Industry Insider Archives

Property Investment Market Continuing to Hit New Heights in Hong Kong

According to a report by JLL’s latest Property Market Monitor, the property investment market in Hong is continuously hitting new heights since last year, which is also riding on strong global investor interest.

A total of four en-bloc office buildings were sold for a total consideration of HKD 14.8 billion in 2018, which is about 17% higher than last year.

The en-bloc sale of 18 King Wah Road drew the most attention, setting a new record for the largest office transaction in Hong Kong East.

Decentralization remained as a key theme playing out among office tenants in the leasing market. The spotlight and the focus of leasing activity was on Hong Kong East and Kowloon East. Here tenant decentralization and consolidation requirements underpinned demand. Net take-up in the overall market amounted to 209,900 sq. ft till date. The net absorption in Central reached 33,000 sq. ft. as diverse tenants requested room for expansion.

“The broadening gap between rents in Central and emerging core business districts will add momentum to decentralization. We expect Hong Kong’s Grade A office market rentals to continue to trend higher, rising by up to 5% in 2018, with the support of the outbound growth of Mainland Chinese companies. Central will continue to outperform the overall market as demand competes for the pockets of space that exist,” reports Alex Barnes, Head of Markets at JLL.

On the back of a tightened vacancy environment, office rents in Central advanced by 0.7% m-o-m in January. There was a rise in rents in Hong Kong East region by 0.8% m-o-m, driven largely by increasing demand at the top-end of the market.

“The strong pricing achieved in the government sale of the Murray Road Car Park in May last year is now starting to permeate through the broader office market as investors reset benchmarks. With local money also flowing into the market, the record high prices being set in the market are no longer relying solely on PRC buyers. We expect capital values to rise a further 5-10% in 2018 even with interest rates set to rise further,” asserted Denis Ma, Head of Research at JLL.

The sentiment remained upbeat buttressed by record high land sale for government sites in Kowloon as well as strong gains in the local stock market, in the city’s residential market. The mass residential properties’ capital values raised up by 0.9% m-o-m in the first month of 2018 following to an increase of 1.3% m-o-m the previous month.

Mobile Ecosystem in Latin America

More than a billion individuals across Latin America will be connected to a mobile network by the end of the decade, equivalent to about three-quarters of the region’s population. Some markets in the region will be approaching saturation by this point, but many will still have plenty of room for growth. But the real story in

Latin America is not about market penetration: it is about the rapid migration to smartphones and super-fast mobile networks and the impact this is having on society and the region’s economies.

The mass-market adoption of smartphones is a relatively recent phenomenon in Latin America. Smartphones accounted for fewer than one in 10 connections as recently as 2012. However, declining handset prices and the increasing availability of subsidies and finance offerings by mobile operators has led to a surge in smartphone adoption in recent years. Today, smartphones account for about 60 per cent of the 690 million connections on Latin American mobile networks.

The move to 4G networks has also been slower in Latin America compared to markets such as the US and Europe – but 4G has now reached critical mass in the region, providing coverage to 70 per cent of the population. As of June 2017, Latin American mobile operators had launched more than a hundred 4G networks across 45 markets. 4G now accounts for approximately a quarter of mobile connections in the region, almost doubling from a year earlier, due to strong take-up of 4G in large markets such as Brazil, Mexico and Argentina. Local operators are set to invest nearly $70 billion in their networks by the end of the decade, much of which will focus on expanding 4G coverage.

5G networks are just around the corner too: the first commercial 5G networks in the region are expected to be switched on in 2020 and are forecast to provide coverage to around half of the population by 2025.

Around three-quarters of the Latin America’s mobile subscribers – almost 350 million people – use their devices to access the internet, more people than do so in the US. Moreover, Latin America has some of the most advanced and engaged mobile internet users in the world. Three of the top ten countries surveyed by We Are Social/Hootsuite on daily mobile internet usage are Latin American, with Brazil ranked second. Smartphones have also been instrumental in establishing Latin America as one of the world’s largest consumers of social media, with the vast majority of usage occurring over mobile networks.

With faster devices and networks, it’s no surprise that mobile data consumption is rising rapidly. At the same time, local operators are becoming increasingly successful at monetizing data traffic. In Brazil, for example, Telefónica Vivo reported a 144 per cent year-on-year increase in data traffic in Q2 2017, which it attributed to improving 4G coverage and strong adoption and consumption trends. But the operator was also able to report a 31 per cent increase in data ARPU, which more than offset declines in voice revenue.

