Where finance and media intersect with reality

Why digital independence is as important as energy independence

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Or: How I learned to stop worrying and love the smartphone

Imagine waking up one day and, as you do, lazily extending your groggy hands to grab your trusty smartphone. However, there are no notifications, no icons with unread messages, and the little header on your screen has an exclamation mark indicating no internet. Curious. You check your laptop and there is no internet connection there either. Finally, you check the router, but that too is blinking red. What’s going on?

You turn on terrestrial TV and on the news you see that there has been a rolling global outage at AWS, Azure (Microsoft), Google and Apple. The news channel is broadcasting to a limited audience as well, as they can’t connect to the internet either. No outside broadcasts or access to their cloud services. You notice the news anchors are wide-eyed and seem a little bewildered, the air almost thick with uncertainty.

All digital payment systems and ATMs are down too. Suddenly, you’re on a scramble to find some cash.

While it may seem unlikely, the reality is that if these “big four” tech companies have an outage, then practically the whole developed world (except for perhaps China) would stop functioning because of the digital domino effect. Essentially, our dependence on these four core companies is so extreme, that our whole way of life could be put at risk. Every digital system in the world (except for China) is somehow connected to one of the big four. There are very few (and quickly vanishingly) alternatives which mean that most IT professionals will attach themselves to the big four for their business infrastructure.

As co-founder of an online ticketing platform and founder of the anonymous reporting HaYA App, I have spent the last 15 years watching the internet services market get absorbed by the big four. When starting our ticketing platform, we were using a range of different service providers from the UK and abroad. Over the years we switched to the big four and now run entirely on AWS, Google, Apple and Stripe. There are very few options out there that are as cost-effective, efficient and reliable. This makes it very difficult, from a technical and economical perspective, not to pick them.

Never in the history of humanity has the world been so dependent on so few. I appreciate that back in the days of Rockefeller and Carnegie, most of the western world’s technological and industrial developments were dependent on a few companies too. The key difference between then and now was that production couldn’t shut down in seconds. Today, if there is an outage, it would affect everyone immediately. Even small-scale shutdowns can prove extremely disruptive. On 5 July 2022, three Meta services; Facebook, Messenger, and Instagram, were down intermittently for the course of more than a day – if these were your main messaging apps, and you did not maintain phone number backups for your contacts, you would have been unable to contact anybody you spoke to regularly for over twelve hours.

The really worrying part is that nobody seems to be paying attention. Here in the UK, we aspire to be more like Peppa Pig than Google.

Practically speaking, there is one major western country that would likely be alright; since the four companies are based in the United States, we could speculate a relatively rapid patch-up of services locally there.

Unfortunately, the rest of us would take second place.

Imagine what just a few days of a total digital shutdown would be like for the UK – no communication, no payments, no information and, god forbid, no Twitter or Instagram; it would be a singular disaster. Some of us have experienced something similar to this because of recent rolling power outages. My area in Kent was out of power for 48 hours and it felt like I had jumped back to the 1980s.

The UK spends billions of pounds on cyber security and yet a glaringly obvious hole, the delivery of information to the public, is not covered by this spending at all. The UK, like every other country in the world (except for China), is dependent on a handset powered by Google or Apple.

It is useless to spend millions on NHS Cyber Security if none of us can receive an appointment update on our smartphone, or if doctors and nurses depend on their AWS cloud-connected tablets for patient records. Even MI5 use Amazon for our national security!

So what should be the plan for the UK (and every other country that is not the US or China)? In order of importance:

  1. Develop homegrown alternatives to Android and iOS (not just one company, but several options).
  2. Develop a National Cloud, a series of data centres owned and operated by national companies (or better still, a decentralised cloud) as an alternative to Amazon and Microsoft.
  3. Investment into software and hardware companies that can provide a competitive alternative to the few US software providers and Chinese hardware providers. 

How would all this be funded? Most investors are drawn to investment in unicorns, with the majority of unicorns being provided by the United States (I am excluding China from this since the majority of investment in their unicorns comes from the government). Therefore, the government should provide serious incentives to draw investments into homegrown tech. This is certainly not done with small tax breaks such as SEIS and EIS incentives. Rather, the government should offer returns by investing in local digital infrastructure services, as opposed to creating more ways to incentivise tax efficiencies to the big four.

This is not a plan for nationalism. The goal would be to encourage cross-border collaboration so that smaller independent companies can offer products and services to each other so that we, the consumer, would get a seamless experience and carry on the way we are used to. It’s not about creating a new Amazon, Google, or Apple. It’s about creating local companies that can function as backups to these systems while surviving in the meantime as go-between service providers between these tech giants and the local economy. 

These local digital services could offer technological redundancies; for instance, they could host AWS services but similarly run mirrored backups of relevant cloud-based local data, that could still be provided should AWS go down. 

How much safer would we be if instead of being dependent on only four options we could choose from hundreds of different systems so that if one went down, we could switch to another in a matter of minutes.

Remember, all your millions of investments in cyber security don’t matter if your ‘cyber’ ceases to exist.

Though it is unlikely to happen, being prepared is a win-win for everyone. Not only would we improve – or rather, guarantee – our digital security. We would also strengthen our local economies, creating thousands of meaningful local jobs, as well as taxable income for the government.

In the Conservative leadership debates, all the candidates spoke on the importance of energy independence; plans to develop small and local nuclear power plants so to ensure a resilient energy supply.

Surely, in this digital age, we should be applying the same principle to digital independence.

 

 

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