Eleni Coldrey - Please DO Disturb – Why Digital Disruption Means Future Success

You talk about this Buddhi term, why structure means future success? So it's your, thank you. We can everybody. So we are living through an age, a huge digital disruption 20 years ago when I got my first mobile phone. I don't think any of us would've predicted how today we live our lives with a device permanently in our pockets and continuously online, and that digital disruption can have a few effects. Does it inside fear for you and your business? What does it excite you? And the same question goes for your customers and for their customers.

In fact, how do you feel about the digital disruption that is happening all around us? But today I'd like to talk about the growth opportunity that that disruption brings. When we look at the capital markets, we see the trades make their money with volatility, and I would suggest that actually the same is true for us in the banking industry, in the payments industry, the opposite of disruption is inertia. And I think we'd all be happy with a slightly higher growth rate than zero.

So what I'd like to talk about today is how to overcome the fear and in fact, how to embrace the disruption that's happening. And as part of my presentation, the, the enabling factor is going to be knowledge. So how do we break through that fear and understand how we're going to build a successful digital platform that is Futureproof and that is ready to handle everything that the, the new technologies, the disruption market are going to be throwing at us.

Now, how are you gonna prepare your platform for success to be able to pivot with the changes that are quite clearly going be coming over the next year, the next 3, 5, 10 years, and going into the future. So talk you through a few industry. Examples. I'm going to tell you about three key factors that we see in our business as being crucial to enabling successful digital platforms. We see the future of banking and payments as being instant, open and everywhere.

And if you can lift the bonnet on your digital platform, you will find that if you can make inroads into having these three critical factors, then at a business strategy level, you'll be able to deliver the agility that is needed to survive the disruption today. So that go, let me go to the first element in, in this series of three, so instant delivering the realtime solution. So as consumers, we know that we expect from any on our mobile phone, an instant answer, the same is true of banking as it is of any other application you might be using.

And our industry is directly compared to everything else we're using on our mobile phones. So responding to that demand for real time solutions from our customers is a real challenge. And the traditional players in the ING industry, it's, there are a couple of significant challenges. The first one is that legacy, it systems were not built for real time solutions. They operated more in batch processes. And the second piece is that non predicted the volumes of data that we'd be seeing today. And so our systems are unable to, to handle the, the volumes of information that are coming at us.

So to give a little bit more context to this, like we talk about a very well known use case in the market, slightly outside the banking, but grab the Uber of Asia Pacific, quite possibly going to be the Uber of the world. At some point, they describe themselves as a transport food delivery and payments app and grabs its in the pocket of hundreds of millions of consumers in Asia Pacific. So how have they built their success? They're quite clearly a disruptor and the key tenant of their success is narrowing their customer and understanding their market extremely well.

And to do that, they've invested hugely in data analytics. There's a recent headline from the press, 150 million to be invested in their AI capabilities. And the reason that this is so crucial is because they need to know where their customers are. They need to know what their customers want. They also need to know where their partners are. So for grads, this means the taxis, where is the fleet of taxis. They need to know where their food partners are and what they're able to deliver. And when that's a huge volume of information that they need to process. So how do they do that in real time?

It's really a question of physics and plumbing. It's quite simple when you actually live upon it. So you have to get a grip on the data. You have to understand where it's coming from and then you have to understand how you're going to get it and how you're going to get it quickly. And ultimately the entire fleet of taxis, the entire world of that consumers are generating data on some kind of device, which is connected to mobile and internet networks. So if you want to get that data quickly, you find out where the edge of the internet is and where the edge of the mobile networks are.

And if you can get that data as quickly as possible, you can process it quickly and you can deliver a real time solution back to your customers in a meaningful way. And so the example that is very small, but if you want a bigger version, we can, we can share it with you. Another time is describing the edge analytics platform that ground built with a few partners. So your data will be different. The edge points of where your data is generated will be different, but ultimately it is knowable.

And that's something that you can find, you can find out where it is and you can work out how to get closest to it. The second element of success for graphs platform is using cloud partners. And that is a key part of any data analytics platform that you'll see there. And there are two points I'd like to make around cloud. The first is that this is a hybrid cloud world. When I say hybrid, I mean, it's a combined architecture of public cloud, the big names that we know and private cloud infrastructures, and it is hybrid by a couple of reasons.