As a result of rising smartphone adoption and 4G usage, the mobile ecosystem in Latin America provides a large, scalable platform for entrepreneurism. A vibrant tech startup ecosystem is emerging in major regional hubs such as Sao Paulo, Buenos Aires and Mexico City.

As a result of these trends, Latin America’s mobile ecosystem will be a growing contributor to the region’s economy over the next few years. In 2016, the industry added $260 billion in economic value, equivalent to 5 per cent of GDP. This figure is forecast to grow to $320 billion by the end of the decade (5.6 per cent of GDP), underlying the ecosystem’s increasing importance as a platform for innovation, investment and entrepreneurism.

Mexico: Fintech to Drive Competitive Growth

Mexico is making the greatest strides in Latin America when it comes to regulating the fast growing fintech industry.

A new bill doing the rounds promises to protect consumers and stimulate competition, keep a watchful eye over payment security and cryptocurrencies, and prevent money laundering or terrorist funding.
It’s a notably progressive step for Mexico to take. It will join a select number of other countries like Germany that have introduced explicit fintech legislation. According to Federico de Noriega Olea, partner at the Mexican offices of law firm Hogan Lovells, the law should provide more legal certainty for firms to carry out and expand their businesses, which may also mean greater access to funds.

It will at the same time place greater responsibility on companies to adhere to the rules, such as meeting capital requirements and reporting obligations. The more mature companies that have been carrying out some form of self-regulation may be better equipped to deal with this change. Younger companies that have just launched may struggle to adapt.

“The rules will definitely create a barrier to entry,” says de Noriega Olea. “Any regulation is in itself a barrier to entry. Again, the degree of such a barrier will depend on secondary regulation. I don’t believe the regulator is planning to create a high barrier to entry because one of the main goals of the proposed law is to foster competition.”

Bridging the credit gap
As per figures from 2015 from Encuesta Nacional de Inclusion Financiera (ENIF), a survey on financial inclusion, 44% of Mexican adults do not have a bank account. That figure may have changed slightly in the last two years but it speaks to a problem in Latin America’s second largest economy where adults have little or no access to credit or financial services. While there’s plenty of bluster and big promises, fintech is trying to bridge that gap and regulation can either be a friend or an enemy.

The International Finance Corporation (IFC) has been supporting fintech companies already active in the country, such as online and P2P lenders Afluenta and Kreditech, which provide a new bent on traditional services. Fintech has regularly threatened to upend traditional financial institutions but both sides of this coin will be affected by a change in the law.

“We consider that the legislation, as it is now, has the right elements to promote innovation in the financial industry,” says Carlos López-Moctezuma, head of new digital businesses and financial inclusion at BBVA Bancomer, one of Mexico’s biggest banks. “However, we need to keep track of the secondary legislation because those are actually the operative guidelines on how the fintech legislation is going to be implemented.”
BBVA Bancomer is very active in the fintech space itself. In August, it launched its startup sandbox programme, inviting startups inside the bank to work on new fintech services. These very companies will fall under the rules of this new legislation.

“However this is not something new for us in the way that we as a bank have been supervised, and prior to beginning working with another company, depending on the services offered by them, we have to be authorised by the authority,” López-Moctezuma adds.
“This is something that will affect fintech [companies] that haven’t been working with banks so far because they will have to spend resources in order to comply with the new regulation.”

Ahead of the pack
Mexico is the most forward in the Latin American region as far as implementing fintech regulations. Other countries haven’t moved as prominently but are starting to take notice. Brazil, the region’s biggest economy, is evaluating new legislation on how the technology should be regulated.

The Brazilian central bank published the draft law for consultation in August. According to an official from the bank, the law is specifically designed to address crowdfunding and online lending.

“The proposed regulation is expected to improve the regulatory framework for this type of electronic credit contract while contributing to the enhancement of efficiency and competition in the credit market,” he explains. “Such benefits are likely to reduce banking spread and boost the real economy, reaching microfinance operations.”

The Mexican law has not yet been passed and it’s expected that there will be many amendments made to the final document before the consultation period ends. Following the public consultation, the bill will eventually make its way to Congress but it’s difficult to pin down any time frame.

