Technologyquarterly March 9Th 2013

The telepresence How to put a What the father of robots are coming submarine online the iPod did next TechnologyQuarterly March 9th 2013

When it’s not so good to share Growing pains in the “sharing economy”

TQCOV-MARCH.2013.indd 1 26/02/2013 11:08 The Economist Technology Quarterly March 9th 2013 Monitor 1 Contents Picture imperfect

On the cover A host of new services that make it easy for people to rent out their cars, spare rooms and other items to strangers online are becoming ever more popular. Owners get handy extra cash, and renters save money. But as this sharing economy expands, it is starting to hit regulatory obstacles, page 10 Monitor 1 Detecting image manipulation, potatoes on a plane, the case for asteroid mining, better hearing aids, a novel way to power pacemakers, drone gliders, a new model to predict technological change and preserving historical audio Digital imaging: Insurers, publishers, law-enforcement agencies and dating Dierence engine sites are using software that can detect the digital manipulation of photos 7 After 3D, here comes 4K HE photo splashed across front pages hiring an expert for days, says Hany Farid, Electronics rms are pushing an Tworldwide in July 2008 showed four professor of image forensics at Dartmouth even sharper form of HDTV Iranian test missiles blasting skywards. College in New Hampshire, who some- Released by the media arm of Iran’s Revo- times acts as an expert witness. Rockefel- Telepresence robots lutionary Guard, Sepah News, the picture ler University Press, publisher of the 8 The robot will see you now (top) was soon found to have been manip- Journal of Cell Biology and other journals, Wheeled devices that let you be ulated: one missile had been cloned and employs a full-time analyst to examine in two places at oncesort of appeared twice, evidently to conceal the submitted images, opening them in Adobe fact that another had failed to lift o (see Photoshop and looking for anomalies by original image, below). Governments adjusting a series of display settings. The sharing economy have long doctored photos for political Eorts to automate the detection of 10 Growing pains reasons. In Nazi Germany and Commu- doctored images are bearing fruit. Last Why peer-to-peer rental services nist Russia, senior gures who fell from year Fourandsix Technologies, a start-up are running into legal barriers favour were commonly airbrushed out of based in Silicon Valley, began selling an photographs. Now, thanks to digital tech- add-on for Photoshop, called FourMatch, Biomedical scaolding nology, image manipulation is available to that determines whether an image has 13 Under construction everyone, and nefarious uses are becom- come straight from a camera or has been New materials mix man-made ing far more widespread. manipulated. It compares the metadata and biological elements In around one in 75 insurance claims, associated with the image against a data- photos documenting property damage base of signatures that represent the char- Underwater networking have been fraudulently retouched, says acteristic ways in which dierent devices Eugene Nealon of Nealon Anity Part- capture and compress image data, to 15 Captain Nemo goes online ners, a company based in London that ensure that the image is what it claims to Building an aquatic internet for advises insurers. Liz Williams, editor of be. FourMatch is sold primarily to law- submarines, drones and sensors the Journal of Cell Biology, says her publi- enforcement agencies and costs $890. But cation rejects around 1% of peer-reviewed it cannot tell whether a manipulated Brain scan scientic papers after discovering that image has been slightly tweaked or exten- 17 The podfather, part III microscope images have been doctored to sively doctored. So a human analyst is still What Tony Fadell, the father of make results look good. needed in the loop, says Mr Farid, one of the iPod, did after leaving Apple Many fakes are obvious. But unmask- the rm’s co-founders. A trained eye can ing a sophisticated forgery can require spot inconsistencies in shadows, reec- 1 2 Monitor The Economist Technology Quarterly March 9th 2013

2 tions and incorrect perspective. analysis is complex and time-consuming, Another tool, recommended to insur- says Anderson Rocha of the University of ers by Mr Nealon’s rm, is Verifeyed, Campinas, near São Paulo, who provides made by a company of the same name photo-forensics advice to law-enforce- based in Prague. Like FourMatch, its soft- ment agencies in Brazil. His team is devel- ware examines image les to look for oping software to automate the mapping inconsistencies in colour, encoding and and matching of discolouration patterns. compression formats that indicate the use Software can generally sni out ama- of retouching software to modify the teur retouchers, says Dr Rocha, but profes- image. The software costs $899, and Veri- sional forgeries continue to slip through. feyed will also analyse large batches of This is partly because skilled forgers keep photos on behalf of clients, charging up with the academic literature on image around $0.07 per image. Its customers forensics, says Siwei Lyu, a researcher at include insurers, law-enforcement agen- the University at Albany. Forgers now cies, forensics labs, a dating website and a have the upper hand, he says. logistics company keen to expose bogus The ultimate solution may be to sep- claims that goods were damaged in transit. arate photographers from their photo- Verifeyed’s boss, Babak Mahdian, reckons graphs, so that they do not have the oppor- that the technology could also be useful to tunity to manipulate them, says James signals than people do. But on an aircraft, news organisations that wish to check that DeBello of Mitek Systems, based in San the people in even a partially lled cabin photographs are genuine. Diego. Bank of America, JPMorgan Chase, pose a barrier to wireless communication. Manipulation-detection software is Wells Fargo and other big American banks Human bodies act as dielectric materi- desperately needed in health insurance, let customers deposit cheques remotely als, absorbing some of the electromagnet- says Mr Nealon. In some countries 2-3% of by taking pictures of them with their ic radiation that passes through them. The claims submitted contain images re- smartphones. They do so using an app mixture of water and salts in a human touched to embellish the truth, he says, provided by Mitek that takes a snapshot of body is particularly good at attenuating making injuries look worse than they the cheque and sends it straight to the signals in the 2.4GHz and 5.0GHz bands really are in order to collect more money. bank, leaving nothing on the phone itself. used for Wi-Fi networking. (The same is Only about 10% of insurers are using Codasystem, a French start-up, oers a true for some mobile-phone signals, software to spot fakery, says Mr Nealon, so similar service. Its Shoot and Proof which are transmitted at frequencies of there is plenty of room for growth. system allows an image to be taken with a 700MHz-3.5GHz.) Wi-Fi is already in use In January a new law came into force mobile device, tagged with a timestamp aboard more than 1,600 planes that y in Israel making it illegal to use images in and location and then uploaded to an over the United States, so the problem is advertisements that have been retouched online repository. The image can then be no longer academic. Companies that to make models look thinner without viewed and downloaded, but the original install in-ight Wi-Fi and mobile kit for printing a disclosure on the picture. On- remains in the repository, untouched. Any customers, including Boeing, its European line images are exempt, however. We’re nefarious Photoshoppery can therefore be rival Airbus, an American provider of not going to correct the whole world, says easily exposed. Digital technology can, it in-ight Wi-Fi called Gogo and a satellite- Rachel Adato, an Israeli parliamentarian seems, be used to prove that an image is based mobile operator, OnAir, have had to who sponsored the bill. The Photoshop genuineeven as it makes it easier than deal with this problem for years. law, as it is known, has prompted eorts ever for cameras to lie. 7 Until recently, rms had to use a combi- to pass similar legislation in America. nation of computer modelling and hu- A feature introduced several years ago man testing in labs and cabins to simulate by Canon and Nikon, the two leading dierent conditions and determine how camera manufacturers, gives photo- to design and position antennae. It was graphers a way to prove, if challenged, Coach potatoes expensive, time-consuming and impre- that their images have not been manipu- cise. Herding hundreds of stand-in pas- lated. When a picture is taken, the cameras sengers into a test aircraft for days on end attach a coded signature that is destroyed was hardly practical. So in December if the image is modied and resaved. An Boeing announced an alternative to hu- intact signature, then, should prove that a In-ight electronics: Researchers man test subjects, in the form of sacks of photo is genuine. But researchers at El- have resorted to an unusual spuds. When placed on aeroplane seats, comSoft, a computer-security rm based approach to model the behaviour of potatoes turn out to aect Wi-Fi signals in in Moscow, have shown that the system is wireless technology on planes much the same way that people do. To easily fooled. Counterfeiters can copy an prove that this was not an early April-fool image’s security signature and reapply it UMAN beings are, to an engineer’s jape, Boeing even produced a video and a after retouching, says Vladimir Katalov, Happroximation, bags of brine. This bunch of experts explaining its approach. ElcomSoft’s boss. presents a problem for wireless communi- The Synthetic Personnel Using Dielec- Another way to determine whether an cations, because the most commonly used tric Substitution (SPUDS) project mim- image has been manipulated or not relies radio frequencies are partly absorbed icked human bodies using 9,000kg on the fact that in a digital camera’s grid of when passing through salt water, and (20,000lb) of tubers. Sacks of potatoes millions of light sensors, several are usual- through fat, muscle and bone. In large were easier and much cheaper to push ly awed. Each aw creates a tiny dis- public spaces, such as an open concourse around than people would have been. colouration, imperceptible to the naked in an airport terminal, human bodies are Boeing says this allowed it to carry out eye, in pictures taken by the camera. If the spread out and have little eect compared tests to identify hot spots and dead zones pattern of unusual discolourations in two with the building materials that enclose in coverage quickly and accurately. The pictures taken by the same camera match- the space, like metal and sheet rock. In a results were then swiftly validated with es exactly, neither image has been re- typical house, brick and chicken wire do human test subjectsand the spuds were touched, at least in those areas. But the more to soak up Wi-Fi or mobile-phone donated to a food bank. 7 The Economist Technology Quarterly March 9th 2013 Monitor 3