Sometimes it's the regulator that tells you to do that. They would like you to keep, for example, personal identifiable information on soil. Sometimes it's actually for your own choice. It's very cheap to put data into the cloud. It's very expensive to get it out again.

And so what we see in the market around data analytics platforms, across industries, particularly those that are more advanced in AI than perhaps the banking industry is that there is a, a hybrid cloud structure where data is held with private infrastructure at the cloud edge, closest to the public clouds and the compute has a cloud use. So as many you would say, you write the data in private infrastructure and you read the data in public cloud.

And if you can create that combined structure, which talks to each slide talks to the other in real time across a private network, then you have an efficient data analytics platform that would also be compliance. The second part here is also that it's the world of multicloud. So I fully appreciate that most journeys to the cloud for any business start with one cloud partner is natural and here, see, grab is citing AWS one, as I keep cat cloud partners, but in reality, the future is going to be multiplied. And I think most people would recognize that.

And it's really key to plan for that from the outset, the reason it's multicloud, again, just regulatory element, the regulators are telling our bank customers that they see a single cloud as a single point of failure. It's no good to say, well, I'm an AWS, UK and AWS Frankert for example, a single supplier, what's your cloud exit strategy. So that's one reason. The second reason is again for your own internal strategy, you need to have choice and flexibility for the future.

It's about choice of technical capabilities in the cloud, and it's absolutely a bad choice of commercial commercial models. The, the rate at which that each of the cloud providers adjust their commercial models is very hard to keep up with. And so in the future, as more of your infrastructure becomes cloud based, you will want the ability to port across clouds in an efficient way. And so it's important to build cloud agnostic from the outset onto the second element for success in building a digital platform. Openness.

So whether it's through your own choice or whether a regulator is pushing it onto you, for example, with PSD, two legislation forcing you to give access to new can parts. The future of digital platforms is really ecosystem based and our industry is, is no different. And it actually does make a lot of sense. Perhaps we don't have the skillset in house to, to build digital realtime solutions. Perhaps we just like the idea that someone else came up with. And we'd like to combine that with our own skillset, perhaps we're just not agile enough.

And in order to get to market quickly and again, dealing with our legacy infrastructure, perhaps we need a partner to act quickly and get to market. But cause times in market is time to revenue. So hopefully we will agree the future is ecosystems. And to demonstrate that I've given an example here of my view of ecosystem this, and forgive me, this is very UK focused, appreciate this is a, not just a German audience, but a lot of the logos on here are, are UK based. And what I'd like you to consider is the different layers of the ecosystem that we'll be interacting with each other.

And each interaction represents a new connection and new link across which data is being exchanged. This is a huge amount of complexity. The world of banking has not integrated such a huge volume of new players in, in a long time. And I talk to customers and ask them how many new endpoints counterparts they might be integrating in a year, two, three, perhaps, but in this new world of open banking ecosystems, the demand is there coming at you from the market and also strategically outwards building your own marketplace.

And when you start trying to integrate in a secure way, in an efficient and in an agile way. So many new came parts perhaps 10 this year, perhaps seven new ones next year, take out three who haven't worked.

This, this flexible and evolving ecosystem is very hard for us to manage. And so I want you to think about how we could simplify this complexity for your platform and how we could secure the data exchange between this very broad ecosystem, which as yet it's completely unknown. We're just at the beginning. So banking, the key point to remember is that if you want to have agility at a business strategy level, we see a lot of press releases about partnerships and collaboration.

If you actually want to deliver on that and deliver on it in a, in a reasonable timeframe, the delivery mechanism is your digital platform. So if you can get yourselves into a position where you have built in flexibility and scale and speed and openness into your platform, you will actually be able to then move forward at business level. This is a real business enabler. So the key challenge that, that I see at a platform level when building out your ecosystems is with the traditional networks, let's take the, the main two that are use.

So if you look at the traditional world banking and payments and commerce, it's, it's either internet or it's telcos. So main carriers, if we can say internet, which is the default plumbing mechanism for open banking across the EU, because it's free, which I would contest. But anyway, internet is the default. There are a number of issues. So the internet has no SLA it's best effort delivery, which means that you can't guarantee quality of service at all. And we're talking about real time applications that we're going to be using on our mobile phones.

