Friday, September 28, 2012

Data deluge measured in "quintillions" as tech companies race to meet the need for speed

By Business editor Peter Ryan

The explosive growth of popular social media sites like Facebook and Twitter in recent years has created a daily challenge to make data move increasingly faster.

The instant voice messages, photos and videos that ordinary people take for granted are competing for space with the massive amounts of data churned out by businesses and governments.

Technology companies are now racing to install the latest server technology in a cut-throat race to meet the growing need for speed.

And while gigabytes and terabytes might sound big to computer novices, the experts are now using numbers like quintillion to describe the deluge of data.

Apple co-founder and Fusion IO chief scientist Steve Wozniak in Sydney
 Listen to the story from this morning's AM.

David Flynnn, chief executive of the US-listed technology company Fusion IO, can keep a room silent as he explains the mind-boggling measures of data in quintillions.

"It is 18 zeros - one with 18 zeros. That is the equivalent of a billion billion or a million trillion. Why do I use this number - because today the world is generating two and a half quintillion bytes of data every single day," Mr Flynn told AM..

"If bytes were buckets of water, you're talking about it taking just 20 weeks to fill the entire oceans of the planet with data."

It's a far cry from this correspondent's first computer bought in 1992 that came with data storage of just 40 megabytes.

But apart from deeper data and lightning speeds for consumers, businesses and governments, how can better technology improve everyday lives?

David Flynn, who is visiting Australia to drum up business, uses this example of a US client who wanted faster download speeds for a one hour high definition movie.

"They figured if they could get that one hour worth of content down to 15 minutes, that it would be a total win," Dr Flynn said.

"I learned last week that the initial test results, that one hour movie, 39 seconds. They came back and said, you don't understand. This changes our whole business."

Fusion IO boasts some big global clients who need to move real time data, video and audio such as Facebook, Apple and Westpac.

The company also has a big name as its chief scientist - Apple's co founder and speed evangelist Steve Wozniak who thinks today's technology is just the start of a new love affair with mobile devices.

"Consumer products are moving more and more towards that touch of artificial intelligence and in particular speaking to your devices and having your voice sent off to the cloud, recognised and analysed on good computers there and transmitted back," Mr Wozniak said.

"That's a huge amount of data. The more and more we use voice, that's going to be the trend."

It might not be as glamorous as artificial intelligence, but David Flynn says new technology is already at work here in Australia where the supermarket giant Woolworths is getting a much faster reading of its national sales.

"It took them 17 hours to do the analytics each week of what was selling. They wanted this report every Monday morning for the executive meeting so they could look at how things are going," Mr Flynn said.

"But the problem is with 17 hours, they could not incorporate the weekend and the weekend of course was the most important part of the retailing.

"They were able to move that down from 17 hours to three hours."

It's a dry, even boring, example. But faster data processing in retail could mean a better deal at the checkout for consumers.

And the speed of information traffic - along with consumer expectations - is expected to grow once Australia's national broadband network is finally rolled out.
Twitter: @peter_f_ryan

Tuesday, September 25, 2012

Australia exposed to "vulnerabilities" in Asia, Reserve Bank warns.

By Business editor Peter Ryan

The Reserve Bank has warned that Australia could be exposed to "vulnerabilities" in Asia sparked by fallout from Europe's unresolved debt crisis.

In its latest Financial Stability Review, the RBA has signaled that a slowing in the United States and China caused by "a disorderly resolution" of the Europe crisis puts Asia's banking system at risk.

"Vulnerabilities may have built up during recent credit expansions which could be revealed in the event of a significant decline in asset prices or economic activity," the RBA says.

"As some banking systems in Asia are now quite large, there is a greater chance that problems in them could have adverse international spillovers."

But the RBA says Asia's banking system has been so far "largely resilient" to the Europe crisis because of their domestic focus.

The semi-annual review confirms that the Europe crisis remains the single biggest risk to the global economy despite recent intervention by the European Central Bank to buy unlimited bonds from struggling economies.