orbit, where they will spend years observ- space rock at one end and churn out n- ing and cataloguing nearby rocks. ished spacecraft parts at the other. None of The idea is to build Firey on the cheap, the company’s technology has yet been Fool’s platinum? forgoing extensive testing and using com- demonstrated, however. mercial o-the-shelf components rather Most important, perhaps, the eco- than custom-built electronics. To reduce nomic case for asteroid mining also re- costs further, the Firey probes will y mains far from clear. A doubling of supply alongside larger payloads on scheduled from space might exert such downward Asteroid mining: Two start-ups see launches. David Gump, the boss of Deep pressure on the price of platinum on Earth promise in extracting valuable Space Industries, hopes to attract cor- as to undermine the whole business case resources from asteroids. But how porate sponsorship for his rst missions. for the venture. Asteroid mining seems practical is the idea? He is also counting on support from likely to stay in the realm of science ction NASA, America’s space agency, and pos- for the time being. 7 T ISN’T a gold rush quite yet. But the sibly its counterparts in other countries. Ilaunch of a second asteroid-mining In this, Mr Gump has some form. Five venture in a year suggests that the allure of years ago he co-founded Astrobotic Tech- extraterrestrial prospecting may be as nology, a company which has booked a hard to resist for some as the Klondike place on SpaceX’s Falcon 9 rocket for a Music to the ear was. On January 22nd a start-up called lunar rover called Polaris. If all goes to Deep Space Industries entered the fray. It plan, in October 2015 Polaris will embark joins Planetary Resources, a rm backed on a one-way mission, carrying NASA by Larry Page and Eric Schmidt of Google, instruments to hunt for water, oxygen and which launched last year and promises to methane at the Moon’s north pole. Polaris Medical technology: New tricks allow have its rst asteroid-hunting spacecraft in beneted from $3.6m of NASA contracts hearing aids to cope better with high orbit by late 2014. and Mr Gump hopes Deep Space In- frequencies, making speech and The potential bonanza is, well, astro- dustries will strike similar arrangements, music more comprehensible nomical. A single 500-metre metal-rich especially as no one has ever studied the asteroid might contain the equivalent of small asteroids that Firey plans to visit. HE human voice, like any sound pro- all the platinum-group metals mined to Mr Gump says NASA is interested. Tduced by thrumming a stretched date. Icy bodies could provide water to If successful, the Firey missions will string, has a fundamental frequency. For sustain astronauts or be processed into be followed by a more sophisticated voice, the centre of that frequency lies rocket fuel for future missions to Mars. spacecraft called Dragony. This robotic mostly below 300Hz depending on the Deep Space Industries might be think- vessel, which Mr Gump hopes to launch speaker’s sex and the sounds in question. ing big, but it is starting small. Even small- by 2016, would try to intercept a small Information is conveyed through simulta- er, in fact, than the relatively puny Plane- asteroid and return a hefty 25-65kg sample neous higher-frequency overtones and tary Resources. The rm is aiming to raise to Earth within three to four years. additional components that can stretch up a mere $3m this year from venture capi- If all this sounds far-fetched, that’s to 20,000Hz (20kHz). Modern hearing talists, angels and private-equity funds, because it is. Stardust, dispatched by aids are able to distinguish only a small and another $10m next year. It will spend NASA, and Hayabusa, launched by Ja- part of that range, typically between the money designing, building and pan’s space agency, took more than twice 300Hz and 6kHz, reducing noise and launching three single-use spacecraft, as long to bring back just a few specks of amplifying those frequencies where the called Firey, to conduct y-bys of small dust. Deep Space Industries’ proposed wearer’s hearing is weakest. asteroids. Planetary Resources, for its part, robotic 3D printer, for use in its mining But dierentiating elements of many intends to start by launching several con- operations, is if anything more fanciful common parts of speech occur in higher stellations of tiny spacecraft into Earth still. It would accept crushed nickel-rich frequencies. This is the result both of harmonics that ripple out from the main tone, and from non-voiced elements used to utter consonants, which employ the tongue, teeth, cheeks and lips. Take the words sailing and failing. Cut o the higher frequencies and the two are indis- tinguishable. The problem is compound- ed on telephone calls, which do not transmit frequencies below 300Hz or above 3.3kHz, resulting in the need for cues like S for Sierra, F for Foxtrot. People with hearing aids experience this problem constantly, says Brian Moore of the University of Cambridge. Typical hearing loss tends to be most acute at frequencies above 10kHz, which contain quieter sounds but where speech can still include important cues (as well as progressively less important ones extending up to 20kHz). Older hearing aids cut o at no higher than 6kHz, but much modern equipment stretches this range to 8-10kHz. However, a problem remains, Dr Moore Still science ction, at this point says, because bespoke hearing-aid calibra- 1 4 Monitor The Economist Technology Quarterly March 9th 2013

2 tions for individual users, called ttings, do not properly boost the gain of these higher frequencies. So Dr Moore and his colleagues have come up with a better Let’s have a heart-to-heart method. Their approach can be applied to many existing devices, and is also being built into some newer ones. A key step in any tting involves testing an individual’s ability to hear sounds in Medical technology: A new invention lets pacemakers scavenge the energy to dierent frequency bands. Each hearing power their circuitry from the motion of the beating heart itself loss is unique, and for most users a standard prole would be too loud in some N 1958 a priest named Gerardo Flórez, sive and can lead to infection. ranges and too soft in others. But current Ithen 70 years old, was blessed with the One approach, being pursued by some tests pay scant attention to the higher world’s rst articial pacemaker. The researchers, is to deliver the necessary frequencies that a device’s tiny speaker device kept his heart ticking in good order energy wirelessly. Some designs beam can produce, regardless of whether the for another 18 years. It connected to the energy to a receiving coil in an implanted user needs a boost. Dr Moore’s new test, heart externally, weighed 45kg (100lb) and device, and others use an external pace- known as CAM2, which is both a set of was powered by a 12-volt battery that had maker that wirelessly stimulates an elec- specications and an implementation in to be lugged around on a cart and re- trode implanted in the heart. software, extends and modies ttings to charged every 72 hours. Another possibility is to scavenge include frequencies as high as 10kHz. Since the 1950s pacemakers, which use energy from the natural processes occur- When the results are used to calibrate a electrical impulses to regulate a beating ring in the patient’s body. In 2011a group modern hearing aid, the result is greater heart, have shrunk substantially, as have of Swiss engineers installed a tiny turbine intelligibility of speech compared with their power packs. But scientists would inside a simulated artery which was existing alternatives. CAM2 also improves dearly love to get rid of the batteries alto- propelled by a bloodlike uid owing the experience of listening to music, gether. Even the best modern ones run out through it. And now Amin Karami and his which makes greater use of higher fre- every 7-10 years and patients must un- colleagues at the University of Michigan quencies than speech does. dergo surgery to have replacements in- have gured out a way to power a pace- The university’s licensing arm has stalled. The process can be painful, expen- maker by harvesting energy produced by been busy plugging Dr Moore’s software the very heart it is nudging along. and found an early taker in EarLens, a This is not a new idea, and Dr Karami’s Californian maker of a device with a approach, like previous attempts, relies on 10kHz range. EarLens’s gizmo comprises so-called piezoelectric materials, which two parts: a behind-the-ear microphone produce a current when subjected to and a vibrating actuator that has direct mechanical stressin this case the vibra- contact with the eardrum. An infra-red tions caused by a beating heart. Those beam focused into the ear carries the earlier eorts stumbled, however, because signal from the removable external com- the piezoelectric components were only ponent to the actuator. (The company has able to harvest enough energy to power a yet to secure regulatory approval for its pacemaker if the vibrations fell within a device and is therefore cagey about reveal- narrow frequency range. As a result, they ing the technical details.) worked for a limited range of heart rates, Another rm, called Sonitus, has devel- typically between 58 and 63 beats per oped an alternative approach to extend minute. Any lower (as when sleeping) or the frequency range to 12kHz. Its Sound- higher (during physical exertion, say) and Bite aid, which has been approved for sale the piezoelectric elements did not produce in America, uses an in-ear microphone enough oomph. Dr Karami’s non-linear coupled with a behind-the-ear transmitter harvester, by contrast, still works at heart that sends audio wirelessly to a remov- rates of 20 to 600 beats per minute. able receiver inside the mouth. The receiv- It does this using a combination of a er is custom-tted to a user’s teeth, and piezoelectric material and a magnet, takes advantage of bone conductivity to arranged so that the magnetic eld ampli- bypass the inner ear and stimulate the es the piezoelectric material’s response cochlea directly. It is designed as an al- to the vibrations. The result is that the ternative to bone-anchored hearing aids. magnet causes the sensor to vibrate more These are nifty, but deliver a relatively strongly when the vibrations within the narrow frequency range. chest cavity veer away from the sweet Crucially, bone-anchored devices spot. The magnet’s shape also boosts the require surgery to implant a screw at the piezoelectric component’s vibrations, and base of the skull onto which a customer thus the current, by varying amounts at snaps a removable, battery-powered dierent frequencies. This, in turn, ensures microphone and vibrator. The SoundBite that the current remains more or less the does away with the need for such invasive same, regardless of how quickly or slowly procedures, making it cheaper and safer, the heart is beating. as well as more versatile, while the Ear- Dr Karami’s piezoelectric generator Lens requires only the relatively straight- produced more than 20 times the power forward placement of the eardrum actua- needed to keep the pacemaker ticking at tor. The hard of hearing will love the normal heart rates. It also has the ad- sound of that. 7 vantage that it is smaller than a battery 1 The Economist Technology Quarterly March 9th 2013 Monitor 5

