope right but I mean if you look what Jeff Bezos did at Amazon He came up with the Kindle nobody has asked him for the Kindle and when he took the Kindle to the publishers the publisher said We don't really like this idea. We want to print books and ship the books And so what he did what did he do? He bought the books for the regular book price He made them electronic and he paid the publisher 30% of the price to sell it cheaper to the customers So he subsidized to the tune of 8 billion dollars So that we get to use the Kindle and now today guess what more people are reading books on the Kindle than in print So that's what it takes is to be unreasonable and I think this is a very tough lesson for us central Europeans You know, of course in Switzerland. We're never unreasonable. You know, we're always diplomatic and safe and secure and independent but Unreasonably, I mean if you think about unreasonable you think about two people right the Chinese maybe and the Americans Because you're thinking about basically what's happening in terms of mindset. We have to develop that mindset here This is I think is crucial. We can't be complacent because the speed is just mind-boggling Exponential technological leaps. I'm not a tech guy. You know, I'm originally a music guy. So I'm not a techno maniac, but Technology is mind-boggling if you see the changes that were already experiencing every single day the other day I went to my doctor and I had googled my problem before and I said look I found this what do you think about that and he said, you know What I don't care what you have googled. I am the doctor Let's say volume that that's not the response. I was hoping to hear from my doctor, but Exponential technological leaps. Here's an example five years from now You will be able to touch through your phone computers will be able to not only look at images, but understand them Come here. Yeah, what matters a computer system will know what I like to eat better than I do Computers would have a sense of smell Today my ambulance know all about a bike accident just by talking to a helmet It grabbed the patient's record before we even picked him up It found out the doctor. We need it was at St. Ames And it got is okay on treatment from miles away. It even pulled strings with the stop lights My ambulance talks with smoke alarms and pilots and stadiums, but of course, it's a good listener, too That's a Cisco video. There's a reason for this right, but If technology can solve all these issues and if we can get connected with the Internet of Things if my health records are in The sky when I have an accident in Chile, I can be immediately Connected to the data. Those are technological leaps that are absolutely mind-boggling big data ubiquitous connectivity real-time so-called social media cheap devices at the Internet of Things This is a graph from from Ericsson how that is Taken off what they call the third wave of networked everything Ericsson is predicting 50 billion devices connected to the Internet And I'm not talking about toasters and refrigerators So I'm talking about sensor networks in the in the traffic lights in my car Right in my asthma machine that I may have to use to measure and connect with others mind-boggling possibilities a smart a smart world that is going to save 40% of co2 emissions Could be saved but people could be put back by having technology make it more efficient 40% So if we if we made a switch to renewable energy and did this, right? We'd be home-free theory at least Intelligent systems for a connected world. I mean Exponentiality according to Ray Kurzweil another famous futurist that you may know the founder of a singularity movement This is the issue with exponentiality. Yeah humans aren't exponential So if I work 16 hour days, I'm not going to be you know at twice as productive and I work eight hour days You know, that's not the way it works with us Because we're not machines yet so What I'm contemplating is when I count one two three four five It's quite clear, but when I count one two four eight sixteen thirty two That's exponential, and I tell you right now that we are at four and the next number isn't five. It's eight and And this is the reason why we can't afford to sit here and say let's take a swiss Wait and see attitude It's not gonna work because by the time I've seen it. I'm toast I'm already run over by the exponential future. I mean looking at these devices, but it's all that stuff is now on an iPhone And the blind spot that we have because we can't think exponentially is very very dangerous And this is a cultural thing, of course Well, what we have to do is we have to start thinking exponential Into our business model for example here some key transfer in 2020 Global population growth everybody knows but 65% of people will be connected to the internet in 2020 that's almost five billion people and Who are they? Well, we already are connected, right? They're the Russians and the Indians and the Indonesians and the Chinese and so on They will change dramatically what we do Because all interconnected How we pay who we pay? Where we get information from and do you think that your business model from today is going to be the same in 2020 with five billion people connected I mean clearly with Google Glass and the rise of data and the self-driving car that Google is coming up with that's based on data 3d printing where you can print your shoes iPhone covers and of course you can print a printer as well And and here is a device that allows you to connect your home heating system and the air-condition to the iPhone called the nest Using such a device would result in over 40% energy savings in homes It's already been investigated and five million people are using this augmented reality Shopping with virtual reality to where you can tweet or Facebook the dress and get responses from your friends in real time That's something you would do every single day. I'm sure augmented reality shopping I mean mind-boggling the stuff that we're seeing here in three years. We will not be using translation things anymore We will have automated real-time spoken and written translation into 25 languages Not finished to sweet to Chinese for example. That's kind of difficult But I mean this already working the other day I was in the Google apps that I spoke into a mobile device in German and it came out in Chinese in real time Imagine how that will change your business in 2020 so Mary Miko who is the lead investor in Facebook, sorry to say but She publishes a slide every year. It's called the internet trends and