"Along with the weaker near-term outlook for global growth, the euro area problems will continue to pose heightened risks to global financial stability in the year ahead," the Review warns.

Despite the global outlook, the RBA says the Australian banking system remains "in a relatively strong position" and that it is underpinned by "robust financial, regulatory, supervisory and crisis management frameworks."

The Review also notes the pressures on wholesale fund markets have eased and that banks have restored good market access to international markets over the past six months.

But once again, the central bank is urging caution.

"While the Australian banks have little direct asset exposure to the most troubled euro area economies, they remain exposed to swings in global financial market sentiment associated with the problems in Europe."

While bad and doubtful debt charges have fallen since the peak of the global financial crisis, the Review says banks are now challenged by high funding costs, lower credit growth and slower growth in profit.

The RBA says that while the competitive pressures have not yet spurred "inappropriate risk taking" , it is concerned about lower lending standards last seen in the leadup to the financial crisis.

"A challenge for firms in the competitive banking environment will be to resist the pressure to ease lending standards to gain market shares in the pursuit of unrealistic profit expectations."

The Review says households and businesses have continued their "prudent approach" to debt.

"Many households continue to prefer saving and paying down their debt more quickly than required," the RBA says.

The RBA says the paying down of debt is "desirable" as it makes indebted households better placed to withstand future shocks such as a fall in housing prices.

Twitter: @peter_f_ryan

Social media gangsters preying on Australian retirees, ASIC warns.

By Business editor Peter Ryan

The corporate watchdog is warning that Australian retirees using social media sites are being targeted by organised criminal gangs.

The Australian Securities and Investments Commission (ASIC) says the fraudsters are preying on self-funded retirees via Facebook and Twitter, offering dodgy investment schemes that promise to boost their superannuation.

Apart from using social media, the gangs have also set up sophisticated call centres in Asia with offers designed to fleece retirees of their savings.

ASIC regional commissioner Warren Day told AM that gangsters use the latest technology to convince victims they are from legitimate banks or investment houses.

"We're talking about somebody who's a mastermind of the scam, maybe someone from Europe or the US or the UK. They will go down to the Philippines, Indonesia, Thailand, and they will set up what's called a boiler room, effectively a small call centre," Mr Day said.

"Through Facebook or Twitter, they'll attract English speaking people from the local area who have good American accents, good UK accents. They're going to make it sound more authentic when they call you and try and take your money from you."

Mr Day says the gangs have moved beyond the confidence swindlers known to retirees that have traditionally approached potential victims in person door to door.

"These guys do a really good number in putting together very sophisticated, very professional looking websites. They'll also use web technology to create reviews of their services, so that when you do a Google search for the name of their ficticious company, that will turn up higher on the searches than our searches sometimes," Mr Day told AM.

Mr Day said the gangs also use technology to make incoming telephone calls from call centres in Asia appear as if they are local or from the United States.

"The main device that they will still use to get you in is the very simple phone call - probably six o'clock at night, to your house," Mr Day said.

"They'll give you a number that's effectively a 1300 or a 1800 number here in Australia, which will transfer to their call centre somewhere in Asia. You honestly might think that you're ringing the US, you may think that you're ringing you know Queensland or South Australia, but the reality is you know you're ringing that call centre.

"They're very good. They've got very good scripts in terms of keeping you on the hook, keeping you investing, keeping you placated in terms of any scrutiny or any curiosity you may have about their authenticity or not."

Mr Day said the gangs are targeting people over 50 who are often managing their own superannuation investments through increasingly popular self-funded retirement schemes.

"We've got $1.3 trillion tied up in retirement savings in the Australian system. As a result it's a big pot that is being targeted by scammers," Mr Day said.

"We've also got an investing public through self managed super funds who are keen to increase their levels of returns. They are curious, open and interested in pursuing opportunities offshore becaused everything locally is telling them there might be better and cheaper options."

ASIC is urging people approached with suspicious offers to ask for evidence of an Australian financial services licence.

More information on investing scams can be found on ASIC's web site at

You can follow Peter Ryan on Twitter @Peter_F_Ryan