2 pack. Some of the extra energy produced oped at the Naval Postgraduate School in is stored in a capacitor embedded inside Monterey, California. It needs an electric the device. If the patient suers a cardiac propeller to get airborne, but having arrest and the heart stops beating entirely, reached a reasonable altitude TALEUAS The law and the capacitor kicks in. Its aim is not to can y all day just by riding rising currents shock the heart to restore its normal of warm air called thermals. the prots rhythm, as an implantable cardioverter- When TALEUAS encounters a thermal debrillator would do, but to hold enough it senses the lift and spirals around to take charge to keep the pacemaker running advantage of it. Vultures and eagles use Technology forecasting: A new while doctors try to revive the patient the same technique, and Kevin Jones, who step and wait model claims to using an external debrillator. is in charge of the project, says he has TALEUAS outperform industry rules of thumb Tests in pigs and sheep look promising. often found sharing the air with in predictive power The next step is to build an interface to these raptors. On some occasions, indeed, connect the new power pack to standard the birds found that the thermals they REDICTING the course of technologi- pacemakers, over 400,000 of which are were attempting to join were too weak for Pcal progress can be a risky business. installed annually in America alone. More their weight, as the drone is more ecient Scorn the latest advances and you risk than three-quarters go to patients aged 65 at gliding than they are. being left behind, as when Sony kept or older. Anything that saves them from TALEUAS’s endurance is limited only investing in at-screen versions of cath- going under the knife every few years by the power requirements of its electron- ode-ray televisions in the 1990s while would surely bring a hearty cheer. 7 ics and payload, which at the moment are Samsung piled into liquid-crystal displays battery powered. Dr Jones and his team (LCDs), and eventually replaced Sony as are, however, covering the craft’s wings market leader. Embrace new ideas too with solar cells that will generate power early, though, and you may be left with during the day, and are replacing its lithi- egg on your face, as when General Motors um-polymer battery with a lithium-ion spent more than $1billion developing one capable of storing enough energy to hydrogen fuel cells a decade ago, only to last the night. That done, TALEUAS will be see them overtaken by lithium-ion batter- able to stay aloft indenitely. ies as the preferred power source for elec- TALEUAS does, however, depend on tric and hybrid vehicles. chance to locate useful thermals in the rst To determine when to proceed with a place. Roke Manor Systems, a British rm, new technology many managers and hopes to eliminate that element of chance engineers employ popular heuristics, by allowing drones actively to seek out some of which are seen as laws. The rising air in places where the hunt is most best known is Moore’s law, proposed in likely to be propitious. As well as ther- 1965 by Gordon Moore, a co-founder of mals, Mike Hook, the project’s leader, and Intel. At rst it stated that as more transis- his team are looking at orographic lift, tors are crammed onto the surface of produced by wind blowing over a ridge, silicon chips, the devices double in perfor- and lee waves caused by wind striking mance every year. This law was later mountains. Their software combines revised to two years, and chip perfor- several approaches to the search for rising mance is now usually reckoned to double air. It analyses the local landscape for large every 18 months. Other laws use S at areas that are likely to produce ther- curves and various other calculations to mals, and for ridges that might generate predict how technologies will evolve. orographic lift. It also employs cameras to Many of these laws have become spot cumulus clouds formed by rapidly widely accepted and are now applied Flights of fancy rising hot air. when drawing conclusions about a broad Perhaps the most ambitious scheme range of technologies. Some have become for a robot glider, however, is the articial self-fullling. Chipmakers, for example, albatross proposed by Philip Richardson use Moore’s law to co-ordinate their re- of the Woods Hole Oceanographic In- search and development (R&D) activity Unmanned gliders: Powered drones stitution, in Massachusetts. Like its natural and plan their capital investment. In reali- are old hat. The latest robot aircraft counterpart, this articial bird harnesses ty, however, such laws are unreliable are wafted around by the air itself, wind shearthe dierence in wind speed because progress is rarely smooth. So allowing them to stay aloft far longer at dierent heightsin a technique called Ashish Sood of the Goizueta School of dynamic soaring. Business at Emory University, Atlanta, and LTHOUGH undeniably graceful, glid- The air is quite still near the surface of his colleagues have come up with their Aing has until now been suitable only the sea even when it is blowing strongly own law, which is explicitly based on the for pleasure ights. But this is changing, as just a few metres above, so an albatross tendency of technology to progress in researchers enhance the capabilities of can rise to gain height like a kite in a stops and starts. unmanned aircraft. Small drone gliders breeze, then glide down in any direction. Their step and wait (SAW) model, will soon be able to stay aloft for weeks, By repeating this trick it can y thousands recently published in Marketing Science, acting as communications relays, keeping of kilometres without apping its wings, notes that advances in performance are a persistent eye on the ground below and and by tacking it can travel anywhere, often followed by a waiting period before even tracking marine animals thousands regardless of the wind direction. Dr Rich- the next step forward. The steps can be big of kilometres across the ocean. ardson hopes to replicate this with his or small, and the waiting periods long or One such glider, the hand-launched robot bird. If he can, he will surely break short. The researchers also hypothesise Tactical Long Endurance Unmanned all records for the time a heavier-than-air that greater support for innovation means Aerial System (TALEUAS), is being devel- artefact has stayed aloft. 7 new technologies improve in larger and 1 6 Monitor The Economist Technology Quarterly March 9th 2013

2 more frequent steps than old technologies years. For traditional incandescent lighting of world music. As its name implies, did. This is the result of higher R&D spend- ing, an older technology, the step was their rm sells its music in digital form, ing, the existence of better tools and the 0.11% with waits of almost 20 years. Opti- mostly on CDs, though it presses a little fact that more countries are undertaking cal bres used in networking produced vinyl, too. research. But as the number of compet- some of the biggest step improvements, at Dust-to-Digital’s most ambitious eort itors in a new eld increases, both the size 2.19% per step, with a waiting period be- since Mr Ledbetter’s original gospel set of the steps and the length of the wait for tween steps of less than two years. received a Grammy nominationthe the next step can change. Using these data to compile their SAW company’s seventhin the Best historical To look at the factors involved, Dr Sood model, Dr Sood and his colleagues said album category in December 2012. and his colleagues studied 25 technologies they were able to produce superior predic- Opika Pende comprises 100 recordings in six markets: external lighting, desktop tions to those obtained for the technol- made on 78rpm records across Africa printers, display monitors, desktop mem- ogies in question with the traditional between 1909 and the 1960s. The col- ory, data transfer and car batteries. This laws. In the case of magnetic storage, for lection is the dream project of Jonathan provided more than a century of diverse example, they found that it took 28 Ward, who blogs at the site Excavated technological evolution for them to get months for systems to double in perfor- Shellac about old recordings of folk and their teeth into. Using historical records, mance, which is ten months more than vernacular music. In November 2012 the they tracked performance steps and wait- the gure commonly used in predictions. rm released Pictures of Sound, an ing periods, in order to obtain averages for The researchers say SAW can also be album of historical audio that had been each technology. used to predict the nature of the threat encoded in a variety of ways, including They found, for instance, that in light- posed by a competing technology, by drawings, barrel-organ rolls and early ing the predicted step size as a percentage more accurately classifying the steps and 19th-century recording technologies such improvement in performance for light- waiting periods involved. Had it used as the phonautogram. emitting diode lamps was 0.34%, with a their model, they reckon, Sony might have The label also publishes more recent mean waiting time between steps of 3.6 switched more quickly to LCDs. 7 material. For instance, it released eld recordings from a Florida folklife project of the late 1970s, and an album by a con- temporary improvisational (and un- conventional) folk artist who went into a recording studio for the rst time in his 30-year career in 2010. Dust-to-Digital’s releases are not blockbusters. But the label has built enough of an audience that it can always aord to pursue the next project. The biggest problem, Mr Ledbetter says, is cherry-picking among the many great ideas that come their way. At the same time, Dust-to-Digital is trying to preserve the past on a larger scale through a non-prot organisation called Music Memory. Its goal is to digitise as much as possible as rapidly as it can, by placing equipment in the homes of record collectors who are methodically processing their own holdings. The group will Unforgotten songs assemble lyrics, liner notes, discographic data and audio in an online collection. The challenge with all this cataloguing, digitising and assembling of material for release is the awkward status of audio (or Historical audio: A specialist record label digs up old recordings and phonogram) rights. Whereas musical re-releases them in digital form to preserve them for posterity compositions or spoken words are subject to copyright protection similar to that ANCE LEDBETTER’S interest in obscure rarer gospel recordings. Instead, in 2003, covering books and other printed materi- Lmusic began in the 1990s with a col- he ended up releasing a set of six discs als, audio released in America between lege-radio programme he hosted on Sun- ve of music and one of sermons. The the dawn of audio recording in the 1870s day mornings. A lot of his listeners in collection, Goodbye, Babylon, costs $100 and 1972 remains under protection until at Atlanta were on the way to or from and comes in a cedar box packed with raw least 2067. Some reform eorts currently church. Unable to nd a large enough cotton, along with a 200-page book docu- under way might succeed in putting audio variety of gospel songs to ll the show menting the selection. It received two from the 1920s and earlier in the public (and t his tastes), he started approaching Grammy nominations. It sold well, too, domain, however, as well as shortening collectors. Some dusted o old 78rpm and laid the foundation for a record label, the limits for the rest. recordings that he went on to play on the Dust-to-Digital, which Mr Ledbetter now The Ledbetters do not let rights issues air. Much of the material had been un- runs with his wife, April. Over the past deter them. They doggedly track down the available for years. I could not believe decade they have issued dozens more current holders of composition, perfor- how much incredible music you couldn’t anthologies and other works. mance and audio rights required for re- walk into a record store and buy, he says. The Ledbetters focus on material that is lease, wherever they are. And so, bit by bit, This stoked an obsession which led to unlikely to have been heard widely, or byte by byte, Dust-to-Digital will continue what Mr Ledbetter originally intended to perhaps ever, since its release. They stick to expose modern audiences to forgotten be a one-CD collection of some of the mostly to folk and gospel, with a smatter- gems from the analogue era. 7 The Economist Technology Quarterly March 9th 2013 Dierence engine 7 After 3D, here comes 4K

