2015 AUSTRALIAN DIGITAL SUMMIT

Monday,

26 October 2015

NEW SPEAKER: Welcome

to the

Telstra 2015 Australian Digital Summit

Monday, 26th October

2015 NEW SPEAKER: Good morning and welcome to the 2015 Australian

Digital Summit. Ladies and gentlemen, please take your

seats, we’re about to commence Thank you NEW SPEAKER: Well, good morning, everyone. Welcome, welcome, to our 2015 Australian Digital Summit. On behalf of Telstra, I’d like to welcome you to the event, which today we acknowledge we are meeting on the traditional country of the Gadigal people of the Eora Nation. We respect their cultural heritage, beliefs and relationship with the land. When it comes to reconciliation, Telstra’s purpose is to create a brilliant, connected future for everyone. Our vision for reconciliation is to see our purpose come to life for Aboriginal and Torres Strait Islander people. Through Connection, we can create the necessary social, economic and cultural change and achieve a brilliant connected future for Australia. Well, today in the room, we’ll have over 1,000 delegates joining us for our fourth Digital Summit. And if 2014 was any guide, we’ll have many thousands more joining us via live stream at Telstra.com/summit and perhaps Sydney’s traffic this morning might make that very convene on Telstra’s 4G network! Our fourth summit is themed, no going back now – the intersection of business, people and digitisisation. The general ticket sales proceeds are contributed to our foundation partner, the national centre of Digital excellence Prior to today, we’d raised over $30,000 for the foundation and today we are hoping to add much more to that. Thank you very much for your generosity and contribution. The event is also supported by some of our

corporate partners, Davidson, Accenture, and Deloittes Digital. Thank you for your contribution to make today possible. Without further ado, I would like to welcome to the stage, Andrew Penn, Telstra CEO Andy joined Telstra in January 2012, serving at Telstra’s chief financial officer and group executive of Telstra International. Andy became CEO in May 2015. Prior to joining Telstra, Andy was with AXA Asia-Pacific for 20 years, where he held a number of different positions. Please join me in welcoming to the stage Telstra CEO, Andrew Penn ANDREW PENN: Thank you very much, Monty, for that kind introduction, and welcome, everybody. Senator Mitch Fifield, Minister for Communications, also minister for the arts and minister assisting the promise — minister assisting the Prime Minister where. And can I also pay my tributes to the Gadigal people, on whose land we hold this event this morning. Ladies and gentlemen, welcome to the Telstra Summit. Who could have predicted the digital world in which we live today? The speed of technology innovation has surpassed even the most forward-thinking minds of yesterday. Now, last week, if you were following it on Twitter, as I’m sure many of you were, last week was an important date, the 21st October 2015 Because it was the date on which Doc Brown and Marty McFly fictitiously went Back To The Future in the Doc’s 1980s-built DeLorean. Now, in their 2015, the world comprised of automatic service stations, transparent neck ties, dehydrated pizzas and of course those very, very cool hoverboards. Also, 50 years ago, following the 1964 World Fair, Isaac Asimov, the 20th century science fiction writer, reflected in a New York Times article on what the same fair would look like in 2014, 50 years later. Now, he predicted that work would have begun on cars capable of automatically driving people around. To quote, “Much effort will be put into designing vehicles with robot brains, explaining that they could be set for a particular destination and then left to proceed there without further inference”. So I’m not sure how many of you were also following Twitter last week because there was another important event and it marked a 57-hour journey of a Tesla model S from LA to New York and the significance of that journey was not so much that it was in Tesla’s very cool electric car, but that it was actually on autopilot for the whole trip. Asimov’s predictions were therefore uncannily accurate. Unfortunately, the same could not be said for Back To The Future, where the predictions were more about superficial things, flying cars and hoverboards, that we haven’t solved for yet. Although, there is an innovation being worked on at the moment called Hyperdp — Hyperloop, that may get us there soon. But Asimov and Back To The Future missed two very important developments – smartphones and the internet And both of those have changed our world beyond comprehension Because internet is the backbone of the digital world in which we live today And that is why the theme of our summit, which Monty just announced this year, is digital – there is no going back. People say that digitisation means the world is changing but I think this misses the point. It has already changed – and changed forever – and it will keep changing. In fact, the change that we have seen to date is nothing compared to what we are going to see in the months and years ahead Because the rate and pace of technology innovation is accelerating today faster than at any time in the past. And at Telstra, we take this very seriously. We understand the need to embrace technology and innovation and make it work for us and our customers. That is why our vision is to make Telstra a world-class technology company that empowers people to connect. A world-class technology company with

world-class customer service, world-class technology and world-class telecommunication networks. This is what we are focused on delivering at Telstra and these are the topics that I’m going to address this morning. So, I wanted to start by reflecting that in a period of incredible transformational change and technological change and disruption, one thing remains more important than it has ever done in the past. And that is customer service. At Telstra, we have spent the last five years on a transformational program designed to put the customer at the heart of everything that we do. And while we have made some progress on that journey, I know that we still have much more today. We don’t deliver everything that we should and we still do not make it as easy as we should do, and need to, for our customers to be successful. Because technology plays a crucial role in transformation. Like many large companies, technology is both part of the problem and the solution. The legacy systems of the past can be clunky and slow whilst at the same time technology innovation can transform customer experiences, and it is therefore crucial that we embrace this. Because today, like many of you, we are not being compared by our customers to our traditional competitors We are being compared to new competitors, new companies – new companies that have been born only digital. New companies that are challenging the old benchmarks, the old accepted norms, of what constituted satisfactory customer service Take Uber as an example – and you are going to hear from the chief executive of Uber Australia and New Zealand, David, a little bit later on today, so forgive me, David, for using you as an example and forgive me for what I’m about to say – in that Uber is not a technology company. I say that in the most complementary way in the sense that the technology at Uber is not necessarily more complicated than exists in any businesses today. What Uber has done, though, is identified a very, very poor customer experience that we’ve all been familiar with and transformed it. Let’s face it – in the old world, taking a taxi was not much fun. Finding a taxi, knowing when it was going to arrive, finding a clean one, finding a driver who knew where they were going, finding one that took cash and then, when you needed, finding one that took a credit card. Just the worst experience ever. So Uber and companies like Uber have transformed that customer experience forever and even the traditional companies are having to catch up in that regard. So think about, where does your customer service let you down the most? What is the weakest link in the chain that you have with your customers and find that and fix it because that is welcome back disruption is going to arrive first. Because, in a world where technology is accelerating and digital needs to be at the company’s core, all of us need to be responsive at providing digital solutions at even greater speed because if we do not, somebody else will. Let me move to the second topic I wanted to cover this morning, and that is world-class technology. I’ve already spoken about the dramatic change that we are seeing in our industry Change that we believe brings great opportunity. As a technology optimist, I see great opportunity for those of us that embrace that change – great opportunity for those of us who embrace technology innovation Because Telstra is no longer simply just a telecommunications company, a telephone company – technology pervades everything that we do. And there are three significant trends that are driving this. Firstly, the massive shift to mobile. 20 years ago, there were less than 100 million mobile devices in the world Today, there are more than 5 billion. Less than 10 years ago, only less than 10 years ago, mobile phones were used for making voice calls and texting Today, they are our mobile office and a remote control for so many aspects of our daily life. Today, in Asia, more people are connecting to the internet from a mobile device than are from a desktop Indeed, many people in Asia will never even use a desktop

Globally, mobile data grew by nearly 70% in 2014 and an extra 1 billion people became mobile internet users. By 2020, mobile data traffic is expected to increase six-fold from where it is today, with video representing more than three-quarters of that growth Recent data out of the US shows that 90% of 18-34 year olds are never without their smartphones, day or night. They are connected 24/7, and not unreasonably, expect to be able to get what they want, when they want and with ease and speed And of course the latest trend, which I’m sure will get discussed over the next day or so – the Internet of Things Billions of connected devices from aircraft engines to cars to engineering componentry to agricultural equipment. In the future, almost everything that can be connected will be connected. Conservative estimates predict that by 2020, there will be up to 50 billion connected devices in the world – all producing data to be processed and analysed Because in future, if a business is not mobile first and digital to the core, if it does not present on an app or an icon on a customer’s handset, then effectively it will simply not exist. The second area driving significant and rapid change is the Cloud. The continuing advances in Cloud and virtualisation are driving major changes to businesses – in our ability to react quickly and adapt and change. There was a time not so long ago when it would have been almost unthinkable for large companies to outsource critical parts of their IT. But how quickly things have changed. A recent study of large Australian companies that showed 86% are now using the Cloud in their production environment. But the most complex aspect of Cloud computing isn’t running the data centre or the software, it’s not a complex IT problem in a conventional sense – the complexity is getting the information in and out of the Cloud at speed and securely through a network. As well as effectively operating the multiple Cloud solutions, you need scale. And, of course, this is a telecommunications challenge and this is why Telstra is the leading provider of hybrid Cloud solutions in Australia today. And it is why our Cloud business is one of the fastest growing parts of our business, at 30% per annum compound growth. Our differentiated Cloud capability is integrated with Telstra’s next IP data network and leverages strategic partnerships with some of the world global providers including Cisco, VMware, Microsoft and Amazon One of the crucial dynamics of Cloud is it is bringing down the barriers of entry to traditional businesses. Today, a start-up with a good idea has access to much of the infrastructure, resources and tools and computing capacity that was once only ever available to larger companies They can rent computer capacity on demand They can use affordable and very capable Cloud-based enterprise resource planning systems. They can use PayPal for prosecutions, market to millions of customers using social media, and outsource the supply chain to FedEx or UPS. Because start-ups are changing markets overnight, because they are nimble, smart and able to challenge incumbent businesses that are finding scale is no longer an advantage and Cloud is playing a crucial role in this And that’s the reality of our digital world today and our digital future The third and perhaps most significant area of technology innovation is in machine learning and artificial intelligence. Advanced algorithms in conjunction with the massive increase in computer power mean that computers can now see and hear better than humans. They could also learn as we provide them with more data Now, of course, some of the most exciting innovations and applications are in the field of health diagnostics and treatment analysis. Artificial intelligence is being used today to ensure the right person is taking the right drug at the right time. AI Cure, which is an American company, is using mobile technology with facial

recognition and advanced algorithms to identify patients, the medication that they’re taking and the process of that medication ingestion. We’re also seeing artificial intelligence play a role in consumer applications. Common examples such as Amazon’s Echo, which can already follow many commands Google Now, which learns about your preferences and predicts your needs even before you have And of course, Apple Siri plays a role in this space, as well These technologies are still at their very early stage of development. But ultimately, it is actually the combination of these three trends. ..that is causing the innovation and acceleration in technology. A massive shift to mobile, in conjunction with the cloud and in conjunction with machine learning, together is what is providing the exponential growth in innovation, because there is an exponential growth in data, the ability to store it and access it when you need to – and cheaply – and of course the compute capacity on an affordable basis to process it to solve almost any problem that you can think of. Which brings me to the final subject I wanted to cover this morning. And that is telecommunications networks Because ultimately, all technology innovation depends on the quality of the underlying network to which it is connected. There is virtually no technology innovation that is happening today, no technology, that is not connected to a network somewhere. And it is the underlying network that makes possible our digital presence — present and our digital future. And, of course, networks are at our heart and soul. It is the heart and soul of Telstra’s business. Because we are committed to having the best networks in Australia with the broadest coverage. We’re already investing billions of dollars – – and earlier this year, we announced a further increase in that investment, in particular into our mobile networks, increasing our total capital investments to 15% of sales for the next two years. In total, over the three years to June 2017, we expect to have invested more than $5 billion in Telstra’s leading mobile network. We will continue to expand our 4G footpatht to 99% of the population. We will also continue with our LTE technology, including voiceover LTE, LTE broadcast and the next stage of L TE advanced, which delivering download speeds of up to 600mb per second. Our customers are clear about what they want – better coverage, better call and speed reliability, fewer dropouts and, most importantly today, faster downloads. And our commitment is to make sure that they get it So let me sum up by reiterating that this is an extraordinary time. Digital technologies are changing all of our businesses They are changing our economy They are changing our lives. But the changes that we have seen to date – remarkable as they are – are nothing compared to what we will see in the years ahead. If Doc Brown and Isaac Asimov could miss the internet and smartphones, what will we miss about the possibilities of our future? This is such a time of opportunity, digital innovation in products, services, processes and business models offers opportunities that we simply cannot afford to miss. But in the end, though, this is all really about our customers – your customers and our customers. Technology is just simply a way to make their lives easier, our lives easier, and their businesses better and your businesses better. And that is why we’re working to make Telstra a world-class technology company that empowers people to connect. A world-class technology company with world-class customer service, world-class technology and world-class telecommunications networks Thank you very much for coming along this morning Thank you for coming to this Digital Summit. I hope you have a wonderful day. Enjoy it, and I hope you get a lot from it

Thank you (APPLAUSE) (APPLAUSE) NEW SPEAKER: Thank you very much, some incredible insights there, thank you very much, Telstra CEO, Andrew Penn. Three forces – massive mobile shift, Cloud and AI machine learning – driving exponential growth We’re now very privileged to have with us Senator Mitch Fifield, Minister for Communications, minister for the arts, minister assisting the Prime Minister for digital Government, why we’re all here today, of course, and Liberal Senator for Victoria. Mr Fifield was sworn in as Senator for Victoria in the April parliament in 2004, re-elected in 2007 and in the 2013 elections. Senator Fifield was previously the Assistant Minister for Social Services with responsibilities for disabilities and ageing Senator Fifield was appointed the Minister for Communications, Minister for Arts, and minister assisting the Prime Minister for digital Government on 21st September 2015. Please join me in welcoming to the stage, the Honourable Senator Mitch Fifield (APPLAUSE) MITCH FIFIELD: Well, thanks very much, Monty, and I don’t think any politician really likes to hear the song, “When I used to rule…” but thanks for that! (LAUGHTER). But it’s a real privilege to be here in my relative new role, as Minister for Communications and minister assisting the Prime Minister for digital Government. I wanted to start by acknowledging Andrew Penn, a fantastic presentation and for the great leadership that he provides not only as Telstra but also in the digital economy more broadly. So great to see you, Andy (COUGHING) Sorry, I’ve got the tail end of the flu, apologies for that. I do also want to acknowledge the DJ this morning! He has managed to give me, in some of his earlier choices, my daily fix of 80s music! It was particularly Spandau Ballet’s “I know this much is true”, that I enjoyed today. Always good to get an 80s fix at the start of the day! And on the subject of matters 80s, Andy mentioned that this is, of course, the week, the 30th anniversary, of the first Back To The Future movie, 1985. In 1985 I was in the first year of uni, and that was a time when I went through all of school and all of university without touching a computer. Without touching a mobile phone. And obviously the internet didn’t exist. There was no Twitter, there was no Facebook – it really was a pre-digital world that I grew up in. And just to emphasise the point, at Sydney University, the library catalogue was in three parts – the bulk of it was on cardboard cards that you would flick through. Some of the more recent acquisitions were on microfish, for those of you who can remember that, and the last six months or so acquisitions were on computers and they were these screens with this funny orange writing. So that was the world that I grew up in And obviously, so, so much has changed. The role I have as Minister for Communications, up until 1975, that position was called “The Postmaster General” I kind of like it! So I might bring it back! I might petition the Prime Minister! Minister for Communications and Postmaster General. But that was the title of the minister with responsibility for telephones and post. And there’s probably no better indicator of digital disruption and change than Australia Post itself and its declining mail volumes, which are literally going that way And the director is doing a masterful job in reinventing Australia Post as an organisation. But that’s just, I think, a salient example to look at, to see the pace of change and how it’s manifesting itself Now, disruption, clearly, is not a new concept. It’s not new to this century. It’s always been with us. But in different forms