“Hopefully, it will be approved before year end,” says de Noriega Olea, “but I personally don’t believe that will happen because Congress has other priorities now, including discussing of the 2018 budget.”
That budget of course will be under much scrutiny in the wake of the earthquake in September which will mean funds being allocated to rebuilding and recovery, so fintech regulations may not exactly be on the forefront of Mexican politicians’ minds.

High Tech to Boost the Growth of Mexican

“Mexico is spending US$5 billion to modernise its ports as it seeks to double cargo handled from 250 million tons to 500 million tons during the six-year tenure of President Peña Nieto (2012-2018),” he explains.

As part of this project, Mexico is investing in three inter-oceanic multi-modal corridors. “[These are] the Northern corridor, which connects the Port of Mazatlan in the Pacific with the Port of Altamira in the Gulf of Mexico, the central corridor that connects the ports of Lazaro Cardenas and Manzanillo in the Pacific with the Ports of Tuxpan and Veracruz on the Gulf, and the Southern, or Tehuantepec Isthmus corridor, which is seen as an economic development engine for the region. This connects the ports of Salina Cruz in the Pacific with the port of Coatzacoalcos in the Gulf,” Diaz-Balart highlights.

One of the biggest recent challenges for Latin America’s ports has been the ‘stress’ they’ve experienced thanks to the cascading effect felt from shipping lines using ever-larger vessels.

As part of its plan to improve Mexican ports’ capacities, the government contracted APM Terminals to design, build and operate a new deep water terminal at the country’s second busiest port.
“This terminal will enable bigger volumes to be handled on the Pacific coast of the country – a strategic area for shipping connections to Asia,” notes José Rueda, Managing Director of APM Terminals Mexico.

The high tech terminal, called APM Terminals Lazaro Cardenas, opened to receive its first official vessel call in February, once phase one of construction was completed. Its depth is currently 16.5m, deep enough for today’s biggest container ships, but will be deepened to 18m to accommodate future larger vessels. Currently 750m in length, the quay will also be lengthened to 1.5km, with further cranes and rail tracks to be installed, eventually increasing the terminal’s capacity to 4.1 million TEU’s – twice the current capacity of Mexico’s biggest port, Manzanillo. This work is scheduled for completion between 2027 and 2030.

Semi-automated processes geared towards increased productivity
Regarding technology, it uses semi-automated processes that are geared toward delivering higher productivity and availability for clients, as well as contributing to Mexican trade growth by offering a new gateway for commerce. As Rueda highlights, APM Terminals believes that digitisation and automation are key factors to success in this sector – globally.

“Connectivity, delivery times and digitalisation are from my point of view challenges in the business, but not only regarding this region,” he notes. “Terminals in the near future will need to operate with service standards unknown today and this will be a basic requirement in less than ten years. We understand these requirements and at APM Terminals Lazaro Cardenas we are now ready to bring our customers the service of the future.

“Our semi-automated terminal has automated gates and stacking cranes are operated from the control room in the office building,” he highlights. “Both the gates and cranes are equipped with optical character recognition (OCR) and in general all areas of the terminal use the most advanced technologies available.”

The port’s high tech nerve centre is of course its control room. Even before a ship docks, its cargo manifest will be in the system and an unloading sequence worked out. The OCR identifies containers, allowing the operator to track its progress throughout the terminal and sensors assist them with trajectory prediction, alignment and stacking.

Cargo flows are segregated depending on the next destination and mode of transport. For example, if the container is moving on by rail, the terminal management system will schedule a railcar and interact with the shunting software to ensure that an optimal train composition is created in the on-dock rail facilities.

Once the container has left the terminal by whatever means, it is automatically tracked until it leaves APM Terminals’ custody.

“This investment brings the highest productivity and reliability in operations, providing error reduction, accuracy, reliability and cost savings. It also provides a safer working environment and enables our employees to develop new skill sets,” Rueda highlights.

A concerted bid to improve the supply chain to Asia
This project is just one part of a much wider undertaking to improve Mexico’s supply chain to Asia and the rest of the Americas. APM Terminals Lazaro Cardenas provides improved connectivity to its inland terminal in the industrial centre of Mexico City, home to more than 200 onward distribution centres, also helping to improve Mexico’s trade routes. But as well as boosting trade, projects such as this are boosting local communities by providing more skilled jobs, which in turn help regional economies.

“Before I joined APM I was basically an unskilled worker, even though I had a good high school education,” says Martin Aviles Luna, an STS crane operator. “Many of my colleagues were in the same boat as myself, so to speak, and they too have been set on a promising career path.’”