Home entertainment: A new television standard called Ultra HD is four times sharper than today’s best HDTVs. But providing content in this new format poses daunting technical challenges. And does anyone really need it anyway? AVING seen interest in 3D television screen. In raw form, a two-and-half-hour Hzzle, electronics rms are eager to lm shot in 4K at the usual 24 frames per nd another blockbuster product that will second contains 216,000 frames. With each get consumers to splash out. The develop- frame of the lm containing 8.6m pixels, ment most are hoping will do the trick is a and each pixel having 24 bits of colour in- display technology known as Ultra High- formation, the resulting video le contains Denition, which oers four times the res- 5.6 terabytes of data. Even with compres- olution of today’s most advanced 1080p sion, transmitting such gigantic les over HDTV sets. No question, Ultra HD provides the air or by cable would require more stunning imagesat least when displaying bandwidth, at far greater infrastructural content created in the new 4K video for- cost, than broadcasters can aord. Stream- mat. Unfortunately, only a handful of fea- ing a feature-length 4K le over the internet ture lms (including The Amazing Spider- would run into similar bandwidth con- Man, Prometheus and The Hobbit) straints. The internet connection needed have been shot with 4K-capable cameras. would have to transport data at speeds up Will 4K follow 3D’s fate? It is far too early to a gigabit a second. Few homes have to say. But 4K televisionfar more than 4K broadband that fast. cinemafaces some formidable obstacles. An alternative would be to distribute 4K As with 3D television, the new 4K televi- lms as Blu-ray discs, just as conventional sion format takes its lead from Hollywood. 2K lms are soldor were until people The existing wide-screen digital format switched to streaming them instead from used in cinemas is 1,998 pixels wide and 1,080 pixels tall. The 4K Netix, YouTube, iTunes and other online services. A 2K lm lm standard has twice the resolution vertically and twice hori- etched on a Blu-ray disc uses all 50 gigabytes of its two recording zontallyie, 3,996 pixels across the frame and 2,160 downmak- layers. A 4K lm would require a third or fourth layer. Even then, a ing it four times sharper all round. more ecient compression method than the current H.264 stan- By contrast, the 4K format used in television is slightly narrow- dard would be needed to shoehorn a 4K lm onto a Blu-ray disc. er, having 3,840 pixels across and 2,160 pixels down. The screen width was reduced to maintain the 16:9 aspect ratio of HDTV, with Get ready for a squeeze its 1,920-by-1,080 pixel count. This makes it possible to show exist- So a new compression standard is evidently required. How ing video content that has been upscaled for Ultra HD without lossy could a compression method aord to be before it compro- the need for black letterbox bands above and below the picture. mised the quality of a 4K picture? The international bodies re- But who actually needs a super-sharp 4K television? The reso- sponsible for compression standards have been discussing a suc- lution of even an HDTV set with 1,080 progressively scanned lines cessor to H.264 for the best part of a decade. The latest draft, (ie, continuously from top to bottom) is wasted on the vast major- known as High Eciency Video Coding, is said to double H.264’s ity of viewers. Most people sit too far from the screen to be able to compression ratio without loss of image quality. Even if that see the detail it oers. A study done some years ago found the me- proves up to the job, it will take years for the new compression dian eye-to-screen distance in American homes to be nine feet (2.7 standard (H.265) to be adopted universally. Many in the industry metres). But researchers reckon that, given the human eye’s limit- feel that if 4K television is to succeed, an entirely new way of en- ed acuity, people even with 20/20 vision should sit no farther than coding and delivering its content is needed. 1.8 times the width of the screen away from it, if they are to distin- Sony’s answer is to bundle a media server with its rst gener- guish the detail displayed. ation of Ultra HD television sets. The server will come with ten At a distance of nine feet, even an existing HDTV set would lms preloaded on its array of hard drives, along with a selection need to have a screen of around 70 inches across the diagonal for of short videos. Sony says the lms included are direct copies of viewers to benet from the resolution they have paid for. With pristine 4K masters. But no one has said how customers will add anything smaller at that distance, details simply blur into one an- fresh titles to their servers. This is obviously a stopgap measure, other. There is no question that, with twice the resolution horizon- designed to encourage wealthy early-adopters to splash out on tally and vertically, a 70-inch Ultra HD screen would be pretty im- the latest video fad. (Sony’s 84-inch Ultra HD set costs $25,000, pressive from nine feet away, and would still provide resolvable and buyers are also given a media server on loan.) But if Ultra HD detail at up to twice that size. is to be HDTV’s successor, then sooner or later cable and satel- So the best argument for moving to Ultra HD is the trend to- lite-TV providers and streaming-video services will have to nd a wards larger screen sizes generally. Today’s HDTV sets begin to way to deliver 4K content reliably and cheaply. No doubt, they look spotty when their meagre 2.1m pixels are spread over screens eventually will. The question is when. greater than around 80 inches. With 8.3m pixels to play with, Ultra The best guide is the penetration of HDTV. America’s rst na- HD screens can be made twice as large before the pixels become tionwide broadcast in digital high-denition was John Glenn’s too glaringly obvious. lift-o in the space shuttle Discovery in 1998. It took another dozen Assuming you have the space and the budget for an 80-inch- years for HDTV to go mainstream. By that reckoning, it is likely to plus TV, the next hurdle will be getting native 4K content onto its be 2025 before Ultra HD is in half of all American homes. 7 8 Telepresence robots The Economist Technology Quarterly March 9th 2013

Your alter ego on wheels

tered oces and turn on a dime. Telepresence robots are not just for of- Robotics: Remotely controlled telepresence robots let people be in two places ce workers, however. They also let home- at once. But they look a bit goofy, and raise security concerns buyers tour distant properties virtually, allow doctors to conduct bedside ODAY’S most advanced videoconfe- TiLR robots since 2008; its sleeker Luna consultations from afar and provide a Trencing equipment, installed in dedi- model went on sale in January for $3,000, cheap way to patrol workplaces at night. cated meeting rooms, delivers startlingly and its proposed 2015 model is expected to Oculus, a robot used mostly for security vivid images and sounds from afar. It can cost less than $1,000. Businesses common- patrols, is essentially a set of wheels for a cost hundreds of thousands of dollars to ly buy telepresence robots to inexpensive- laptop running Skype videoconferencing equip each room, however, and in most of- ly bring distant employees back into the software which can be controlled using a ces many fruitful meetings happen infor- fold at the oce, says Fred Nikgohar, the smartphone. Made by Xaxxon Technol- mally, in people’s oces or at the water- company’s boss. Later this year a Pennsyl- ogies, based in Vancouver, it costs $290. cooler. Now a new and radically dierent vania start-up called Bossa Nova Robotics Some globe-trotting parents have even be- approach to videoconferencing is helping will start selling a 1.37-metre-tall telepre- gun using robotic telepresence systems to overcome both shortcomings. Robotic sence ballbot called mObi that rolls stay in touch with their children at home. telepresence, as the technology is known, around on a football-sized sphere, a design Robotic-telepresence technology for allows people to move virtually through a which enables it to weave through clut- hospitals is now so good it’s like being at distant building by remotely the bedside, says Antonio controlling a wheeled robot Marttos, a doctor who uses ro- equipped with a camera, mi- bots to visit gunshot and crophone, loudspeaker and bombing survivors in Brazil, screen displaying live video of Haiti, Iraq and elsewhere, its pilot’s face. from his base at Jackson Me- Telepresence robots can- morial Hospital in Miami. But not match the audio-visual - it’s expensive. delity of a good, large-screen One model Dr Marttos videoconferencing installa- uses, the RP-VITA, can cost tion, with its carefully calibrat- $5,000 a month to rent. Even ed lighting, eye-lines and au- so, eagerness to get one dio. But the robots cost much spreads like wildre after less and are more exible. reports that a stroke victim or They give their pilots the free- other patient would have died dom to converse with any- without it, says Michael Chan body at the remote location of InTouch Health, the robot’s rolling over to the desk of a California-based manufactur- colleague, say, or accompany- er, which has sold more than ing a busy boss on her way to 700 of them. RP-VITA was co- a meetingrather than limit- developed with iRobot, a ro- ing communication to a spe- bot-maker based in Bedford, cic time in a special room. Massachusetts, and was Proponents of the technology cleared for use in American say that by placing a remotely hospitals in January. controlled embodiment of Brazil’s Olympic Organis- yourself in another location ing Committee will put tele- you can nurture your con- presence robots in operating tacts, increase your inuence rooms for the 2016 games in and assert your authority. Rio de Janeiro. João Grangeiro, Several start-ups are intro- the committee’s chief medical ducing new telepresence ro- ocer, says this means that bots this year, and sales are doctors unable to accompany growing as costs fall. RoboDy- their athletes to the games will namics of Santa Monica, Cali- be able to advise Brazilian sur- fornia, for example, has sold geons during operations. more than 100 of its $10,000 A consultation via RP-VITA Even sluggish regulators 1 The Economist Technology Quarterly March 9th 2013 Telepresence robots 9 The next stage in the evolution of telepresence robots may be to give them limbs

2 and hospital bureaucracies in eastern Eu- forehead. People keen to project their au- Botiful. It can be remotely piloted as it darts rope and Russia now want the kit, partly thority may think twice about manifesting around on a table or on the oor, carrying because late-night visits from remote doc- themselves via an object that resembles a an Android-based smartphone as it goes, tors keep tired sta focused, says Svetlana cartoonish stick gure. and streaming video via Skype. A future Karpova of Baltic Consilium, a consultan- Better to ooad design work to Apple, model will have sensors to stop the robot cy to hospitals and health ministries that is says Dmitry Grishin, head of Mail.Ru, a driving over the edge of a table or staircase. based in Britain. Robots were Russian internet giant. Last year This month a start-up called Romotive, virtually absent from Rus- his investment vehicle, Grishin based in Las Vegas, will begin shipping a sian hospitals several Robotics, put $250,000 into a similar iPhone-toting robot for $149. Any- months ago but will proba- start-up called Double Robotics, one with an invitation from its owner and bly be in more than 30 of to develop a robot which cradles access to a web browser can virtually step them by the end of this year, an iPad that serves as its brain inside the Romo, as it’s called, and control she says. They are also useful and face. Consumers have al- its diminutive, tanklike tracks to, say, at hospitals in big, wealthy ready decided that iPads are manoeuvre around glasses on a bar coun- cities such as London, where beautiful, Mr Grishin says, and ter for face time with distant friends. emergency specialists some- Double Robotics will benet Telepresence robots are gradually get- times get stuck in trac and from continuous innovation by ting cleverer. Some, like the Oculus, auto- may not otherwise reach pa- Apple and its legions of app de- matically dock themselves to a nearby tients fast enough. velopers. Based in Sunnyvale, charging station when battery power is But the greatest commercial opportu- California, Double Robotics sells its low. Others can synchronise themselves to nity lies in boosting workplace produc- sleek, minimalist and lightweight users’ schedules, autonomously rolling tivity, says Tim Lenihan, head of strategy wheels for your iPad, known as Dou- into a given meeting at a particular time, for Anybots, a manufacturer based in ble, for $1,999. The rst production units for example. But the sensors needed for the Santa Clara, California. Bosses can keep were shipped to customers last month. robot to be able to navigate on its own can employees on their toes by embodying Engineers are still trying to deter- be expensive. The autonomous version of themselves in a robot to cast an unex- mine the most conversation-friendly PeopleBot, a telepresence robot made by pected eye around the oce from home screen sizes for telepresence robots. Big Adept Technology of Pleasanton, Califor- or the road, he says. To point to things, pi- screens create the eerie impression that nia, costs $32,000, in part because of the lots can use a laser pointer mounted on a oating head is walking around, notes on-board infra-red and laser-mapping kit. the QB, the rm’s two-wheeled, ramp- one manufacturer. Use small screens, climbing robot, which costs $9,700. however, and a feeling of shared pres- Talk of the devil (While moving, the QB balances by con- ence may be replaced by a sensation of The next step for telepresence robots may tinuously rolling under its centre of grav- surveillance, says Sanford Dickert, an be to give them limbsnot to manipulate itylike balancing a broom in the palm American robotics consultant. Small distant objects, but to make the robots of your hand.) screens also handicap the person speak- more expressive. The pilot’s arm move- Aside from cost, the main barrier to ing through a shrunken head, he says. ments are sensed using a motion-capture wider adoption, you might think, is that Figuring out the best height and over- device such as the Microsoft Kinect, and telepresence robots are begging to be all size for a robot is also tricky. Robots of then relayed to the distant robot. A forth- kicked over from behind by disgruntled medium height talk down to people sit- coming $300 stationary robot called Wo- employees. In fact, a bigger problem is ting in chairs, but have to talk up to peo- bot, designed by Dr Hsu at Yuan Ze Univer- worries about security. Having a remote- ple who are standing. When using a ro- sity, makes arm gestures to express its controlled camera and microphone bot that can adjust its height, such as the controller’s happiness, surprise or disgust. crawling around a nancial institution QB and Double, pilots may be tempted A telepresence robot sheathed in rub- or research laboratory, piping goodness to tower inappropriately over their in- bery skin is being sold to researchers by Ja- knows what over the internet, raises un- terlocutors. Thanks to sci- movies, peo- pan’s Advanced Telecommunications Re- derstandable concerns with corporate- ple prefer robots they could overpower search Institute International. Resembling security types. Clinching sales for some if something goes wrong, says Yeh-Li- an androgynous and legless child with of the roughly 70 QBs that Anybots has ang Hsu, a designer of telepresence ro- short, handless arms, Telenoid, as it is sold so far meant setting up rewalls to bots at Yuan Ze University in Chungli, called, is essentially a large humanoid ensure the security of the Taiwan. He says heights of phone. The idea is that lonely grandpar- data streaming to and 70cm or less are best. ents feel the human presence of relatives from its robots. But some designers who speak through it while remotely mov- Another worry is that are thinking much small- ing its head and other body parts, says the some users may regard er, and are designing mo- project’s leader, Hiroshi Ishiguro. But this telepresence robots’ bile robotic cradles for creepy robot is unlikely to catch on outside goofy appearance as un- smartphones, aimed at Japan, says Timo Kaerlein, a German re- dignied. The QB, for ex- consumers. In Decem- searcher who studied Telenoid on a visit to ample, has a squat, two- ber a start-up called Ro- Kyoto. One observer described it as a wheeled base that sup- botics Valley, based in nightmarish, fetus-like demon-spawn. ports a telescopic pole Palo Alto, California, be- By comparison, having your disembodied holding a roundish head gan manufacturing a $300 boss drive up to your desk for a quick chat with a small screen as its Your robotic Double? three-wheeled robot called seems reassuringly normal. 7 10 The sharing economy The Economist Technology Quarterly March 9th 2013

