compared to what they are doing. you are not connecting. as a consequence you are not connecting. these terrorists are a threat first and foremost to the communities they target. communities have to take the lead in protecting themselves. that is true here in america as it is true anywhere else. when someone starts getting radicalized, family and friends are the first is the something has changed in their personality.

that allows them to think about their actions. and reflect. on the meaning of their faith. in a way that is more consistent with peace and justice. families and friends, coworkers, neighbors. they want to reach out. they want to help save their loved ones and friends and prevent them from taking a wrong turn. but communities don't always know the signs to look for or have the tools to intervene, or know what works best. that is where government can play a role if government is serving as a trusted partner. that is where we need to be honest. i know some muslim americans have concerns about working with government, particularly law enforcement. the reluctance is rooted in the objection to certain practices where muslim americans feel they

may have been unfairly targeted. in our work, we have to make sure that abuses stop, are not repeated, we do not stigmatize entire communities. nobody should be profiled or put under a cloud of suspicion because of their faith. [applause] engagement with communities can't be a cover for surveillance. you can't securitize our relationships with muslim americans dealing with them solely through the presence of law enforcement. when we do that only reinforces suspicions. it makes it harder for us to will trust we need to work together. -- build the trust we need to work together. as part of this summit we are announcing we are to increase our outreach to communities including muslim americans. we are going to step up our efforts to engage with partners and raise awareness some more

communities understand how to protect their loved ones from becoming radicalized. we have to devote more resources to the efforts. [applause] as government does more, communities are going to have to step up. we need to build on the pilot programs that have been discussed already in los angeles and minneapolis. these are partnership that bring people together in the spirit of mutual respect and create more dialogue, more trust and cooperation. if we are going to solve these issues, the people who are most targeted and most affected have to have a seat at the table where they can help shape and strengthen these partnerships. [applause] we are all working together to help communities state strong. -- stay strong. finally, we need to do what terrorists hope we will not do. stay true to the values that define us as a diverse society.

if extremists are peddling the notion that western countries are hostile to muslims, we need to show that we welcome people of all faiths. in america, islam has been woven into the fabric of our country since its founding. [applause] generations. generations of immigrants came here and went to work as farmers and merchants and factory workers. and helped to lay railroads and build up america. the first islamic center in your -- new york city was founded in the 1890's. america's first mosque was in -- interestingly north dakota. ,[laughter] muslim americans protect our

communities with police officers and firefighters, and first responders, and protect our nation by serving in uniform. in homeland security. in cemeteries across our country, including arlington. muslim american heroes rest in peace having given their lives in defense of all of us. [applause] of course that is the story extremists and terrorists don't want the world to know. muslims succeeding and thriving in america. because when that truth is known it exposes their propaganda as the lie that it is. it is a story every american must never forget. it reminds us all that hatred and bigotry and prejudice have no place in our country. it is not just counterproductive.

it doesn't just aid terrorists. it is wrong. it is contrary to who we are. i am thinking of a little girl named sabrina who last month sent me a valentine's day card. in the shape of a heart. it was the first valentine i got. [laughter] i got it from sabrina before melia and sasha. and michelle. [laughter] she is 11 years old in the fifth grade. she is a young muslim american. she said in her valentine, i enjoy being an american. she wants to be an engineer or basketball player. [laughter]

which are good choices. she wrote, i am worried about people hating muslims. if some muslims do bad things that doesn't mean all of them do. she asked please tell everyone that we are good people and we are like everyone else. [applause] those are the words and the wisdom of a little girl growing up in america just like my daughters are going up here in america. we are just like everybody else. everybody needs to remember that during the course of this debate. as we move forward with these challenges, we all have responsibilities. we all have hard work ahead of us on this issue. we can't paper -- we can't paper over problems.

we are not one to solve this is -- if we are always trying to be politically correct. we do have to remember that 11-year-old girl. that is our hope. that is our future. that is how we discredit violent ideologies by making sure her voice is lifted up. making sure she is nurtured and she is supported. then recognizing little girls and boys like that are all around the world. and us helping to address economic and political grievances that can be exploited, and empowering local communities, and staying true to our values with diverse and tolerant society even when we are threatened. especially when we are threatened. there will be a military component to this.