you can download it from the client up Perkins website But she talks about the reimagination of everything And this is so true if you're looking at you know, most of you have kids I assume if you're looking at your kids and how they consume television They don't even know what it means to sit down at quarter after eight for Todd or it or something, you know They would never understand. I mean they have reimagined how this works. They have reimagined education They learn on YouTube. They go. I mean it's mind-boggling how all these things are changing and Einstein has said Imagination is more important than knowledge Knowledge is limited imagination and circles the world. So what we have to think about So how can we imagine what we do a couple years into the future and This is really sort of our roadmap the roadmap that a reimagination of everything and of course part of that is unfortunately Taken a leap trying something you haven't done before and again This is something that is very difficult for us here in Europe I lived in America for 14 years. We're leaping as part of the daily sport and if you haven't gone bankrupt once you haven't lived So this is a different cultural thing, but look at what happened for example Apple made 50% of the money with the iPhone that wasn't here five years six years ago The Kindle is now generating huge amounts of profits That wasn't here five years ago linked in that we all scuffed at years ago and saying what do we need this for? Make an 800 million dollars now having invented the market essentially and And giga ohm says over 70% of Apple's revenue and almost 50% of IBM's comes from things that weren't here a few years ago So I would propose to you a majority of your 2018 revenues may well result from products and services that don't exist today and that's pretty safe to say So what does that mean? It means if we don't start creating things that will be there now The half of your revenue will be gone. That's what it means and I can tell you this is quite obvious in many instances You know in the publishing business of the media business. It was obvious But we don't sometimes we don't like reality. So we prefer to hide But this is a difficult thing to do now when your business is sort of going okay is to contemplate that it may not and Make those changes So here's some bottom lines to start with one the future cannot be extrapolated by looking forwards from today In other words what works today is very likely not to work tomorrow Because of the extreme exponential change The other thing is that we have to get used business as usual is not coming back ever anywhere What work then is not coming back. We don't have to keep looking for it The growth that we've known is not coming back because we have saturated because we have used what was there We have done this Traditional event that just may become obstacles if you aren't successful today that is an obstacle Because you know if you're not suffering why would you you know why would you reinvent if you're not Troubling with your wife. Why would you get divorced? It's the same thing. Yeah, so it's either pain or love you have to do something So if you're looking what happened with a lot of the big innovation of the past Steve Jobs fell in love with the idea of a touch screen And when I work with Nokia, they said to me know what nobody wants touch screens Yeah, sure. Look where they are now So they're you know falling in love with the idea is crucial huge opportunity is generated by technology and the resulting habit shifts And this is no this is certainly true in the financial markets The habit shifts, right? Well, that's not really a shift, but it's pronounced now. There's a deep trust crisis with financial institutions That's a fact and The habit shift is to not trust them to begin with So how can you actually work with this with technology to actually help this so when I was looking at the slides? I couldn't help kind of have a laugh about this When it says the decision-makers said okay a majority assumes that social media is somewhat interesting But right now social media has a minor impact, right 53 percent. I Want to ask where have you been? Until now if you if you think the social media has a minor impact talk to your kids They prefer to watch algae zero on Facebook then they will switch on the TV They exchange information all day long on all different platforms I mean social media is something where we could say, you know, if you have the Swiss attitude and maybe also Local attitude to some degree as I could see from the slide side Wait and see wait and see really means please forget about me wait and die same thing So that's that's really the consequence and I can't tell you how many clients I've seen seven years ago That said, yeah, this all sounds good and we should do that, but you know, we don't take risk here And they're dead They did I mean not because of my bad advice, but a good advice for that matter But yeah, so let's take a look at the traditional business advantages And these are all good advantages and they're very much Swiss and Luxembourg combined in a nutshell Advantages on location geography people demographics Working ethic and so on based on legislation regulation No, we have a pretty much the same background here Advantage is based on access to information and what I call data exclusivity Having access to something that somebody does not So data information scarcer to your resources money for example as a resource Those were good traditional business advantages and and you have exported those here in Luxembourg to a very nice degree And I congratulate you for that But that's a burning platform Because these advantages are still here But now there's new advantages being desired and they look like this right They look they're part of the networked society of the network effect that goes on on a global level now And they include things like this Creating new ecosystems Creating things business models that work together and across boundaries and this is over the European thought of course, but it's not so easy to create an ecosystem when it's incomplete Again going back to publishing biggest problem is ecosystem isn't complete It's not that people don't want to pay. It's not that advertisers don't want to advertise But it's not put together yet. There's there's gaps there So when you're living in this gap, it's a nightmare, you know, so you you have to create ecosystems and You have to become indispensable The car companies today Audi BMW Volvo. What is their first initiative now? It's no longer