All eyes on the sharing economy

Collaborative consumption: Technology makes it easier for people to rent items to each other. But as it grows, the sharing economy is hitting roadblocks HY pay through the nose for some- Wthing when you can rent it more cheaply from a stranger online? That is the principle behind a range of online services that enable people to share cars, accom- modation, bicycles, household appliances and other items, connecting owners of un- derused assets with others willing to pay to use them. Dozens of rms such as Airbnb, which lets people rent out their spare rooms, or RelayRides, which allows other people to rent your car, act as match- makers, allocating resources where they are needed and taking a small cut in return. Such peer-to-peer rental schemes provide handy extra income for owners and can be less costly and more convenient for borrowers. Occasional renting is cheaper than buying something outright or renting from a traditional provider such as a hotel or car-rental rm. The internet makes it cheaper and easier than ever to aggregate supply and demand. Smartphones with maps and satellite positioning can nd a nearby room to rent or car to borrow. On- line social networks and recommendation systems help establish trust; internet pay- ment systems can handle the billing. All this lets millions of total strangers rent vice that operates in California. Airbnb, based in San Francisco, which has things to each other. The result is known As they become more numerous and helped 4m people nd places to stay since variously as collaborative consumption, more popular, however, sharing services it was founded in 20082.5m of them dur- the asset-light lifestyle, the collabora- have started to run up against snags. There ing 2012 alone. People can list anything tive economy, peer economy, access are questions around insurance and legal from a spare bed to an entire mansion on economy or sharing economy. liability. Some services are falling foul of the site, setting rental rates and specifying It is surely no coincidence that many industry-specic regulations. Landlords house rules (such as no smoking or pets). peer-to-peer rental rms were founded be- are clamping down on tenants who sub-let Anyone looking for somewhere to stay in a tween 2008 and 2010, in the aftermath of their properties in violation of the terms of particular city can enter their dates and the global nancial crisis. Some see shar- their leases. Tax collectors are asking browse matching oers from Airbnb’s ing, with its mantra that access trumps whether all the income from sharing 300,000 listings in 192 countries; Airbnb ownership, as a post-crisis antidote to schemes is being declared. Meanwhile, the takes a cut of 9-15% of the rental fee. Others materialism and overconsumption. It may big boys are moving in, as large companies oering similar services include Roomo- also have environmental benets, by mak- that face disruption from sharing schemes rama, Wimdu and BedyCasa. ing more ecient use of resources. But start to embrace the model themselves. As Car-sharing schemes divide into peer- whatever the motivation, the trend is clear. the sharing economy expands, it is experi- to-peer car-rental services in which you People are looking to buy services dis- encing growing pains. pay to borrow someone else’s car (Buzzcar, cretely when they need them, instead of By far the most prominent sharing ser- Getaround, RelayRides, Tamyca, Wheelz, owning an asset, says Je Miller, the boss vices are those based around accommoda- WhipCar) and taxi-like services (Lyft, Side- of Wheelz, a peer-to-peer car-rental ser- tion and cars. The best-known example is Car, Uber, Weeels) in which people use 1 The Economist Technology Quarterly March 9th 2013 The sharing economy 11 The idea of renting from a person rather than a faceless company will survive, even if the early idealism of the sharing economy does not

2 their cars to ferry paying passengers. Some create norms that keep owners and renters saction can review each other. Another peer-rental schemes focus on particular in line, because they fear the repercussions characteristic of such services is that users types of customer, such as students, or par- of bad reviews: other people on the site or listings with plenty of reviews will be ticular types of vehicle, such as high-per- will be less willing to do business with sought after, whereas those with no re- formance cars. Peer-to-peer taxi services them, and they may be kicked out altogeth- views look less attractive. Mr Blecharczyk use location-aware smartphone apps, cou- er. Travis Kalanick, the boss of Uber, a ser- says Airbnb recommends that rst-time pled with a central dispatcher, to bring vice that matches up drivers with passen- listers set their prices less aggressively to drivers and passengers together. gers, says the review system means drivers encourage renters who might avoid a place Variations on these models include with poor ratings don’t last long, while without a review. As soon as one review DogVacay and Rover, both of which are passengers who behave badly nd it hard appears, he says, inquiries can increase dog-kennel services (like Airbnb for dogs), to get a ride. tenfold, and listers can raise their prices. and Boatbound, which oers short-term, Most systems don’t provide immediate peer-to-peer boat rental. There are also conrmation when one user applies to Growing pains peer-rental sites for car-parking spaces rent something from another, allowing the For the most part this self-policing ap- (Airbnb for cars, in eect), bicycles, photo- provider to decide whether to proceed or proach works well. But occasionally things graphic kit, musical instruments, garden not, based on the applicant’s ratings, re- can and do go wrong, which has forced equipment, outdoor gear, kitchen appli- views or other factors. Being turned down peer-rental sites to take steps to protect ances, and so on. These sites generally start can lead to hard feelings, but there is usual- themselves and their users. Airbnb suf- o serving a particular city or region, as ly no opportunity to complain, because fered a rash of bad publicity in mid-2011 Airbnb did in San Francisco. But the more only people who actually engage in a tran- when a host found her apartment trashed successful ones have expanded to cover and her valuables stolen after a rental. multiple cities and entire countries. After some public-relations missteps, All these services rely on ratings and re- Airbnb eventually agreed to cover her ex- ciprocal reviews to build trust among their penses, and added a $50,000 guarantee for users. Staying in a stranger’s apartment in hosts against property and furniture dam- another city seems much less daunting age. That was increased to $1m in May 2012 when you can read testimonials from pre- with the backing of Lloyd’s, an insurance vious guests. Similarly, before welcoming marketplace. Airbnb also improved its site strangers into your home it is reassuring to to allow hosts and guests to nd out more read reviews from other hosts they have about each other in advance. stayed with. Many platforms also carry out Peer-to-peer car-rental services also background checks, looking into their us- provide insurance as part of the deal. Mr ers’ driving and credit histories and check- Clark says it took RelayRides 18 months to ing for criminal records. In addition, some nd an underwriter for the $1m policy that peer-rental services (including Airbnb, Re- backs each driver during rentals. (Much of layRides and Lyft) integrate with Facebook the 40% commission RelayRides takes on to let owners and renters check to see each rental goes towards insurance.) But whether they have friends (or friends of the question of whether a car-owner’s in- friends) in common. surer is liable in the event of an accident re- We couldn’t have existed ten years mains untested. Three states (California, ago, before Facebook, because people we- Oregon and Washington) have passed ren’t really into sharing, says Nate Ble- laws relating to car-sharing, placing liabil- charczyk, one of Airbnb’s founders. ity squarely on the shoulders of the car- Airbnb doesn’t require its users to connect sharing service and its own insurers, just their accounts to Facebook, but when peo- as if it owned the car during the rental per- ple nd they have friends in common with iod. The laws also prohibit insurers from another user it sets their minds at ease. cancelling owners’ policies. One insurer, Thanks to social media, says David Lee, GEICO, rewrote its policies in 2012 to with- founder and managing partner of SV An- draw accident coverage for cars that have gels, an early investor in Airbnb, people been rented to others in states that permit are generally more comfortable meeting it. A fatal accident involving a RelayRides new people using technology. Providing a driver in Boston in 2012 may test the limits secure platform for nancial transactions of existing policies in Massachusetts. is vital, he says, but creating a trusting com- Insurance is just one example of how munity is just as important when it comes peer-rental services are running into regu- to attracting users. latory barriers. In many cases they also Shelby Clark, the founder of Relay- nd themselves in conict with the com- Rides, says his company checks its users’ plex rules that govern some industries. In driving records for major violations, but re- an eort to avoid such diculties Lyft, lies on user reviews when it comes to as- SideCar and other peer-to-peer taxi ser- sessing the cleanliness of both cars and vices do not set a price for a given journey drivers. Such systems, he says, tend to and do not handle billing. Instead, passen-1 12 The sharing economy The Economist Technology Quarterly March 9th 2013