Foreign Tech Firm Needs a Threat

There’s no denying that the technology industry is rapidly evolving. And as a result, the companies that operate within this lucrative sector are also growing. From Apple to Samsung, the tech elite have billions of dollars at their disposal and are becoming ever more powerful.
With all this power, they’re capable of exerting their dominance and influencing countries around the world. But while high-growth technology companies are contributing massive amounts of money to global economies, some people fear that these firms pose a security risk to critical infrastructure systems.
The United States is an example of a country that has slammed foreign technology companies in recent times. Recently, American lawmakers ordered telco AT&T to sever its ties with Huawei over fears that the Chinese mobile phone maker is simply becoming too powerful. They believe that the firm poses a grave threat to national security.

Creating security backdoors
The worry for government officials – especially in the United States – is that foreign technology companies could use backdoors to compromise state information security. Scott Crawford, a director at 451 Research, believes that this issue plays out on “multiple” levels. But it is “often more visible when it comes to security risks, rather than foreign dominance”.
He tells us: “In many of these cases, the concern is that foreign interests could introduce technology or capabilities into the US that could introduce a risk to US information security – a risk that could be difficult to ferret out, if such a threat could be obscured within the technology.”
American security researchers have been looking into these threats for years, as the 2012 case with Huawei and ZTE certainly proves. However, Crawford makes it clear that these incidents aren’t just exclusive to Beijing – they come from countries globally. “These concerns arise in part from evidence gathered by security researchers in recent years alleging either direct or indirect involvement of foreign interests in breaches of sensitive information security. China has repeatedly been alleged to be behind many of these incidents – but it isn’t the only nation seen as posing a threat to foreign interests,” he says.

US as the culprit
The United States isn’t exactly innocent when it comes to surveillance and other espionage activities. Former CIA employee Edward Snowden has offered a great deal of insight into the country’s cyber spying over the years. “The US itself is often seen in this light, particularly following Edward Snowden’s allegations about US surveillance activities. It is therefore not surprising, perhaps, that in 2012, investigations by the US House of Representatives flared around accusations that Huawei and ZTE were doing exactly what the NSA was revealed to be doing two years later with their Tailored Access Operations teams,” explains Crawford.
Responding to these allegations, the Chinese have also been hesitant to accept American technologies into their market. Companies such as Apple and Google have struggled to reach out to the masses in the country. “China itself has reportedly opposed the incursion of US tech leaders into its markets, though many strategic tech companies have sought to reach rapprochement with China to ease concerns,” he says.

Companies that rely solely on foreign technology providers could be putting themselves at risk, admits Crawford. “There is concern at a more strategic level. Should any nation become dependent on a foreign technology provider for capabilities critical to society, it could be placing its strategic interests at risk. At the personal level, this concern could arise regarding technology critical to individual health or safety. At the societal level, it could involve technologies seen as part of critical infrastructure,” he explains.
He expects governments to become tougher on technology companies with the rise of IoT, concluding: “We would expect these concerns to color government response to the continued rise of the Internet of Things, as smart computing capability becomes increasingly integrated with the technologies of everyday life, from large-scale utilities to the smart home.”

A growing security risk
James Wickes, CEO and co-founder of cloud-based visual surveillance company Cloudview, says governments are right to be concerned about foreign companies that become too powerful. He tells us that the threats are “particularly felt in the domain of CCTV equipment, where the security services have not only raised concerns but identified specific threats”. Wickes points out to a situation in the 2016 case when MI6 became worried about Chinese company Hikvision being Britain’s largest supplier of CCTV equipment. He says UK security specialists “expressed grave concerns about the potential security risk, particularly for internet connected cameras”.

In May 2017, the US Department of Homeland Security highlighted similar vulnerabilities. It found a range of problems in connected cameras and issued a security advisory notice. Wickes explains that security researchers have also reported “backdoors in a range of cameras from other manufacturers that allow remote unauthorized administrative access via the web”, giving cyber crooks the ability to target government systems. He says: “Such backdoors are rarely an oversight, and are built in by people who know what they’re doing. They provide a means for hackers to come and go undetected, bypassing all usual security measures.”
In extreme circumstances, cyber criminals could use these backdoors to launch devastating terrorist attacks on countries. “They could even allow the hacker to configure the device to allow front door entry by unwanted persons to appear legitimate. This could easily result in a security breach that affects national security or competitiveness. With an inbuilt back door, poor IoT security might be a little too tempting for a nosey nation, while for terrorists, why bother with suicide bombs if you can shut down power stations, open dams and look at CCTV footage of major cities and public places at will,” he concludes.