As is often said, history doesn’t repeat itself, but it does rhyme. We can look back to the railway transport of the 1800s or mass industrial production in the early 20th century. Since then, we’ve seen things like hard copy maps replaced by GPS navigation devices and these in turn transformeded by an inventive group of Sydneysiders with an app called “Expedition” and today we can all know our world intimately, thanks to Google Maps. We’ve seen computers that would fill a lounge room when I was growing up give way to compact and affordable micro-processing and now storage and processing has well and truly moved into the Cloud, as Andy mentioned. Today, we just need to look as far as our wrists, if we have anything on our wrists at all, or pockets, to see the new wave of digital disruption transforming industries around us. We can buy music on Apple or Spotify – companies that haven’t produced a single song. We pay for things with Pay Wave or PayPal, yet we never see a physical note or a coin. And online job marketplaces enable an army of freelancers to undertake a variety of jobs without any employees. And if you are looking to give way, an old couch to sell or a fridge to find a good home, there is a sharing economy for that, too So moving, I guess, to my role as the minister assisting the Prime Minister for digital Government, imagine, then, if you never had to set foot into another government office – what a joy that would be! And this government is serious about harnessing the profound opportunities that we all know to drive future productivity, to drive the digital economy, and in government, as well. So, what is it that we can do to realise the opportunities of the digital revelation? — revolution? Well, digital platforms offer one of the greatest opportunities for both business and government, not only to meet the challenges of the digital era, but also to carve out new niches. Innovation such as Cloud infrastructure and open source software means that these systems are more accessible and affordable than ever, linking different parts of the business to a shared platform means less duplication and less expense And while this is critical for any business of scale, it’s especially important for governments, which are made up of dozens – well, let’s be honest, hundreds of departments and countless smaller agencies, each traditionally managing their own IT and duplicating a similar range of services. And perhaps most importantly, digital platforms are inherently and infinitely scaleable. We’re no longer talking about a single piece of hardware occupying office space and with scale some affordability – a key benefit for governments and business alike. And this becomes an even more important proposition when we’re talking about interactions with government. We simply can’t deny that the best interactions with government are those that do not require a visit to a government office. To achieve this, we do need a strong pool of digital talent and skills and the imagination of Australian companies, large and small Companies like Telstra and the range of Australian banks, which have made massive investments in technology to improve convenience for their customers and provide easy access to accounts. We need to leverage tech expertise from outside government and partner them with the digital transformation office, which we’ve established in government and with other agencies. There are hundreds of innovative tech businesses, start-ups and SMEs right across Australia that would not normally partner with government, due to prohibitive procurement costs. Our aim is to make it easier and less costly for companies of all sizes to partner with government and this is critical if we are to innovate our own use of IT in the Australian government and essential if we’re to deliver services that are simpler and easier to use. Modelling from a report has found that almost 5 million Australian jobs, or around 40% of the workforce, are at risk of being replaced by computers in the next 10-is a years but there will be many, many new jobs and employment opportunities created by this

revolution. So it’s vital that, as a nation, we adapt to take advantage of these opportunities. We must become even more flexible, agile – as you will have heard the Prime Minister say once or twice – to make sure that we remain at the birthplace of fortune, as Michael Fullerlove described in his recent lectures. The government recognises there are profound opportunities to drive Australia’s future productivity and growth. I think it would be fair to say that the Prime Minister is the most tech-savvy leader has had to date. He is close to innovation and the advancement of the digital economy and puts it at the heart of the agenda and he has outlined his vision, his agenda, as to how Australia’s telecommunications industry, as a key enabler of innovation, will be central to this. He has set a clear mandate for this task, including in part the establishment of the Digital Transformation Office earlier this year and my appointment as the minister assisting him for digital government. The government will also launch an innovation package by Christmas to strengthen the nation’s innovation system. Measures will focus on specific changes, such as improving collaboration between business and the research sector. Increasing investment in start-ups and ensuring that Australia has had a larger pipeline of students capable of critical thinking and problem-solving moving through the system. Exposing more students to, in particular, computing at a younger age will be critical to our prosperity in the years ahead and the government must also lead through example, through initiatives such as the DTO. Our mission is to overhaul the way the government delivers services and to ensure that people can get the information they need when they need it. We also, obviously, want to make government more efficient, to better position Australia to benefit from the opportunities that digitally smart businesses of all sizes – from start-ups to major corporations – can offer For example, in government, with the guidance of the team at the Digital Transformation Office, we’re looking for ways to embrace change and deliver better products more quickly using an agile and multi-disciplinary approach. As our Prime Minister stated recently, we need to become more comfortable with disruption, uncertainty and change. Like Christopher Pyne, we need to channel our inner revolutionary But with Christopher, I’ve got to say that didn’t take too much encouragement! Our vision is that everyone who needs to use government services should be able to find what they need quickly and easily and, just last week, the DTO announced it would develop a gov.au prototype for how the public can more easily access government information and services and to do so in just nine weeks. That is a tight timeline, but those of you who work in business know that, when something needs to be done, when a customer demands something, that is the impetus for change and you’ve got to work quickly. We have been unashamed about seeking influence from the private sector in the way that we go about digital transformation and as we work toward becoming the leading digital economy in the world. We know that there is a global demand for talented digital specialists and Australia wants to compete and wants to make sure that we can harness those individuals and get the best. So we’ll need skills and expertise from both within the public and private sectors to meet this demand and to ensure that we can capitalise on the opportunities ahead. And that’s why our close collaboration and partnership with business will be critical government, we don’t have customers in the traditional sense. People don’t necessarily have a choice about where they can apply for a licence or register their business or access benefits and information However, I should add that postal services and some broadcasting are notable exceptions. So although many government services are not in a competitive marketplace, we are judged by the standard of service that people experience through the commercial sector in their everyday lives, and rightly so. In any given month, more than half of the 2.5 million Australians who look up

government information and services online will experience a problem of some sort – and chances are, it’s happened to everyone in this room. Many departments are working on their services individually, but we can still improve our approach to design and delivery overall, so that members of the public can do what they need to do without having to navigate multiple, difficult to traverse, and disparate websites. And this cuts to the core of the digital transformation agenda and the Digital Transformation Office’s reason for being and that is to find ways of delivering services that are centered on the user So often when the government designs systems and processes and programs it’s about what is convenient for government rather than what suits the individual citizen. Now, this is not about pointing the finger at any one service or department, although I’m very happy to do so! It is about realising that Australians do not distinguish between departments, or even between tiers of government – they just want what they need and to get it quickly and easily. Their expectations are high and they should be. The DTO has announced that as one of its first projects, there will be a collaborative effort between the department of industry, innovation and Science, which is Christopher’s department, the Australian Tax Office and Service NSW, at the State Government level, to use online services, streamline business registrations, improve compliance, minimise errors and of course as a by-product reduce frustration. There is another important piece of work being undertaken by the DTO and that is the establishment of a common digital identity, or online credential. This would be an online ID which could be used to verify your identity across different tiers of government, between MyGov federally and state-level online service portals. This is an important step to ensure that users can conduct prosecutions online without being required to go to a physical office to provide ID, saving users and government time and effort. So, in addition to improving the quality of our services, digital transformation will offer substantial savings, as well. The research shows that many users will try to conduct their transactions online first, and that if it’s too difficult, they’ll move to other channels such as the phone or face-to-face interaction. And that means that by the time they reach government, they are already very dissatisfied – never mind the fact that obviously phone and face-to-face services do come at a greater cost to government and hence the taxpayer. And of the 800 million transactions with government, every year, around 40% are still completed using non-digital channels. According to a recent report from Deloitte Access Economics, if that figure over the next ten years the change would deliver around $17.9 billion in savings to government through productivity efficiency and other improvements and a further $8.7 billion in savings for consumers through time, convenience and out of pocket expenses. So the potential cost savings available through digital transformation are intrinsically linked to improving the quality of the service. If we get one right, the other will inevitably follow. Service transacted over the phone costs about 16 times the digital equivalent through the post, about 32 times, and face-to-face transactions is about 42 times. That said, it’s important to note that embracing digital transformation is not just about chasing savings for government – and I underline again, when we say “Government”, we mean the taxpayer. Rather, there is an incentive for government to utilise effective digital technologies to create a quicker, easier, simpler experience for the customer. If citizens embrace these improved online services, just as they have with online banking and online airline ticketing, amongst other things, then the cost savings are obviously an additional benefit. On this note, last week you may have noticed in the government’s response to the financial system inquiry, that we will move to ensure payments are technology-neural, which banning merchants from imposing unfair card surcharges. So, in conclusion, if we want to remain

a prosperous economy, with all of the benefits that go with that, digital transformation for government and for business is not negotiable. We have made some progress. We need to do more. We do need to be more competitive, we do need to be more productive. We do need to be more innovative – and, in fact, the Prime Minister has directed all ministers to change their middle name by deed poll to “Innovative”! (LAUGHTER). And for a lot of us, especially for those of us in government, it really means just fundamentally changing the way we do business We do have to pick up the pace in government, we do have to be more agile, to seize the opportunities that are before us. We can no longer seek to proof ourselves against the future. We must embrace the future. There is a spirit, I think, of optimism abroad. There is a desire and an attitude to do things. There is a willingness on the part of government to change the way it does business. We can’t do that alone. We need to draw upon the skills and expertise that is in the room today. ..to make sure that we in government can be what you are in your work – relentlessly and remorselessly customer-focused. Thanks very much (APPLAUSE) much, Senator Fifield. The 80s, Spandau Ballet, postmaster general, and digital government in one speech – that is a new world-first! Putting us on the map, thank you. And some seriously ambitious programs of work there – an innovation package and a nine-week transformation work project in the Digital Transformation Office. Thank you very much to Senator Fifield and also to Andrew Penn. We will now change tack slightly to bring out the first of our international speakers to the stage. Our first international speaker will be Kathryn Parsons, who is the co-founder and CEO of Decoded Kathryn founded Decoded in January 2011, teaching people to code in a day, and pioneering a global effort around coding Decoded wants to empower anyone and everyone to work out what’s happening behind the screen She has taught thousands of professionals across every industry and sector in over 40,000 cities worldwide and I understand that Sydney is now on the map for Decoded. It has ranged from boards of multi-nationals, graduates, schools, start-ups and executive teams. Described as a woman on a major mission to change the world for code, she has been recognised as one of the top 50 women in technology in Europe Please join me – all the way from sunny London – for a big Australian welcome – Kathryn Parsons! (APPLAUSE) (APPLAUSE) intro, it was so good, I feel like I should get off stage and quit while I’m ahead! Thank you so. I’ve been in Sydney for about a week and I’ve completely fallen in love. Today I’m going to share with you a bit of my personal journey in business and technology, but more importantly, why I believe that the future is being written in lines of code. I think everyone in this room can be part of that future. I’m going to nick a little bit of Andy’s and Mitch’s conversation, with a very obvious question – how many people in this room have a smartphone in their pockets? Every single hand has gone up! I saw you all checking away! This is incredible – you have a super-computer in the palm of your hand. It’s changing the way that you shop, it’s changing the way that you bank, it’s changing the way that you communicate, it’s changing the way that you date. Tinder has 1 billion swipes every single day Technology has a lot of things to answer for! But globally, by about 2020, penetration is going to be at about 80%. Technology is becoming ubiquitous. We talked about driverless cars – this is the science fiction of yesterday becoming a reality today. On the streets of California. This is Tesla’s vision of our driverless car future – it’s very romantic,

isn’t it?! It’s reshaping not just the roles that we do or don’t do but the faces we see around us – we’re having to rethink it all. Do you recognise this image in Minority Report? We were talking about machine learning earlier – machine learning, artificial intelligence are being used by security firms and government today to predict when crime is going to happen and where and who will commit that crime before it even happens. And who in this incredibly technology-literate room has experienced virtual reality? I expected a lot of hands. Some of the latest virtual reality experiences which are coming out – people are saying, this isn’t just virtual reality, this is actually better than reality I mean, what happens to society when virtual reality is better than reality? We can all kind of clock off, can’t we?! So there are some serious questions here, really. The future work summit was hosted recently and it was debated that this poor guy – I mean, he might get a job after this, who knows?! But up to about 80% or two-thirds of graduates leaving higher education were leaving feeling ill-equipped for the world of work they were going into. A famous piece of research globally recent predicted that up to 47% of jobs which exist today could be easily replaced by machines. Did you see that? Well, I thought I had take a little look at a piece of research just a little bit deeper, because I think what jobs? What jobs aren’t going to be replaced by machines? We need to know that, don’t we? Well, apparently you have a choice of going into the clergy or becoming a choreographer. How confusing is that? Also, the highest rising jobs on linked in with data scientists, which I can kind of understand, but also becoming a zumba teacher. It is a very confusion moment in time, I think. Technology is changing everything – every single industry, every single economy, every single one of our jobs and behaviours are being radically impacted by technology and it’s this – it’s being driven by this. The 1s and 0s – the code The languages behind the screen sending instructions to computers and powering this thing that’s affecting all of us. Look at that – it looks kind of scary and impenetrable – you always think of the hoodies hacker type guys doing this. So how many people can confidently say they’ve felt empowered by the technologies behind the screens? In this room, put your hands up if you could confidently say yes to that question. Lots of hands going up over here! Well, that’s good. I ask that question a lot and I have a feeling that only 1% of the world could confidently put their hands up to that question That’s a real disparity. That feels really wrong. So rewind to 2011, when I was kind of sitting in a grotty pub in what is the east end of London, which eventually became the heart of the technology scene, and I was thinking, “Well, what could you do about this”? So we set ourselves a challenge. That was it – we started with a mission Could you take anyone – someone who had no interest, no skills, no knowledge in technology – and actually take them on a journey, an educational journey, where they could actually learn so much about technology in a short period of time that they could create something, maybe even code an app in a day. How could you make technology education amazing? But above and beyond that, turn people from feeling that they are the passive observers of the digital world into really active participants? So that’s how it started. It started, really, just with a challenge, with that kind of Mission Impossible. And I’m going to share with you now some of the challenges that we faced along the way and then kind of where we’ve come to today, which is just so radically different to make – I did not study computer science. I studied a very different kind of code, which was Latin and Ancient Greek. Debatable on how valuable that is! I was passionate about languages, Latin, Ancient Greek, Japanese, Mandarin, Italian. It was all about understanding cultures and unpicking the language. So code to me is just another language but it is the language of today, the language of billions and it was the passion I wanted to learn. Of all the great technologists I’ve come across in the last few years, yes, we have people who studied

nano-technology, physics and engineering, but you have musicians, artists, people who studied Shakespeare, for example, and they found technology and creative tools enabled them to realise their ideas and ambitions. Never think that creativity is different to technology – they are one. So this kind of image brings to life a bit of a pivotal moment in my kind of journey. And in 2011, it was really hard to get anyone to kind of come and learn with us It was really challenging. So, I was invited to my first ever technology conference to speak and I was absolutely terrified It was called the Dublin Web Summit, so I was in Dublin and I got in the taxi and the taxi driver said to me, as taxi drivers tend to, he said, “What do you do” and I said to him, well, “I teach people code, I could teach you code in a day” And he looked really not interested, frankly, so I wasn’t feeling too positive about that! And I thought, OK, I’m going to convince this guy, and I said, “This is a skill that is going to stay with you for the rest of your life. Not only are you going to look at the world entirely differently, but the world will begin to look at you very differently, too” So at the end of this journey, it was incredible, because he actually wanted to learn. He was passionate. I had converted him into someone who felt this was something he needed. So I felt really pumped and I got out the taxi, getting ready to, you know, speak on that first stage and I suddenly realised that he thought I taught people how to make coats (LAUGHTER). So it was really awful! I thought, wait, there’s a bigger market for coats than there is for code?! Maybe I should just get the code thing because he really wanted to make a coat, and I thought, “I’m going to have to teach him to make a coat”. But we kind of exchanged details at that point and it was pretty embarrassing! This was such a humbling moment for me because I suddenly realised, nobody cares Nobody cares. And nobody even knew what the word “Code” meant What a big challenge. So, what did we have to do? We suddenly realised that we had to become campaigners. We couldn’t just become educators. We had to get off those technology stages and get into government, classrooms and the media, and educate people on why code isn’t just a nice-to-have, but it is an absolute economic need-to-have So if you have a campaign within you, unleash it – there’s never been anything more powerful. So this is the queue for the women’s loo at a technology conference. Guess what I’m about to talk about! I mean, the perks are pretty small, aren’t they?! Now, the audience here looks pretty great in terms of representation, but this is normal. How has this happened? Technology is supposed to be for everyone. Now we know for reasons of access that some people cannot get hold of it, but even people with access to technology, for reasons of permission, feel that they can’t be part of it. And one group I’m very passionate about is women Women are opting out of technology in their droves, when it comes to at school for some subjects but also as career level. How has this happened when some of the earliest pioneers in technology were female? I think a few days ago it was Ada Lovelace – does everyone know her here? She was a big gambler, as well, so I think if she was speaking at this conference she would be at the slot machines! But she was Lord Byron’s daughter and she invented the first algorithm. So I think that there’s an issue with the issue of stereotypes around technologies that really needs to be debunked and something that I’ve heard a lot in my kind of journey and the challenge that I’ve faced is, I’ve heard the phrase that, “Women’s brains don’t work that way”. Oh, yes! I hear that a lot. Can you imagine another subject where that would be acceptable? There is a thought that, somehow, this is more a subject that is towards the male mind. So, we’ve been very lucky We’ve had tens of thousands of people walk through our doors and we capture a lot of data about people and how they learn 50% of them have been female. So we thought, we’ll take a little look at this – is there a difference between a man and a woman’s ability to computationally think? Guess what? No! There’s no difference But there is a vast difference – up to 30% less confidence. Women are up to 30% less confident that they will succeed. So does it even matter? Who cares about

this? At the same time, we’ve been working with thousands of different businesses across the world and we know what they’re looking for, what skills they want within their business, that they will pay anything for. And it’s not just digital skills, it’s digital literacy, it’s digital confidence, it’s the ability to ask the right questions. So for me, code is not just an economic issue – it is also a feminist issue and I urge you, claim your digital vote, because I believe that the future is being written in lines of code and I want women to be a part of that future. So, it has been – fast-forward to 2015 and how the world has changed. We have gone to 45 different cities around the world, demystifying dark arts – not just code, but data, cyber-security, the Internet of Things, there is a lust and a passion of people to actually understand the technological world around them I’m going to share with you some of the insights and observations from across the world of business that I think have been pretty common, but also we’re coming to Australia! Woo! In January – I’m so excited – it’s going to be our first home after London and New York And for three, I think, really magical reasons. Number one, there is a culture of creativity and innovation here. It also marries with a passion for learning that’s absolutely standout for us. And thirdly, digital is on the agenda. As we heard earlier, this is on the government agenda and this is on board agendas and that is so significant – those three things have to come together for real digital transformation. I know that my team would also say that a really big plus point are the beaches and the brunches! I mean, it’s definitely amazing here. It’s not hard to convince anyone to move to Australia. In fact, I think I might lose most of the team to Sydney! So the world has changed. Code has now become this Zeitgeist and has been introduced to criticulums everywhere. I’m proud to have been a part of UK’s campaign do put code on the national curriculum. I know Annie Parker is here in the audience and she is heading up koed Club here and it is incredible to see how that work is creating sustainability for putting code on the curriculum – actually empowering teachers with the skills and information they need to put code into the classroom agenda in every single subject So the conversation has changed – this is another Tesla image Can you spot the human being in this image? Not many! There are about 160 robots. I think they have some of the biggest robots in the world and they’re all named after XMen characters or something. But the conversation in business has radically changed in the last, I would say, year, even across the world. I used to very regularly hear the phrase from business leaders and boards and they would say to me, why do I need to understand what’s under the car bonnet in order to drive the car? And it was a very challenging conversation, you have to challenge someone’s mindset. Well, how it has changed. Today, the conversation is not just, “I need digital transformation”, everyone is saying, “How do I do it? I know I need it but how do I make it happen”? In fact, the conversation has changed so much, that the conversation is “How do I kill my business, how do I use disruptive technology so much that I kill my business and reshape it from the ground up”. So if I left you with one question to pose, I would say what technology do you imagine could kill your business? What technology do you think could replace your job? Because if you can imagine it, it probably means someone has created it or will create it and don’t you just want to be part of the change, rather than have change happen to you? Something that we pose to ourselves a lot, as well. There’s also a wealth of talent. So if this is — this is the cher unnic face of that change. His name is Jordan Casey, he has been flown around the world by Apple, he is speaking at the EU, he is a self-taught coder and CEO of his own games company. I know! Terrifying! So I think I have a list of about, you know, 100 or 200 of these types of incredible technical prodigies, all under 18 years old. When has there been a moment in time when a 14-year-old could potentially know more about technology than, say, a 40-year-old, you know,