savage cruelty is going on out that have to stop. isil is killing muslims at a rate that is many multiples. then the rate they are killing non-muslims. everybody has a stake in stopping them. there will be an element of us stopping them in their tracts -- in their tractsks with force. but to eliminate the soil out of which they grew, to make sure that we are giving a brighter future to everyone, and a lasting sense of security, we are going to have to make it clear to all of our children including that girl in fifth grade, that you have a place.

you have a place here in america. you have a place in those countries where you live. you have a future. ultimately, those are the antidotes to violent extremism. it will take time. this is a generational challenge. after 238 years that should be obvious, america has overcome bigger challenges. we will overcome the ones we face today. we will stay united and committed to the ideas that have shaped us for two centuries, including the opportunity and and -- justice and dignity of every single human being. thank you very much. [applause] >> we will hear from president obama again tomorrow.

it is a final day of a three-day summit held at the white house. you can see the president's comments life thursday at 2:30 a.m. eastern here on c-span. c-span's three nights of tech continues now with a discussion of the use of digital sensors on every day off -- i like watches and sisters. a panel at the churchill club and santa fe debated how the expanding collection of data might be used to expand business opportunities, affecting the way people live. this is one hour. >> welcome everyone. i am the chief economist for the consumer electronics association. how will known as the producers of a small middle -- little show called the international ces. we are almost 50 years in history. 2.2 million square feet, hundred 70,000 friends. i'm sure we will be talking

about that today. this is my oprah moment. we have given you all a copy of my newest look, -- book published yesterday. "digital destiny." that future and implications are when everything becomes digital becomes connected, centralized. we see a world where that really starts to impact every experience we have. we will get into that as well. larry, let me turn it over to you. >> share. thank you. thank you to the churchill club. congratulations on your book. i the privilege of reading it in manuscript. it will be a terrific success. i think it encapsulates a lot of the same kind of technologies that i have been looking at in the research i have been doing.

that was the basis of our book last year. it is more of the same. we certainly talk about ces this year since the two of us were there. my feet still hurt. i think one of the big themes i want to look at, is what we think of as the second generation of this -- disruptive innovation. 20 years ago, when i first started writing about these trends, the industry that really affected immediately with the obvious ones. consumer electronics, computing, communication, entertainment. the ones that were using those technologies all along. what we found in the research was that now mentoring a new stage where all of the other industries that weren't affected

, now it is their turn. a lot of interesting reasons we could talk about, why some industries are happening slower than others and some faster than others. all of the same kinds of -- being amazon, and napsterized. all of these industries that have had little impact last time. this presents an interesting set of opportunities for startups and investors, and other interested parties. those are the technologies i think that you write about so well in the book, and we should hopefully talk about as many of them as we can. >> robin? >> i lead our industry that serves our internet and social clients around the world. i've been there for nearly two

decades. one of the previous -- privileges is i get to work with exciting clients. as i chart my history at accenture, i have been working around digital disruption for a while. i was working with the music metered -- majors when napster hit them. and their response or lack thereof. i've done a little work in the console gaming space, with the last three generations of consuls -- consoles. unlike a smartphone that we thoroughly every couple of years, consoles have to ask for a longer. of time. --period of time.

hey make them, launch them, and how they work is very different of -- from a lot of throwaway electronics we see today. we have worked with leading cloud providers since 2005. that is interesting from an intensity perspective. you are making decisions that are quite often decades ahead. those are two decades investments that you are looking to the digital future and trying to guess where the world is heading. and then as you look at some of the other types of work around mobile and iat, much more software development. if you look at the results from ces, amazing developments over the past year. just bring it full circle, i started my career with ford motor company back in europe.

i worked in the -- worked with for -- ford in 1995 with virtual reality using silicon graphics. 20 years along, it actually work s. back in the day we could not achieve that. it is interesting looking at the fast-paced that we see that everything is changing really really fast. there are these long cycle developments around digital technologies. that actually underpin a lot of the change we see and structure we see right now. we look at the disruption as it is happening right now, and allow that disruption to occur are on -- actually occurring over a decade. congratulations on your book. i have skimmed it. i've only had a day to read it.