While the news that the US Government wants to stop AT&T from forging an ever-closer business relationship with Huawei may seem slightly extreme, it appears that some of these worries are just. There are instances where governments rely too much on foreign technologies, leaving them exposed to attack from state actors. Clearly, security organizations need to keep a closer eye on government IT infrastructure to ensure it’s robust enough to fend off cyber crooks.

Costa Rica: The Best Place in the World for Retirees in 2018

According to a report, Costa Rica took the top spot for the first time in the index’s history. It topped the categories of healthy lifestyle and healthcare while scoring well in the fitting in, governance, entertainment and amenities, and climate categories.

A Costa Rica Central Valley Correspondent said, “Costa Rica has it all! It has perfect year-round tropical climate, your choice of Caribbean or Pacific beaches, mountains and volcanoes, big cities and nightlife or tranquil rural settings.”

As a proportion of Gross Domestic Product than the U.K., Costa Rica invests more in education and health. As a result, Costa Ricans enjoy a literacy rate approaching 98% and a long life expectancy. The country regularly wins accolades as having the happiest people on earth.

Ticos have established in their country one of the world’s most stable democracies. Costa Rica dissolved its standing army in 1949 and the reallocated funds are spent on education, healthcare, and pensions.

Costa Rica is already filled with a thousands of U.S. and Canadian people and millions have traveled there over the years for beach-resort vacations, surfing, fishing, and many more. With many Costa Ricans speaking English, it’s pretty easy for retirees to navigate while learning more Spanish.

With about 25% of the country’s territory protected, there is a focus on preserving the environment in Costa Rica. There is also a commitment from the government to power the country on solely renewable sources, especially hydroelectric, wind, and geothermal.

While Costa Rica wins the top spot as the most favorite country to travel, it’s just one of 24 countries examined in 12 categories, including: buying and investing; renting; benefits and discounts; visas and residence; governance; cost of living; fitting in; entertainment and amenities; healthcare; healthy lifestyle; development; and climate.

The motto of this guide is to assist the retirees to find locations, their currency goes further, and they can get the best bang for buck in terms of real estate, cost of living, and overall quality of life.

Building a software Company, all you need is the Balance

In the era of ‘Digital Transformation’, we’re repeatedly told two mantras: Software is eating the world, and every company is now a software company.
Unsurprisingly for a company that specialises in software development, CA Technologies is a big proponent of the idea. The company’s CTO, Otto Berkes, has even written a book about it. But he takes this concept further.

He says that companies should look to become “Modern Software Factories”; where not only are companies developing their own software, but doing so in a way that makes use of all the most up to date practices and tools around DevOps, Automation, Continuous Delivery, and security.

Mastering your software transformation
CA recently released a study, Don’t Let an Outdated Software Strategy Hold You Back, designed to explore how far along companies are on this journey towards every becoming a software company.

At an event launching the research, Berkes warned that there are “Already leaders and laggards in race to build software factories.”
The report suggests that while most businesses understand the importance and need for better software and processes for developing them, few have actually perfected their implementation of the concept. Only around a quarter of the 1,200+ companies surveyed reported widespread use or implementation of tools such as automation and application analytics as well as deployment of DevOps and security principles.

Those that embrace this concept get more than just applause in reports: The companies that are leading the way towards this software-driven way of doing business – what the report calls the ‘Masters’ – report higher revenue and profit growth than other companies. These ‘masters’ were also seen to be better at attracting talent and more agile.

You can’t just buy your way to digital transformation
Whether it’s John Deere acquiring Blue River for its Machine Learning skills, GM buying Cruise Automation for its self-driving car nous, ASSA ABLOY paying up for smartlock startup August Home, or Boeing snapping up Aurora Flight Sciences, legacy companies left and right are buying the tech startups trying to disrupt them in an effort to try and get ahead of the game.

Cultural change
Beyond the mere acquisition of talent – through hiring or buying – the hard work can be changing the way the company as a whole thinks and works.
“The cultural aspect is often underestimated. You can spend a ton of resources acquiring a ton of talent, but if you don’t have the systems and the culture in place to support and enable them, it will become a futile exercise.”