CEO of a technology company? I think that moment is now. That’s happened. So everyone is wanting that talent but there is a fundamental red herring here, I think, and that is that we can’t wait for this generation to grow up to embrace change. I love framing technology for people who feel like they can’t be part of it and going, “Are you creative? Are you a good problem-solver? Are you quite persistent”? If you can put your hands up and say yes to those things, there’s a great technologist waiting to be unleashed within you – unleash your 14-year-old developer! So, this is actually Facebook’s hack-athon to celebrate their IPO. How are we going to compete with these businesses? Look at the Googles, they’ve got the astroturf, they’ve got pools and food times infinity, and those salaries – there’s one technology company just launched in London and they are poaching people from their ᆪ60,000 job to ᆪ600,000. That’s very, very competitive! Exactly! Yeah! Well, I think that I’ve seen businesses embracing a culture of digital transformation – a culture of innovation. Actually kind of embracing the mindset of a technology company. For example, doing hack-athons, incubators, like Telstra’s incubator – companies engaging with government and creating their own hubs. That’s true collaboration. New collaborative ways of working. Sell fast, be lean, agile methodologies Really what these companies are doing is hanging a sign above their doors and they’re saying technologists are welcome. This is a place where you can create, this is a place where you can play. But, more importantly, this is a place to understand you and we can speak the same language. That is incredibly appealing to technologists. They will take a pay cut for that kind of environment. So finally, I would say we’ve been kind of a large debate, where we’re not just living in a technology revolution, I think we’re living in a bit of a renaissance and we’re living in a learning renaissance. You can learn anything online now – anything I’ve seen adults investing in their education to make themselves relevant for an agile company. And we see businesses learning not just as a corporate perk or away day, but it’s actually shifting into something that’s core to the capabilities and skills of that business – to ensure that they actually exist in the next five to ten years – it’s exciting. And in the middle of this renaissance is Plato and above Plato’s symposium’s doors were the words “Let he who knows not geography not enter”. And Tim Lee, who invented the worldwide web, said “This is for everyone”. This is an inclusive learning resolution. I will leave you with a quote – it’s great to do the impossible. We face impossible challenges in order to teach people the impossible. They’ve been the most fun challenges to take on But the great thing about technology also is that everything is possible using technology. It’s limitless. So ask yourself, what’s your mission impossible? Embrace it, relish it and thank you so much for having me here today Wonderful, wonderful! What absolutely wonderful insights Thank you very much, Kathryn, and when we talk about Australia’s role in a digital economy, it’s fantastic that Decoded chose Sydney in Australias a its third location to bring – I am looking for ward to signing up. I will will negotiate a friendly discount Awesome to hear from you Staying in the northern hemisphere, but across the Atlantic, we are going to be joined – Robert Scoble. He troubles the world, looking at the bleeding edge of technology Looks at inVo excavators and report what’s he learns on social media. I have been followling his Facebook feed today. It is already alive and well. His weekly newsletter – any subscribers? It isn’t to be missed! Robert is followed by

millions of people globally and has written books on digital change, with another Shel Israel who law you hear. He will share his insights on a topic that we are now referring to as friction. Welcome to t he So lis Robert! Take it away! UNKNOWN SPEAKER: The music you just heard was The music you heard was picked by an Al go rim emat Spotify The team who runs the Al o rit exem, toll he has the best top 40 list in the world because he has three times more user than Apple music. He has more data to pull from to figure out what the most popular music is and Calvin Harris is close to the top of the list We are entering a post mobile era. That’s a scary thing, to say to Telstra. We are entering a world where we are going to change and devalue the mobile phone screen. Today we are looking at that mobile phone scene all day long. But, soon, thanks to the guys like this, we are going to see the world in a new way. Let’s explore a bit about this. First, just to ask, how many people here have posted in the past week on Linked-In? Twitter? Facebook? These are all social media junkies! Google Plus? (LAUGHTER) There we go! We already know the world is changing here. How many people use ways to get to work or get to school? The traffic app? Come on! A few PshWe are heading into a world where the algorithm will control our existence. She’s right Coding is going to take over everything. By the way, every time I come here, I have – this is my fourth time at the summit, I meet incredible entrepreneurs like Melanie Perkins who started camber. She just got $15 million or Jody Fox who started her company. You are coming to a good place Let’s look at what we are doing Shel and I wrote a book. You will hear from Shel later. It is about how mobile and sensors and wearable computers and big data, and location data are joining to make a new kind of thing possible, Google now is a good example of that. But soon we are going to not be staring at that screen. We are going to be using something called Magic Leap or Microsoft Hollow Lens or that mega glass you saw. How many people have heard of Magic Leap? Google invested half a billion dollars in this company and they are just about to announce another half a billion dollar investment. Most of you haven’t heard about it yet. Let’s talk about what it is. This is an image shot through the magic leap glass. Note there is a virtual image on top of the real world. It’s properly occluded so that a fun thing is going to be — is going behind the table leg. It interacts with the real word. The sensors in the glass know where I am looking and know how I am moving around and I am seeing a bright and sharp image Ted said 20th century Fox – the futurist at the movie company, said this is Google’s first trillion dollar idea. Why would he say something like that? Because we are going to devalue… We are going to wear this and be entertained as we walk around. We are going to be able to put a chessboard on our table and play chess right there. We are going to be able to walk around the world and see what’s happening in the world I will see the tweaks that are up on the screen — tweets on the screen coming up in front of my eyes. It is already happening! Let’s talk about this stadium Levy Stadium, where the Super Bowl will be played next February. I know in Australia you play a day rent kind of football. But the stadium is important here. As you – if you go to the Super Bowl, if you are lucky enough to get one of those tickets, the guy who sells you the ticket is going to know where you are sitting when you

boy that tick, because you will put it on to the Levi Stadium app and it knows where you are It is going to know when you come to the parking lot, because you are going to have to check in at the parking lot, and if El Nino causes flooding in parking lot A, he can in real time tell your mobile phone, “Don’t go to parking lot A. It is closed. Go to parking lot D.” As you walk in to the stadium, you are going to be met by one of these things, called a Keyzar. An Internet of Things device. It is the name of the first 49ers stadium. That thing has a bunch of sensors. As you walk in the stadium, it is going to know you are there, and up on the big screen, up at the entrance to the stadium, your name is going to be there! Welcome, Monty Hamilton. You will stop and take a selfie and you will think it is the coolest thing ever, a stadium recognising when you are walking in the front door, without you doing anything. It is going to have ticketless entry, because your phone has a beacon in it We will talk about that in a second. Right here! A beacon People have a beacon on them, you know. A few people. They are little radios, cost $10 or less They spit three numbers into the air every 30th of a second Your phone can tell how close it is to the beacon. So if I had three or four of the beacons around here I would know exactly where you are sitting. The stadium has 2,000 of these beacons. It has 1200 Wi-Fi hotspots. It has 40 gigabytes of internet, in and out. So it knows where sitting Where you are standing. And I had one audience member tell me, “I am going to turn that shit off.” off the Bluetooth because I don’t want the stadium to know where I am sitting. That is a privacy infraction. I said, “No, you’re not, because you’re going to get food delivered to you.” (LAUGHTER) “If you keep it on.” There is a sensor – you talk about the bathroom. There is a sensor in the bathroom to know how long the lines are, and when you bull out your Levi Stadium map and ask it where is the bathroom, it is going to route you to the bathroom with the shortest line Because it knows where you are and where the bathroom is, thanks to these beacons. You should know about this guy. On the left. Daniel. The guy on the right is his dad, his dad started Internet Things developer. Daniel has created an app called Tupingo. Tap and go I call it. If you are at any university in the USA, you are probably using Tapingo You wake up in the morning and say, “I need a nie latte.” You go here and order it. It tells you your ice latte will be ready at 7:29am. It does that because there is a virtual queue, he figured out how many latte can make a minute and he put a box into the Starbuck’s, so Internet of Things infrastructure matters cap to this new world The box lights up, beeps, spits out an are e seat that goes into the work flow of the restaurant and they make your latte and you go there and pick it up. It is a frictionless transaction You don’t tap anything, you don’t touch anything, you don’t talk to anybody. You don’t hand over a credit card or cash, you just pick it up and leave. Now I thought that was pretty nice! But that’s last year. This year he told me, “I know where you are standing and I know where all your friends are standing, because everybody has a mobile phone and he has the GP is — GPS location of everybody in the system.” He nos my friend is already in the Starbuck’s, and he will put a notification on my friend’s phone saying, “Why don’t you pick up Robert’s latte and deliver it to class and you will get five Tapingo dollars?” He’s creating a new kind of delivery service, a decentralised delivery service, all for the mobile phone

I am pretty sure that when magic leap comes out, he is going to get rid of the mobile phone Because I am talking to guys, like Adam, who started Siri, where he is creating a new company where you talk to a world, an audio operating system. I will see it in couple of weeks. I will have a fun in class soon. I am going to just say, “I want an latte”, and an latte will show up! (LAUGHTER) A Cooper cafe, one of the coolest places to go if Silicon Valley, they take Bitcoin, and they have little boxes on the table. And they ask you to download an app and they say, “Well, you can do it the old way. You can get in line And wait 20 minutes to get in line and go and get an latte.” Monty, would that be kind of me to leave our conversation while I am talking with you for an hour and wait in line for 20 minutes to have another latte? No. I will pull out my mobile phone for the app and say, “I want an latte. You want one too?” OK. In two minutes they will bring it to our table, because they know what table you are at, because of the beacon in the top of the box. Sales went up 395% so far. I know you are going to do it because it’s going to increase sales. You take clicks away from people, you increase sales. You make people’s lives better, you increase sales. That’s why I know you are going into vest in this — going to invest. Let’s talk about grocery stores. They are creating a new grocery store, putting a beacon inside the cookie aisle and you are going to tap your phone and you are going to get cue ponds for that ail, and other things. If I am in the cookie aisle I will tap and it will say if you take 10 boxes of Oreos you will get 10 loyalty points. The company studes any time you say something about wine. If tonight you are at dinner and say, “I just had the best bottle of pen fols I have ever had”, or we are having a great time, or if you go to the Penfolds winery they put a v Joe sown sore on the winery. You go there and say, “I just bought a case of pen folds.” Think about what you just told the world and told his system. Penfolds is – what, about 100 bucks a bottle? More sometimes. If you bought a case of that, you just told me you make $100,000 or more. One tweet. If you go to Napa, and a $10 bottle of wine that tells me something else. If you come into my winery, and I am wearing magic Leap I will serve you differently. Based on what the app told me about you. Says you are walking in my front door with a beacon. Every one as a beacon. You probably have two Knowing Shel! I talk to Cantelope systems. Their family owned vending machine businesses for years. He said the old way of doing vending machines is stupid. My driver will have to go up to the machine, open it up, count how many Diet Cokes were sold, go back down to the truck, carry a bunch of Diet Cokes up, and maybe do this trip two or three times. While the truck is standing outside, probably getting a ticket because he’s double-parked, wasting gas, wasting labour expense, because he’s getting paid $20 an hour in San Francisco. Instead I will put a Jasper computer and internet of things computer in there that talks to the internet and now his vending machine tells his system how many Diet Cokes sell in real time. If there is a run on Diet Cokes because it gets hot, he can have a truck go out there and refill the machine But the machine is – the supply chain radically changed because now they have put a bin together for each machine and he only has to take one trip up, he doesn’t have to open it up to count anything, because he – the system knows how many Diet Coke s were sold out of the machine So, you radically changed and simplifed the supply chain Makes his employers happier, because they have to carry fewer things and make fewer trips upstairs and stuff like that Anybody have this device that’s called an Amazon Echo. I don’t know if they allow that here in Australia. You have one? Do you like it? You do? I absolutely love it! Every single person I

have asked in an audience says that. You know what? You are paying with toilet paper, right, because you talk to this ING and you say Alexa, I need more toilet paper.” It says, “Brian, would you like the Sharman brand you brought last time?” “Yeah.” Alex is play a game.” “What’s the stock market doing?” What’s the weather doing?” “Turn on my lights”, because if you have the new lights, internet connected lights, it’s hooks up to them and turns off the light It will turn off the lights in the bathroom or the kitchen, “Turn on my lights.” It is coming This thing is crazy freaky! Because it is listening to you, full-time. We are expecting a new kind of experience in the world. This is not looking at a mobile phone. We are walking around our kitchen. My boss has brought $10,000 of stuff off Amazon and Amazon has a database of every purchase he’s made When he talks to this thing and says he needs new cups, he – the system knows what kind of cups he buys. He says, “Would you like the red ones?” “Yeah.” We will have new shopping experienceexperiences, where we are going to be measured by 36789D sensors. I saw this already – where you just turn around in front of a sign that e-Bay is building. We are going to strengthen the amount of inventory that is needed in the store and the amount of floor space that is going to be needed to try new things on and you are going to try new things at home I mean, Flip Card is crazy Anybody heard of that? It is the number 1 e-commerce system in India. It will be the head of product and the numbers are just astounding. This thing is going to save your life! Again, you are not looking at a mobile screen. Maybe you are! But soon you are magically say, “Your dad hasn’t been out of bed.” It is already doing this It saved three lives. It is a little internet of things package that you put, a sensor on your dad’s – or parents’ – senior parents’ bottle, put one on their refrigerator, and within on the front door. It tells you if they don’t get out of bed. If they don’t get out of the bed, they don’t take pills or touch any doors. We are going to see new kinds of products This is coming, it is a new dog dish with a sensor. It tells you if you have fed your dog enough New kinds of wearable computers are coming. That tell you – like this one tells you you are not standing up straight enough There is now kinds of sensors for our garden, where we are going to put these things in and it is going to tell us to water our plants. We are going to get new kinds of interfaces for our cities, because there is going to be things like this that tell us there is parking available over at this lot, not over at this lot. The Google self-driving car uses this thing called a vechlt ladine – anybody has a subwoofer, Veladine one? I used to sell them in the 1980s. They were the best subwoofers. That is speakers! He has a factory because he shoved his factory to — he moved his factory to China. He started making devices for self-driving cars. Spends 80 — spins 80 lacers in the air 30 times a second and it can see what you are doing. Now, what Google is doing with that, is building a predictive system It’s predicting what you are doing on the ground. It is Age of Context technology. That’s how it’s going to work. This step is going to lead to start cities. I was in Dubai last week, and they showed me a work station where they could watch everything in the city, because they are putting sensors on everything, and people are using Ways, so they can see traffic patterns, and buying data from the cell phone provider. That is how you get the red line. If you car a Verizon fast it knows how fast you are going – or Telstra here in Australia – and it tells the data – it knows where the traffic is going. We are going to see new kinds of entertainment, thanks to virtual reality. We talked about that We are going to see new kinds of products for the ski slope This is Oakleighs ski Google