>> thank you. it is interesting that all three of us have talked about timing. that is something had talk about in the book as well. we tend to think of these eureka moments, where innovation is binary. but really it is broader evolutionary path that plays out over years or decades. that is definitely what we see about the trends we will talk about, connection sensitization. we start first with devices owned at high frequencies. televisions were the first to become digitized. you take something that is widely owned and start there. we have now done through over the -- gone through all of these core devices we have. and we are starting to spill over into the adjacent second-order effect. what do this start to look like?

we can kind of go to the end of the story where everything is impacted. that is an easy jump. what is the sequence of events. from now until the end of digitization. >> as sort of a general rule, one of the things we found in our research about industry transformation is, there is a famous quote from ernest hemingway. how do you go bankrupt? the other one says, two ways gradually and then suddenly. that is it that the what we found in the industries we looked at. you see a long. of gradual change, where incumbents say ok this new technology is company -- coming and may affect customers. but it is happening in an incremental and predictable way and we don't have to worry about it. then one day, some event happens , or some critical mass is reached, someone gets the right

combination of technology and business model, and they let it go and it is facebook. and all of a sudden all of the rules are changed. i think that is sort of the general trend we are seeing. as you talk about the book, the price performance and size are important of sensor technologies and computing stuff. it is getting better all the time. it now becomes cost-effective to start introducing intelligence into more and more things. in my jiggly, from las vegas last week, -- takeaway, from las vegas last week, there was one overriding message. the theme song from the lego movie everything is awesome. everything is connected.

everything you size connected to everything else. -- everything you see is connected to everything else. the list of partners initially seemed completely bizarre. car companies lock company, fit bit, what do those have to do it a thermostat? oh, and a dryer. now your dryer is talking to the thermostat. it is telling you that if you get in the car and you have left, if the cartels that did thermostat, the thermostat says no one is home and it will turn down the heat or turn off the air conditioning. if you are not home, then the dryer can know that they are not coming back, so slow down the cycle. 10 minutes before they arrive, turn it back on.

or when you put your key in the smart luck, -- lock, it can adjust the air temperature settings. these are the connections that say -- are initially bizarre bear. but then you say, that makes sense. all of these companies don't normally seem like people who would be partners are things that we go together. once you get to that incredibly low price point and show dozens of senses into everything. suddenly these connections become possible. and the idea of industry starts to fall away and you see these very strange patterns. >> i think one of the things that happen in technologies we have these eras were removed from a scarcity to a surplus.

highly think about the 60's and 70's were computing power was a scarcity. we used a very sparingly. universities may or may not have had computer access. they might have been -- there might have been a mainframe that people could queue up for. then around 1984, it kind of becomes in abundance and we start to waste it. apple introduces the macintosh the first computer to use a graphical interface. prior to that we would have never wasted computer power on rendering a graphical user interface. it was an essentially redundant feature. if you wanted to control a computer you would command window. a computer in 81 had not been successful and it was expensive because you had to pay a premium. i feel like sensors are there today where it has gone from

scarcity to a surplus and we start to waste it. when we do, it creates these new opportunities for these new marketplaces. i think about image sensors on phones. please tell include one image sensor. and we started to include second ones and now there are multiple ones. it changes our behavior. it introduces the selfie. we can argue whether that is a good thing or a bad thing. >> the word of the year. >> right. that is empowering because we have multiple sensors on the front of the device. if you are in an industry, you need to think about what are the deployment of senses going to do to the experience? that is an example of gradual and then sudden. >> one of the things driving the sensitization of everything that's -- sensor's asian of everything is that smart phone. but that has done is created a

secondary market for all the parts that go with smartphones. if you take a commercial drown, 3-d printer, if you take them apart, you find that most of the pieces are smartphone pieces. often they are last generation smartphone pieces that you can buy cheap, because they have been made in such incredible volume. they are being made and such incredible volume just for the smartphone market that has spilled over into other industries. suddenly what might have been years away from being cost effective is happening overnight. >> i would say if you look at the course of technologies, i like to think it in terms of the device level or the sensor