2 gers are prompted to give drivers a volun- cupant is also resident at the time.) Having make sense for them to work closely with tary donation of a particular amount previously taken the position that it is up to these upstart rivals. After the GM Ventures and they know that failure to do so will hosts to ensure that they are complying investment, for example, RelayRides was lead to negative reviews, making it dicult with local laws and taxes, Airbnb has re- given privileged access to GM’s OnStar to nd a ride in future. cently shifted its stance in response to a navigation system, which is installed in 6m But regulators are unimpressed. In No- growing regulatory backlash. In October American cars. The sign-up process for Re- vember 2012 the California Public Utilities 2012 it appointed David Hantman, previ- layRides has been streamlined for OnStar Commission issued $20,000 nes against ously the head of government relations at users, and OnStar-equipped cars can be Lyft, SideCar and Uber for operating as Yahoo, as its head of public policy. He says locked and unlocked by renters using an passenger carriers without evidence of Airbnb is now working with governments app, so there is no need to meet to hand public liability and property damage in- around the world to clarify and even over keys. GM hopes this will encourage surance coverage and engaging employ- change the patchwork of laws that apply more car-owners to sign up for its OnStar ee-drivers without evidence of workers’ to its hosts. The more policymakers and service in the hope of making some extra compensation insurance. All three rms neighbours learn about our service, and money on the sidean average of $715 a appealed against the nes, arguing that the better they understand it, the more month, according to RelayRides. For Avis, outdated regulations should not be ap- they realise that this activity should not be meanwhile, owning ZipCar and a stake in plied to peer-rental services. In January the prohibited, he adds. Wheelz gives it exposure to a new model city of San Francisco agreed to allow Lyft that threatens to upend its business. and Uber to continue operating while it de- Here come the big boys What looks like a disruptive new mod- vises new rules, due by July. Uber has also Meanwhile, the peer-rental model has el will probably end up being mixed into won permission to operate its service in been endorsed, at least in the eld of car- existing models and embraced by incum- Washington, DC. But in many other cities it sharing, by incumbent carmakers and bents, as has often happened before. Tim faces bans, nes and court battles. rental rms. GM Ventures, the investment O’Reilly of O’Reilly Media, a long-term It is not just car-sharing services that arm of America’s biggest carmaker, was watcher of internet trends, says such con- have run into legal problems. So have among the investors who put $13m into Re- solidation is inevitable. When new mar- apartment-sharing services, which have layRides in 2011. ZipCar, a pay-by-the-hour kets come in, they often look more demo- fallen foul of zoning regulations and other car-rental rm that maintains its own eet cratising than they end up becoming, he rules governing temporary rentals in of vehicles, led a $14m investment in says. The idea of renting from a person which the property owner or occupier are Wheelz, a peer-rental rm, in 2012. ZipCar rather than a faceless company will sur- not present. Many American cities ban was in turn acquired by Avis, a conven- vive, even if the early idealism of the shar- rentals of less than 30 days in properties tional car-rental rm, in January 2013 for ing economy does not. The fact that regula- that have not been licensed and inspected. $491m, giving Avis a stake in Wheelz. tors, tax collectors and big companies are Some Airbnb renters have been served As well as being a vote of condence in now sning around a model that has been with eviction notices by landlords for rent- the peer-rental model, investments by in- embraced by millions of people is a mea- ing their apartments in violation of their cumbent rms highlight the fact that it can sure of its value and growth potential. 7 leases. In Amsterdam, city ocials point out that anyone letting a room or apartment is required to have a permit and to obey other rules. They have used Airbnb’s website to track down illegal rentals. Ocials in San Francisco have raised similar red ags. The city’s treasurer ruled in April 2012 that Airbnb and other similar sites were not exempt from the city’s 15% hotel tax. Airbnb responded that the regulations, dating back to 1961, should not apply to internet-era business models. The city’s mayor, Ed Lee, has championed the notion of the sharing economy as a means to stimulate economic growth. City ocials have promised to work out a regulatory and tax framework, but for the time being Airbnb and other such services re- main in a legal grey area. In New York, meanwhile, a landlord faces nes of as much as $30,000 after one of his tenants sub-let his room in an East Village apartment via Airbnb while going out of town for a few days in September 2012. (A law passed in 2010 does not allow the renting out of homes or rooms in them for less than a month unless the usual oc- The Economist Technology Quarterly March 9th 2013 Biomedical scaolding 13

folds from a mixture of natural chitosan and an industrial polyester polymer, using a process called electrospinning. The raw materials are dissolved in solvents and placed into a syringe, the needle of which is attached to a high-voltage supply. Charged liquid is then expelled from the needle towards an earthed collector plate. Like a spark between a cloud and a light- ning conductor, the liquid stretches out to the collector, and the molecules within it form into a solid but incredibly thin thread. The resulting minuscule bres accrete into a dense mesh whose texture is similar to that of the body’s own connective tissue. In laboratory tests, prototype nerve guides built from this nanomaterial sus- tained the growth of new neural cells, pro- Under construction duced no immune reactions and were much stronger and more exible than commercial collagen tubes. By adjusting the electrospinning process, the orienta- tion of the nanobres can be controlled to terials tend to have good biocompatibil- build scaolds suitable for cultivating cells itythe ability to play well with the that need precise alignment, such as elon- Biomedical technology: Tiny forms of body’s own cellsand usually biodegrade gated muscle bres and heart tissue. scaolding, combining biological gracefully when their work is done. But Ms Zhang’s team is also combining nat- and synthetic elements, have a wide they have drawbacks, too. Biological mate- ural and synthetic polymers for use in drug range of medical uses rials vary from batch to batch, can be hard delivery. Some cancer drugs are extremely to obtain, may carry disease and can break potent and will harm healthy cells if not IRST-TIME visitors to Asia are often sur- down too quickly in the hot, moist envi- applied carefully. Wrapping such drugs in Fprised to see construction workers on ronment inside the body. a scaold allows doctors to keep them modern buildings, even skyscrapers, Purely synthetic materials are not al- close to a tumour and control their rate of climbing up imsy-looking bamboo scaf- ways a perfect alternative. True, they can release. One promising approach involves folding. These traditional structures are be produced in volume and engineered to super-absorbent polymer scaolds called not as ramshackle as they might appear. degrade at very consistent rates. But their hydrogels. These are jelly-like materials Bamboo poles are lighter, more exible limited ability to interact with living tissue made up of a bundle of highly water-ab- and cheaper to erect than Western-style is a mixed blessing. It minimises the risk of sorbent polymer chains. This makes them metal scaolding, though they are more an immune response or cross-contamina- liquid enough to be injected, carrying a likely to buckle in humid conditions. These tion, but synthetic materials are less good pharmaceutical payload with them. Both days, the poles are usually secured with at encouraging the cell growth essential for of her team’s composite biomaterials are strong nylon straps for safety. successful implantation or healing. So tis- now heading towards commercialisation. Researchers working with scaolds at a sue engineers have been pursuing a hybrid Another approach to making hybrid far smaller scale are now exploring the use approach, developing new scaolds that scaold materials is to convert a natural of similar hybrid structures, made using a combine biological and synthetic aspects. material into an articial one while retain- combination of biological and synthetic ing its structure. Over 2m bone grafts are elements. Three-dimensional scaolds are Some nerve performed worldwide each year to replace often implanted or injected into the body Consider an accidentally severed nerve in bone lost to damage or disease. If only a as part of the process of tissue engineering. a hand, for example. Today, a small tube small amount of bone is needed, it can of- They have many uses: to target cancers made from bovine collagen would be sur- ten be harvested, painfully, from the pa- with localised drugs, repair the eects of gically attached to the nerve endings. Be- tient’s own pelvis. When more bone is trauma or disease and maybe even to help cause the collagen tube resembles the needed, donor bones can be used. But they regrow entire organs and bones. body’s own nerve guides, cells will grow are limited in supply and carry the risk of Much of the miniature scaolding in through and around it to rebuild the nerve rejection or transmitting disease. Biologi- use today is purely natural in origin. Many gradually. Although the collagen guides cally inert metal bones are strong, but are a commercially available scaolds use ma- are structurally weak and occasionally poor substitute for living bone and often terial normally found in the human body, provoke an immune response, they are require further surgical interventions. harvested from animals or human donors. still preferable to tough polyester scaolds Over the past few years attention has Others have more exotic origins, such as that cannot support natural regeneration. focused instead on calcium-based ceram- spider webs, silk, algae, seaweed and the At the University of Washington in Se- ics such as hydroxyapatite. These have a chitinous shells of crabs and shrimp. attle, a research group led by Miqin Zhang chemical composition close to that of nat- Scaolds made from these natural ma- is weaving nanoscale nerve-guide scaf- ural bone and can encourage some regen- 1 14 Biomedical scaolding The Economist Technology Quarterly March 9th 2013 Biological materials vary from batch to batch, can carry disease and may break down too quickly

2 eration. Hydroxyapatite is extremely brit- created using a form of 3D printing called Seattle and Wallonia, Belgium, has devel- tle, however, and cannot sustain the stress- micro-stereolithography. oped a material called STAR that stimu- es experienced by arms and legs. But The resulting structure provides a wel- lates the body’s natural immune defences researchers at the Institute of Science and coming environment for stem cells, some to occupy it. When dense objects such as Technology for Ceramics (ISTEC) in Faen- of which are placed into the scaold, implants or medical devices are implanted za, Italy, noticed that some woods, in par- which is immediately implanted, thus in the body, they provoke a reaction that ticular rattan, shared the complex porous avoiding the need for a sterile clean room. usually encapsulates them in dense scar structure of human bone, and were simi- The hope is that the polymer scaold will tissue. This can be dangerous, isolating larly strong and lightweight. biodegrade in the eye slowly enough for bacteria within the encapsulated region This inspired Simone Sprio and his col- the stem cells to nd a permanent home. from infection-busting white blood cells. leagues at ISTEC to try to convert the cellu- The rst test in human patients is planned Andrew Marshall, Healionics’ chief lose of wood into something suitable for in collaboration with the LV Prasad Eye In- technology ocer, speculated that a scaf- implantation. Their process starts by heat- stitute in Hyderabad, India, later this year. fold with pores large enough to permit ing rattan in the absence of oxygen, pre- Designing for biocompatibility does macrophages (the largest white blood cells, serving the wood’s structure while reduc- not have to mean slavish biomimicry, over 20 microns wide) to pursue bacteria ing its organic molecules to pure carbon. It however. Healionics, a start-up based in (typically 2 microns wide) would reduce is then infused with calcium, oxygen and encapsulation and sepsis. He experiment- phosphorous in a series of chemical steps, ed with tissue scaolds made by fusing bil- to create a hydroxyapatite scaold with lions of tiny acrylic spheres, lling the gaps the same structure as the original wood. In with silicone, then dissolving the spheres, tests using sheep, this novel scaold was leaving just the silicone structure behind. completely colonised by host bone cells in By altering the size of the spheres, he could one month and new bone began to form. control the dimensions of the pores. In tests in mice, Mr Marshall found that pores Microscopic sites for sore eyes of 25-40 microns (about half the diameter A dierent biomimetic approach (in oth- of a human hair) resulted in the formation er words, inspired by nature) is to engineer of about twice as many blood vessels. a material from scratch to have characteris- When white blood cells encounter the tics found in natural materials. Tissue engi- STAR material, instead of kick-starting in- neers in Britain are doing just that to treat ammation and scarring, they make them- corneal scarring, a painful eye condition selves at home in the highly porous struc- that aects millions of people, particularly ture. They then send out chemical signals in the developing world. When the cornea, that cause capillary blood vessels to grow the transparent front part of the eye, is into the material, creating a permanent hy- damaged seriously enough to wipe out its brid scaold within days. The result is resident repair team of limbal stem cells, much less scarring, and an encapsulated scarring and blindness can result. region into which macrophages can travel. The most successful existing treatment Through its Belgian spin-out, iSTAR Medi- involves extracting limbal stem cells from cal, Healionics recently launched its rst a healthy eye, cultivating them on human product, a small device that is implanted amniotic membrane (harvested from hu- into the eye to treat glaucoma. One benet man placentas) and then surgically graft- of Healionics’ approach is that its innova- ing this to the damaged eye. But this re- tions are structural rather than chemical. quires a well-stocked tissue bank and a Because silicone is widely used and well biological clean room, both of which are in understood, obtaining regulatory approv- short supply in many developing coun- al was relatively simple, says Mr Marshall. tries. And the implants are often rejected: Many of the scaolds that have already the long-term success rate for this opera- been commercialised for wound repair, tion is less than 50% after three years. bone grafts and surgical aids are compara- Sheila MacNeil, a professor of tissue en- tively simple. Moving to the next genera- gineering at the University of Sheeld, tion of scaolds for the delivery of drugs, wondered whether this was due to dam- cells and eventually genes will require ex- age to tiny niches in the cornea where lim- tensive safety testing and lengthy clinical bal stem cells are thought to reside. With- trials. But Robert Langer of the Massachu- out these refuges, colourfully known as setts Institute of Technology, who pioneer- the palisades of Vogt, the transplanted ed modern tissue engineering in the 1980s, stem cells could not survive. Ms MacNeil says he is condent that the industry will and her colleagues created a scaold that ultimately deliver. Hybrid scaolding, in incorporates articial palisades of Vogt by which man-made and biological elements building up an electrospun polymer called University of Washington scaold for work together, could then become as wide- PGLA, commonly used in dissolvable su- elongated muscle cells (top); rattan wood spread on the insides of human bodies as it tures, on a carefully designed template (middle); Healionics STAR (bottom) is on the outsides of Asian buildings. 7 The Economist Technology Quarterly March 9th 2013 Underwater networking 15