with a computer inside. It tells us how fast we are going, where on the mountain we are, where my kids are, and let me chat with them It shows me the hang time on my last jump, which in my case was not on purpose! (LAUGHTER) We are going to see new kinds of manufacturing systems. I saw this with one who makes a lot of things in the phones. They are building new work stations. The work stations tell you how to make things in real time, and they can reconfigure the product line if they figure out something is not working, they can retrain you in real time and they have a camera and send sores that watch you work, and so they can see if you are doing things the proper way. Let’s talk about my favourite topic! This is the demo I got at Occulus Rift a month-and-a-half ago, where I had – another guy across somewhere else in the world had it on too and I could see him and play with him, light things on fire with a little – true! Throw things, stretch things, shoot things. The sensors coming out – by the time we come here next year, we are going to have this, right. It’s amazing. Think about how this transforms education, things — thinks about how I might not have to fly here next year to give this speech. You might not have to be here. You could be watching this at home. Right. I could see you all and you could throw things at me and I can throw them back and I could be in California. That would be a lot of fun. A week ago I was in Dubai and a guy came up to me and goes, “I have a new product Doesn’t even have a name yet Not released. This is the first time it’s been seen in the world.” It listens to you. It is a little microphone that listens to you. While it is listening to you it is listening to the sentiment and the context of where you are, the sentiment of your voice. Are you angry? Happy? Are you saying something that might be important to call back later? You can even touch it and tell it, “This is really an important time to capture a note”, so if I have a thought, like I need to worry about my ticket, I will tap and sate, “Later on, can you remind me to check on my airline ticket”, or something like that. This is a problem. We are going to talk about this at 4pm in a little panel. The entrepreneur came up to me and goes, “How do I convince this is OK – people this is OK?” Because this is a privacy problem. If it is recording my voice 24 hours a day, record it — records it for two days on one charge, how do I bring the product to market? Imagine you are at a big company and you are trying to do this Your boss is like, “No, I won’t let that thing go to the market.” This is one guy who created a product with $10,000 of his own money and wrote an app. And it works! Our world is about to change and we are going to get new kinds of capabilities that are going to devalue our mobile phones. Thank you very much (APPLAUSE) Hang around! We are doing Q&A UNKNOWN SPEAKER: Thank you very much. We are going to hang around for Q&A. Ill welcome back Kathryn Parsons. Grab a seat, guys. You have seen the tweet feed coming through. Please throw your questions up with the hash Telstra Summit in the tweet and we will pick them up There is microphones around the room We will be on for about 10 or so minutes here. Please keep the Q&A coming and then we will be on for a morning coffee break shortly. Kathryn, why don’t we kick off with you. What is a data scientist? That is one of the things that we – we teach. It is tricky, because there is so much jar qon involved in the world of technology. A data scientist, at the moment, within business, they are like human unicorns! Except they actually exist Incredibly, incredibl rare. For me, there are different kinds of interpretations, also it is someone with business acumen and insight. Someone who can

actually manipulate data but also tell a really insightful story using that data or data UNKNOWN SPEAKER: Well, data Robert, your thoughts Robert Scoble His goal is to one consider next to you when you ask for a car. Not five, because that is too many. Not zero because that isn’t enough. And he’s using data science to figure out how to get one car next to you, right. So they had 3,000 catches at Cochella. That is a big music festival. They knew there was going to be high demand for their service. They called all drivers from the western United States and said, “Can you please come to Palm Springs and pick up people?” That’s what they are doing. They are using data scientists to know ahead of time what the demand is going to be and – like you said, tell the story. Great way to put it Fantastic. There are microphones around the room if you want to ask a question directly to Kathryn or Robert. One of our first questions that’s come in can can Australia become a technology leader? Kathryn you have chosen Sydney as your third stop for Decoded. Perhaps you can reflect on that? Absolutely. There is no way that we would be here unless we thought that it had all the ingredients that made it incredible for technology in innovation — innovation, in terms of culture, people, passion for learning, the fact that coding has been put on the national click lum, your can creating incubators, it is picking efficient — ticking every box in terms of that energy and that excitement. I cannot wait to – the next few years are going to be so exciting! Awesome. Robert, you have been here – your fourth trip My iPhone says you are 18 hours ahead of Cupertino. Think about that one! Jody Fox showed me how you can build a really interesting global company from Australia and there is a lot of tech talent here, a lot of business talent, and you need to work a bit more on fining rich people who will fund risky new ideas that I hear are still needed. You need to bring broadband to everybody, because – what is the difference between here and Silicon Valley? I talked to the founders of people who started here. They needed to move their headquarters to San Francisco They did so because there is internet infrastructure there that you can’t get elsewhere There is talent that you can get there. If you need to hire somebody who built a 20,000 node cluster, there is few places you can go the hire that person There is PR and money. There is business economy here in sill son valley that takes risks and funds risky start-ups. That is starting to be built here. It is exciting to see it. I am meeting with self companies tomorrow to see the latest Right. Good stuff! Fantastic Kathryn, you talked about diversity. It is a big challenge in all businesses and not to mention our own at Telstra. We are making steps. What are you both observing in terms of change, real change, gender and beyond in diversity in tech? There are a few contradictions in many senses. How can our business have attracted so many women – 50% females within the business. But then the facts and figures have never been worse and they are getting worse. So for me, it is about showing why this is important. For me, it’s the product that are increasingly shaping our lives and changing the world, borne out of an insight that is not female or – aren’t coded by women. We are going to end up – in that state where advertising wasn’t — was in the ’40s and ’50s and not understanding the needs of half of the population For me it is a high priority issue OK. Robert, you are based in the bay on the doorstep of Silicon Valley Valley I agree. We are in the third age of the personal computer. The first age was building a beige box that sat on your desk. The second age is building the mobile phone. That’s sitting in my hand. It has to be more everyone threat tack — empath empatheic. The new age is wearable, and we need new skills but the nerds, the nerds in sill convalley, are not skilled at fashion or empathenic interfaces. We need new workers and we need women to

be a part of that, and other minorites as well, which are very undisturbed in our industry Thank you so much. If a 14-year-old knows more about tech than a 40-year-old CEO, should they be scared? (LAUGHTER) I have met teenage coders and think – well, it is probably not legal for you to be working in my business but I would hire you! So, it’s a time where I think there’s a new kind of shift in power dynamic I love this kind of reverse mentoring, seeing – leaders are connecting with young, technical talent, investing in it, but also mutually learning from each other Yeah Increasingly, the young person is the CEO. I remember walking Mark Zuckerberg before he was the billionaire, back when he had 50 million users – he was already a pretty important CEO But now he’s real the most powerful CEO that I know of We are going to meet a young person who is going to buy an Occ zu Rift in the next year and it will beu see Spielberg. They are going to – he is going to discover how to create movies in the way a — that 20th century Fox is trying to, but 20th century Fox is aimed at building a movie for a screen. That’s a different skill than building a movie where the action happens all around you There is a Broadway play in New York called Sleep No More. It is a remake of Shakespeare. The action happens all around you That’s the still that we are going to need in this new statement world. It is going to be a young person who gets it I am too busy to create that movie and so are you. It will be the young people who come along and create massive new companies Fantastic By the way, somebody disagreed Mobile isn’t going away. When I say mobile is being revalued, music got devalued, Spotify and napster. It didn’t go away. The mobile is still going to be in your pock, because it is going to the — pocket because it will be the hub. We will look at it less. That means it will be devalued. We are going to create new things and new ways of interacting with the world that are going to have more value There will be less neck pain, because (LAUGHTER) Yeah! Or maybe less I will be in a virtual reality world and I might not see you here, right? That might – that will lead to a cultural shift. We don’t know where that’s going yet. We are going to discover that together over the next 18 months I know someone who’s enjoying the experience in variety yool reality so much. I asked hem how much of your day do you spend if reality versus virtual. It was a significant prosecutortion, it had been spent not in the real world Wow! Let’s take one of these other questions. In your opinion, what is the next major industry or service to undergo major disruptions? I think it’s happened to different industries at different times. It’s interesting to see that media, for example, are probably one of the most to be radically impacted. For me, I think the ones are interesting is wherever think think there is an element of human function or human trust that can possibly be replaced by technology. Because it is always that assumption that that couldn’t possibly be replaced by technology that gets undermined So, things like luxury fashion, through to private banking. I think they are right in the midst of a big disruption Robert? Entertainment. It is going to be the big story of 2016. We are going to get Occulus or Sony Playstation VR and we are going to get a whole lot of new virtual reality devices, Google is giving away millions of cardboard devices to New York Times subscribers, and there is going to be a lot of them. You are going to get them at trade shows because they will be handed out like handy. Because they cost $2 to make. Now you can experience the world in a new way. We will see – here is where I am coming from and why I am bullish. I watch people at both web summits, which you spoke at, and the consumer electronics show, come out of the demos of Occulus. Every person used an expletive coming out!

(LAUGHTER) They said, “Holy” – I can’t believe what I just experienced It is so mind-blowing. Until you have it on your face, you just can’t get how deeply this will change our society. And our entertainment. But entertainment is not necessarily in trouble Because the ones who invest in the new world – we are not going to watch TV any more on a screen. Or we are going to watch it less. OK. We are not going to go to as many movies. We are going to watch a lot more in a virtual reality. We are not going to go to as many sporting – so sporting people, the people who run the stadiums, are worried about are we going to go to the stadium any more? Because it is going to be far better to watch this thing court side, because I will be able to sit right next to Bill Gates at a basketball game! I have already talked to – in fact, the guy wearing that thing in my flight, he was director of IT as the Golden State Warriors. He is saying there is huge demand in China for his sporting events for virtual reality. He is going to put virtual reality cameras around the court. You are going to have a better experience in China, watching the Warriors game than if you were sitting there They are on a bit of a roll. Any prediction force the season 2015? Closet fan from down under! I don’t do sports! (LAUGHTER) We have a question from the floor. It is our microphone 2. I am just interested – with regard s to what’s being talked about, how do you combat the tin kum ban — the income ban say to stop the disruption. Uber is the example where they are fighting in NSW to actually be legal We are in a period of friction That new device I showed you – changes what we think of this privacy. There is laws against recording conversations without both people’s permission. We are going to see continued efforts by Uber to fight the taxi industry, who is – let’s just put it this way. When I walk into a city and they don’t allow Uber, I assume it is because the government is corrupt. Uber is – to me, is a far better experience than any taxi system I have ever been in. It lets me see in real time the rating of the driver. The driver knows who I am. She or he is safe or un safe, because if something bad happens, everything is captured And I can prove it in a court of law. This guy murdered me or my – you know! (LAUGHTER) You can’t do that with a taxi because you don’t have the data You can’t do this. So, when I go to a city and they don’t have Uber, their behind, and they are corrupt. I go to Las Vegas, they don’t have Uber – until a week ago. They stopped a light rail, a quarter mile from the airport because the taxi system is so powerful and pays off the politicians and it is so corrupt So, we are going to see a decade of where we have to figure out how to influence the political system to allow better systems to evolve It is a great question Fundamentally it means that governments, the people kind of making – drafting legislation, need to be digitally literal and aware and be payable to think five years into the future. You need to be unplug security to put in place encryption laws, otherwise it is like stabbing in the dark really Fantastic. You heard from Senator earlier that Malcolm Turnbull is the most tech savvy That ended our question this morning. We will try to get back to you on Twitter. Coffee time We will kick off again at 11:30 A big round of applause for all of our speakers Thank you!

(CHEERING AND APPLAUSE) Lethal generosity

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Stash Trip local, trip alocal V class. Vendee Visitor Watt bloc. Xeer, zero : Zed Technology s Welcome to Ericsson’s Live Remote Captioning Service

Welcome to Ericsson’s Live

Remote Captioning Service

Welcome back everyone. If you can take your seats we will be

kicking off in about one minute So, grab your seats, guys! I hope you have fuelled up with a coffee Welcome back, everyone If you can take your seats, we

will kick off with our secession. I hope you have all managed to fuel up on coffee. I am reliably informed the baristas are in high demand and producing quite a good product out there, even though we all know Melbourne is better for coffee than Sydney! (LAUGHTER) There is a few of us here. Good! So, as we kick off our second session, I wanted to take time to reflect on some of the insights, particularly from Kathryn this morning on Decoded Joining us to the stage now is Annie Parker, Holly Cardew and Cate Hull. Let me tell you a bit about Annie Parker. She is the cofounder of muru-D, the start-up acceleration program in Australia and Singapore that’s funded by Telstra. In addition to muru-D, she is the director of of the code club, a network of coding clubs in Australia for children aged between 9-11. We have heard already the importance of early education in terms of technology and coding Holly – sorry, Anne will be joined by Holly Cardew, the founder and CEO of pixie . Not only is Holly running this fang business, she was the winner of the 2013 Australian digital school/ship. After lunch, or a bit later in the day, we will be having the 2015 installment of the Australian Digital Scholarship. Al of you here and those online will be able to participate and vote for the winner Holly is an alumni of muru-D and she will be doinged by Cate Hull. Cate Hull won the 2014 Australian Digital Scholarship We are in good company. Without further aI do, why don’t I welcome back do the stage or up to the stage, Annie Parker, Holly and Cate Hull! let the ladies grab a seat first. I will put the microphone down. One of the things that you will note about the speakers we are at a little vertically challenged! (LAUGHTER) It is a pleasure to meet you guys here. It is the first time I have actually been to the Digital Summit. I have always wanted to be here, but it’s too first time managed to coordinate the diary. For those of you who don’t know what muru-D is, I am about to put myself under the spotlight of what we do for our start-ups pretty much every single day and the saying to Holl and Cate they will have to do a 60 second pitch. If fine is timing – Mick, I know you are in the audience. I will give you the 60 second pitch of muru-D Good morning. I am Annie Parker, the Co founder of muru-D, which is Telstra’s start-up accelerator program. We take 10 start-ups, we invest a small amount of seed capital for which we take around about 6-8% equity stake in that business and over the course of the six months we bring in industry leading mentors, advisers and coaches, and essentially help them kale their business and go global. So far we have three act second ray tor globally, one here in Sydney, one in Singapore, and a partnership that we are trialling in Brisbane. So far, 34 start-ups invested in, three different locations, as I mentioned Nearly 100 entrepreneurs that we have actually helped to education and bring forward to help grow the ecosystem here in Australia and Singapore. I am delighted to say that as a result of that we have generated over 5 million worth of capital invested in those start-ups, on top of the million dollars that we have already put in to those businesses. What a great way for us to be able to build the ecosystem from the ground-up and help these wonderful entrepreneurs achieve a global business! How did I do? Got it! (APPLAUSE) (LAUGHTER) OK. So, that was the muru-D pitch. For any of you who do want to find out more I will do one small plug. Hands up how many of you in the room have already been into muru-D or mentor a start-up outside of the muru-D program here in Australia? There is quite a few hands. Awesome. However the majority of you haven’t. So, my personal plug – please get involved. There are so many different programs here in Australia now for you to give your time Tom. Imagine, think of the knowledge capital sitting in this room. If we were able to apply that thinking, apply that learning and experience to the next generation of entrepreneurs, we get to short cut their success. So, please, do get involved Obviously if you want to get involved the muru-D that is

awesome too! Now, I will talk about a few things we have already heard. It is kind of fun to do the impossible. And with technology — which technology will kill your businesses. The chances are somebody is already out there building it. I will introduce you to Cate and Holly and who will give you on background These two ladies absolutely manifest exactly those two statements. And you will find out more now. Holly, why don’t you start with a 60 second pitch At the moment we provide on-demand image editing services and on the mication services for e-commerce stores. We are building an end-to-end producting listing solution E-commerce business owners don’t have to sit at their computers uploading content, optimising it and then pushing it to every platform and market place they are selling on done. Nice work. Cate? I am Kate CEO of freight exchange. The problem we are solving is one in five trucks on the road globally are empty You can imagine the enormous waste and the imposition on our environment as a result of that Our solution is to develop a technology platform, where businesses can seamlessly and automatically buy and sell freight capacity. We launched in April, we have got over 300 trucking companies on the platform, tens of thousands of trucks. And our next step is to look at international markets so we are travelling to Indonesia tonight Both of you beat me. I feel like I have done my job right! Holly, you won the scholarship a couple of years ago. Remind us where you were at with your business? When I first pitched I had a landing page and maybe under a hundred customers. Now we are over 5,000, and in over 15 countries Amazing. Clearly winning a scholarship like this gives you some PR coverage, but one of the things you guys got to do as a result of winning… Yes How was that? Fantastic. I mean, what is interesting is seeing the difference between SydneySilicon Valley. South by south-west is in Austin but the majority come from Silicon Valley. It seemed like an international community but focused on the same things – helping each other. So, I found it interesting that in Austin everybody’s really open to sharing and helping you grow your company How about you, Cate? That is my official happy place! Possibly the most I-opening most frenetic, most ideas that I have been exposed to in the space of four I would ex-Co the cutting edge of thinking globally is on display there. Companies that are 3B Pty Ltding limbs, everything that you can possibly is on display, and, also, some of the fastest moving companies And obviously it was a year ago, pretty much to the day that you were on stage pitching. What changed? I don’t even know where to start! Everything! (LAUGHTER) We were justem barking on muru-D at that stage We were at a similar stage of development, with very few customers. Since then we launched, with a lot of customers and filled a lot of trucks Fantastic. What is the end vision? So ultimately our goal is to be invisible and to be a global market police where freight capacity is automatically optimised, and to really change the way – the way freight is moved around the globe Back to you. One of my personal stores that I love about you – amongst many of course – is that you are from Orange. One of the things is the story of how you built essentially what is a global business but from regional Australia. What advice do you have for other budding entrepreneurs who have a similar maybe background to you? The biggest thing they learnt was because I didn’t have anyone in Orange that I could hire, I immediately went global. I looked for people online, I had people in eight countries who work with me. It works well for us. It is like – even then and it does today. So, I think for other entrepreneurs, it is like you don’t have to look just within your surroundings, it’s – there are people online, there are people all over the world, there is talent all over the world. You – I know that it does