level. he think of the network and conductivity. arguably conductivity is not moving as fast as we are seeing with devices. then you have the clout that is just unlocking incredible creativity. i'm struck by adept technology level, -- at eight technology level, but other things, with the reason we're seeing an explosion of creativity is not only the technology but also the fact that there are open ecosystems for development. if you are a startup today, you cannot conceivably go into the hardware space. you can work with a variety of different players. you can actually get into the hardware space, and you can

stand on the shoulders of giants. the other thing is if you look at the smartphone and the financial power of the user. with android and ios, that is one billion customer accounts. one billion paying customers. you can access that. that is unique. that is something that has happened over the last year. back to your world a continual rise in consumer electronics. what is fascinating is not only are we spending more and more in consumer electronics at the expense of other categories, but products like the tv is costing less. you kind of get headroom opening up. that kind of fueling of spend in

these new categories is phenomenal. it comes to the point where you say, how many units will the apple watch be sold? there is such a huge amount of spend opening up. i totally agree. i think we are in an amazing time of creativity in the digital space. it is almost this moment where we are seeing proliferation of so many different products as evidenced by ces. it is interesting to see which will survive which ecosystems will survive. how will they interact -- a very good question. which services will be picking makers? will it be ios or android or some new company we haven't thought of?

i think this is an absolutely fascinating time. >> the standards as well. we are seeing this now on the internet. there is not yet kind of dominant standard for how these devices will share data and interacts. there are maybe five competing. i wouldn't predict which one is going to win, but we also found in research that it is very typical that you will see a fight among different standards. until he gets worked out, it is very chaotic. most of the internet of things and solutions, most of them are kind of point solutions. this is a smart baby monitor this is a smart electric grill. smart you cannot was my favorite.

-- smart yoga mat was my favorite. you can see the groping towards that. we know it will happen but we don't know who is going to make the market. >> i think what we are doing is bringing -- building up the notes--nodes of the network. if you use go ill a couple of core devices. a few years ago, it was mobile phones and tablets. we have changed the structure of the network, making the mobile phone the center of this network. it has become this hub device for all of these things. if you look at many devices that are connecting to the internet they don't have an interface. the interface is the smartphone, that is the viewfinder. 15 years ago, our digital

existence was very separate for -- from our analog existence. we would actually go online. we even talked about logging online. reviewed those very distinct identities. we see that blaring with the mobile phone becoming the bridge that allows us to easily toggle between those two identities aired their once very --. they were once very distinct. i think it is an interesting premise that social norms will start to set in and start to apply those to what we want to have digitize and what we don't want. the question now is not can we digitize it. it is not a technical question anymore. that used to be the focus. the technical solution. now it is, should we digitize it? if so, how do we connected -- 24 g or 3g?

bluetooth or other communication protocol? i think that becomes the paramount question. what does that scenario look like for my experience. >> one of the positive side effects of all of this entrepreneurship is you do get kind of 1000 flowers blooming. it is so easy now. you source the parts over the cloud, you buildings, everything can be done virtually. you can really be in the hardware business even if you are one person. we found great examples of people making products for fun. the risk is because there is no had to this monster,--head to this monster, the concern is privacy and security. which is no surprise. a lot of folks are going into the business of the internet of things.

smart devices don't have a lot of history. they don't understand the concept. they don't think about encryption. they don't really think about what is the risk. not so much the damage, but the bad pr it causes for everyone when somebody hacks the base of a smart baby monitor and starts talking to someone else's kid. it is so creepy. people start to set back -- step back, and say maybe there's be some central authority at four standards. clearly not the way it is happening in the united states. but, it is one of the downsides to our open-ended permission list -- permission was innovation culture. >> you mentioned the data sets being built. one of the things that we are seeing is that there is all of this data being built up by

multiple different players. they are not talking to each other. google exercise has lost -- i extracted all the data i could from every digital service that i need. i went to google facebook, to fit that hearing all of these sources. the reality is when you do that, there is an unparalleled amount of information being captured. the average altitude last year was 600 and two feet. i'm struck by the data. i suppose what i'm intrigued by is all of the security threats. put that to one side.

