Competitive Intel – #33 Transcript – How Much Secrecy Can You Expect?

Authored bycascade

This is a transcript of the CI Life Podcast, Episode 33. If you’d rather listen to the podcast, click here.

Sean : Welcome to another episode of CI Life. In this podcast, we’re going to tackle something a little bit timely, as the subject we are about to cover has been in the news in the last couple weeks.

In short there always been a lot of discussion about how much the government monitors private citizens. There has also always been discussion about how much your business is transacting what it’s doing in the open, per se.

And so, what we’re going to do is talk about an interesting subject, I think, given the news of the day which is how much can you expect to remain secret in this day and age?

Is your product launch actually secret in any meaningful sense?

Are your sales initiatives actually secret in any meaningful sense?

And so, we want to talk a little bit about that and maybe with a little bit of the backdrop of what we’ve been hearing in the news about PRISM and things like that. I guess a good place to start is just how much secrecy can you expect? What are the trends? What does it mean if you’re a business leader?

Scott:  Yeah, I think this is really pretty interesting. I know that when we have spent some dime down in the Valley, it used to be pretty common, years ago, where you’d meet somebody at a networking event and they’d say…”What are you doing?”

And they would say, “Oh, I’ve got a startup but it’s in stealth mode. We’re in stealth mode right now.”

It’s a funny thing because every time I heard that, I thought, “OK. Your success or failure has zip‑to‑dee‑doo‑dah to do with your being in stealth mode right now.”

One thing that proves this change is real is that we’re just on the verge of something that’s never happened before which is that probably around August the Securities and Exchange Commission will allow you to sell 20 percent of your startup to the planet through a platform such as Kickstarter.

What this implies is you can’t be secret. Nobody’s going to fund a stealth mode startup. So if you go to Fundable or Cabbage or any of these sites today, you see all these startups and they’re all talking about what they’re doing and they’re talking about it completely in the open. They’ve made the decision that they would rather have cash than secrecy.

I think fundamentally what people are going to decide as secrecy erodes away is secrecy was never really our secret to success anyways, for a lot of industries. Not for every industry. If you’re a defense contractor, I wouldn’t say that.

But I don’t think Southwest Airlines beats the major airlines because they were secret. I think they beat them because they had a strategy.

Sean :  Sure, and I think that’s always been true, right? For example if you are the victim of a surprise attack as a company, military, nation‑state you can still win if you have a decent strategy. The emphasis on “usually,” is important of course. There are times where even if you had a great strategy for a response, maybe the surprise was so great that it was difficult to really overcome it.

I think we also need to look at whether this is less of a permanent change and what we are really looking at is a pendulum?

I think there’s an argument for that, too. I think that the pendulum does swing in large arcs on this topic of secrecy. I think much like you see in military circles and things like that, there are times where traffic is more secure, technology changes, engagement models change, and traffic becomes less secure. Then we switch back again to a mode where it’s hyper‑secure.

I think there’s this pendulum effect here in business as well, but I think if you’re living in the world of business circa 2013, you have to face the facts that whatever you’re doing is more out in the open. You’re going to live in a world that, for the immediate future at least, is going to be less secure and you’re going to be able to conduct fewer activities in secret when it comes to product launches, sales initiatives, marketing initiatives than you would have been able to do 10 years ago.

Scott:  Yeah, and this is…We don’t always agree on everything. I realize never say never, right, but I don’t know. I feel like we’ve been on an inexorable trend from the day where you handed the messenger a piece of papyrus to run across the kingdom to today. If only because the amount of data is increasing and increasing. Even if encryption or different technology allows more or less of it to become a secret, the fact is that the sheer amount of data that is available is rising and rising.

I think we are on a downward trend for as far as the eye can possibly see on secrecy. I don’t think 10 years from now it will be easier for businesses to keep a secret than it is today. I don’t think 100 years from now it will be easier for businesses to keep a secret than it is today. But who knows?

Sean :  Like you mentioned we disagree a bit on this one. I think there is definitely a pendulum effect going on here. I mean, if you think about it from a military standpoint, originally everything was on paper. In one way, that’s kind of secure. It’s not being transited over the open airwaves.

You get to World War One. There’s more open communication. We use wireless because it gives an ability to mass troops and communicate signals more effectively but on the other hand it’s a little bit easier to gain access to. Then you transmit the same message in code but we don’t have computers to crack it more quickly.