work well when one is sitting next to you, but if you is set up good processes then you can have a global team and do a global business Cate? Any – I think you are from WA? No Going Back Now: The Intersection of People, Business and Digitisatio PCate? Any – I think you are from WA? No Going Back Now: The Intersection of People, Business and Digitisation We did start in Fremantle. What I am trying to say is we can prove just by the two founders that we have on the stage that you can global from day 1 What advice do you have for somebody looking to do something similar? To deliver a global company Distributor teams are incredible. I have been fortunate to travel to a number of countries, and observe what our competition is doing in China and in South-East Asia. To learn a lot from how other countries and regions are doing, solving the problem, is really important. Yeah, likewise, the distributor team is gold The other thing is you can contact – like a customer anywhere in the world. They will respond. You don’t have to contact people just here One of the other things you have done since grade waiting was to get accepted into one of the sort of leading global accelerators, 500 start-ups What did you learn from that experience that was different to what you learnt here in Australia? 500 start-ups, 60% of people were international. I think, again, you learn from every culture, different backgrounds straight away and everybody is coming from a different place so they are already thinking globally. The other one – the other thing is that with 500 start-ups, — Silicon Valley style, everyone is helpful, it is no longer competition. Every corporate company, start-up, every person is willing to help you and I think that is extremely important, because either your company is going to make it, and someone is going to want to acquire you or your company is going to fail and someone is going to want to hire you Everybody is helpful because they know at the end of the day you are all in it together Cate, I think you have been out in the wide wall, post-grade waiting. For or five months? What have been your learnings since leaving the program and seeing this Christ lie for you? One of the greatest learnings, mixing the audience – you will be delighted to hear this – is we need to move faster and faster, and that doesn’t mean to do things in a stressful or panicked way – although that does come into it occasionally – but it is basically putting that rigour around testing, learning, testing, learning, and I can say we are absolutely moving at a breakneck speed relatively He will be delighted! I will ask you a question now around – if you could change anything about the Australian ecosystem, what would you ask for and wave a magic wanded over and say, “The great if we had this.” Holly? Two things. Investors need to take more risk. It isn’t about how much revenue you are making today, it is what your vision is, and the money you need to get to that vision. And then the other thing is I would definitely say people partnering together to help you, even if it is just to test product. I know people are closed to testing products because they are buggy, they don’t work and they are not interested in helping you until you have a brand established Cate? I don’t have much to add! (LAUGHTER) Apart from that, but also be – to support female entrepreneurs, and also to get education in coding. You know, we have got a very resource-heavy education-heavy industry here, we should be making more of that On that point, around encouraging more female entrepreneurs, what do you think needs to change? Or what was it that inspired you, as a woman, to go and create a business? Lots of things. I just wanted to – like many Australians, I wanted to be my own boss. I think wanting to – I want to make a difference. Seemed like a good way to do it What advice would you give to other women potentially wanting to take that leap of faith as well? Do it! (LAUGHTER) Give it a go. I was fortunate to have amazing network of – support network. Maybe seek out your support networks and take the risk Holly, anything for you that made you think, “I am going to do it anyway”, as a woman? Anything holding you back? I have always been entrepreneurial, even 16 years

ago. It’s is difficult being a woman because you are seened a the admin or the secretary that turns up to the meeting. You just start to ignore it, and you stus – I don’t know, you do your job Rise above it A couple of questions. I will bring it back for muru-D. For those who don’t know we are open for applications now until 31 October. Please do apply! (LAUGHTER) Shameless plug over! What was being part of an accelerator program like for you both? I think the best thing is that you are surrounded by people who are really inspiring, and the other thing is if you don’t know something, marketing, business, growth side, but not so much the technical side or the hiring of certain people, and sow you can learn that from — so you can learn that from being surrounded bid other people Absolutely. Being a start-up means that you are competent in two or three things and every other element of the business is an area where you need help So, Telstra – you can reach out to people with expertise all throughout Telstra for that help, working with other businesses, which is a gold mine of information. It means that you have got 20-30 other companies who are making mistakes that you don’t have to make! (LAUGHTER) It is an amazing network Then we have three of the – three other staff from the muru-D family pitching this afternoon for the next Digital Scholarship. What advice would you give those guys? Keep it short, suss pint, talk about your problem and your solution and how big your vision is Cate? Yeah. Tell a story. Make it exciting Cool. Well, that’s pretty much us done. We have rattle through 20 minutes of questions quickly And please thank Cate and Holly for joining us today (APPLAUSE) Thank you. I say, again, if you have n’t already got involved in the ecosystem. It will pay you back 10-foal. Please pay it forward, people Thank you very much (APPLAUSE) Awesome. Three fantastic stories, muru-D and a couple of other scholarship alumni. Thank you very much, guys. What an awesome session! An awesome session! OK. Next to join us is a gentleman by the name of Rob Tarkoff. Rob is the President and CEO of Lithium. He is responsible for the strategic direction and corporate vision and inter supervise software — enterprise software company who’s total platform helps brands build trusted relationships with customers helping people get answers Prior to joining Lithium Rob ran the enterprise – digital enterprise products at Adobe. To join us, tell us who is getting it right and what opportunityes, Rob Tarkoff, welcome to the stage (APPLAUSE) Welcome back. Fourth year in a row Lithium have joined us Great to have you here! Alright. We haven’t talked one about rugby! (LAUGHTER) Yeah. I was not watching it at 2am. I will be honest! I had to speak today and I promised Monty I wouldn’t I did watch the highlights. An incredible game I am a US rugby fan. That was a huge mark. Way to go everybody here! It’s been an incredible panel, set of panels and speakers this morning, and I think when I see all of the technology that Robert talks about and the leadership that people like Andy and the centre are talking about and just the wave of the way technology is changing, I think, well, of course, it would be easy for companies to just seize this and adopt it and implement it in to their systems. I thought the perspective that I could offer this group – someone referred to you as the digerati of Sydney – I will be careful I don’t dry to dwell v into — delve inis topics I don’t know One thing I do know is my personal story. The conversations I have been having with CEOs and CMOs across the world. When I was at Adobe running the digital enterprise business I ran the PDF. My wife would say the reason I left is because I got tired of being assaulted at cocktail parties with people telling me that their reader download didn’t work on a mobile device (LAUGHTER) That is not the reason I left! The reason I left is because in about 2010 and ’11 I saw an incredible phenomenon taking

shape. We have heard a lot about it today. It was a phenomenon that was hitting the corporate world by storm. I thought that it is going to be a whole new system of technology, a whole new system of engagement that is going to guide the future. It will transcend devices, it will transcend form factors. It will be more about behaviours of companies and how they adapt to the future So, I thought a lot about this concept of customer change and how we could get corporations to change. But the trend that was emerging with something — was something interesting. And that is that the trend is total fear Totl fear inside a company, almost terror. You can understand it when you watch presentations like you saw today and you saw the incredible motivation of the start-ups, that came up, the comment, the absolute brazen ability to go in and say I will get acquired or get hired, it doesn’t matter. I will compete. Effectively against the established companies. It creates fear. Fear that almost makes these large companies freeze. Because business, as we knew it, and Andy talked about — about this, is going forever. How many here went to business school? OK Throw away all your books, all your case studies, everything you learned. It is all irrelevant. Because the kinds of conversations that I am having with brands today is about an entirely different world, about an different set of behaviours So, we decided to do research Last year Brian Solis is up here and he spoke about the phenomenon which he referred to as the magazine as an iPad that doesn’t work. I loved that! I loved that! I have to give credit to Brian. Because it is about that complete change in the customer and consumer behaviour, the way they perceive products, the way they perceive brands. And the way they perceive service. It was great to hear Andy talk about customer services a a key priority of Telstra and one of the areas they are trying to differentiate thoemss, but for the most part you have to agree in the old model, the one we have from business school, customer service was an afterthought, it was the realm of the contact centre, it was the part that you funded the least, it was where you outsourced the Labor and you tried to get arc Tarj on technology investments. It was the last point in the journey of the consumer. Right. All about marketing, sailing and re reaffirming your purchase decision and then service came at the end. The problem is today – this is Australia-specific data that we looked at – 67% of Australia’s — Australians agree to pick up the phone to call that customer service agent, that contact centre that you invested hundreds of billions of dollars in, you have already failed. It is a complete failure, the experience is a breach of trust By the time they – you call them, you have failed to meet what we refer to at Lithium as the era of extreme expectation Not so extreme in our consumer life, right. We live it every day. We have a card at the push of the button, ready make ingredienteds for milk, packaged and deliver on the same day. On the corporate world, back into buildings, go up in the elevators and think about how or consumers act, we don’t think about the new model, which is service always comes first. And service is the new marketing The second piece of data I thought would be interesting to share is that in the old model it didn’t matter if you failed in a customer service process If someone was fwrus frustrated that they found their Kai to the call centre, it didn’t matter because it was an isolated incident The problem today is a 46% of Australians – by the way you Australians – this is a higher statistic than the Germanys or French or Americans – 46% are more willing to share a bad experience than you are willing to share a good experience. You would rather talk about the problems that you have with the brand, than praise them on social media. In my conversation that I have around the world, I still oftentimes get the corporate resistance Even though they know this can inflict massive damage at breathtaking speed. We see it all the time. I get resistance because CEOs and CMOs and chiefs of customer care – they say, well, you know, we don’t care about those people. They are going to gripe anyway. They are narky customers. They will go out there. Nobody pays attention to them anyway Research showed something different. This is probably all intuitive. 68% of Australians

will not buy something that doesn’t have a positive review online. You guys agree with that? 68% of you. One of the highest statistics again. You guys are so far out ahead in really thinking about peer review and trust established between different customers, rather than between a company and a customer. 68%! You should care if you are a brand about the really bad things, the 46% people are saying, not because you care about them, but because you care about the 70% of people that they impact. They won’t buy your product. You can’t ignore the experience of vocal detractors, but, still, across the globe lots of resistance to this point of view. Last year – how many of you were here last year at the Digital Summit? Not that many. Great. You haven’t heard this story. One of my Klout, we thought that over a year ago. E told a surprise and delight store. He told a story of a stake house who was listening to blogger. Someone was flying to Chicago. They said you know what would hit the spot? A porter house. Moreton delivered the porterhouse ” My God. Incredible service.” Tweeted about it. It was a great story. It isn’t realistic. It is not what most customers expectfrom brands, in my opinion. Most people want you to do what they have entrusted you to do. They want you to do something that they are allowed to share with others within the context of their relationship The only challenge is that they want it right now. In the old model, instant gratification was considered an aberration. Most people are OK, they understand the human condition, we have priorities, there is queues. I have different things I am working on. Not in today’s world. In the new world, of extreme expectation, 72% of Australians want instant gratification from any online interaction. It isn’t just having a conversation. It is providing them the right answer that they want at the time. They expect you, as a company, to leverage everything that’s available at your disposal. If you think about all the stuff you saw this morning, all the technologies, all the capabilities to bring that into play, it is a lot of things to incorporate, unless you change from the old model to the new model way of thinking. Finally, a large percentage, 40% of Australians, expect an on-line response within an hour. How many of you work for companies that provide consistent online response within an hour? Not a lot of hands. Good for you guys Because you are satisfying almost half of the population who will make decisions about the brands they want to do business with and the places they want to work, based on these kind of statistics. So that’s the world of extreme expect taxes. It is the new — expectations. It is the new model of consume ever. I go around talking and everyone shakes their head, I get Uber, Amazon Prime, I live all of that, but we are not set up that way. That’s not the way our company’s been built. If we are going to change we need to understand what the new reality is. When we get into this conversation, we talk about the experience of the consumer. We talk about the experienced consumer in the context of how you responded to business. I love to tell the story of what I call Daniels market theory of interview. Heard of Daniels market theory? Economists out there? Good. You shouldn’t. It doesn’t exist. It is my son, my 14-year-old son (LAUGHTER) He has a DJ business Like Barry there! He does really well with his DJ business. He is very talented, an artist, not much of a business person. But he constantly has to buy equipment DJ is very capital intensive business. You have – need to be able to look at the stuff there You have to be upgrading. He picks a really good business partner – my daughter command — Alexandra. She will be the CEO who will replace me. I said it here! She said OK, I am the

artist. She is the businessman We will work with dad and figure out how we get him to front us some money so that we can buy the DJ equipment. It turned this into an experiment. How are you going to go about this? Think went on their purchase — they went on their purchase journey to buy the mixer. All of you know this – because you do it every day – you discover through search, looking at videos, images, consuming different content that is out there on the web, you compare it through ratings and reviews. He want to get in the mix.com. I don’t know if you have been there Barry! The great sites that talk about how to look at different DJ equipment at different points in your evolution of the business Then he went to the comrunlt — community to compare prices. He connected with all his friends on social media to compare different things. He built the DJ total community himself around the experience. He bought a new mixer, but nothing in his discovery ever came from new mark. Nothing was part of the old model of the way that new mark was the way it would think about marketing or product promotion or building loyalty Again, nothing earth shattering here. We all do this. When I talk to large companies around the world, I don’t talk about technology, which may seem strange. I talk about behaviour The issue is behaviour, like my Australian selling of behaviour! Pretty good! (LAUGHTER) Not how we spell in the US! You see it now! (APPLAUSE) Hey! Locally sensitive presentation! (LAUGHTER) The issue is behaviour. And recognising the behaviour is recognising that the customer experience is fundamentally different. It is an experience driven by a behaviour that establishes trust in a very different way than the old model product. Extreme expectation, says that the brand doesn’t dictate the experience We came over with a great expression with Lithium – I would love you guys to tweet This is my favourite – if you like it Brand is negotiated, not declaredin this world. I love that statement. I don’t know who came up with that. It wasn’t me One of my people on my team Brand is negotiated, not declared. Because to build a customer experience in today’s environment for a large company that aren’t the new start-ups, that are entering world without the income ban say, they have to rebuild trust through a negotiation with the customer Andy talked about that today, scale is often times not an advantage. Because you have to rethink the way that you build trust with a consumer. So, here is the challenge – few Australian businesses are doing it. In May of 2015 there was a new consumer experience index It talked about very few companies that are making this change. Tactical, not strategic changes. Lack of understanding of the true customer journey Lack of ability to invest deeply in the data that’s able to them to change their processing They need to know what they don’t know about their customers That’s the conversation I have when I go around the world. You can’t think about digital transformation, you can’t think about technology overhauls until you actually understand how your customer has changed forever and how nothing you did in the past apples any more. So, it usually results about this point in the conversation in one of three reaction from the company. The first is total denial. You are one of those upstart Silicon Valley CEO-types and our blazer and coming in and telling me the world has changed, it isn’t real. Go away! I deny that this is happening We are going to stake to the things that we do and good luck! Most of those businesses in the four years I have been at Lithium- they are gone. It is happening fast now The second phase or wave that most people find themselves in is experimentation. Most execs are not like that. They say I see it. I have corporate maverick. They are the really smart newly minted Med MBA that everyone will tell you I will run the company. I will put them on the project give them discretionary funding and let

them go. It is what I call new technology, new behaviour, but not to scale The third wave – this is where I find a lot more companies arriving, particularly here in Australia and I will talk about some of them – is courage. The courage to accept the new consumer extreme expect tax, and a– expectation and adapt businesses. My point to you is in light of all the digital transformation that is happening, not enough companies have the courage to make the change to survive what this transformation is going to do to them. So, if you are one of those companies, how many here represent companies that are established with over 25 million, 15 million in revenue? A lot of you here? Great. My thoughts that I share about the behaviours to move from wave 2 experiment mentation to wave 3, because that is whether most people are. Most people aren’t in denial. The first diversify your team. Immediately. I don’t just mean the traditional diversity, which you should be doing anyway around age and gender, and nationality, but I mean diversify the skill set Make sure you have people that understand all aspects of this consumer behaviour and these extreme expectations. People who understand the data that surfaces. You will hear from Uber shortly and they will explain – I imagine – the way that Uber runs a business on data that didn’t exist when any of us were in business school That is their data set. As we move forward, the sharing economy, all of the new technology companies are looking at data as a gold mine. They diversify the go of the brand Daniel’s market theory does not require you as a brand to promote messages to the consumer. It requires you as a brand to curate and host conversations about topics that are important to you, to be seen as somebody that a consumer can trust, to be seen as part of the conversation, not somebody only interested in the transaction That’s the fundamental difference and a good – a big part of moving from experiment tax to courage. Gather data from experts. When Daniel was searching for the new DJ mixer, he didn’t know who was going to be the person to give him the answer, but he did know the type of person he was looking for He wanted somebody with experience with reputation, with ranking, he wanted somebody that was trusted by others like him. He wanted somebody who was prolific on topics important to him. He didn’t care what company they worked for or what job they held. He just wanted the know they were passionate about the topic. Oftentimes the super fans of a product gather data from influencers and experts because they drive your business more than anything else Finally, take money from the core faster than you are. If your company — if you are a company still spending hundreds of billions on call centre technology and not putting money into the things that matter, you got to move faster. Let me tell you the story of companies quickly MYOB – a company that moved from experiment to courage. Many of you know. 1.2 million customers in Australia, cloud accounting service provider. They went through their transformation from on-Prem to cloud. Stock turned off. Email support. They built a community, invited their 40,000 partners to that, so they could provide expert answer and help the transformation of their is.2 million businesses moving from accounting software to cloud Dramatically changed their business. Helped them move ahead much faster than they would have in that transformation Cross-examine — CoMcast. I don’t know if you have heard of them out here. US cable provider. Often berated for bad service. It decided that a key part of their business was going to be to use the new model the way their consumers are talking about, as an an early warning detection. They are able to tell when an outrage occurs in a certain area of the United States faster then they are in their call centres and able to get there and create the kind of conversation that they want around that. In addition to saving lots of money and driving up the reputation British Gas very exciting company! Imagine saying utilities! Believe it or not, British Gas was able to tap into all the conversations that are happening around hot water heaters, and lifestyle