what is the opportunity of that part of being connected. where was that lead and how that data be pulled together? a nice example is in our personal memory space. in our photos and videos. if any of your like me, you have your photos stored in a variety of different places. you have your fitness data. think about that narrative. what you did last year and where you were. some of it is done on facebook. they are doing interesting things with you -- year end review. i'm fascinated by, how does that data set get harnessed in the future? how does it draw insights and improve our lives entertain us, inform us? i think we're in this interesting era where things are not really talking to each other. we're creating proliferation of

data. but if you have to really behind -- it has yet to really be harnessed. when technology finally catches up my 40,000 photos on the icloud or in google, interesting things will happen. >> predicting a recommendation especially when it deviates from this historical course. there's no reason today that some of these fitness devices couldn't also look at my calendar which is digital, and say, you are not going to hear your gold today unless you deviate from your course. looking at the photos, you could easily imagine the recommendation engines that look

at where you have in or suggest you have done a lot of beach photos. it really connect with this inner enjoyment that we have that we didn't may be fully recognized. i thought highlight the beach but i didn't -- i thought i'd liked the beach, but i didn't know i like it that much. one of the big things today's figuring out how much the companies tell the customers. they can't be too over-the-top with how much things they can tell you. they don't father to tell you your average altitude. they don't want to freak you out. but when that becomes a useful data source, a data bite, to inform and predict something that you might be interested in, i think that is interesting to

see. >> and how you drive usefulness out of it. i have been using the tile app which you attach to your keys. it is tracking my location. and i fully aware of it? they have all this location data for me. i am, but is also the reason why when i parked my car in a place i forgot, it was able to guide me in the rain and dark back to where my car was. i'm happy to have that trade-off. when events like that happen, it is remarkable. >> you are both talking about this use of the data for personal enlightenment. that is a collective enlightenment. i was hearing it on the radio about genetic testing, where you take a swallow saliva and they decode your dna.

and they have already built up a pretty substantial database of individual dna samples. with permission of their members, they have sent data sets to pfizer to using research on future lupus treatments and drugs. there is some ways, it is information about a lot of people, you abstracted, and we use it for something completely different than what it may have originally been collected four. --for. but then the creepy factor. sending data to drug companies sounds awful. but then, they had permission, and it's for research.

you have to make these trade-offs. you have to do a lot more as data starts to become connected or connectable. the good news is asked,--x, the bad news is y. >> one of the things i find amazing is over the last couple of years, we have been talking about as when we will use the cloud as the golden source of data. if any of you bought a new iphone and you had your old one, and you wiped your old iphone and connected your new iphone and all of your photos

got downloaded, most people did not do it through itunes. in that one case, all of your personal data went to the cloud. and your phone became secondary to your golden copy sitting in the cloud. i think that flip from stuff being stored locally to now the golden copy being in the cloud is something that has happened. most people don't really realize that message shift has occurred. -- massive shift has occurred. i think back to one of the earlier comments. each one of those might not seem that big, but it takes you so far. in the golden globes, richard linklater 14 "boyhood" where he

shot it for three days every day for the last 12 years. he made sure that in every shot they did, every shoot, each year, they included some technology of the day in the shots. you can see the advanced that occurred -- advance that occurred. he was insightful and all the things that will change of the 12 years of selling the film. one of the things impressed upon people was the change in technology. you could feel her 12 years the technology being used in each year of the movie was remarkable. >> phones get smaller and smaller. and then bigger and bigger. >> it has changed in a very short space of time. you're much more qualified to talk about it, but that change in smartphones, we went from small smartphones and thinking

that was the norm to small smartphones being weird. if you hold iphone 5, you think it is a toy. behavioral change can happen very fast. that is why i'm quite bullish on the apple watch. i think we will shift rapidly. >> i think that is the experiment taking place now. is no longer a technological question about if, but if it is technologically meaningful. what were looking at is does the internet make sense on the wrist for a smart watch? one of these scenarios for apple is payments. so we can empower payment on the wrist. at the fundamental level, that is the question we are asking everywhere does the internet makes sense in a yoga mat? in your vehicle?

