A few strategists steer the world. Numerous heroes exist in the Bible and the 'Romance of the Three Kingdoms' (a Chinese historical novel written by Luo Guanzhong in the 14th century). Most people think the real heroes of the 'Romance of the Three Kingdoms' are warlords Liu Bei and Cao Cao, but is it true The answer is unfortunately no.
The real hero is ZhuGe Liang, Chancellor of Shu Han, during the Three Kingdoms period of Chinese history, who is often deemed as the greatest and most accomplished strategist of his era. All the warfare was waged in his head beforehand. When he acted on what he had envisioned, a true war was fought. There also exists a plethora of warlords and kings in the Bible. Yet, prophets such as Samuel and Isaiah were those who had already foreseen how those wars would pan out.
The world that had gone through the Agrarian Revolution and the Industrial Revolution is experiencing an IT revolution at the moment. Those who developed and disseminate steam engines, electricity, computers, operating systems and network technologies are strategists ( or prophets) - and revolutionists at the same time. The Agrarian Revolution and the Industrial Revolution were driven by a few hands and the IT revolution, which is also driven by a handful of people. For instance, if the world is heading in the direction Bill Gates and Steve steers it, it means we are led somewhere by a few people. IT is a battle of imaginations, waged by a handful of people, not a technology war.
The G20 Seoul Summit is only a couple of days away. The heads of state from the G20, one tenth of the entire nations in the world will gather here to take care of global finances and economic orders. In terms of economic size, the G20 takes up over 85% of the total global GDP. Thus, it is fair to say that they are in a position to dictate the global economy and financial order. More strictly speaking, the future looks as if the global economy will be decided upon in the minds of the G20 leaders and financial ministers. A select subset of people will determine the future of the global economy, finance and IT. The G20 Summit is a consultative meeting designed for achieving the sustainable development of the global economy, preventing a global financial crises and expediting international collaboration. Just as the UN was born 50 years ago, after World War II to police wars between countries, the G20 Summit was set up to brace for the world's biggest threat, global financial crises.
In contrast to the past, finances and IT are directly related to each and every individual living in our globalized society. Home equity loans, stocks, funds, credit cards and consumer finance are all examples of how modern people's lives are interwoven with finance. On the same note, the financial life of people revolves around IT such as online banking, credit card transactions and e-commerce. What's more, smartphones and Twitter have become the bread and butter of netizens. IT has become a space where financial transactions are done and is serving as a means to access finances. That's why the G20 leaders should pay due attention to a change in the inseparable linkage between finance and IT.
A Post-G20 Seoul and Another Risk
Just as PCs have their operating systems, financial transactions have their own operating system. IT has already become the operating system of financial transactions and the internet has provided space for financial dealings. Thus, any attacks on the operating systems for financial transactions and financial cyberspace can deal as severe a blow to the global economy as the global financial crisis. In other words, that is one possible crisis which is often underestimated and dismissed by us. Specters of Marx is drifting on the internet, not in the EU. Globally, the value of a day's global online financial transactions hovers around US $1 trillion. When stock trading and e-commerce are factored in, a couple of trillion dollars are circulating in the cyber world. This can be the soft target of Specters of Marx.
High on the agenda of the G20 Seoul Summit are methods of exploring how to weather global financial crises and implementing policy and institutional tools to stabilize the global financial system. However, the G20 should set its sights on the safety of cyberspace, where real money flows, let alone the security of capital flows such as financial institutions and policy. What merits the attention of the G20 leaders is finding ways to ride out today's visible crisis, as well as potential dangers that are brewing silently under the surface. This is what we expect from great prophets (or strategists) who pull strings behind the scenes.
The future and change of IT, "from Internet to Smart" & "Information to Money"
Over the past decade, the internet has taken center stage of IT and been the keyword. Everything has been wired and everything can be done on the internet. Major social infrastructures such as media, broadcasting, finances and communications, not to mention individuals, are interconnected via the internet. Just as all roads led to Rome during the Roman Empire, the internet has become a modern day Rome. However, today, the newly created Rome is changing. The internet is no longer ITs keyword. The Internet is simply a cyber-environment. The IT world's keyword that replaces the internet is "smart". Just as expressways diverge into general roads, all kinds of communications networks are interlinked with internet at the center.
Now is the time to take heed of what kinds of cars are running on the roads. When people set off towards their destinations, they have to hit the road. That is not because they like driving on the road, but because they choose roads as a means of reaching their destinations. Yet the vehicle they drive is their possession which offers them their own space, so they choose what they like the most, within a certain price range. Thus, people pay a great deal to purchase a nice car. Global IT giants like Apple, Google, Intel, Microsoft and Samsung Electronics can be likened to auto makers. Individuals travel the world, make financial transactions and converse with various people via their laptop computers and smartphones.
Just as people have fallen in love with nice, fancy cars, they are now enthusiastic about nice laptop computers and smartphones. Horses were taken over by cars, which are now giving way to personal communications devices like smartphones. Protection one was offered of horses was it's reins and horseshoes while that of cars is tires and airbags. As such, smartphones and PCS also need safeguards. In other words, people need something that safeguards their personal information and money. Another change in the internet is a qualitative one. The internet has morphed from a sea of information to a sea of money. Just as no one has the right to lay claim to sea water, the same is said about the information offered on the internet, it does not belong to anyone. However, the several trillion dollars going around on the internet is owned by individuals. With the emergence of smartphones, the money trafficking all over the Internet will explode.
