Internet connected toys suspected of spying on kids

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Privacy is becoming an issue for the internet of things topic. However, a more unexpected field are internet connected toys. Over 18 privacy groups have been or are filing complaints with the European Union as well as the US Federal Trade Commission concerning Genesis Toys and speech recognition company Nuance for deceptive practices and violating of privacy laws. It is argued that i-Que and My Friend Carla, both pictured, do not only capture voices without notice or approval, it is also not clear what Nuance does with the information that is sent. As an added problem, the organizations are also accusing the companies of not making sure that other Bluetooth connected devices cannot access the toys. Evermore, if not properly managed the speech information that is recorded and sent to nuance could be sold to third parties. There is even another problem that hackers could gain access to these products and the microphones in those devices. Future scenarios could even go as far as “predatory stalking and physical danger”. All in all concerns are plenty, and stakes are high. However, chances are that speech recognition is going to be used more and more in future toys, especially in dolls.

It is unsure yet whether and to what extend the European Union and the US Federal Trade Commission are going to do something about these practices in themselves. It is extra complicated as these products are marketed to kids, who are obviously less able or responsible to manage privacy concerns themselves.

I am curious about how you think about these toys developments. Do you think we should ban them or develop rules? Then again, if we develop rules, how can we enforce them? And in the case of hacking, how should we manage the security of such hardware and the software behind it? Please comment below.

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Innovation in social media? Forget Facebook!

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Power of social media

In the current digital arena, social networks have touched the lives of almost every human being on earth, allowing us to share life’s novelties with friends and loved ones. However, social networks are not restricted to sharing and commenting on pictures, but giving rise to innovation among individuals to help make our world a better place.

Social media can be an excellent way to reach out to both existing and potential customers and take advantage of their creativity. There are two ways to involve your network in developing new products and services:

  • Crowdsourcing – asking your network to brainstorm solutions to a particular problem your company is experiencing, either on their own or in groups. The community collects, develops and ranks the contributions to reveal the strongest performers.
  • Open innovation – allowing people to submit their own competitive ideas and inventions for your company to harness.

Rise of new entrants

With so many minds able to network together, open innovation allow people to work together on a massive scale. Sites such as Facebook and Twitter have already become immensely popular for setting up robust platforms for online communities and many enterprises are using them as an effective medium to innovate. However, today there are very good examples of social networks where niche communities not only find work, but also hire a development team, innovate their business, and collaborate from different corners of the world.

The world of social media might be crowded, but that’s certainly not stopping new players entering the market. The success of Pinterest and Instagram  has shown that it’s possible for relative newcomers to make a big impact. And while Facebook may boast close to a billion users, many alternatives are aimed at a more exclusive audience. The drop in organic reach has been apocalyptic for many businesses. Why? There’s too much content on Facebook and the company is forced to ratchet down the reach. We’ll have to either spend a lot more money on Hollywood-quality content, a lot more money on advertising or both. This will force some businesses to reconsider Facebook as a viable channel and enable a migration to less noisy venues.

Source: Cosenza 2016

Future of open innovation

Innovation and idea generation are no longer confined to the boundaries of office buildings now that niche social networks create room for like-minded people to come together and give their input to deal with particular challenges. Idea sharing on a global scale leads to innovative solutions in a shorter period of time. Businesses now also rely on niche social networks for innovative ideas to increase their sales, establish brand value and convert prospective customers into loyal ones.

Without a doubt, social networks posses incredible potential for innovation among individuals from all walks of life. Businesses, non-profit organizations and governments also realize the efficacy of social networks in making this world a better place, which is why they are all using niche social networks to connect with people of similar interests and innovate solutions to deal with specific challenges.


Arno Ch. (2012), The rise of niche social networks.

Cosenza V. (2016), Social Media Statistics,

Kind. C (2015), 28 Social Media Marketing Predictions for 2015 From the Pros.

NIBusinessInfo (2015), Online business networking and social networking.

Singh M. (2016), How innovation develops among individuals in niche social networks.


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Insurance, reinvented.

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Traditional insurance is losing relevance for customers because it fails to keep pace with rapid technological development in the connected world.