that is the question we will be asking for the next 3-5 years. does the elsewhere make the internet in that yoga mat a better experience than you start to tie those together. that to me is the ultimate test. something happens in the physical world, we digitize it, connected, and that is the easy part. the real question is do we close that feedback loop and do we get something to then change back in the physical world? it is -- if it is a fitness device now digitized, the level of fitness, doesn't want me to eat differently or sleep differently? if it doesn't, that is where things really start to unwind.

that is some of what will start to set in. or they say i will keep my analog whatever, yoga mat. knowing that i have payments on my wrist doesn't influence that. >> it is interesting that with technology prices collapsing, do you actually even need to make this decision? isn't it a question of whether everything will be digital? like the yoga mat, harvey we going to get to the point where they are so inexpensive and maybe they can draw power from your motion. it's just going to be implicit in most products over a certain value. >> i think yes, but i think the bigger question is, does it provide a meaningful experience to the user. it doesn't really provide a meaningful use then it really

doesn't matter whether it is digital or connected. it doesn't really change what is happening. i think you see that in some states of the world. if you look at the way we greet each other. we still do that in a very analog way. digitization hasn't really impacted that yet. just because digital can be doesn't mean it will be. >> by the secondary effects can be often on even more dramatic and important from an economic standpoint. is this valuable for me, but more portly, as you look at the whole range of health and fitness related devices and biometrics. you start to and -- imagine a world like that. if you put all this things together and collect that information in some standardized

way, it tells you bunch of stuff about yourself and changes your behavior and nutrition. i'm not even interested. i'm interested in what effect does that have on at the health care industry -- on the health care industry? we have 100 plus years of the model where there is a professional class of doctors and health care professionals the only ones who have that secret information and the ability to tell you your pulse and blood pressure and glucose levels. that in some ways is how the health care industry for better or worse has been structured. now suddenly, as it accidental consequence of cheap technology, you can imagine a world in which every patient has that information about themselves. they are collecting and analyzing and getting feedback. how does that affect the health care industry and its model of delivery and training?

those are what i think of second order effects from an industry standpoint that can be much more devastating. largely because their unintended and -- they were unintended and unplanned, catching incumbents by surprise. >> and it is something that is changing the dialogue. at the minimum. ultimately, i think it changes the experience that we have. we already see that taking place. if you look at the digitization of entertainment, one thing that the digitization of music that was allowing us to break apart and album easily. we saw the explosion of singletrack experiences. that entire music experience is fundamentally different than it was prior to digitization. >> and now it is happening with video. >> right. is happening with books.

amazon has kindle singles. it fits into a smaller space. when i look at the digitization in other spaces, it has the ability to really influence the experiences we have. you don't need a steering wheel or seats that faced forward, you can do anything you want in that vehicle that drives itself. it is a fundamentally different experience because of the building blocks. you can change everything. if you are in an experienced industry, you need to think about how that changes once it becomes connected and digitized. >> especially when it comes from left field. when it comes from people like double our smartphone manufacturers. -- google or smartphone manufactories. >> and your obviously more

connected with washington, but regulation, you mentioned health and driving. as you look at all of those, regulation plays a massive part in the ability for businesses to be able to do some of the novel use cases. had he see that playing out -- how do you see that playing out? >> some industries are affected at a different pace than others. one of the big determiners of how fast to digitization and other technologies transforming industry is the degree to which it is already protected in some ways. it's existing business model is in some ways protected by transformation by fast regulatory space. in some ways, they complain about it, but now there are

protected from change. we see this publicly and how the taxicab companies are responding to things like uber and how the hotel is responding to airbnb. we have to live in is highly regulated world that may not make any sense anymore, but that is not the conversation. we want to stop these guys from working because they don't have to play by the rules. they can deliver these things at a lower cost because they don't have regulation. in the regulation becomes the bludgeon with which to slow or change the pace of disruption often for worse. sometimes for better, but in many cases, it can really become the negating factor, as we refer to it as the bullet time.