Captain Nemo goes online

can even remember. But now better un- ter, to provide the military alliance with an derwater-communications technologies unprecedented ability to gather intelli- Networking: Emerging undersea are changing the rules. gence, communicate and co-ordinate its data networks are connecting Although traditionally more a sneaky forces underwater. Akin to mobile-phone submarines, aquatic drones and sniper than a team player, as Eric Wer- towers but communicating using pulses of other denizens of the deep theim, an American naval analyst, puts it, sound rather than radio waves, the nodes submarines are increasingly expected to are placed a kilometre or so apart. A few URING the Cuban missile crisis of co-ordinate with surface and land forces. extra nodes are needed because acoustic DOctober 1962 the Soviet Union sta- Subsea networks being developed by signals can be scrambled or lost near a tioned submarines in the region in order to America and its allies will shue data be- choppy surface, in fast currents or in a re- be able to sink American ships in the event tween submarines, aquatic drones and gion with a sharp temperature change. of war. But communication between the sensors via devices that sway beneath the Each node, which costs $5,000-10,000, submarines and Soviet high command water or bob on its surface. They will make is around the size of a canister of tennis was hard. Electrically conductive salt wait possible to detect enemy vessels and balls. It contains a computer to process sig- ter absorbs radio waves, so exchanging in- mines and allow submarines to link up nals, a microphone to pick up sound formation with Moscow required the sub- with surface ships, aircraft and distant waves, and a piezoelectric transducer to marines to ascend to periscope depth in command centres, says Vernon Clark, emit them. This transducer, similar in size waters patrolled by American planes and America’s former chief of naval opera- to a small plate, is made of a special materi- ships. Between scheduled transmissions tions. Undersea networks could also mon- al that expands and contracts suddenly Soviet crews also poked antennae out of itor waterways and gather scientic data. when a voltage is applied, creating an the water and listened to commercial radio acoustic wave in the water. This signal is to see if hostilities had broken out. A blun- Making waves picked up by other nearby nodes, which der could have been catastrophic, says In the 1970s and 1980s both America and retransmit it as appropriate to more distant Alexandre Sheldon-Duplaix, a naval-war- the Soviet Union built underwater-signal- ones, like an underwater internet. fare historian at France’s defence ministry, ling systems based on extremely low fre- Seaweb, an underwater network being because the Soviet submarines were quency (ELF) radio waves. Both systems designed at the Naval Postgraduate School armed with nuclear torpedoes that the needed large electrodes, buried in the in Monterey, California, and the Space and West did not even know existed. ground 50-60km apart, and could then Naval Warfare Systems Command in San In the decades that followed navies send signals to submarines thousands of Diego, takes a similar approach. Its nodes continued to be dogged by the diculty of kilometres awaybut only one way, and at have been tested under the Arctic ice sheet establishing underwater data links. In the a rate of around ten characters per minute. and in water 300 metres deep. Data pack- 1980s America decided not to integrate its To overcome these limitations, more recent ets hop from one node to another until new Los Angeles class of attack subma- research has focused on signalling using they reach their destinationa submarine, rines with aircraft-carrier groups, says Nor- sound, over shorter ranges. a subsea drone, a warship or a gateway man Friedman, a former consultant to the The big technical challenges have been node at the surface. Gateway nodes use a secretary of the US Navy, because it was mostly overcome, says John Potter of satellite-radio link to connect the under- concerned that aky communications NATO’s Centre for Maritime Research and water network to the rest of the world. links between ships and submarines Experimentation (CMRE) in La Spezia, Ita- Seaweb nodes are capable of exchang- might lead to collisions or friendly re. A ly, who heads one of several groups building information through dozens of kilo- former commander of an American carri- ing underwater networks based on small metres of water. Such long ranges, how- er in the 1990s says he was unable to estab- devices called acoustic nodes. These could ever, require the use of low-frequency lish submarine contact more times than I be shovelled out of a plane, says Mr Pot- sound waves, which reduces the data rate. 1 16 Underwater networking The Economist Technology Quarterly March 9th 2013 Underwater networking will put an end to the ‘data starvation’ experienced by submarines

2 Joseph Rice, the project’s leader, says a Sea- multiple messages simultaneously. The the reach of underwater networks. The lat- web node can send a low-resolution photo improvement in bandwidth is largely due est glider UUVs consume very little bat- to another one 5km away in ve seconds to progress in signal-processing software, tery power: rather than turn a propeller, two seconds to emit the sound waves, and which is capable of coping, for example, batteries pump oil in and out of an exter- another three for them to travel that far. In with multiple echoes of a signal from a nal bladder, changing the UUV’s buoyan- seawater acoustic waves carry only a few choppy surface. The latest nodes can also cy. Fixed wings convert this rising and sink- thousand bits of data per second, but they save bandwidth by deciding for them- ing into slow forward motion, allowing a travel at 5,600kph (3,500mph)ve times selves how much to compress an image, glider to run for months on a single battery the speed of sound in air. say. But smarter software is needed, says charge. Already, gliders serving as mules It is hardly broadband, but it can be Arto Laine, manager of underwater-war- are descending to sensors in deep water used to connect submarines and warships fare research at Patria, a Finnish defence where they acoustically collect informa- to sensors and roving subsea drones, also contractor. Even with an excellent acoustic tion. They then ascend to the surface and known as unmanned underwater vehi- link, a mine-hunting UUV cannot stream send the data via radio, says David Kelly, cles (UUVs). Mr Rice imagines that UUVs all the data it collects to a submarine or sur- chief executive of Bluen Robotics, which might deploy sensor nodes and could visit face node. So UUVs will have to get better provides UUVs to half a dozen navies. them when required to download the data at determining what information should The US Navy has ordered several glid- they have collected in large quantities. Sen- be sent back rst, he says. ers to form underwater mobile networks. sors could also alert UUVs of any unusual A growing understanding of bubbles With no engine noise, a stealthy swarm readings that require investigation. caused by surface waves, which aect how of gliders could monitor submarines and In a related project, called NILUS, Nor- far acoustic signals travel, promises further ships entering a strait, for example, surfac- wegian researchers have designed a com- improvements. Future nodes will listen to ing to transmit their ndings. Floating gate- bination of acoustic and magnetic sensors way nodes, dropped from the air, allow capable of detecting submarines in deep messages to be sent to submerged devices water. Roald Otnes, project scientist at the via low-frequency acoustic signals. This Norwegian Defence Research Establish- scheme, known as Deep Siren and devel- ment, says the nodes are easy to deploy: oped by Raytheon, an American defence each one is simply heaved overboard (it contractor, has been tested by the British weighs about 60kg, thanks largely to its and American navies. battery pack). The NILUS sensor nodes are networked using technology provided by Disconnected no more the Seaweb team, which is also helping a The combination of acoustic signalling Singaporean project called UNET. and UUVs, which can deliver data physi- The shallow oshore waters around cally, will put an end to the data starva- Singapore, where container ships and tion experienced by submarines, as snapping shrimp create a racket, present a America’s submarine command de- particularly dicult environment for scribed it in a report last year. Often incom- acoustic signalling, but UNET nodes man- municado, subs have been condemned to age to communicate at distances of more lone wolf roles, says Xavier Itard, head than 2km. Equipment that performs well of submarine products at DCNS, a French around Singapore will work pretty much shipbuilder. His rm is developing a fun- anywhere, says Mandar Chitre of the Na- ambient conditions and adjust communi- nel-shaped torpedo-tube opening that tional University of Singapore, the pro- cation frequencies accordingly, says Grant would make it easier for a UUV to dock ject’s leader. A handful of bobbing surface Deane of the Scripps Institution of Ocea- with a submarine. Being able to send mes- nodes provides a link to the Singaporean nography in La Jolla, California. sages quickly via acoustic networks would mobile-phone network. Another promising avenue is the use of enable submarines to take on more tactical A separate European Defence Agency laser pulses to beam information between rolesinserting special forces when need- eort called RACUN brings together Ger- nodes. Lasers require less battery power ed to a nearby battleeld, say, or support- many, Italy, the Netherlands, Norway and than acoustic signals and are far more dis- ing ground operations by launching cruise Sweden. Such co-operation illustrates a de- creet. Information is sent using cone- missiles from the depths. sire among NATO countries and their al- shaped beams to ensure that the signals The Soviet-built ELF radio system relies to design technologically compatible reach light-sensing photodiodes on the remains a backbone of Russia’s submarine subsea networks that could be intercon- ceiving node, even when both nodes are communications, according to a Norwe- nected. Unfortunately, makers of acoustic moving. But this approach will work only gian expert. But in a clear vote of con- nodes have developed several incompati- over distances of a few tens of metres at dence in newer technologies, America ble data protocols, creating a Tower of Ba- best, according to a German military scien- shut down its own system in 2004. Thanks bel and a world of pain for teams trying to tist working on the technology. to steady progress in undersea networks, link them together, says Mr Potter. American researchers are developing what was once a technological marvel Data rates have steadily improved, in- bre-optic UUV tethers dozens of kilo- was, a US Navy statement explained, no creasing tenfold over the past two decades, metres long, which would allow high data longer necessary. Whether via sound says Michele Zorzi of the University of rates. But long tethers can get tangled or cut waves, laser pulses, optical bres or under- Padua, in Italy, who is busy extending the by crabs. UUVs will probably play a bigger sea drones, there are now better ways to RACUN system so that nodes can handle role as roving wireless nodes that increase deliver data underwater. 7 The Economist Technology Quarterly March 9th 2013 Brain scan 17 The podfather, part III