the fancy sport car for the likes of you and me What is it? It's a self-driving car Self-driving car. Why would I buy a self-driving car? You know if you like cars, it's useless, right? but Google came up with a self-driving car and Everybody was thinking what it why is Google doing this? Well, the reason Google is doing this because when I'm in the self-driving car I'm going to use Google Rising tide floats or boats Google becomes indispensable Now I would submit to you if Luxembourg as a financial Place for financial organizations and funds and so on if it doesn't become indispensable by added value It will be dispensed dispensed with that that is just that's the option You either indispensable or somebody will dispense you That's what happened to all of the large organizations So in the being indispensable is going to focus on speed offensive innovation Offenses meaning changing something that is painful, but has a better result and The strategy based on abundance There is no shortage of money. There is no shortage of money It's abundant, but Where does it go? I mean, how do we get how do we have a strategy that merits it? Why why is the money all moving south and east now? Because of GDP growth. I'm not sure and then we still have the old values They're here. They're also really powerful values as well. They're not gone so bottom line is And I can safely say this is about Switzerland. I won't go as far as saying this about Luxembourg I don't know enough about Luxembourg and I've been here a few times, but if you live in a dome of protection You know and in a bubble and a protected space. You're lucky Because people have to pay to get in and you can control the dome And this is what happened to a lot of financial institutions for banks for record labels for publishers for satellite companies They build a dome it was expensive and to get in you have to pay and they even privately lived in their small little Dome surrounding their heads you know their mindsets and Some of that still works, but the future really is about this right the future is about interconnecting business models About being part of a setup of wheels Let me ask you a question now considering your natural inclination of humans to control the wheel or to be the wheel You know Apple type be the wheel This doesn't feel very safe to us because you know the other wheels are also moving and we have to somewhat keep a Steady view on this we can't control the wheel But what is the likelihood that you can be the only wheel That likelihood was pretty big 20 years ago. You know likes of Microsoft and others. They were the wheel. That was it But now a skype, you know from this country more or less launched Skype is the best example. There wouldn't be any skype if the other users were online providing the bandwidth for skype It's a peer-to-peer system So the future is about this right it's about creating and being an important player in this ecosystem and of course that will be The redefinition of growth along the way if you're looking at growth as just GDP. I think you're missing the boat You know if we're all just chasing profit and growth in one direction will eventually explode I mean if you know see what's happening here with numbers are quite clear, you know China India in Ethiopia Mozambique in Tanzania have the biggest growth in GDP Well, it's obvious reasons why that is we have to redefine it and the chief of HSBC said their new reality is in the Guardian. I am afraid a world of significantly lower growth stack nation Where the gap between our expectations and actual income is getting bigger day by day How do we redefine growth? I mean, what do we actually do with growth? So here's a roadmap for this way when looking at this, this is traditional thinking about growth You know road maps plans targets return on investment campaigns, you know military terms Linerity stationarity projections and so on a good MBA battle map But this is where it's going now all of a sudden we're saying oh, it's about networks Connecting with other businesses creating networks creating interfaces API as flows return on engagement resilience agility speed I Mean if you're not 15 you'd be scared Because on these are all skills that we have said and we don't really need this in the same way Agility and resilience we want to be powerful. We don't want to be resilient But I think this is where our future is going is we're going to be more like a scaffold The strongest building material in Asia by the way bamboo We're going to be more like a scaffold than a road to the money Because in this scaffold if something breaks we'll just put something else in it's resilient It's collaborative it works together it can grow in any of any which direction and this is the reason of course Wilds wildly used for building so our economic model has to be more like this. It's not such a clear roadmap like this We'll say you follow the money. I Doubted so basically I think we're heading in this direction and When I was looking at the slides and I got this from the I think from the word newspaper Talking about the vet perhaps face guide the competitive competitiveness. I couldn't help thinking it's like why does it matter? Why does it matter? I think it's going to be more about collaboration's fair. It's kind of the ability to collaborate to create new business opportunities Rather than the ability to compete Each other for the same slice of pies make this make the pie bigger. Of course, that's very American viewpoint clearly But to be hyper Collaborative and I think it was Bill Gates who said it's not about hyper competition. It's about hyper collaboration Our future forward is not about hyper competition is about hyper collaboration Because the the changes in our world are so huge if we don't collaborate We won't be part of them and they can't be seized by just one entity take this opportunity It's a it's a three point four trillion dollar opportunity to rewrite transportation cars trains airlines It's huge This opportunity will not be created by one company or by Tesla or by you know By whoever it this is a collective issue that will require lots of different laws and so on So for example, if I have a car like this and I go for 200 kilometers I'm I'm over right because there's no there's no electric gas station The the ecosystem doesn't exist So I think what we're right now at this point to where we can say no if we can build a system to where we can Complete those ecosystems. That's a huge opportunity That goes for for legal for banking for medical for renewable energy The opportunity