issues around home appliances Instead of selling products, in the old model, British gas was able to provide expert advice from the community and inside the company. Come Source Bank the first digital bank in Germany to change the way they talk with customers. It was about sur fags peer content. They were able to drive conversion up 30% by putting that content in front of consumers from others like them as opposed to the brand. And, finally- sorry, go back. Sorry We will stay with Telstra (LAUGHTER) Finally, Telstra Telstra, as you guys know, has done an unbelievable job in building an incredible community. 250,000 members of CrowdSupport. They have been able to innovate and drive knowledge over 80% growth year over year. More importantly, they have learned to make this so central to their business that when new products come out, the entire community’s fuelled the training for the rest of the company. 17,000 employees at Telstra have to know about the new iPhone, 15 days after it launches. An impossible task if you are not leveraging the best parts of digital transfor places and changing to the new model are the way consumers find information Hopefully at this point I can do my 30-second info commercial You are probably wondering who are you guys. We are software provider with a largest in the world providing total community solutions to large brands. It consists of three parts – we listen and engage over social networks to help the brand understand who’s talking about your product, and how do you interact with them to build the most engagement We help you build communites on your own websites, you can curate that conversation from social on to your website, to help drive sales or drive down coast or create expert knowledge to run your business. Finally, we help you tap into your influencers. Your experts, the people who know your brand, who others – other consumers will trust as they make their decision. As you leave today, I wanted you to think about the set of conversations I have had for the past four years. I end with three questions. I ask you to ask yourself these questions First, if you represent a business here, do you understand your customers’ extreme expectation? How many of you think you do? OK. That’s honest. Thank you. Think about that. Think about the ways your customer interacts in new models that you haven’t prepared for Secondly, ask whether you can meet it with current investment Most companies that I speak to still have 90% of their stuff chasing infrastructure, technology, processes that don’t matter any more. Finally, if I started from scratch, what would I do if I had a blank piece of paper, and I could build companies like muru-D if moneyng and financing, was able to build from scratch, how would I do it? Would my legacy be a burden or a benefit? Would I move money faster, away from core, to enable me to flourish in the new economy? I hope you take some of these comments away, as you think about the transformation happening as a result of extreme expectations and the business needs to meet them. Thanks a lot (APPLAUSE) Wonderful. Thank you very much, Rob. Thank you very much. We are going to have you back shortly for some and da Grab a — Q&A We will kick unlawful. Three stages, denial experiment and courage and understanding how your customer has changed forevertheir behaviour has changed. Fantastic. Continuing on the theme, we have heard this morning a number of references to Uber. Why don’t we ask a slow of hand – who took an Uber in the last 24 hours in the room? I think you will be happy with that David! (LAUGHTER) Not to steal anyone’s thunder by David Rohrsheim is the general manager of Uber in Australia and New Zealand. David was living in San Francisco back in 2012 when he met the Uber founders and agreed that Australian cities needed a better way to get around. After initial launching in Sydney as Uber’s third international city, David has since helped Uber expand to nine cities across Australia and New Zealand and there is more to com. Creating thousands of jobs

Please David Rohrsheim of Uber! Go for it! DAVID ROHRSHEIM: There is one second question – is who here has given a ride using Uber app? That’s the next frontier for us If you have a good driving record and a car that’s in good condition, I think everybody should during their spare time Oar their journeys share the empty seat in their car. Rob was right – we started with data on or first slide. This is a map generated from Uber’s journeys around Sydney. A bit oh out date. We have spread further across the city now. Very excited to be here at the Telstra dij the summit. Any opportunity to speak will be great but this year’s theme is superrelevant to us, the discussion around convertions between different technologies, business models and peel is what made Uber possible. No-one thing was necessary for Uber But quite a few. I will talk through the Uber story in Australia, and what technology made it popular This is a low res picture but it was so good I have to use it This is the current experience or this was the concern experience of taxis between I joined Uber in 2012 and our founder in 2010 were motivated to start Uber because they were unhappy as customers with the experience they were getting The senator Fifield made a pitch this morning for all of us in the digital community to get involved in the digital transformation of government. I am sure few people were thinking I don’t know how government works. I don’t know what services and technology they need. But if you are a customer and you know what good service looks like, if you know what a good experience of a transport office looks like, if you know what a good experience is registering a business, then you are qualified to get involved and be part of that. That was the beginning of the Uber journey. No-one in the business was a taxi driver or knew anything about dispatch. They knew what good looked like and what bad looked like. This picture shows one lady holding her shoes. A good sign it’s been a fair while out on the road trying to get a ride. That’s not safe. She should either be still in the bar having a drink or at home and not out on the street The individual peeking through the window is involved in some sort of a negotiation for the opportunity to be a customer and pay money for – to a driver to drive him home. He’s also out on the street. Tragically the father of two died on Paramatta Road trying to cross the road to get a cab. The process of sticking your hand out and trying to negotiate through line of sight is not the best we can do with today’s technology. I won’t dwell on how the app works but I will talk about the ingredients technology changed So Uber was only possible once we had smartphones with strong GPS, strong data connections That’s why Australia was one of the first markets globely Telstra has done the good job raising Dan starts, get — standards. And GPS and maps Those are starting conditions to rethink how we can improve that experience. Fundamentally we talk an anonymous transaction and made both parties accountable. So, you as the passenger are handing over contact details, mobile phone number, credit cards, which were verified, and the driver also – once you request a ride, you will know their name, the photo, their vehicle, their registration. If you need to, you will have their phone number, but in most cases you don’t need to communicate. We know where you are from GPS. And the moment that trip’s been requested, accepted, you can then in stage 2 here watch the car driving to you on the map We are obsessed with getting you cars superquick. We are down to 3.5 minutes on average in Sydney. But in the early days it was n’t that fast, or that good And sometimes it was a 10-15 minute ETA, and riders were tool can it. The insight there was they were happy knowing it was coming. That transparency, to see there is a car coming, I know for sure, that John is coming do pick me up, and it is 10 minutes away. I believe it because I can see it on the map and see it advancing towards me and the ETA updating. If I need to I can call and confirm that Suddenly, customers are calm,

becausetive transparency At the end of the trip credit card’s on file, no money changing hands. Huge step forward for safety of the driver, they are not carrying catch. The biggest incidents in taxries are passengers doing a runner, in Uber every ride is a runner! Or someone breaking in to the cab because you know a cab will have a certain Alt of cash in it at any time of day Finally, the rating system – there is talk about what kind of a rating do I need to get to get kicked off Uber? It’s not really the main focus. Just knowing that you are going to be rated – goes both ways, drivers are rating you on Australia Day everyone needs improve their behaviour. The worst day of the year by far! (LAUGHTER) Just knowing you are going to be rated means people bring their best behaviour. You are not aamong mouse, fearful of another anonymous stranger, you are accountable. That is the technology that made Uber possible. Nobody thought it was going to be a big thing in the early days. Here is an image from a Saturday night in the early days in San Francisco Originally Uber was just a club It was an app you could download but you needed a password to use it. It was Travis and Garrett and 50 of their mates. They would show up. Say, “Watch this”, a car shows up, feels like their own personal driver One by one their friends said, “That’s awesome. I want that too. Sign me up?” ” At some point they realised this was actually a business. On a Saturday night, four trips. The blue line, trips in progress, the individual holding briefcase is waiting to get picked up, always holding a piece case– briefcase. Come a long way. Turns out getting a ride — getting a ride when you need it is a global problem This is a typical image from Sydney. We are in 300 cities world wide. Last week in Australia we celebrated 10 million uberX ride. We are excited that we have tapped into something that – it was fundamentally disappointing Ebber X was — ebber X was — uberX was the real innovation uberX taps into the cars that a city already had. Uber black did that with them scenes, but uberX is tapping in to a city like Sydney 4 million-plus cars, of which ill like to believe at least a million are in good condition,ing with a responsible driver. We are just making better use of what the city’s already have. Subject to the appropriate background checks Instead of spending billions on more roads and tunnels and infrastructure, that’s the current government’s mandate from the last election. They brought at least a $10 million spending plan to combat congestion and efficiency in the city. We think we can start by making that better use of what we have already got. So Uber is the software for the city’s hardware. We make existing infrastructure work better Building a tunnel takes at least five years to talk about and at least five to billion it. Uber, we have 10 million rides in a year-and-a-half. Somewhere can move faster than — somewhere — software can move faster than government or infrastructure Another feature worth focusing on in the sharing economy is the part-time nature of it. This is a story that was published earlier this month from the Gold Coast. Illustrates that most partners using uberX aren’t doing it full-time. They are just logging on, when they have spare time, or when they want to make extra money. And that is a new way of working. It’s cool as a customer that you can press a button and get a ride. That is what is expected now. That’s the bare minimum in transport But what’s often not noticed is that we have created the same opportunity for drivers. They can log on, start making money Here in Sydney, during the last month, that was an afternoon, Monday — average, money in the back $30 an hour. They could log on and make $30 an hour when it suited them. When we survey our partners, that is the number 1 thing they highlight, the freedom, the flexibility to fit in around other things in their life, whether they are a student, parents, caring for others. 9-5 job, it doesn’t work for them. We give them the flexibility to fit around whatever else is going on if their life. It is fine it is transitional. Between jobs, or just to hit a certain savings goal. That car only has two doors so that can’t be the car There is a four-door requirement on Uber. The point is clear – just to go one step further, you

might have had this experience on a journey? Sydney. We have four deaf or hard of hearing partners on the platform. That is the last number I know. On the ber app — Uber app and you request your driver lard of hearing you will get a prompt saying put in the destination because your driver is lard of hard of hearing. Then the ride just works fine. Another example of how technology is making – this wasn’t conceivable in the old frame, taxis when the legislation was written in the ’90s and to this day in most state, you can’t get a taxi licence if you are deaf or hard of hearing. Taxis don’t like this. This was a scene last month in Melbourne, Victoria That first picture showed you with two taxis and a whole bunch of customers essentially begging for a ride. They are a happy place. That’s the perfect outcome for a taxi driver. It means you are always busy, your cab is full, you are making as much money as possible. But it means customers are getting the worst possible experience Taxi industry thinks it has a monopoly on transport. They think they should be the only option to get around. This is their traditional way of getting what they want. A protest Strike, what have you. Public Democratics. Our response is a technology response. Most of our Uber riders would have received one of these emails during one of the taxi protests in the last few weeks, but in Victoria, within an hour, we were able to send out an email to our users and let them know what was going on. Taxis are blocking the streets. Do you want to tell your side of the story? With a click of the button they are in touch with their MP or sharing on social media and under hashtag why I ride or why I drive, they are telling their own story. Tens of thousands of individuals contacting their MPs that day. Trending on social media nationwide. We are empowering the consumers. I think Andy, the CEO this morning, totally on board with the power of the consumer now We just heard more of it from the Lithium folk. The consumers have a voice now. Traditionally it was an angry, loud minority that were dictating how transport works, but now the consumers have a voice. We have made it easy to be heard to get their demands out there and it applies to government too. The governments are more accessible and can be communicated with, easier than ever before. It goes both ways. In Canberra, comfs the first — which was the first state or territory in Australia to recognise ridesharing and announced they were going to put regulations in place, slated to begin this Friday, when the chief minister made that announcement – this is a cute example – but his social media was trending globally for recognition and thanks for being a leader and actually taking on this opportunity Now, it isn’t just transport We are just a technology company, we are software that makes the cities work better What else can we work with in in Sydney we have put boats on the system. It is actually the best way to get between some points in Sydney It isn’t US — it isn’t just for a laugh. Same technology Just hand it to water taxi owners. We are making an underutilised asset easier. We have done it with ice cream. We had a lot of fun with that Press a button, get some food That is a product in a bunch of Uber cities every day of the week, Uber Eat. That isn’t just fun, it is an experiment of other technology that we could deliver. It is also so we can have fun and it also gets people talking about the app, the highlight for the marketing team was in July. BNT magazine announced that ebber was the most talked about brand on Facebook, edging out Apple That’s a win for the team Coming up with content that people like to talk about and share. What comes next? The neck nothing day — the tech — technology day. Inbounder pool Anybody tried this? Awesome. I hope it was fun. It was – only about six months old, worldwide With ebber pool we are — Uber pool we are giving you the option to share your ride with another passer heading in the same direction. It doesn’t need to be beginning and ending in the same point at the same time

Someone could jump in halfway through your journey, you get to your destination and they carry on. We are in pursuit of a pipette July trip where the cars always have at least one passenger in them, which means they are more utilised than ever and the passenger can pay less than ever and you are starting to approach public transport prices at the touch of a button on-demandwhen you need it Again, if we are talking about congestion, this is another step forward. If we are putting 2-3 now individuals in one car, rather than just one passenger – I think there is hundreds of thousands of cars journey across the Sydney Harbour Bridge every day. Huge opportunity to match some of those up. Maybe we don’t need to build more tunnels Maybe we don’t need to spend so much on congestion. It also means people will own less cars There is a whole generation growing up saying, “Why do I want to own a car?” I can’t – don’t want to buy up-front, 10, 20, $3,000 worth of asset. I have to find somewhere to park, not cheap. I have to find somewhere to park. Can’t use it when drunk. I have to get it maintained, queue up to get it registered, when it breaks down I have to deal with it. I have to pay insurance, fuel, or… I could just open up my phone, where all of my happy things are and now I have one more service, press a butt — press a button Get a ride. Only true once we have got cars in every corner of the city at every time of day at a price that is superattractive We are getting there. Cities that then don’t have as many car owners, suddenly don’t need quite as much space for parking A city like Melbourne or Sydney has between 5-15% of the CBD dedicated to parking space. If people didn’t own so many cars what else could you do with that? Cities could look different in the near future. We have also opened up an AP I This is big news. Exciting step for us over the last 12 months That means that within your app you can actually search for information about how far away is the nearest Uber ride, how much would it cost to get to this restaurant or this hotel, and potentially even book a ride from inside your app. Keep your customer where you want them, and then transport is a service, an AP I. Google matches has done — Maps as done it. Monty, we need to talk. Not enough Telstra devices or apps that have this embedded. There could be. It is just – a function that makes other experiences come to life I would also highlight Uber Rush this is a public test or product in a bunch of US cities where we use the same technology, same cars most of the time, to move packages Small businesses, small retailers can load up a dashboard and start moving packages around the city on-demand, again. Deliveres within 5-10 minutes, not overnight or the next day at — autonomous vehicles. The Teslar gave the world autopilot Over the air software upgrade to the hardware. All of a sudden you had an autopilot system which could cruise along highways for you. Within a week these three individuals decided to really push it. And they set a new electronic vehicle record coast to coast, California to New York City, in two-and-a-half days using Teslar vehicles, charging station and autopilot That definitely means they were travelling well above the speed limit a lot of the time. But – they got high fives from people The point is the technology is out there now and for today’s theme there is no going back now. Once consumers are started using it, they started loving it, starting going cross-country in two-and-a-half days, just for kicks, there is no turning back now. But it is a good example The rules for autonomous vehicles barely exist right now Perhaps after this stunt, a few state also think about it and say, “Gosh, do we want these cars on this road. There should be rules.” It is a test for government. Technology is evolving at a faster and faster pace, whereas I would argue that governments are making decisions at a slower and slower pace. And thankfully we heard from the senator – and I would agree – we have a Prime Minister that at least understands the opportunities. We certainly believe Google is a bit of a litmus test – Uber an a bit of a litmus twist (LAUGHTER) Don’t tweet that! (LAUGHTER) We believe Uber is a

litmus test for government. How quickly do they respond, as Robert Scoble articulated. It is a bit of a litmus test SportsBet Australia is running odds on the first state or territory to legalise Uber. Some states are 16-1 and some – they got the ACT right It is an opportunity for states to prove that they are welcome to innovation and when they do, they will see more coming. They will see more following. That’s the Uber story. How we connect people. Fun to be here. Thanks for listening around, because we have got plenty of time for Q&A and I might also ask Rob Tarkoff to come back up to join us. Hosting this moderated Q&A is a very familiar face to the Digital Summit, and that is Brian. He is back in Australia, he’s been with us for each of our summits and he will have a wonderful keynote for you coming up after lunch. But nor now, he is — for now he will host Q&A, the question format will be the same. Come through to any of the microphones here, or post your questions up through the instructions that will come up on the screen. Please join me and welcome — in welcoming Brian Solis (APPLAUSE) Sole Solis — BRIAN SOLIS: I did not choose that song. I want to encourage you if you do have questions I think there is is a timer to kind of look at. That keeps you on time for lunch. If you have questions, please either tweet them or come up to one of the microphones. I have a whole bunch. Using an analogue app called paper pen and clipboard – or an stylus! Rob, you opened the door of which you sort of put people first, right, and people is one of the pillars of the themes of the event. I think about customer relationship management, I think about customer support, customer retention, customer acquisition They all have the word “customer”. CRM, what have you – but I don’t think businesses actually think about the C as human beings, I think they think of it as can’t! What do you think businesses misinterpret? What does technology get in the way of our ability to see people and build relationships with them? A great question. There is a couple of things that I think are happening. One is there is a statistic I recently red that 70% of the purchase decision in a B-to-B software context is made before you ever talk to the company. That’s an industry where you are traditionally dealing with – enterprise software companies hate to here that. But the available information makes a relationship with the someone before any transaction happens. That’s when they become a customer and they actually buy something. It makes it really far more important than ever. If you think about any of the jornys today of gathering information or figuring out what it is that you want to do with a brand, they don’t have the data sitting in their CRM system, they don’t have the customers and objects in some database with attributes assigned to it. There is a bunch of conversations going on, there is a bunch of patterns, there is insights that you are gathering from their behaviours And I think that the learning or the behaviour that – to change is to go beyond the system of record being a CRM system. That’s good once they are a customer. But what about when they are in that critical phase of determineling, from all different choices, who they want to do business with We think of this as from a techno speak perspective. There is a new set of technology that is emerging, called system of engame. The system is products like our own, the total community and others out there that help you connect in to all the conversations among customers and influencers and people who can impact your business before they ever do a transaction, and if you can capture that, I think it will change the way most businesses think about all these things you talked about, customer experience, retention, because it’s not about the transactional part of that equation, which is traditionally what CRM has been about. It’s about the true conversation, the insight, the building of really