General insurers weaknesses

General insurers services do not provide frequent and tangible benefits, which customers increasingly expect and receive as standard from popular connected services, such as mobile navigation. General insurers products frequently do not keep up with the emergence of new risks caused by digital technology, such as cyberterrorism. Online customer experience may be poor. This is often caused by the amount of data which is required to finalise a transaction online. The nature of business itself makes it difficult for insurers to innovate. They may lack insight into customers, because offered products are low-touch, which means that the insurers come in contact with consumers rarely. The problem very often lie within the insurance companies – they lack people with innovative mindset!

Digital revolution

The digital revolution is felt to be a threat by many in the insurance industry, especially following the increase of innovative new entrants and the rapid rise of comparison websites. Insurance disrupted focuses on nine applications of digital technology that could have the greatest potential to disrupt general insurance over the next ten years.


Source: Deloitte 2015

Shown above nine potentially disruptive applications may lead to transformation of insurance industry.

  1. Telematics-based insurance will allow a flow of data from connected devices to insurers who use this data for risk assessment and pricing. It appears unlikely to win many more customers, however has great potential to disrupt general insurers if it facilitates new connected services.
  2. In the long term self-driving cars can shrink the motor market insurance market, but in the short term it will create more complex risks requiring more sophisticated products. It is caused by the fact that self-driving cars will be safer than cars under human control, but will not completely eliminate the risk, moreover it will create completely new risks.
  3. Mobile internet transactions will give an opportunity to new entrants to prove better than incumbents in creating good multichannel experience. Traditional insurers are burdened with legacy systems, while new entrants can build themselves around digital technology.
  4. Price comparison websites will allow customers to find and compare insurances significantly more easily. It most likely will lead consumers to become more price-sensitive and force insurers to seek efficiencies and saving in order to stay competitive on the market. Insurers might merge to achieve greater scale.
  5. Social media facilitates peer-to-peer insurance (P2PI) due to forming online networks of customers who share risk. Potentially it could shrink the market for traditional insurers. Furthermore, it would also lead to adverse selection for general insurers, because of poor risks being excluded from P2PI networks.
  6. Bought By Many (BBM) is a new type of online intermediaries who are social brokers. Currently they are only intermediaries, but there is a threat for traditional insurers that social brokers might become underwriters, because they have relationships with customers, not the insurers, which disallow insurers to build consumer loyalty and strong brand image.
  7. A completely new segment of cyber risk insurance is most likely to emerge. Customers and regulators’ concerns about data security are increasing, constantly building a potential base for demand. Cyber risk insurance represent an underdeveloped market.
  8. Sharing economy might lead to creation of sharing economy insurance. For instance, those who sell services in online marketplaces could need liability cover for buyers (e.g. AirBnB). Ultimately, insurance could move from insuring people as owners of assets to insuring people as users of assets as a standard.
  9. Value comparison websites is a new type of online intermediary. It helps customers to choose policy based on value, rather than on price. It does so based on customers’ needs.

Solution for insurers?

In the face of new competition and dramatic technology and industry change, insurers should be pursuing two growth options in particular:

  1. Going “back to the future” with regard to the insurance industry’s role in society. This is to help make commercial and technological inventions, especially disruptive ones, into safe realities—in effect, helping to translate technological possibilities into human-centric solutions.

Insurers can help protect society as these technologies advance. Insurance has always served as a proxy and enforcement arm for regulation and can do so now, as well.

  1. Becoming a trusted advisor to help customers meet the unique needs that will arise as technologies and societies change. The insurer becomes a hub or aggregator or concierge that brings together a series of offerings from a variety of related providers, with the goal of addressing an increasingly higher percentage of the needs and intentions of individuals and corporations.

Insurers should take concrete steps to leap to new growth curves.

  • Create a “red team”. To deal with a risk-averse culture, and other internal constraints, firms should launch a “red team” or a separate entity whose role is to detect new customer needs and create new services.
  • Transform to a human-centric culture. Insurers need to move to the same side of the table as customers, addressing an increasing part of their needs through service ecosystems.
  • Partner with technology companies or other innovators to create new services. In critical technology areas, insurers should be carving out a role for themselves in partnership with tech companies.



Accenture (2015), Beyond insurance: embracing innovation to monetize discretion. Retrieved from:

Caudron J. and Peteghem D. (2014), 5 digital disruptions in the insurance industry. Retrieved from:

Deloitte (2015), Insurance disrupted. Retrieved from:

KPMG (2016), Empowered for the future. Insurance reinvented. Retrieved from:

Terry H. (2015), Big Bang Digital Disruption: Is the insurance industry in Asia next? Retrieved from:

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