is to co-create a new ecosystem not shore up the old one. I Think that is where we're going Give you a short video to give you my mindset as far as how we're gonna get there Again, this is the USS Montana requesting that you immediately divert your course Please This is Captain Hancock you will be burdened your course over This is the USS Montana the second largest vessel in the North Atlantic fleet you will change course 15 degrees Before taking measures to ensure the safety of this ship over This is a light as major to your call So yeah, so that that teaches us something, right? What are we assuming? About the future about what we do that actually isn't so I Mean you would not believe the amount of conversations I have with CEOs about their beliefs that those are truly beliefs. They're orthodoxies right assumptions That govern how the whole company is working working, but those assumptions are never questioned And what are our assumptions about where it's going? I think this is a key question, you know, what do we think? What's our mindset? You know, which way are we going with this? I want to ask you over this Okay, first. Here's the fortune cookie. Blast are the children for they shall inherit the national debt and Here's Buckminster Fuller. You never change things by fighting the existing model some reality To change something build a new model that makes the existing model obsolete So what is your viewpoint? I'm going to build a new model to fight the existing model to make it up. It sounds like a good paradigm, you know, California paradigm Which way are you taking with this? I think when I look at this at the presentation early I'm thinking okay stagnation, you know, we're going to basically give our children the debt That won't work It's already a lot there. I mean this goes for every single part of this. For example, if you're looking at the New York Times and the paywall Okay, the concept That people will pay $300 a year to read the New York Times online Because the New York Times can't figure out how to make it work other which way Was marginally successful, but think about this for a second. This actually goes back to the belief issue The belief was our journalism is worth money Nothing wrong with that belief. I love the New York Times. I love their writers. I love their content Nothing wrong with that second belief was if it's worth the money you should pay up Not a good idea man, because in general people have never done that It's supported by advertising That's not a secret. I mean in the US you can buy the entire subscription to the New York Times Correct me on this. I think it's $29 a year Subsidized to other things or $10 a year for Time magazine Because it's subsidized by advertising Well, I'm not I've never paid for time over New York Times and in reality so What we have now the BBC guy took over Mark Thompson took over the New York Times And they're realizing that if they go on like this is not bad. There's not gonna solve the problem This is the most beautiful newspaper in the world really and allegedly the best writers $300 a year guess how many subscribers they have This is a chart showing the growth right now. I think they have roughly 1.3 million subscribers That's not bad, you know, it's 300 million dollars something like that But are they gonna get to 50 Nope, they're gonna increase costs decrease cost. Nope. They're gonna lose the advertisers. Yes So really what we need to see how how do we believe shape businesses? I think it's about pay will not pay wall That's that's the secret People aren't cheap people aren't bad people aren't pirates people aren't cheaters They pay for value and Where do they pay the Economist? Atlantic linked in pro Harmville Netflix Spotify, I mean people are paying for content. So let's figure out a model. I'm how do we do this? The movie industry has been famous for the scene on the left, which is to hide the content at all costs or Shall it to the likes of us who will pay seven euros to watch it for 24 hours? And I do that so I'm not complaining But look at what Netflix has done Netflix, you know the online service for $10 a month unlimited streaming 40 million users paying $10 No questions asked right now is it not available in most countries in Europe for licensing issues, right? But I mean look at this. I mean pay will pay wall and Netflix has achieved the goal of pay will all of those movies I can download some wells If I set my mind to it So the lesson is the future is not a zero-sum game is not you win I lose or you lose and I win it's not that game any longer the future is a game to where we can have several wins It's possible because of the technology changes that make things abundant when things are abundant You don't have to kill somebody to get their food There's enough food for everyone Scarcity based models are ending if your company is based on scarcity some sort of you know God forbid even artificial scarcity You're in deep trouble Because your people are finding out now that this is really not scars. You're just making it scars Like music for example here lending online. It's exploding financial advice on the web Exploding how are you going to be scars? How is information about money going to be scarred? It isn't as Peter Diamantus said who was also a colleague of courts while he wrote a great book called abundance that you should read and He's basically saying abundance is replacing scarcity as the key operating paradigm We have to base our future business model on abundance abundance of information abundance of users at abundance of marketing abundance of media and abundance of money That sounds kind of strange when you're thinking about the current you know financial situation they're wearing But basically when everything moves into the cloud everything is there my health records my movies my media files my My data everything is there and abundance has all these things that are completely opposite of scarcity So this is a concept. I think we should investigate The other thing that goes with this and this is not just true for media is that we're going in on a global scale from ownership to access Our first true for music, of course, you know, nobody owns music anymore. We just click on it in a place Nobody owns movies anymore and you don't collect those weird boxes with a tape inside You just click Now a lot of kids in America and this is a global trend don't get a driver's license guess why they don't want to own a car They want to drive somewhere they take public transportation or they're being driven or they're going to use