relationships Well said. On the contrary, Uber use this technology to bring people together. To actually improve relationships, to not just – not just facilitate transactions, but to actually improve customers’ experiences At the same time, I would be foolish to call over just transportation company Obviously you are now in the gelato business and in San Francisco you are also in the kitten business, delivering happiness to people everywhere But what was the perspective around the company to use technology differently than most businesses are, and what should other businesses learn? In terms of those adjacencies, what is common between the lato — gelato and the kittens is we are in the on-demand business From day 1 it was press the button get a car. That was new! That was an app that got you something in the real world That was exciting. It is far more common now. It was a lot of fun to experiment with three or five years ago. So the questions in the room were what else could I get with a press of a button? And I think food is a good example of something that when you have a need, if you can solve it if five or 10 minutes it is useful, but if it takes three or five hours don’t worry about it. With shoes, dress, you can wait a few hours. So, we are focused on that instant gratification. There is a whole generation growing up that how they expect the world. They get their information at a moment’s notice, their friends at a moment’s notice. That is what they want I have a question that I want to ask of you Rob and then go to you, David. We are all I would like to think we are all aspiring geeks. Technology is becoming sort of part of our every day life. For in the mobile phone is an extra appendage. The argument around technology is just – it is almost a — illogical while businesses aren’t understanding the impact. As you said, a lot of things we are getting in the way of fear, these are all human issues. What is it that you see businesses getting wrong and then also at the same time what is it that finally breaks through, that gets an executive to see they need to change? I think one of the biggest challenges is that most people inside these large companies don’t know how to do it. I mean, this has been the phenomenon in the Silicon Valley for years Every cycle, when there is a huge new technology disruption, you get a brain drain into start-upstart-ups. Particularly when the VC ecosystem is superstrong. You get ideas that are being created until what you find – the concept of entrepreneurship – they call it the idea you find the people who want to start businesses inside of large organisations – it takes a very, very Visionaire CEO and – to enable that stuff. Clip the stuff we are hearing about from Telstra from muru-D and that kind of initiative, you rarely see that. Most corporate venturing initiatives fail Because somewhere the CFO gets ahold of it and he goes, “I don’t know. Is that good enough? Are we a venture complainant list? I don’t know where to put it.” I have seen this at multiple big companies, which is why I wanted too try to big my own big company. I wanted to enable us to do this. That is what I see as – you get this sort of institutional bias against this entrepreneurship Uber has the largest logistics network in the world If you think about everything you know about routes, drivers and where people go and – so, why couldn’t that be – have been built inside of a company like Fed-Ex or UPS or anybody that has all that worldwide logistics information? It’s because it would have required somebody tot go do something certainly disruptive, like what they have done. So I think it is that, the sort of the death of entrepreneurship, which is part of the reason you don’t see these amazing ideas spinning out of big companies. That is my experience. At some point that has to change, or else they won’t survive (LAUGHTER) They try to be innovative because I got stuck in meetings all day! (LAUGHTER) I will sort of modify the question. I am also cognisant of the questions coming in over the Twitter-verse. One of them has to do with customer insights and how you use that to translate into business innovation. I

mean, for Uber – it is incredible. It isn’t really a surprise that the taxi experience sucks in so many parts of the world. I can understand sort of the motivation or the inspiration to create Uber. Before we get to the second half of the question The first is what do you think prevented change in the taxi industry? No surprise that they were sort of inflicting pain to certain people. It is also not a surprise that change was inevitable. They could have been part of change. Now they are just sort of violently erupting against it It’s a question we have only started thinking about after we launched the business. We didn’t come in with a hypothesis around, “This is why this model is broken and here is the answer.” It was just – it was a club for a few people who wanted to pay extra money to solve their own problem. But, of course, we have gone back and reflected on it. I think the ingredients are – you look at anything that hasn’t changed for 20-30 years. That is probably a good opportunity. Frankly, regulations, a highly regulated environment is on the balance of probabilities probably going to restrict innovation. If you see – doesn’t necessarily need to be a monopoly, but if you see highly profitable businesses, that means they are not reinvesting in their own technology and improving the service or improving the experience for drivers. Those are the plastics the industry made. The owners in the industry said, “We can make a lot of money out of this while the riders and the drivers suffered.” And so that inevitably is going to open up opportunities. I would keep an eye out for those. Top of my list would be anything to do with financial services and healthcare. Highly regulated, highly profile table reinvesting in the business. So the idea of boats, food, in the US tlrp there was a story going around about the partnership with the new BMW 7 series, and how Uber was promoting rides with the coming cars, a way of helping BMW reach new audiences How much is different by insight and how are you able to enact the insights quickly? Clearly we are a data driven company. We have been a technology company from day 1 That native to us. We never went through a technology revolution So, everything is trackable in terms of who is looking for a ride, when, we use that data pro-tick where should the cars be, the drivers get money and passengers get rides. What is probably given us – my belief, what has given us the ability to keep innovating is just the comfort to test and try and fail. So, for us, each city is really a start-up within a start-up. There is 300-plus general managers around the world. Out there making Uber work in their city. That is an unusual model for a technology company. Most companies, if they can avoid it, would have the entire team in Silicon Valley, sitting together. We have people in each city trying to figure out how should Uber be different. That is how Sydney ened up with boats. Monty would want member to be coffee ondom That would be a local thing What is key is cities are empowered to do it. It is OK to fail. The company from a top down understand that. We push responsibility and decision making as far down to the frontline as we can. We can run 300 different start-ups Rob, I have a big question. Just one second, because you have used the word “fail” a few times in your response. In Silicon Valley it is a good word. It means you are trying. I am sure many people in here – when they hear the word “fail” it isn’t good. Right? It means you tried and you failed. So, how do you and cow rarnl a culture of experimentation experimentation? I will be clear to draw the line on failure, if it isn’t about safety. There is a few read lines for us, just to be clear (LAUGHTER) How do you create the culture? It is the manager’s responsibility to say yes to a crazy idea. Kittens on-demand Who knows whether that will be a good idea. No amount of data you can collect will tell you that Buzz Feed will tell you otherwise Turns out kittens are viral. You don’t know. You don’t want to have – there is too many companies where you can make a mistake. That is what people will talk about and be in your review. The correct, logical behaviour is to not try. If you are trying to keep your job and get promoted, too many companies where that’s the case. I was speaking ton’t a MP — to an MP

who wanted to do an entrepreneurship award, the best business idea, or – of the month or the year. I said, “No, mate Come up with biggst failure. Go reward the individual that had a crack and didn’t work and say, “That’s awesome.” Excellent. I am a big fan, Rob, of your message, vision and purpose. I want the room here and those following on Twitter and socially to hear your response. You talked about the Moreton example. That is talked about a bit, written about, as a standard of excellent customer experience. I will go on the other side and say it is a big PR stunt. I am also going to go on record to say that I think Co pl cast is — Comcast is using Twitter as PR. If it was true they were using social as a way of improving the customer experience, they would improve customer support, experience, and we wouldn’t have issues like we saw with Veronica, quite famously when she tried to quit the service, because they transferred her to the customer retention department, which is a big sales group, that tries to uncomfortably keep you as a company. The question is – how do we not get caught up using new technology asstunts. How do we take insight to bring about proper change, rather than using technology to mask the real problem? Yeah. A great question. It is why it is hard for people to go from experimentation to courage Look, Comcast serves millions and millions of people with entrenched model of customer care. It used to be whenever you had a problem you got on the phone, call, a tech came to your house. You had a good experience or a bad experience You sort of moved on. There was – there is a lot of embedded processes in that that – you can’t change overnight. But what Comcast did do is they took an initial experiment of 10-15 agents monitoring social and trying to get the conversations right They said we will take this to 150. We will quadruple this, start pulling money out of the core, having bumps along the way, we will have experiences where rogue agents – you know, does something like this and it is bad PR. They also – this is a false knitting thing in terms of team diversification – they took their head of PR and put him in charge of customer service, digital customer service. I thought that is amazing, because here is something who is used to only being able to talk about things that are sort of liquor Pratt messing, and now it is something who has to respond to all the issue that’s happening As she started to learn the issues she realised there is bigger things we have to do to transform the overall image. It was a bit of the kind of the learning inside. How do I get my PR team to understand this is the real customer experience until this is what should make its way, this is the real PR, what piece happening on the customers service side. That’s one great example of just moves that Brian made inside of Comcast to get customer service at the front end The other thing I was going to say to the question of – if you are moving, as a big company from experimentation to courage, you will fail a lot. What I tell CEOs is don’t focus on whether you are going to fail Focus on how you are going to experiment, because you will fail. But do you do the experiment right? Do you set up the parameters in a way that you are constantly learning from what you are doing, because I think if you run an experiment and fail and don’t learn, then it is not excusable. That’s a failure That is a bad failure. But learning failures are OK, I got data, I got more insight as a part of that. We, today, are running experiments with our brands to say, “What if you could tie everything you know about people on cloud with all the conversations that happen across 450 large brand communities on thousands of topics?” What if you could build a profile for your consumer that allows them to better negotiate their service levels with you, and for the brand that you – that allows you to know more about them than just what they have brought and what they said specifically on the community in response to a problem. I know everything about you. Lots of privacy implications, lots of – how do I go take that and deal with both sides of the equation? A better experience for the consumer, and a better experience for the brand. We are running lots of experiments Some of them aren’t working Some of them are working well But the key is every time we do that, we have got to be learning, getting data, that is helping us to refine that. And so that – I think sate lot more That is the – a lot of the things

Uber do. They may not “succeed” but there is no much data generated but you are smarter the next time. That is why it is so rich I know we are out of time. I will ask you a quick question, David, because it keeps coming up as Uber set aside budgets for a fleet of autonomous vehicles yet? Speaking… We are investing. No questions asked. In the US we have partnered up with a university, the best robotic department in town. That’s a disruption technology. We could sit back and wish for everything to stay the same. But there is other industries that have been that way. We are investing, we will give it a go. Just to highlight – Tesla that went coast to coast, it was Australian autopilot 96% of the time. There is still 4% where it hasn’t got you covered. That last 4% can be hard. It isn’t the type of product that you can launch when it is 99% ready Fail is a real fail in that game! (LAUGHTER) That is different to a lot of technology and software companies’ ways of thinking. We are investing. We want to be part of it. We don’t foe when it will be ready Ladies and gentlemen, please join me in thanking Rob and David (APPLAUSE) Well done! Thank you very much, guys It is lunchtime, guys Time to get some food. Lunch will be served on the terrace and also in the foyer. If you want to get sunshine, it is a beautiful Sydney day. Get out amongst it. For those tweeting, the top 5 tweets of the day will win a Telstra TV. Keep those coming. Brian will be back after lunch, which will conclude at 2pm. Psh This is a test

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UNKNOWN SPEAKER: Welcome back everyone. Just ask you to take

your seats. Hope you all managed to get a bit of Sydney

sunshine. That sky looks fantastic. I popped out for a

quick walk and for those dining inside, I hope you enjoyed your

lunch. As I promised before the lunchbreak, a summit, is Brian

Solis, and he’s going to join us for his keynote in a moment

Let me introduce him first He’s a principal analyst at

Altimeter Group. He’s a business strategist, a future

rist who created new media strategy, and builds brings

between companies, customers and employees. He’s going to talk to us about his wonderful new book X: The Experience When Business Meets Design. Please welcome Solis to the stage wanted to take my time because that is – I mean, that song! It could come out today and it would still be huge. Just noticed too that when I tried the button at lunch, I think it settled too quickly well, you’re going to see the book at the afternoon break Telstra was kind enough to purchase copies for you. It’s not a presentation of the book, but a presentation about the inspiration of behind the possibilities of everything I’m going to share with you how the world is changing, and the irony wasn’t lost on me that I was going to tell you that in a book format! (LAUGHTER) BRIAN SOLIS: As you’ll see it took 3.5 years to produce and a lot of that was because I studied how we use our Smartphones and how we use tablets and the apps and the way we behave of it and the attention span of teenagers in school to see if you could reinvent what a book could be in a digital economy and if you could make print matter in a world where we’re attached to our Smartphone. If I went through that process, we can all go through that process That’s what the theme about this is about. This intersection between humanities, technology, people, it really is sort of the representation of X. X means a lot of things, X marks the spot, but also it means experience and perspective. So on one side you see the zombie apocalypse as we think it looks like and on the other hand if you talk to any executive or any parent, they’ll tell you that that’s the real zombie apom lips. If you — apocalypse. If you spoke to Scoble, if it’s devalued, we’re going to be like this now (LAUGHTER) But that is a matter of perspective, right, because I think at least the way that we see the world and the way that others see the world and a lot of them are at conflict. You heard a lot about technology, we’re going to hear more about the technology, but the magic of this moment, what makes it such an incredible opportunity, is our ability to just maybe see the world through the lens of someone else. Because it is perspective that is holding us

back. Many of us, whether we’re executives or what we’re strategist on just on the frontline, we are coming to that moment based on the moment we know. Based on our life experiences and professional experiences and we don’t see things the way they truly are We see them as we are. I mean, that’s just a natural reflex and seeing all of this change, looking at this massive amount of technology that’s disrupting us now and in the future, it is perspective that’s going to allow us to see what we really need to do about it. Because customer experience isn’t the same thing as it is to you or as it is to me because it’s ib credibly — incredibly personal and it’s how influenced how technology is used in our lives Some of us have gone through wilfully digital detox and some of us are proud to use clip board and paper still but this is in one image, I think, the state of the world I was in Germany at the time, and I got so excited late at night, and, what would be a great caption to this picture, I established it on Instagram How dare she deprive her Facebook audience of this moment! (LAUGHTER) But this is sort of repetitive of that moment that we — representative of the moment, to see things that the ways others want to experience it as well It’s experience for not one but for many. A friend of mine, and his quote was CRM today – as you saw we talked with Rob earlier, customer relationship management is actually nothing – nothing to do with relationships Everything to do with management. And we use technology a way of scaling ourselves away from people, when in fact the gift of technology is that we get to see people, we get to see the humans behind those scenes in ways never before possible to the point where we’re watching digital’s impact on the physical world, the physical world impacts on the digital world, it’s changing everything. I spent my fair share in airports, and on those walking escalators, keep right if you’re going to stand, and kept left if you want to move Even that is hard for people to understand. Now we have to consider the safety involved with this without actually being able to see obstructions ahead space. But the point is: Unless we understand what it is that’s really driving people, like why is this technology affecting your life and how and to what extent? How is it changing your decision-making? How is it making you the centre of your universe? What do those behaviours add up to? How does I change your values? How does it change the attributes of a business that makes you want to align wit. Understanding all of these things helps us to make sense of technology and also make technology matter. Not just to react to every single trend that’s out there but use it in meaningful ways, that build relationships, that nurture those relationships that turn into experiences, that turn into customer loyalty Because customer retention is a lot less expensive than customer acquisition. But imagine if we invested in the experiences of everybody, in every moment of truth throughout the lifecycle, then acquisition and retention leads to all kind of new possibilities where technology just becomes an enabler. You don’t need to have an occlus rip app for your business if that’s not the experience that makes the MES sense. Understanding people is why I became a digital anthopolijist. I want to say businesses that are created, are cocreated. Rob said you got to let go of the brand and that’s – some of it is impossible for executives, because they come from an era from command and control, and they don’t live the brand the way customers and even employees do. They’re busy in a world of stakeholders and shareholder. We have to appreciate why it’s so difficult to bring about change, but also appreciate at the same time that change is inevitable Disruption happens to us or because of us. What is X? What is an experience? This is me was the biggest inspiration of writing the book was that experiences, it’s something most of us misunderstand. It’s not