Therefore, the internet is tasked with another job: to protect and ensure the safe transportation of money. Banks and e-commerce companies bear the primary responsibility of that matter and governments and communications operators take a secondary responsibility. Though a failure in resolving such issues can deal a fatal, far-reaching blow to the global economy, efforts for setting up a defense system are taking baby steps. First of all, the exposure to such risks is sporadic and stays below the radar. There is an unwillingness to spend a huge chunk of money on making responses to such risks. Beside, people are simply hoping for the best sitting on their hands.
What is truly required of IT companies in the G20
Now we need to see the world from a different angle. By analyzing the strategies and current situations of global IT companies, who has as strong a clout over the IT world as the G20 leaders, we can get a glimpse of where the IT world is headed for.
Microsoft:
Microsoft's monopoly over PC operating systems and programs has helped rake in tremendous amounts of revenue. However, it has been sitting on its laurels. Failing in predicting the future direction of the internet and making preparations, it was dethroned by Google. While Microsoft was reigning supreme with its PCs, it did not foresee the advent of an internet and mobile era. As a result, it is strenuously playing catch-up on the verge of losing the hegemony of the IT market. The internet has been conquered by Google and the mobile world by Apple.
Apple:
Apple that has lost out to Microsoft in the PC operating system competition, but has come from behind to beat Microsoft with its formidable weapon, smartphones. It has continued to venture into new territory. Apple's iconic iPhone has catapulted Apple into the top position in both the mobile web and the internet. However, just like it reveled in the success of the Macintosh, Apple is now too self-conceited to remind us of the all too familiar tale of 'The Hare and the Tortoise'. Being too proud of its advanced technology, it has failed to get off its high horse and communicate with customers. Beside, its technological exclusiveness can result in rivaling companies forming a common front against Apple.
Google:
Google has entrenched itself as the leader of the internet porter market. While taking the reins of the internet, it has continued to make attempts at new businesses. In addition, it developed operating systems in response to the advent of the smartphone era. On top of that, it is supplying PC operating systems, threatening Microsoft. Though it has secured a vast pool of internet customers, it knows that there are limits to its business. So it has swiftly drawn up a future business strategy, unnerving both Apple and Microsoft. Furthermore, it is making inroads into the internet-based e-commerce business. Yet Google's weakness is its business itself. Since it is based on astronomical amounts of information, it is always vulnerable to distributed denial-of-service attacks (DDoS attack) and has yet to be armed with any technology for the security of e-commerce transactions.
Intel:
Intel is at the forefront of non-memory semiconductor technologies. It has been making a profit by supplying key semiconductors to first-line PC makers. However, it is now pumping huge amounts of money into new areas in expectations of a pullback in its revenues. Intel postulates that the future hinges on the security of chips, not on the performance of chips. It is striving to transition from a purveyor of tiny chips to that of security chips and security frames. It aims to take charge of the PC and internet security business. However, Intel is also making a mistake: it acquired McAfee, a computer security company, to design safe, anti-virus chips. First of all, security chips that are 100% virus-free cannot be designed and software-oriented approaches cannot prevent computer virus outbreaks. Therefore, Intel may be able to produce chips that guarantee a certain degree of protection against viruses, but the successful development of security chips that are powerful enough to safeguard online transactions is unlikely.
Communications carriers:
Communications carriers are on the horns of a dilemma owing that to the smartphone. The content volume offering for smartphones is way larger than previous levels. As smartphone is used by more people, the load on communication networks will skyrocket exponentially to a level that communications operators are unable to handle. Such high loads can even detract from the quality of voice calls. So making responses to such issues is crucial.
From Smart to Security.
"Smart without security is not Smart"
The IT world had seen the birth of the internet and is witnessing a fierce global competition for smartphones. As a matter of fact, a cut-throat competition is going on among global IT titans. Microsoft, Intel, Apple, Google and Samsung Electronics are fighting a bloody war in the global smartphone market. However, it is very disappointing that in the battle to rule the so-called "smart" market, none of them has the foresight to make preparations for mobile security. At a time when the value of e-commerce is vastly incresing on a daily basis, global IT companies and governments and the financial world should take the issue of porous e-commerce security seriously. The convergence of internet networks and mobile networks, smartphones and tablet PCs will lead to a spike in e-commerce with a jump in the number of online hackers eyeing the tremendous amounts of online money that crisscrosses the globe. This is not the bank's personal problem. It can endanger financial institutions as well as the international community. As the G20 Summit is designed to address current urgent issues, it should precisely anticipate lurking risks and come up with better ways to tackle them. If the G20 member nations follow through with what would be agreed upon at the G20 Seoul Summit, the next potential risk that deserves keen attention would be the spectre of cyber attacks on e-commerce.
"The best risk management is to nip potential risks in the bud."
- - Seong-keun Kim, Director of SK baseball team -