Company culture, however, is often driven by the people at the top. If a company’s execs and leaders aren’t able to adapt to the digital way of doing things that can stop any kind of evolution actually taking place anywhere in the organisation.
“We talk about talent gaps today focused on software development talent, but we also need the right talent at all levels of leadership to be able to move into a new way of harnessing software.”

“It’s a question of talent management. Leadership absolutely is a part of that challenge. There are going be many cases where leadership change needs to happen along with the rest of the talent change.”

However, although change often means new faces being brought on board, simply gutting the company of its older faces isn’t wise. AWS Chief Architect Glenn Core recently told IDG Connect that keeping experience on board is incredibly important during these kinds of transformations in order to ensure new ideas are implemented in a responsibly and logical way, and Berkes agrees.

“With this kind of transformation you need a balance of talent, institutional knowledge, and memory: they know where some of the pitfalls are and where it’s better to tread cautiously, and to integrate new talent, people, and thinking into the organisation in a thoughtful way.”

“The reality in business is you don’t have the option of putting a pause on everything and starting over, you need to make sure that the business that you have continues to operate while you bring in new processes and transform the business. It’s critical to have people who have the historical context to provide that continuity.”

DevSecOps

Given we live in an age of constant hacks and mega breaches, security should be first and foremost in the minds of all developers. Sadly, this is rarely the case. Security companies often talk about the idea of ‘Security by Design’, but given the alarming frequency products are shipped with poor security, it’s clearly not something that’s really reached the ears of developers.
Berkes and CA are keen to emphasise the security aspect of their ‘software factory’ vision, and are proponents of the concept of DevSecOps.

“The idea is to move away from the idea of having security be this thing that you think about at the end of the development cycle, this process you apply right before you release software, and have it be a core competency at all stages of development.”

However, just like changing a company’s whole mindset can be a challenge, so can ingraining security into development. Berkes argues that the concept has to be translated into very specific actions and outcomes in order to have a material impact.

“It’s one thing to talk about secure by design, it’s another to actually have the right tools to be able to cover the software lifecycle.”
Instead of simply telling developers ‘make sure you write secure code’, says Berkes, companies should instead offer tools that will actually help them identify and address security gaps in code.

In response to the general apathy security often receives from people outside the infosec bubble, some have proposed legislating that certain security frameworks for application development should be put in place to legally mandate how developers approach security.

“Legislation is tricky, partially because of the nature of security: nothing is 100% secure, so how do you legislate something you can’t guarantee?”
Instead, Berkes says he’d like to see something more akin to indicators of effort that show how seriously a company takes security.

“[People] download and cross their fingers and hope because there’s no way to really tell what amount of effort has gone into the application of security best practices. We need some kind of indication so you can assess make some kind of intelligent, data-driven assessment on level of trust.”
The Australian government is reportedly looking into a similar rating system for Internet of Things-connected products.

“It’s an interesting idea to try to standardize security best practices so that there’s some awareness both within industry and also on the consumer side of the equation so that when we click on something or download something at least you’ve got some idea of the level of effort that had been expended on security for that particular product.”

Bangalore Leads as India’s Largest Market for Flexible Workspaces

The flexible working space constituted about eight percent of the total absorption (3.42 million sq ft) in 2017 as compared to three percent share in 2016. According to a report, Bangalore remains the dominating market with almost 32 percent share of the overall flexible workspaces pie in 2017, followed by Mumbai with almost 18 percent share.

“We can say that 2018 is likely to be an active year in the flexible workspace sector, fueled by an increase in end-user demand from the IT industry. It is looking for ways to mitigate real estate costs and seeking flexible solutions. By avoiding long-term leases and the flexible workspace sector, occupiers across the market are seeking to minimise risk and are set to be the beneficiary of this uncertainty” asserted Senior Director, Office Services at Colliers International India.

The flexible workspace operators amounted to 1.1 million sq. ft., approximately seven percent of Bangalore’s total office market absorption, in 2017.
Bangalore remains the largest market for flexible workspaces in India and has the largest share of technology start-ups. Initially characterised by domestic operators, the market now has a more diverse range with international entrants including WeWork, The Executive Centre and Regus.

With approximately 23 percent of the flexible workspace operator transactions for the year, the CBD has remained one of the preferred locations. Other notable districts were SBD (28 percent) and Koramangala (18 percent). Despite being the technology hub of Bangalore, Outer Ring Road (ORR) had a share of only four percent, says the report.