We need to have some assurance of quality, particularly when you move into the corporate space for open banking. When you productionize open banking applications, the internet is not going to be good enough from a stability and performance perspective. And it certainly will not be acceptable from a security and a hackable service perspective. Okay? So we need a more secure and a more reliable network will let's go to our traditional carrier.

Well, the issue with targets is that they are very slow to deliver. So I can't wait 60 to 90 days. Each time I have a new connection partner to integrate and their cost models are flexible. We already know my ecosystem is gonna evolve over time. And the most important fact is that actually telcos are not very good with cloud. And if we look particularly this example is open biking, half or more of the ecosystem is cloud based. How are you going to create a flexible network model into the cloud space, both your own applications and partners. And so we need a new network model.

We need to be looking at more agile networks. We need to looking at software defined networks where we can plug and play within minutes and not months, and we need to consider secure cloud access. So I'd encourage everybody to really get to grips with cloud networking.

It is a, a massively underrating skill in the industry. It's a huge gap, both for the FinTech and the bio from our perspective, but the clouds do have private networks. They have names like Microsoft express, route AWS direct connect or cloud interconnect or fast connect. This is all knowable. You can find out how to route in real time to any major public lives to integrate your ecosystem.

So yes, your ecosystem success depends on the ability to flex scale and to secure is growing world, whether it's open banking or whether it's another area of your business business. So the third final element that I'd like to talk about is everywhere. The opportunity in digital business is global.

Yes, there are a lot of local specifics, whether that be regulatory and compliance, whether it be market infrastructures, but actually as a consumer, my requirements as I'm interacting with your service on my phone are actually very similar to those of anybody else sitting in Singapore or sitting in Mexico or here in Frankfurt, wherever in the world, we, we want the same things as consumers. And so how do we, when you've delivered a killer app into the market, how do you make the most of that opportunity? How do you take it globally?

Whilst being able to respect all of those local dynamics that, that are going to continue to exist around the world. And so the example I'd like to talk through is, is I imagine most of you have heard of it. And if you haven't, it's been quite by PayPal.

Now, it's the reason why when we go to a market store or go to a food truck, we can pay by card instead of having to by cash. So is, was one of the first mobile point of sale terminals. And they had huge success launching from Sweden into the European market. They spot an opportunity in the America, specifically in Latin America. And they went for it.

Initially, they tried to service that market from the, from the infrastructure that they had in Sweden, but they found that the response times for this real time payment solution that they had, the response times were inadequate and customers are just not going to go over it. They wouldn't wait that long for the payment to transact. And so again, the solution is to go back to the plumbing is to go back to physics. Data can only move with the speed of light. We can't push it any further from Sweden to America, from Sweden to Mexico is always going to take as long as it takes.

So the solution is to bring your application to your customers, get closer to the data and by doing so and getting closer to that America's market, they were able to get closer to local payment raise and payment solutions and also to their customers. And at that point they had a real time solution for that market.

So the, the solution is in distributing your application, getting close to customers, data's network and cloud. And this is, this is key to what we see all of the major digital platforms doing. So whether we're talking about, you know, whether it be an a, whether it be a PayPal or an Alipay, or whether it be the major streaming customers that we host. So when I talk streaming, I mean the TV streaming or the social streaming that you would use on your phone for video content, they all create global architectures that allow them to be global and local.

At the same time, they understand the, the plumbing that connects the digital economy. They understand the network groups and the cloud access, the private cloud access. And with that knowledge, they then build a global footprint that is as light as possible. And so this is what it might look like. This is an anonymized customer, but effectively, this is how platforms are built. I couldn't get any my time up.

And again, if you want to, to find out how to choose these, these markets, the data is available. And, and we can show point to some places where you could find that. So in summary Equinix for the last 20 years has been supporting digital platforms across the globe, transforming your business to be digital ready is yes, a huge task, but isn't unknowable. There is information that you can arm yourselves with, and if you get it right at a platform level, then at a strategy level, you'll be able to go for it and support market demands in the next 10, 15 years, whatever the market can throw you.

Thank you.