i know you have a lot of thoughts about this as well. >> definitely. it is setting up a series of hurdles that inhibit the spread of technology. let's now open the conversation more broadly. there may or may not be microphones around. there are two microphones. feel free to join our conversation. i think we have one comment appear -- up here. >> thank you. you guys are talking a great deal about -- in exchange going to be driven by consumer toys or

by industrial applications/? like water grades. >> i think it is both happening at the same time. it is a question of, where does the internet make the most sense. i think we're in it. -- aaron where we are moving into the next days of the internet. in 1995, the homepage for the internet was like yahoo! putting digital information on a single page. the metrics for success are how long people are using that page. then with the explosion of websites we moved to search engines. then a further explosion of internet properties, we start to move to something like reddit. i think like we're all living as we all from 2 billion smartphones 250 billion objects

we are moving to the next phase of the internet where we are redefining the homepage. i the enterprise side, and on the consumer side are both moving in the same direction. the fundamental question is does the internet makes sense in water grades--grid, or locomotives, or engines. we can't that the industrial internet are -- call that the industrial internet or the the internet of everything. ultimately we will just talk it -- call it the internet. it is just the internet. i think the same thing will happen with the internet of things in 15 or 20 years. >> i think both are happening too. but there has been a fundamental shift towards consumers taking the lead. when i started looking at disrupted technology, the model

we had was starting in the military application, then business, then finally to consumers. now it is the other direction. that is something that is spreading. because of social media, they can experiment and communicate about new stuff much more effectively than enterprises can. they do so. they become the lab rats for moving the other way. >> i think just the barriers -- everyone has access to the same technology. the barriers to getting something in consumers hands and consumers using it i lower than getting into an and provides -- then getting into an enterprise. i think consumers are end-users --or end-users, i went things are going. i think we will continue to see consumer led initially, and then

-- water grid is interesting. it takes a while to see applications. i think consumer leads. the brand is consumer led. >> next question. >> good morning. larry, this is for you. in a macro environment with information, what companies are technologies do we need to conduit this information. what repositories can we develop? >> i think we have most of the core technology in place. the cloud, high-speed networks. we now talk about 4g, but we did a conference late last year on 5g coming in the next decade.

even crazier than the last. who is going to lead that? you can make the case economically that it could be the providers, it could be the network engineers like the verizon. or it could be information experts at google and so on. all of those are plausible. probably some combination thereof. >> i think what ends up happening in this world of exploding opportunity and data and innovation, we go through eras of chaos and then we try to organize it. and then we go to chaos and organize it again. and you can see that if you look at the web. google tried to organize it and then it explodes. then we do other things to curate it. you have this constant cycle of explosions of information and

cure ration that you try to -- duration that you try to create order. that order might look like insight and curation. but look at that companies that are trying to apply order to chaos current and you also talk about it in your book. >> >> who is going to create the network effect that drives the most value. i think that is why there has been most focus on platform. >> they are trying to create order to the chaos. next question. >> what new business models use the emerging? for example, ge doesn't sell jet

engines anymore. they're basically renting the rotation of the rotors. or if you take over and the driverless car --uber and i driverless car, you take away the whole industry. assets become services. what these the emerging -- what do you see a emerging as new businesses emerge? question number two is, aren't you guys afraid of what the ultimate solution could be? if you watch these tv shows like person of interest --" person of interest,", where a master computer directs you to do things. are you worried that at some juncture we are just -- we are not the director, we're just a cog in a machine? >> to the first question, what is the real business model.

[laughter] >> i think you did a piece of it. capital becomes more productive. one of the things we see over a long. of time >> we give workers pcs, heavy machinery. we give them censored data, and that is one way to make them more productive. we look at polls of labor and areas that are labor intensive and you see the infusion of capital. i look at leisure and entertainment, hotels that have crews that go around and clean the rooms. today, they ring the doorbell, they will wait, they will not eventually they will open the door and there may be somebody in there. they shut the door and move on. now you are starting to see hotels that is