Mumbai
Mumbai too is quickly catching up with Bangalore in the flexible workspace market. Occupiers in Mumbai are embracing the trend for the flexible workspace to cater to this increased demand, and various local operators have expanded at a rapid pace, fuelled by external investment.

Mumbai’s traditional CBD, Nariman Point, accommodates relatively small flexible workspace locations and most operators are planning to concentrate on the new financial hub of the city, BKC, and surrounding areas. The take-up by flexible workspace operators in Mumbai increased from 380,000 sq ft in 2016 to more than 600,000 sq. ft. (0.6 million sq. ft.) in 2017. In 2017, flexible workspace accounted for 12 percent of the total market take-up and remains concentrated in SBD locations such as BKC, Andheri and Worli, says the report.

The trend is expected to continue in 2018 due to the restricted supply in key markets in Mumbai. Companies such as iKeva and Avanta have recently announced expansion plans. Major operators present in the Mumbai market are a mix of international and domestic names including WeWork, Regus, Awfis, Avanta Business Center, Innov8 and Ikeva.

A Senior Executive Director, Mumbai & Developer Services at Colliers International India aserted, “Currently flexible workspace operators have a strong presence in major commercial hubs such as BKC, Andheri, Powai, Vikhroli and Lower Parel. While their footprint has increased tremendously in the last year it has been confined predominantly to these locations. However, we expect growth in 2018 to occur across all micro-markets in rambuildingconsultancy.co.uk.”

Artificial Agencies IT Defenders

If 2017 taught us anything, it’s that you can’t be complacent about your cybersecurity strategy. And as the driving force behind McAfee’s security research and development, you’d expect Chief Technology Officer, Steve Grobman, to have more to worry about than most.
“You could spend all day being concerned about almost anything,” he laughs, when I ask him what threats people should be looking out for.
But there is one big issue facing all companies today. How do you deal with the fast-changing threat landscape whilst continuing to protect yourself against the threats you were worried about yesterday?

“That’s creating a lot of new challenges for an IT defender to comprehend in order to protect their environment,” Grobman says.

Artificial Intelligence has become the latest buzzword in cybersecurity spaces and McAfee is now integrating these capabilities into its latest product offerings.
And it’s easy to see why. When technology has been trained properly, it can be very good at processing massive quantities of data and seeing patterns. Unfortunately, what technology is not so good at is using intuition to spot a new attack pattern or recognize an evasion tactic.

“One of our observations is that there are certain types of things machines are good at and there are things that humans are good at, that machines aren’t,” Grobman explains. “Where a defense strategy can be most effective is when you have a strategy that has the best elements of both working together.”

To those versed in cybersecurity, it’s a well-known fact that the attacker has an inherent advantage over the defender and part of that reason is the attacker’s ability to move faster than the defender.

“When we want to deploy it [a new product] to our customers we have to develop it, put it through our internal quality assurance cycle, have our customers acquire it. They have to put it through their quality assurance cycle then they have to go through a deployment cycle,” Grobman tells me. “All of this can take weeks, possibly months. If you’re an adversary, you can build yesterday and deploy today. Time is very much on the side of the attacker.”
This scenario doesn’t change when AI becomes involved. In fact, it brings with it its own unique set of challenges. However, Grobman’s concerns aren’t from the Elon Musk school of thought.

“I am more worried about overly trusting the outcomes from AI as opposed to it going rouge per-say,” he explains. “There can sometimes be an overconfidence in the ability for AI to do things that they’re not really doing. With AI or machine learning, you can actually have a model that looks very good but is actually worthless.”

To demonstrate this problem, Grobman built his own machine learning model that he claimed could predict the winner of the Super Bowl. On the surface the model worked, correctly predicting the outcome nine out of 10 years. However, Grobman intentionally over trained the model, having it learn the noise of the games he knew he would be testing it on, rather than developing it to understand anything about American football.

“The point is, when you apply it to cybersecurity there’s a lot of companies that are saying ‘here’s how amazing our machine learning model is. Look how effective it is!’ and you really just have to understand some of the nuance of how it’s being positioned. Is it being trained? Is it being tested on things that are very similar to what it was trained on? Those are the things you need to worry about.