a self-driving car Or they don't need a license The trend is clear we're going from this idea of the proud ownership of cars the proud ownership of books the proud ownership of houses and rental houses and airplanes To a sharing and lending model and this is a good trend because there's an entirely new business unfolding Oh, Avis just bought zip car for example for that very same reason from ownership to access and to go back to news one more time because there's a lesson to there a newspaper companies have learned something and that is That what they're actually selling isn't the content The content is the reason of course the reason to be and this has to be good content and it's it's the core of things But the selling of it the money Comes in through added values like this chart for my colleague Ross Dawson shows that all the added values that you can add To the deal that seal the deal for example here. You can see interfaces community filtering relevance aggregation slumliness I mean if it wasn't for Twitter Nobody will be watching CNN anymore Because that's how Twitter gets to be timely How CNN gets to be timely so back to the economist I mentioned earlier I Subscribed to the Economist and I love their writers But I would never want to have the printed Economist because I usually don't have it when I want to read it It's somewhere in my living room right and it's I consider that wasteful basically So the reason I pay a hundred bucks or so for the Economist is because when I'm in the car I can't read I can listen to the Economist as an mp3 an audio and I'm paying for the ability to listen as an audio. That's what I pay for I Love the writers. I would never pay for the MP3 of the writers were bad clearly But the reverse is also true. I would never pay for the Economist if it wasn't for the audio and And that is the future of many of our businesses the future is that we have to add value We have to add value in a hundred different ways if you're publisher if you're if you're power company if you're utility company if you're a satellite company you have to add value continuously because they become the new core adding values around the core and You can download the slides later by the way But Kevin Kelly calls these things the new generatives the new reason to buy I can tell you one thing If you don't get reason to buy from your clients There's nothing you can do you can't force them to buy You can't force them to come to you and say yes We're going to stay with you just because XYZ they have to have a reason when we have to generate those reasons and those reasons are always changing So the other thing is that I think we have to face and this is a real European Issue We're now interdependent What we do in Switzerland can't just be put behind the Alps and forgotten I mean basically we're now in a place where it's completely intertwined all of our fates are intertwined the fates of terrorism The fates of energy mean in Switzerland. We want to get rid of nuclear power But in France they have 50 stations right across the border, you know, what good is that going to do to us? So it's all interdependent our economic models are completely intertwined so it makes no sense for us to try to take them apart and become independent again There is no such future It won't work Interdependence of my view is the new default And if I look at the coverage now basically I think the future of Europe is interdependence Based on some independence of course, you know in certain matters But if you're looking at this and I think it's basically quite clear that we're heading in this direction I'll give you some examples This is taken by the way from a great movie called connected with Tiffany Schlein that you should watch This scene with the trees is taken from that movie So very much like this basically I think lateral growth, you know, education I mean we're looking at a three trillion dollar shift of education to go online Textbooks, e-textbooks, subscriptions, video classes, remote learning, digital learning, lifelong learning, online training We're not going to be successful with this unless we do it interdependently Because there's many issues to be solved Advertising, the future of money It is very likely that in 10 years we won't have credit cards Why is that likely? Because you know we can just carry the same numbers with us on our mobile phone The only thing that stands between that is privacy And we can solve that So I mean basically all these things are pointed to one direction You know, if you're looking at all this stuff, emissions as I said earlier We can reduce CO2 dramatically by collaborating on technology solutions That doesn't mean we don't need to make that switch This would be an addition Interdependent lateral growth I think is our only future My question I have for you is Luxembourg in a unique position to shape this future I think it is, much like Switzerland, interesting Except the Swiss won't do it So the question, I do my part to get them to that point But I think being in a unique position to build an interdependent ecosystem That's what we're looking at I mean this is the future of money, it's the future of medical, it's the future of media It's the future of what we're looking at And the question I have in that context Market maker, market taker, market waiter We have Americans who clearly know they're cowboys, right? They're market makers, Brazilians They're the new Americans Market takers, we know who they are They can take anything, mostly without paying, but anyway And here we are in Switzerland, the market waiters I think being a market maker is a recipe for disaster Because as things speed up and everybody's gearing up to being a market maker So everybody's gearing up to be a maker and then we have a big issue So what is Luxembourg? Can you move this over in this one direction a little bit? And this is essential, this is not an option It is not an option to be a waiter When the speed is exponential And everybody's gunning for the same direction And we have growth as lateral How can you be a waiter? You look like a run over armadillo by the side of the road later I mean, look at these slides Most major Luxembourg companies are not especially concerned about alternative online business models Let's go back and say Most major record labels are not especially concerned about the internet They'll just sue everyone And so we'll solve the problem I mean, nobody will be safe from these disruptions of these new business models that are happening Nobody We think that we're safe because we have existing