AI-Enabled Applications and Going Out of Business
What happens if the company that makes your AI-enabled product, such as your smart car, goes out of business? Will it stop working? Will you be able to re-sell it?
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Before reading, be sure to check out Part 1 about enabling predictive analytics in the enterprise.
Every product that we purchase goes through a lifecycle. Initially, we are excited about the product and we try to use it as much as possible, in all situations possible. Then, our interest either wanes or we start looking for a new version of the same product. Over a period of time, the product may develop faults that need to be rectified to keep the product functional. Finally, the product reaches its end-of-life and we discard it.
Each business also has a lifecycle that's quite similar to that of a product. In the initial stages, a business announces a slew of products and makes attempts to popularize them in the market. Once the products are in the hands of customers, the business makes an effort to provide service to maintain the product and also to provide enhancements to keep customer interest alive. Over a period of time, the business becomes sufficiently large and can focus on multiple service lines and multiple products. Finally, the business makes a decision that it has to mark a certain product for end-of-life and announces this to customers, with the expectation that customers will continue to have a relationship with them by purchasing the new products being announced.
Some businesses may not follow the above-described trajectory. Of course, a business involves many risks and only after successfully managing many of those risks that a business can claim to be successful.
In 2011 (multiple decades ago in the Internet business world), Marc Andreessen, creator of the first graphical browser for the World Wide Web, wrote an article titled Why Software Is Eating the World. The article documents the rise of the now famous Internet businesses — namely Facebook, Amazon, Groupon, Skype, and Twitter — and their value. The article was trying to address the question of high valuations for these companies and whether it was all a "bubble" rather than substantive and long-term. The article also mentions the reason for the rise of these businesses, primarily due to the easy availability of back-end software tools to create the application software and the multiple options available for the applications on the Internet — either on dedicated infrastructure or cloud — compared to standard brick and mortar organizations like Borders, Radioshack, Walmart, and the like. With start-up costs being low, it is relatively easy for services to establish an online presence.
Let's consider the software portion of this discussion. Most of the products that we use today have some element of software embedded — be it a music player, a fitness band, a smartphone, or a smartwatch. While most of these products may sound low-key, surely you must have read of the Tesla electric car and Google's self-driving cars. Each of these products relies heavily on the software present in them to drive their functionality.
Due to this dependence, the biggest question that begs to be answered is, What happens if the company that makes the product goes out of business? In fact, even without answering such a drastic and negative-sounding question, look at some of the cases being fought in the court of law. For example, John Deere, the famous tractor manufacturer, is fighting a case against a few farmers. These farmers wish to maintain tractors on their own, as they have traditionally done for many generations. Due to the presence of software, the company is preventing them from doing so, citing copyright law. Many believe that in such cases, businesses are simply using copyright law and software as a means to stop people from exercising their right of repair and right of re-sale.
But how does all this relate to this article? Simple. What is a customer supposed to do if the company/business whose product he or she is using goes out of business? It is very easy for us to say that the customer should purchase a new product or that the customer should not have purchased a product from that company in the first place. I do not subscribe to either of these arguments. Consider a simple case. I purchased my first digital camera around 12 years ago (in 2005) from Kodak. A few years later, Kodak, one of the biggest names in the photography business, declared bankruptcy and closed shop. You might say that ten years is a long time for a digital camera to be used. But what about people who purchased such cameras and the company shut down within a year of their purchase? Replacing a digital camera might sound simple for many of us, but is it possible to apply this argument to each product?
Consider another example. The Nest intelligent thermometers that were sold recently ran into trouble when the company closed shop. Similarly, there are many people who have bought music from online sites, many of which have shut down. All the investments that these people made is now useless.
Still not convinced? Let's assume that you purchase a state-of-the-art, self-driving car. Such cars, as you might be aware, are controlled by a lot of software, most of which is proprietary to the manufacturer. It is a standard practice that such automobiles always maintain a connection with the parent company's server, allowing the company to monitor the automobile. Now suppose that after five years, the automobile company decides to shut shop. As a result, all its servers are shut down. What will happen to your automobile as a result? Will the automobile refuse to start or allow you to control its functionality because it is not able to synchronize with the server? If access to the software/AI on the automobile is not available/provided, will you be in a position to maintain the automobile? If you take it to a garage for repair, the engineers may have to circumvent the software. The engineers may be reluctant to do so due to the possibility of being dragged to court for violating copyright law. If the software cannot be bypassed, will you be okay with throwing away the $300K or so you paid for the vehicle? Given that the company is non-operational, you will not even be able to sell the vehicle to someone else.
Now for the point of the article. Considering that software is finding its way into each and every aspect of our life, primarily through various gadgets, it is important that the products continue to work when the companies who make these products go out of business. Software is entering every aspect of a gadget, either to make it hyper-connected or to allow the company to better manage its products. With increased automation, the software on the gadgets is getting increasingly complex. To add to the complexity, the principles of the field of AI are being applied to day-to-day gadgets and services.
To shield customers from the vagaries of business, some form of standardization for interfacing and maintenance purposes is needed. In other words, governance and standardization principles need to be put in place not only to protect businesses but also to protect customer such that they are in a position to maintain and use their products for as long as they wish to do so, regardless of the state of the business that made the product.
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