about how they could be improved. Soon he realised that he had the makings of a Tony Fadell helped revolutionise the new business, and together with Matt music and phone industries. Now he Rogers, a former Apple colleague, he is turning up the competitive heat in created Nest Labs in a Palo Alto garage. an entirely dierent eld The company is following an Apple- like strategy. This involves nding a big DON’T want the iPod to be my den- marketNest Labs reckons that there are Iing thing, says Tony Fadell, the chief some 250m thermostats in homes, restau- executive of Nest Labs, a rm that he rants, oce buildings and shops in Ameri- co-founded in 2010 after leaving Apple. ca alonethat has seen little innovation I’m all about peaking late in life. Mr and then shaking it up by producing a Fadell, who is 43, has already done more smart, elegant device at a premium price. than enough to secure a place in Silicon With its rotating stainless-steel control Valley’s pantheon of innovators. During wheel, its sleek industrial design and its his nine years working for Apple, he led clever software, the Nest thermostat feels the team that turned his novel idea for a a lot like the rst iPod in spirit. digital-music player into the blockbuster And all of this ts into Mr Fadell’s iPodand then went on to play an impor- broader vision of where technology is tant role in the development of the mould- heading. People have long dreamt of the breaking iPhone. These twin peaks will be day when the devices they bring into their hard to beat, but Mr Fadell is convinced homes work with one another straight out that he and his colleagues at Nest Labs can of the box. But Mr Fadell is convinced that come up with other devices that will an internet of things, in which smart prove just as disruptive. machines can communicate easily with They have chosen to start with a their owners and one another, is around household gadget that largely goes unno- the corner. In ten years’ time it will be as ticed. The Nest Learning Thermostat is a mundane as a paper clip, he claims $250 web-connected device that is already thanks to several trends. on sale in America and Canada, and will soon be available in other countries. As From smartphones to smart homes well as letting people manually adjust The rst of these is the rapid spread of their heating or cooling systems, it also smartphones, which Mr Fadell believes learns their preferences. Its software mon- will become the principal remote controls itors the way people turn a thermostat up for people’s lives. Companies are already and down at dierent times of the day making all kinds of products, from televi- over a period of time, and can then auto- sions to washing machines to security matically create a schedule based on their systems, which can be controlled via apps. habits. The Nest, as it is known, also uses Another trend is the proliferation of built-in sensors to work out when a house tiny, cheap sensors that are being packed is empty, and then reduces the heating or into smartphones and many other de- cooling to an energy-saving setting or vices. These allow gadgets such as the switches it o altogether. Nest, which includes motion, humidity This is clever stu and explains why and other detectors, to respond autono- the Nest costs much more than most pro- mously to changing conditions. When grammable thermostats, which typically combined with clever software, sensors sell for less than $100. It also underlines can help gadgets work seamlessly with Mr Fadell’s ability to take an everyday one another without the need for human device and reinvent it. But some people ddling. A shift in consumer psychology wonder why somebody who made his will also boost demand for smarter dwell- nameand a fortuneproducing amazing ings, Mr Fadell predicts. As the cost of devices that changed the way people energy and other utilities rises inexorably, listen to music and communicate with he reckons people will want far greater one another is now putting his energy into control over them, boosting demand for something as, er, uncool as a thermostat. smart, energy-saving gadgets. Like many innovations, Nest was born People are used to predictive systems out of a sense of frustration. Mr Fadell was such as Amazon’s personalised shopping building an energy-ecient home near recommendations. The next stage, Mr Lake Tahoe in California and went look- Fadell reckons, involves moving from ing for a thermostat. Those he found had prediction to machine action. People will limited features and looked like they were have to learn to trust the new technology stuck in a time warp. He started thinking in the same way that they learnt to trust 1 18 Brain scan The Economist Technology Quarterly March 9th 2013

If you don’t have an emotionally engaging design for a device, no one will care about it.

2 predictive text input on an iPhone, he hardware and software, says Andy Hertz- what Mr Fadell’s grandfather would says. They will also need to accept having feld, a member of the team that developed wholeheartedly approve of: getting hold companies and algorithms monitoring the Macintosh computer and a co-founder of a device and tinkering with it to see if their habits using data aggregated to proof General Magic. Mr Fadell also proved they can get it to work for themselves. Mr tect the privacy of individual users. Nest adept at pitching ideas to others. Bill Fadell dismisses concerns that the urge to Labs is already doing this. After studying Campbell, an Apple board member, says create, inculcated in him as a child, is aggregated information from numerous that in the case of the iPod, Mr Fadell had waning in today’s society. He notes that Nests, it found that when people left home the great ability to get Steve Jobs to un- youngsters can now learn from one an- early in the day they tended not to come derstand his vision. This was the rst time other, as well as from parents and grand- back quickly. So the rm tweaked the Steve had gone into another category. It parents. His son, for example, posts videos Nest’s algorithm to turn down heating and was a big, big deal. on YouTube (complete with soundtrack) cooling systems faster in the mornings. For his part, Mr Fadell says Jobs taught of things he has built out of Lego, and is Just as the iPod opened Apple’s eyes to him the importance of looking carefully at inspired by other children’s creations he new possibilities that eventually led to the all the ways in which consumers interact sees online. I feel like it is a reawakening iPhone and then the iPad, Mr Fadell is with a device, including seemingly minor of my childhood, says Mr Fadell, who convinced that the thermostat can do the things like packaging and customer sup- points to the rise of Maker Faires, which same for Nest Labs, and that it will be just port. He also developed a healthy respect bring do-it-yourselfers together at big the rst of a series of smart, energy-saving for his boss’s habit of point-of-view events, as another encouraging sign. devices. This is not about creating ran- editing, which involved spelling out in But he frets that too much creative dom one-o products, he says. It’s about detail to employees the reasons for energy is being sucked into social-media nding synergies between them and changes he made to products. And he got start-ups rather than ones that produce building a really long-term business. He to witness at rst hand Jobs’s instinctive gadgets. Impressive though some of these is coy about other areas the rm might feel for great design. Mr Fadell is rmly new social services are, Mr Fadell thinks tackle, but lighting is an obvious one. convinced there needs to be one judge, many of them get too much attention jury and executioner who makes the because the media nd them so easy to Thanks, grandad nal call on how products look, rather write about. It’s like they have become Mr Fadell credits his grandfather for giving than a committee of equals. the social pages of technology, he snis. him a taste for experimenting with stu. His time at Apple also allowed the Hardware is, as its name suggests, harder The superintendent of a school district in podfather to indulge his penchant for to makeand to make sexy. Michigan, he encouraged his grandson to risk-taking. Kwon Oh-Hyun, the boss of Yet Apple has shown it can be done, build all kinds of things, from go-karts to Samsung Electronics, an Apple supplier, and Mr Fadell reckons rms like his now remote-controlled cars. Although his says Mr Fadell liked to try out new tech- have a huge opportunity to impress peo- grandfather never used a computer, Mr nologies that rivals avoided because they ple by combining hardware and software Fadell quickly became hooked on them as were considered untested. And he was in striking ways. Things like driverless cars a teenager in the 1980s. He then showed keen to get them into gadgets and out of are already capturing the popular imagi- an entrepreneurial bent while studying the door quickly. Philips cancelled many nation. Those who work closely with Mr computer science at the University of of the products under development dur- Fadell say he is brimming with ideas for Michigan, co-founding an educational- ing Mr Fadell’s time there. Apple, by con- new products. He has already produced software business with his professor, trast, launches almost everything it works some world-changing gadgets. It is worth Elliot Soloway. Tony didn’t do safe, says on. You must ship every year or so be- keeping an eye out for the next instal- Mr Soloway, who recalls that his student cause otherwise you can’t keep your ments in the saga of the podfather. 7 loved to try challenging projects such as engineers engaged, Mr Fadell advises. building a hand-held computer. Although he ourished at Apple, Mr Oer to readers After leaving university Mr Fadell Fadell occasionally clashed with other Reprints of Technology Quarterly are available spent time at several technology compa- executives there. He left the rm in 2009 from the Rights and Syndication Department. nies, including General Magic and Philips and went travelling for a year before A minimum order of ve copies is required. Electronics, before landing at Apple in creating Nest Labs. Some sceptics question 2001, where he met another inuential whether enough people will pay a hefty Corporate oer gure in his career: Steve Jobs. Apple’s premium for its thermostat, no matter Customisation options on corporate orders of legendary boss was convinced that Mr how good it looks. Mr Fadell sees things 100 or more are available. Please contact us to discuss your requirements. Fadell’s idea for a digital-music player had dierently. If you don’t have an emotion- For more information on how to order special potential and hired him to run a small ally engaging design for a device, no one reports, reprints or any queries you may have team of mavericks to get the edgling iPod will care about it, he says. But any new please contact: to market in double-quick time. gadget needs to impress with its features, Mr Fadell ended up overseeing the too. Nests seem to be doing just that, even The Rights and Syndication Department development of 18 generations of the iPod in places where they aren’t ocially on 20 Cabot Square and then led the hardware design and sale. Mr Fadell’s company has seen its London E14 4QW Tel +44 (0)20 7576 8148 development for the rst three gener- thermostats activated as far away as Saudi Fax +44 (0)20 7576 8492 ations of the iPhone, as well as getting Arabia and Siberia, even though they are e-mail: [email protected] involved in various aspects of its software currently congured only for the North www.economist.com.rights and user interface. Tony’s pretty much in American market. the classic Apple mould, equally adept at Which suggests that people are doing