clients We have trust relationships, it's a people business and so on and so on But the reality is, if you look at LinkedIn as an example LinkedIn has killed the entire human resources and head hunting business in one stroke All of the hiring is done now through LinkedIn LinkedIn And I mean, how has that changed everything that we do here? Technology, user empowerment will disrupt more and more cash cows Because those cows are ready to be slaughtered I mean, they've been a long time Take a look at this slide for telecoms Anybody from the telecom business here Telecom, I think, currently makes about 370 million dollars a day in SMS Well, guess what? When people have a data contract They stop using SMS because they can use WhatsApp and Viber to make free phone calls And they can do all the other things like Twitter and Facebook They stop using SMS That's what we see here Over the top, OTT, service platforms are replacing SMS The 370 million dollar cash cow per day is about to go to the butcher This is happening everywhere It's happening with doctors, with banks, with insurance companies We have to think about how we react And I think the end of protected spaces is near If you're looking to go back into that dome Good luck It's already cracking all over the place I mean, the consumerization of technology People are expecting everything They're comparing us, they're rating doctors They're rating hotels and they're on Airbnb They're renting to each other I mean, it's a nightmare, right? I mean, for an organized business, it's a nightmare So the end of those protected spaces is here And this is the next on the list Clearly, you know, media is already in the cracked dome Or the dome is already evaporated Next is telecom, banking, money, medical, and pharma And the pharma companies are looking at this and saying Oh, this is actually not so bad Because we can find people who can help us solve complex problems Chemical problems that are not working for us We cut them in on new medications for rare diseases, for example They're already doing this They're crowdsourcing those new formulas They're already doing this So we're heading into a direction to where Pervasive mobile connectivity will radically reshape Everything that we do How we travel, how we vote, how we find information How we report things And this is, I call this the tyranny of transparency I mean, as a business, you're naked now You're essentially naked Because somebody can always report on you and change something Everything becomes ICT Lucky for Luxembourg Everything becomes technology or content, one of the two A doctor is going to have the power of the Watson IBM computer At his disposal anywhere in the world in the next five years And the Watson computer can tell him For this kind of cancer that you're looking at I've got 247,000 cases And it's very likely that this is an answer It's not going to replace the doctor But financial services, you know You can push a button and say Give me an estimation, anticipation Of when I should buy this fund or not And the computer will be 99.9% right That's already happening I mean, you work on this every single day So a key point here is That data is truly the new oil And I mean this quite literally This is not for me, this is already born in 2006 This paradigm by I think the American Marketing Association Because everything that we do now is about data Where we are, what we like Every bank or every financial institution in the world Wants to be liked on Facebook And I think of the irony there But data is truly the new oil I mean everything we do creates, generates data And when our cars are connected Everything and our plans and our toaster And our refrigerator So maybe Luxembourg could be the next UAE Maybe Luxembourg could be the place for Where that data is being distilled and refined And stored and treated safely There's a couple of states looking for this position But this, I mean, just this alone Will put the word stagnation into the bag For the next 20 years And it's up for grabs You need a lot of know-how for this This is not trivial Big data, big intelligence, big opportunities One of those is the fortune cookie No, it's prediction Predictive markets There are already people buying stock Based on Twitter predictions called tweet stock You can check it out But basically what's happening is When we have data we can predict things Google is already doing this And we can use this for lots and lots of reasons But I think that what's happening with big data Is that unlike oil, it doesn't pollute It cannot be owned by a bunch of companies Because the data is interactive and fluid It has to be permitted to use the data So it cannot be owned like oil This is a very, very powerful business scenario Because everything is moving to the cloud We had already discussed this And everything is using mobile And there is an aspect here that I want to bring to you Is that I think a certain future is for us Is to pay for our privacy And this is kind of ironic because When I was a musician I paid for publicity I actually paid a lot of money For people to come and see me Or actually find out about me And now I'm going to pay people Not to be found in the reverse But that's going to happen I think we're all aware that As business people we have to be found People have to be able to look at us But who is allowed to use what data? Can people see my health record If they know how to get in So there is a key need here For safety trust, for United Nations of data And the European Commission Is talking about this every single day How do we do this? And the Commission has said I think we have to have the right for privacy We have to have the right to be left alone That has to be part of the future also So here's the opportunity for you All business is becoming dynamic Real-time, social, mobile, local Fluid and predictive All business And much like we can't sit here and say You know people are downloading my songs Or my movies for free and they should pay The answer is not to tell them That they should pay But to create a mechanism for them to get involved And the same thing is here If we don't like what people are doing With us and making life harder for us It's not up to us to tell them That they should change their behavior We're talking about 5 billion people here And this is what they're going to do If you see over company They're going to want to see your face And a video with you And they want to see a product video And they want to see you on a LinkedIn page They want to see all these things So how can you say that it's