“Most of these models don’t really know what an attack is. It’s not like a person who’s saying, ‘there’s bad things happening – this is an attack’. It’s based off the attack looking similar enough to things that it’s been conditioned or trained on so it’s able to classify it correctly. Which is a real risk.”
This very real problem only reinforces Grobman’s belief that man and machine need to work together in order to tackle these emerging security issues. Unfortunately, an increasing cybersecurity skills gap is threatening to undermine that working model and seriously impact on how companies deal with security.

“All organizations will need a combination of technology and people and different types of organizations have different levels of ability to pay for individuals of varying talent. So, you’re going to see cyber security issues impacting organizations that haven’t traditionally had major issues.”

And in some ways, this is set to be the biggest security challenge facing companies in the coming years. How do companies develop and deploy technology that is not only successful from a cybersecurity point of view, but can also improve the efficiency of people, to help mitigate the labor shortage.
So, what can we expect to see more of in the future? Grobman believes we’re going to see cloud breaches that will have catastrophic impacts on organizations or people.

“I think we saw the beginnings of that with the Yahoo breach. You know, one single breach impacted three billion accounts. That’s a scale unlike anything we’ve previously seen. I think we’ll see more breaches related to non-traditional devices.”
Grobman ends our conversation on a relatively somber note, keen to acknowledge that while companies like McAfee are continuing to fight the good fight against these emerging threats, the battle is nowhere near won.

“I think the sophistication of attacks will grow,” he concludes. “All the great technology that defenders are using today is going to be used to make attacks more effective and we need to get ready for it.”

AI & MA is going to fly high in Future

This is a contributed piece from Emil Eifrem, CEO of Neo Technology, the company behind graph database, Neo4j.

Amazon has taught us the value of being able to predict what else customers might want to buy, by analysing online sales data. It’s a lesson that any retailer wishing to survive needs to start learning – and applying.
But to do so, retailers need not only to know about my past purchases, but be able to instantly combine this knowledge with any new interest shown during the customer’s current visit to offer recommendations.

How? Simple: they need to understand the customer intent by analysing a host of clues offered by the customer, interrogate this data at lightning speed to serve up uncannily relevant recommendations and so generate great, tailored offers – offers that become increasingly more accurate, as the recommendation engine gathers more data and learns more about the customer in the process.

To accomplish this requires a combination of NL (Natural Language) processing, ML (Machine Learning), accurate predictive analytics, a distributed, real-time storage and processing engine and, I contend, a graph database to make all the real-time data connections required.

Why do I say that? Let’s look at a real-world example of just such a combination – eBay’s AI-based ShopBot is built on top of a graph database. That graph layer directly enables the system to answer sophisticated questions like, ‘I am looking for a brown, leather Coach messenger bag costing less than $100, please find me those’.

ShopBot asks qualifying questions and will quickly serve up relevant product examples to choose from. The functionality is impressive – you can send the bot a photo with a direction such as, ’I like these sunglasses, can you find similar models?’ and it will employ visual image recognition and machine learning to figure out similar products for you, in milliseconds.

All this is done by using NL processing techniques to figure out your intent (text, picture and speech, but also spelling and grammar intention are parsed for meaning and context), while the graph database (using Neo4j) helps to refine the search against inventory with context – a way of representing connections based on shopper intent that’s shaping up to be key to the bot making sense of the world in order to help you.

That context is stored, so that the ShopBot can remember it for future interactions. So when a shopper searches for ‘brown bags’ for example, it knows what details to ask next like type, style, brand, budget or size. And as it accumulates this information by traversing the graph database, the application is able to quickly zero in on specific product recommendations.

Why relational isn’t your best friend here
Tapping into human intent like this and delivering highly responsive, accurate help is the Holy Grail of what applied AI can offer. In this discussion on conversational commerce the example is well made: in response to a statement, My wife and I are going camping in Lake Tahoe next week, we need a tent, most search engines would react to the word ‘tent’ and the additional context regarding location, temperature, tent size, scenery, etc. is typically lost.

This matters, as it’s this specific information that actually informs many buying decisions – and which graphs help empower computers to learn. Context drives sophisticated shopping behaviour, and graph technology is the way to open it up for a retailer.

But you can’t get there the way you’re going now. The traditional way of storing data is ‘store and retrieve’, but that doesn’t give you much in terms of context and connections – and for your searches and recommendations to be useful, context needs to come in.

To help improve meaning and precision, you need richer search, which is what AI-enriched applications such as chatbots give us.

Graph databases are now one of the central pillars of the future of applied AI, and graph is shaping up as the most practical way of getting there.