Then we develop computers who help us both crack the code more effectively and at the same time create codes that are harder to crack…In my mind, to use a different analogy, it’s more as if we have a ball marked secrecy that just keeps floating up this cylinder and hitting opposite sides along the way. On one hand, you rebound off the side that says, “It’s very hard to get access to this data. We’ve made it difficult to access. It’s encrypted.”

And then you bounce to the other side which is, “There’s so much data, it’s hard to keep it all encrypted. And all the encryption algorithms we use today have basically been cracked and destroyed. Everything’s transacted in the open.

But in essence it’s just a pendulum that swings back and forth.

And then there’s always the human element, right? Look at the guy that launched all these stories about PRISM. That’s a human being that did that. He just had access to an inordinate amount of information.

It’ s kind of a balancing act, I think. But I would agree that as stuff goes more digital in the business space, what you have is an interesting ability for businesses to be very good at harvesting the signal from each other and also throwing misleading signals out there, which is actually one of the things that I think will counterbalance this.

Today you might go to a conference and there’s always one guy who walks up and says, “I know this one time that my company wrote something misleading in a job posting.”

And I’m always like, “OK, OK, OK. I get it. That’s the one time they did, tell me another time.”

And they never have another example.

So in short most companies don’t do this as a regular practice across the entire company today. They don’t just throw misleading information out onto the Internet. Yet, we may see that start to happen, just like you saw in other realms where once it became easy to tap the communications, well then you put a bunch of misleading stuff into the same channel.

And so, maybe that’s part of what balances this out in the end. But we’ve yet to see that. It will be interesting, though, when and if we do because I think it will change very much the way people communicate and what they expect to see in terms of truth on the Internet.

Scott:  There’s a very interesting…You know, it’s funny, right, that the children are our future.

Because kids got on Facebook and because kids got cell phones and they started texting each other and all this stuff parents immediately said, “That’s not your phone. It’s my phone. I’ll look at it any time I want.” So they could scroll through their texts and their posts and their mail and whatever.

The world invents this application called Snapchat. The idea behind Snapchat is that whatever message you send to whatever friend you’re sending it to, they have 10 seconds to look at it and then it’s gone.

I wonder if…Corporations have decided it’s in their interest to hang on to everything forever. I wonder if we’ll see a day where the default is for information to self destruct and you have to market to actually have it stick around forever.

Sean :  Right, it’s this idea that…The burn bag you see in spy movies, you know what I mean, comes back. It’s like we have the digital burn bag.

That’s why I’m not always sure that it’s going to stay more open. Why is it easy to tap these communication channels? Well, they transit over what is inherently an open network to a large degree.

That doesn’t have to be the case. You could have large corporations band together to have a more private infrastructures. Are those just as crackable by someone with effort? Potentially, yes.  Think of something like Yammer vs. Facebook or LinkedIn.

I really think it’s more of pendulum back and forth that we’re seeing here, whether it’s tech tools that reinvents the physical burn bag or it’s people throwing misleading information into a area that most people think is generally full of ‑‑ let’s call it forthright discussion. Maybe not quite honest, but forthright.

The Internet’s full of that right now. What would happen if the Internet was full of basically misleading junk?

Scott:  I think you’re right. I think some people will innovate around bringing secrecy back but I think we’re going to see, at least for a time period, innovation the other direction where some companies decided they’re simply not going to pretend secrecy exists and they’re just going to flat out innovate in the open.

Sean :  Well, right. And then you’ve also got interesting things impinging on this, which is that the larger you are, you’re beholden to certain data protection requirements, things that you have to keep documents around.

But as of right now, there’s an imbalance in how secret a small company can be, even digitally. It’s always been known that a small company can be more secret from a human intelligence standpoint because there’s less points that you can connect with. But even in the digital arena, they can be a little bit more secretive, and it will be interesting to see how that plays out.

One last thing, just to close off. I think we both agree, that for the time being, at least, if you’re a leader of a mid market or an enterprise business, you have to realize you are more in the open than you ever were.

The simple fact is that’s just where we are.

Scott:  Yeah. I totally agree.

We’re not going to answer this in 10 minutes, but it’s just a fascinating subject to think about. With that, I think we’ll let people back to their day.

Sean :  Excellent. Thanks everybody for listening. We hope to have you join us on the next podcast.

By Sean Campbell
By Scott Swigart


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