not important? I don't follow I mean basically these trends are Huge paradigm shifts From the industrial age To the age of social, local, mobile And very soon to the age of human machine combinations Which I won't get into because We'll take another 5 hours Another point here is that so far We've been very happily operating in silos And I can attest to you from first hand experience This is a huge problem Because when you go to companies You know you've got the marketing guys You've got the R&D guys You've got the tech people You've got the money people Everybody's in their own silos And as companies we are in our own silos This is guaranteed future failure Because if you're a deep expert with money That is highly valued now But the future is going to be You are a deep expert And then you can also go lateral You can combine things Clearly it's going to be Combination of those two things Otherwise I think we'll see system failure Like example the music business here Closed systems are becoming Quickly isolated, disconnected, expensive Slow, irrelevant and then die And does anybody remember who EMI Records is One of the biggest music companies in the world They're owned by some Siberian guy I think But I don't know where they're going to go with this But basically I mean looking at this graph It's clear When you run a closed system When people want an open system You're not going to be successful I mean Android, Google's operating system Is doing over 2 million installs a day Because an entirely open system It's beating Apple hands down on a worldwide level So looking at this basically I think this is one of the things that we have to consider We have to throw that switch towards open And open I don't mean naked I don't mean free I don't mean idiotic In the sense of everything is out in the open You don't get paid With open I mean an attitude The question is going back to this report This shift will be bad for the financial center 65% of people in Luxembourg agree That this shift is bad but the same ones are saying This is a good political move So what is it? You're going to be open or you're going to be closed That's the question you have to ask And there's no choice saying We'll be a little bit here, a little bit there And basically openness fuels growth Bottom line, that's it Look at the stats for Android Look what happened with all the things The things that Google is doing with Google Now that's all based on open data, open APIs Open platform standards Stuff that we know from Linux days Openness fuels growth Now that doesn't mean that you can't close At a certain point and harvest the fruit of that growth By being a little bit less open Lots of companies do that I call this open AMAP Open as much as possible And if you look at what's happening with American Express How they're giving away all the cherished financial information On their website, the open forum for free How GlaxoSmithKline is giving away 2 billion euros worth of cancer research In the hope of finding somebody who will contribute to it How Unilever is doing this That's a clear strategy for the future Open as much as possible And then find a place to make it a little bit less open And monetize in some way Hertz A company I've used for the last 15 years I haven't always been happy with Hertz In fact, last month I decided I'm not going to run from Hertz anymore I won't go into that story But then I read this And I tried it Using Twitter as a customer service platform So Hertz has decided that they have to be open About all the stuff that has happened in the past And they're using social media to show this They're using Twitter for customer support And publishing those complaints And I decided to stick around and give them another try I mean, we're basically now at the point to where we are Immersing ourselves in data every single day And it is gigantic to participate We talked about brands earlier And I have no idea honestly Why Switzerland is the number one country brand I keep sending this to my friends They're saying it can't be true, it must be a mistake Allegedly, Denmark is the happiest country in the world But when you talk to Danes, they're saying No, this just can't be true But I don't really know where that starts But Luxembourg isn't listed here But Switzerland tops the ranking of the 25 best country brands I'm not saying that as a proud Swiss I'm just quoting this because I also have a German passport So then Turkey, for example I go to Turkey quite a bit for speaking And people in Turkey tell me the country brand of Turkey is bad For a lot of obvious reasons also, right? So what does it mean? I think countries as a brand has a huge relevance for Luxembourg What do you stand for? Listen to the interview earlier About the most important things in Luxembourg for the future Well, clearly trust and professionalism And those are kind of universal And that's good, I agree with that But what is the positioning of Luxembourg? Is it going to be open, innovative, forward-looking Building an ecosystem Is it going to be about those things More attributed to technology? Is it going to be about this? I mean, everything a brand does that connects to the consumer Is media, everything that Luxembourg does is creating a brand That's something to think about I think it's a unique opportunity Because the brand level of Luxembourg is high at this point So that's a great opportunity to be part of trust There's a great book you should read It's from my friend, Rohit Bargava called Lyconomics And if you know it on Facebook or LinkedIn or so Maybe this is a little bit of a stretch for you Lyconomics means that now it's becoming really important That other companies like other companies and people like companies And basically this whole trust economy is proving again That trust is the only currency that there's left People will do business with you because they trust you It doesn't matter if you charge more They will definitely not do business with you If they don't trust you, even if it's free Look at Huwei, China So reputation, capital, social, those are real currencies We're talking about Facebook ideology here This is somebody who's a Starbucks fan on Facebook Has pushed the like button, drinks twice as much coffee Spends twice as much money at Starbucks than anyone else I mean those things are facts that we have to face Social capital is real, it's not some fancy innovation That came along with Twitter Oh, Lyconomics So I need to come to the summary here I think otherwise we'll be definitely short of our drinks here But I think that for Luxembourg and for Switzerland Swiss ambassador is here, so I'm sharing that with him We have to focus on disruptive opportunities We cannot focus on creating band-aids We're losing an army putting a band-aid over it What is that going to do? We need to focus on making a new body On disruptive opportunities I mean here's a few of them Print on demand, 3D printing This is a revolution that has been brought to the media business It's coming to stuff now Printing stuff, shoes, covers and complex things Even houses can be printed with machines The army is using this Actual houses built with printing machines 3D printing The re-innovation of medicine, medical services This is huge, because all of the technology that's happening there Including the tricorder, digital education I mean what better place for Luxembourg to take a lead in And to make an education go digital Muriards of hurdles, licensing problems Platforms, standards and so on But somebody is going to look at this business and say You know what, if I can make one dollar For each person connected on a tablet computer Every other month That's five billion people connected in such a way Huge opportunity Broadcasting and media The conversions of those two Huge opportunity, the internet of things The human machine overlap I mean scary topics and ethical questions But definitely a huge opportunity that is being Seized on a global level Peer to peer services I mean these business models are not Some models that you can say You know what, there's a bunch of nerds Over in New York doing this I mean remember yesterday Yahoo bought one of those nerds Called Tumblr With 250 million users for a mere 1.1 billion dollars Why do they do that? Because it's a peer to peer platform It's a platform where people do stuff together This is going to be huge Is not going to kill the other platforms It's not, it's going to be in parallel This intermediation If it can go direct it will Airbnb, Uber, taxi service If you want a black town car You don't want to go to the rental company You can go to Uber in New York And a guy will pick you up who has such a car That you can book directly through the web Like Airbnb for hotels Amazon Studios, if it can go direct it will Other great opportunity 68% of consumers around the world Think that companies should do the right thing Parent is whatever that means But most of them are also saying That the number one thing that they should be doing Is to create sustainable products The Patagonia, the jacket company Last year in America launched a campaign About two years ago The campaign had a big fold out in a magazine And guess what it said on there It said, don't buy this jacket If you already have a jacket Do you already need another one? Can you fix it? Can you recycle it? Can you give it to somebody? And this campaign has resulted In last year an 18% sales increase That's kind of paradox But customers want to know that you care About everything that goes on So sustainability is going to stop Being one of those things that you think about When you have time on your right to the airport It becomes something that is part Of the fabric of society And so what's really important I think for Luxembourg also here Is to basically accept the fact That we live in a world of disruption Of abundance Is not going back to a calm scenario We live in Marshall McLuhan global village And we need a global brain We have to think of global solutions Global offerings I mean Luxembourg is very good at this Already bringing people to Luxembourg To work from here But this is basically where we're going with this Let me remind you of one of the key themes We're living in this world now You don't want to be part of the moving wheels Too bad You don't get to have your own wheel You don't get to be in a place To where you can just run the wheels So let me give you a summary Of some takeaway points And then we'll have a discussion First Huge opportunity in creating a European ecosystem Financial services, ICT Renewable energy Internal things Many other things that I've touched on Creating an ecosystem means Really creating something that works laterally Big data Who is the world going to trust To store the data of 5 billion people And I don't mean cell phone data I'm talking about all the data Most intimate data Because that's what's going to happen Is it going to trust Google for that Wait and see is deadly We have to become market makers There is no such thing as wait and see We can pretend that there is But basically it means wait and die Abundance This idea of a zero sum story Like you know I get everything You get nothing or the reverse is over There is enough We can make a bit up high There's abundance of ideas Abundance of technology Abundance of innovation Abundance of money So the other thing is that Because of this fact that in 2018 Most of your revenues will come That you haven't even thought about today That means innovation is the only chance It's not something that you can discuss You know between product launches Google guys get 20% of their time To work on Alphar projects New projects and $50,000 Discretionary budget to make them They have 1,250 or something like that Alphar projects That have nothing to do with the current business So turbo charge innovation is crucial It's not something that we can debate on Hyper collaboration Not hyper competition The US post office last year Signed the deal with UPS Which is the biggest enemy Of any post office in the world But especially in America To collaborate on delivering local parcels Because it was clear if they do that They can gain together Rather than die individually The Internet of Things, ICT Internet of Things, machine to machine communications Artificial intelligence That's obvious, I'm telling you it's obvious But the opportunities there are mind boggling And they also have to do with trust Nobody's going to trust people Creating artificial intelligence to replace people And openness And this is the reason why you should care about social media Because it's not about Facebook Or any of those fake leaf on things It's basically about saying that we care To connect to others To talk about what's going on To look forward Openness, fuels growth So I want to thank you very much for your time and attention I hope I didn't kill all of your future hopes I hope I actually got to kindle some of them Not with the machine but with fire And so I have a website called goodcloud.com This is a Dropbox folder You can download all of my stuff My books, my presentations And the slideshow sometime later tonight And now...