a thing. It’s an emotion, something that you feel. And you feel it throughout anything and everything that you do, so when it comes to working with the brand and what that brand experience is like, we often get confused with messaging and creative and product design, and tactical exchange information with transactional stuff like customer service or customer support. Experience is incredibly personal and in an era where technology is conditioning us to be become accidental narcissists, I don’t call it the sharing economy, I call it the selfish economy in a good way. That means experiences are now more important than ever because people are going to have them and they’re going to share them This is an experience. You’re looking at one of the most sophisticated technologies to hit the consumer market in a long s long time. The amount of data it tracks is incredible But she doesn’t care because it just let her into the park. It knows who she is. She can get into our hotel room, and buy food with it. The vendors know who she is. Overtime it understands her preferences it creates an experience that just unlocks new value and new possibilities. A lot of us talk about Apple when we talk about experiences but a lot of us don’t really understand why it is and to what extent Apple goes out of its way to unify the experience. There is a person at Apple whose job it is to open boxes. All day long! Can you imagine the workmen’s compensation issues of paper cuts?! Apple has a story ark designed for it. Whether you’re supposed to feel and think and do. As you unbox that moment And it’s meant to enliven the overall experience architecture that was designed that is alive in the product design, in the websites and in the retail experience. Incredibly thoughtful and its intentional As to what extent – we have to think about competing for experiences because it is the new value creation. Again, no technology trends needed to be relevant at a human level because customer experiences isn’t just one moment, it isn’t just the share of voice, it is actually the sum of all emotions and experiences people have with you throughout the lifecycle The sum. You fail in multiple places but you succeed in a couple, it’s still the sum we all know the stats that people will talk about negative experiences. They will share a negative experience. If they have negative experiences they’re going to leave you These are all things we know, yet we don’t really do anything about it. We try here and there, but experience is exponential and if it’s complete and universal, that means how we’re structured in business days, the model we operate against, are not designed to be universal. They’re designed to operate in their pacts, to their standards and budgets. So what if in a world we shifted everything and we started to invest in positive experiences because we all know when you have positive experiences you’re going to tell people that you’re going to be happier, you’re going to probably even pay more for product because you know you’re going to get a better experience and imagine then if you invested in this whole new era of customer relationship management when you incentivise people people. All the negative experiences completely pile up online and don’t disappear Experience architecture than required an unbiased perspective. This is an image I thought that really captured the state of my anxiety every single day. The four horsemen of the modern apocalypse we look at our phones 1500 times a week! That adds up to 177 minutes of your life every single day. I don’t want to know where most of those minutes are spent! the idea of social, ephemeral messaging, all of these apps we use, it’s just second-nature We expect a car to be here in a few minutes with a driver of a high rating because we’re being conditioned to do so. Snapshots and selfies, these are all not just acts of narcissim, these are actually marketplaces for emotions, human emoticons and influence that changes the nature and dynamics how people communicate and share. People go to YouTube to search more than they do on Google on the Smartphone. And Google websites comes back, why

haven’t we thought about what the point of a website is in 2015? Because we don’t question enough. We take for granted a lot of the things that are there, but, in fact, when people start wanting to have websites and we don’t do anything about it we have to get to the core of what that means What that means is people are looking for insights, and information that helps them take the next step forward and that completely undermines the lot of our I investments that either exist or that are in our road maps right now experience architecture also begins with empathy because once you study the customer journy, the devices they use, the questions they ask, the content that comes back or the pages that come back, you realise the customer journey is broken, and it’s because we sort of designed it that way. We designed it based on committee without really ever understanding what people do or what they want to do. This is just one of the many examples of how people are hacking their way around you and it’s just becomes a matter of point. The friction you heard come up over and over again Friction sucks! Right, so at some point, you stop subjecting yourself to it. If businesses do not change the way they do business, then you find alternatives. Uber and taxis A million apps like that Tinder and match.com. But I would be lying to you if I considered Tinder a dating app! (LAUGHS). So when you go through the customer journey, you start to empathise with the technology pains that they have – that friction that comes up, the lack of information and insight. The number of places they have to visit to make a decision, you can’t help but feel frustrated yourself but also inspired to understand that the way that they use these personal technologies, the way they they’re talking to one another, the way they’re sharing their lives, they expect every single day for your business to emulate those apps, the experience that they have with those apps should be the way that you do business. And we get stuck because we’re caught up in the legacy infrastructures and investments that we have It’s very hard to pile it or test and learn new things when we are rooted in the past. But today, all of these gestures add up to something much more significant. When you study the customer journey, you realise that most of the time it starts on the phone, and in order for them to continue – this is true from B to B or B to C, they can’t finish it on the phone, they have to break, they have to go to another device, they have to go to a desktop because it won’t load on the phone or it’s a horrible experience. And then this happened last week… mobile search has overtaken desktop search. Per Google’s earning statement What does that mean? That means it’s a world that you have probably designed for your customer is a desktop experience. Not a mobile experience and by mobile experience I don’t mean your team has given you responsive design and loads on a mobile phone. I mean what is the purpose of when someone searches on a mobile phone and how do they interact with what comes next? So this is the result of a lot of work I have been doing with Google over the last year and what we call micromoments Micromoments are when you grab that phone, maybe at a break or maybe on a train, maybe in the back of an Uber, and you start whatever that process is. And it esusually driven by context, like want to learn, I want to buy, I want to know, I want to go. And in those moments what comes back helps you decide what to do or whatnot to do. And what’s key is in those micromoments because they’re only seconds’ lock, maybe 12 seconds, if your experience doesn’t work, then they abandon it. And that reflects poorly on your business. And what’s starting to happen and this is critical because a lot of executives gloat is they don’t have to change so quickly because they’re profitable today, that’s true until they’re not. The minute they’re not they’re starting to react, and when they react it’s act of desperation and not necessarily strategy. So what happens is that consumers are now starting to teach themselves that they are not brand sent Rick They’re going to reward anybody who gives them relevant information, a better experience and understands what it is that they’re doing and what they’re trying to do. That means all of our work, regardless if you’re marketing, or an executive or customer support, whether you’re in product design, that we now

all have to work together to reverse engineer the customer journey combining technology, value, and business objectives Right. This is the baseline of human centre design which is a big, big practice in Silicon Valley especially with companies like Frog Design. Frog Design being the customer that created the magic band. When you look at the customer journey, we tend to look at it in disparate acts but there’s the buy side of it and own side of it. The own side is almost completely neglected. All of the things we can invest in terms of strategy and technology to bring great experiences to life even after the fact, are largely missed opportunities. And what you see here is not just a model that looks cute, but actually becomes sort of the baseline or the foundation for how business could be structured or restructured today. This is why start-ups are eating the world because they don’t have the legacy politics and what have you of the organisation to be able to just go and execute They start from scratch. What could the model look like? What could the canvas be in order to succeed, in order to accelerate, in order to get market share because they have to deliver ROI to their investors and once you start to understand this, and be thoughtful about everything step of the experience, you can now restructure how it works and what it looks like and who works on it and who works together The omn-channel is going to be a figment of our imagination or a buzz word until we do things inside the company to make it possible. That means have to talk to people we don’t talk to today, we have to work with people that don’t necessarily know us. So it’s the epicentre of every micromoment. This is the core of the customer experience moving forward is intent, context, and immediacy And these are the three things that should inspire us moving forward. If you’re not discoverable in these moments, then you’re absent from the ability to be part of the decision-making process. People are not looking for your websites, people are not looking for your info graphics. People are not looking for corporate YouTube commercial. People are looking for information that caters to them selfishly because they have something to do and the contents they find here, whether it’s from brands or from peers and it’s largely from peers by the way, helps them take the next step. So in order to be there, we have to understand where we’re not. We have fob useful. This change it is entire game of how our company talks to market. We’re really good at talking at people. But if you think about who it is that we’re really writing for or creating for, most of the time it’s for lawyers that we can get a path to the legal department. Then the rest of the time it’s for the people who are approving that project or funding that project. And maybe hopefully it’s the customer or people or humans. So understanding what that context is and that intention is, allows us to be more useful, right, because the result of that is just good old-fashioned social commerce When you’re useful, people feel a sense of use, and if they feel that, they want to give something back to you – and that’s business. Most businesses I think it’s like 75%. 75% of companies don’t have a mobile strategy and now that we have just found out that mobile searches has taken over desktop searches, most start on a mobile phone, we don’t have a mobile strategy, the number one place to start is: Where are their friction and their problems and solve for that. If it takes too long, you have to remember the ego system – people who are accidental narcissists do not have time or patience None of us do. There’s that funny Lewis CSK joke. He was talking about he was with a friend a and he was trying to send a message and it wasn’t going through. He looks at his friend – wait a minute! Just wait! It’s going to space! And comes back! We just all want that sense of immediacy, that on-demand economy is no joke You don’t want it now, you want it right now! And all of these other apps and services are conditioning your customers to expect that. So we have an opportunity here. X represent

it is cross roads. Do the thing the same old way or do things the new way and take chances and starting with the little things and elim Nating the friction points. What’s important to the customers. Because one of them creates new value. One of them doesn’t. And new value is is what is going to take to compete. All analysts agree, that customer experience is going to be the baseline of which companies compete against one another. It’s bad because it should have always been the way we did business, but on the immediate horizon, we have to realise that no amount of technology is going to solve this problem. Empathy is going to solve this problem and our ability to go back inside the company when we go to work tomorrow to say what can we start to do differently? What esbroken down to get fixed and how do we work together? Operating the status quo is not going to work. So I’ll leave you with this: If you want copies of the slides you can check the experience with that, but I’ll leave you with this: This is that moment where we have to question whether things like innovation even mean. What do things like mastectomy mean? empathy and sympathy. How do I change what it is that I do or how I see things. The greatest thing in all of this is that what we’re talking about is humanity. I always joke – the humanities of it all. The reality is unless we shift our perspective to see things through the lens or through the mobile screen of someone else, we’re always going to be sympathetic at best, at worst we’re going to be making assumptions. Everyone is using mobile. Great, get a mobile strategy together. Empathy is where you feel something, you can relate with somebody because you feel it the same way they do. Understanding to translate empathy into innovation Innovation doesn’t necessarily mean technology. Innovation could be something as simple as seeing something differently because in Silicon Valley, you rarely hear people come up with technology first solution. No, that’s not true, you hear that all the time. The ones that make the impact and change the world start with the pain point Or optimism or an opportunity or something that sort of brings up something new that you couldn’t do yesterday. Solves the problem that you had to deal with yesterday. Those are the greatest source of innovation of which technology then brings it to life. And so no matter how many disruptive technologies are in the future, no matter how much beacons are tracking you and helping you have a better experience when you walk into a store, for example, they’re all just gimmicks until they connect with somebody based on what someone values or find important. It’s like anything – a relationship is something that offers mutual value. Mutual benefit. And I think that one of the greatest gifts in all of this technology is that it’s very humanising and very forcing us to see — and forcing us to see people in what they want More importantly what they want to be. And that’s why when I say – we are are innovation Innovation is something that begins with us because it’s something that we can feel, based on the inspiration of someone else, based on the empathy we feel for someone else because then technology is great, and as a result, all that we do with everything that matters with people, and once it matters with people, then we got a community together and that’s the foundation of which we can build the future of business Thank you very much Wonderful, wonderful, thanks very much, Brian. Year on year, so many new insights, and fantastic keynote and we wish you the very best luck with your book. For those who are interested in grabbing a book, it’s a complimentary copy and Brian has generously offered to sign those books at the afternoon break So first in, best dressed an you’ll get a niced autographed signed copy. Believe me it’s not a typical on-demand book The book itself is quite special. Congratulations on that launch, Brian, and thank you for your address. Dr Larry Marshall is going to join us now. He’s the Chief Executive of the CSIRO. The Commonwealth scientific and industrial research organisation. I have always known it as CSIRO and sort of thought I’d ek ploit the acronym there. One of the leading mission-directed

multi-disciplinary applied research organisation in the world. Who is using wifi? Anyone using wifi today? The wireless LAN was developed by the CSIRO and now in 4 billion devices world-wide. Australia’s innovation catalyst, Larry Marshall joins us today to discuss the role. Please help me to welcome Dr Larry Marshall (APPLAUSE) LARRY MARSHALL: So I wanted to compliment Telstra on this event. I do feel like I’m back in mountain view, and that’s remarkable. Well done So I spend 26 years in Silicon Valley, I started six tech companies k took two of them public and sold the others and surprisingly didn’t have a crater, but it was as much luck as anything else. Every company I started, I started backwards, it should start with the customer and pain point. We spend our time trying to figure out what to do with them Start-up number 7 – CSIRO. Soon to be 100-year-old start-up 5,000 people. I meant to ask you how to click the slides here sorry, I’m not good with technology. Is it the green button? Excellent! we live in exponential times This is a B with a backpack, we’re trying to figure out why the honey bees aren’t poll Nating the way they used to It’s part of the economy-wide centre network. We did it in Tasmania because it’s small enough to be manageable but we tried to put sensors and gather data from every part of the economy. Also 3D printing technologies have made the bridge between this digital world, and the physical world This is the replacement heel that we custom made with an Australian company to save a man’s leg in Melbourne Literally to save his leg by 3D printing. You think about it – in partnership with Telstra you could beam this part anywhere in the world. So teleportation, transportation is even possible That’s the unique connection between digital and physical that didn’t exist before. I heard on many panels that the 25 most valuable companies in the world today are all data companies and Internet companies. I’m sorry to say that’s not true! It’s actually not even close to true. But they’re very valuable companiesful all of them — valuable companies. All of them were in amazing revolutions in deep technology science, underpinning changes to the way we do business. Fib onics. 100 gig transport. The CISCO router, the Intel chip, nonvolatile memory, all of these things work together to enable, for example, the iPhone to enable mobility, to enable connectivity on an unprecedented scale. I have run 6 start-ups through three recessions and 9/11 and I have seen this battle between deep technologies hardware and software or Internet, I have seen this battle. A lot of competition, but the truth is – they’re linked together. You don’t have one without the other I’d like to touch on some disrupters in the Telecom space So if I was running a telecommunications companies and I’m going to mention AT&T so I don’t contextualise it to Australia. There’s a number of keep disrupters in that space If you think back to the glory days of AT&T, the biggest research lab in the world, invented many of the technologies that underpin the Internet, they had a Monopoly on the US mark. They owned the connection to the customer through physical infrastructure They were wired into even’s homes, they had billing relationships with just about every person in the country, basically an unassailable position. A few years ago we saw this sort of major disruption where content trumped connectivity. We’re even seeing more so today the disruption of that model where content can be free. So content trumps connectivity. Now content is free. Now, previously the competitors to AT&T were other phone companies,

Verizon for example, now it’s Google and Microsoft. It’s a big change to an old established company Internet of things – I invested in first Internet of things, a company back in 2002. I took about five years for the term to koch up. Now you have an explosion of connectivity, data on an unprecedented scale and suddenly, we went from content over connectivity to now content is free, now you’re the product and everything is free by virtue of this data that connects literally into your brain Mobility – everything is untethered an mobile, and again reminiscent of the free to air TV model. If someone can crack it with a low cost, for example, Google fibre with wifi on steroids, that’s a very empowering technology plats form to have. Messaging is reinventing everything, but there’s a sort of democraticisation that needses to happen, what costs $1 in the US costs in Australia. Costs $26 in China. So the democraticisation has to happen there and value will be created when it is democraticised There there’s fundamental generational shift in most western countries. Telemedicine will be huge and I applaud Telstra for getting behind behind the e-Health. So I the company I mentioned – that was one of the first. It focused how you secure the dumb devices in your network because back then the founders of the company realised the printer was the easiest place to hack the network. It’s fundamentally connected into the heart of the netwalk. Today everything is connected to the network. And finally, free space communication, we have seen Google do remarkable things with weather balloons and wifi We’re seeing aerospace to low earth orbit satellites for wifi on steroids. It’s a big, big disruptions in that market. I mentioned the sort of tug of war, the link between hardware and software. I ran companies from about 1989/1990, through to about 2005. And this is a plot of the nad dack through those recessions. I tried to libl the technologies that led at least Silicon Valley out of the recession. Generally they happened there a couple of years ahead than the rest of the world. Each of those technologies was the combination of a profound breakthrough of hard science. Blue LEDs through to white LEDs, ion battery technology and storage technology, sudden why have an iPad which you couldn’t have without those fundamental breakthroughs. My personal egs peefrns, it was driven by this fundamental breakthrough in technology which gave us hope and let us to grow new markets and create new value. I think software or hardware play integral, intimate part and together, and that eye eel be going forward — they’ll be going forward. However, one does worry since the Second World War and even before, fundamental breakthroughs in science and technology drove productivity, created value literal why from nothing, which made the pie bigger, it created new markets, so productivity and jobs grew in lock step. But around the time that the Internet happened, in a consumer sense, it was happening years before in an academy sense. But when it happened in around 2000 in a consumer sense, we saw a bit of a divergence. A new model evolved. It’s a bit difference to creating the new value. It’s about reallocation of value. Now, I’m absolutely confident that the balance will be restored. But we’re going to be in for a really bumpy ride while we go through this transition period basically you could say it’s taking inefficiencies out of the system and improving business efficiencies, that’s great. But from a social point of view, it’s a little hard, a little Changing to cope with. I’m convinced that it will come back, we will continue to grow new value and new productivity and many, many web companies do that. But most of the money now is being made through disintermediatation, it’s happening whether we like it or not. It’s overall a good thing but we need to adapt to it Let’s go back to the AT&T example. Unassailable position Unassailable connection to your

customer, they’re hard wired to you, literally and figuratively And then all of a sudden along comes Skype. Suddenly it’s free to make a phone call, you’re fundamentally disrupted from a seemingly unassailable position and that’s the case for me, Uber is another classic example AirBNB is another example. How do you deal with that? It’s my thesis, fundamental breakthroughs in technology will help us move back to a value creation mode. How might that happen? And what might I do if I was, for example, running AT&T? Well, I’m glad you asked! So I would invest in optical switching technology. I would try and build the most powerful data centre in the world with almost no lek electronics in it at all. I would want to deal with the data at native 100 gig line rates, I would want to process it, manage it and redistribute it so my customers would see no latency in their connectivity, a massive increase in band width Call it a 10 X reduction in physical input, and 1,000 times faster than what is possible today. By getting the electrons out of the loop and leaving everything in they tiff optical mode, the mode it goes through the fibre in. Now, if that sounds far-fetched, I like to talk to you about that in length, but there are three order of magnitudes shifts in the fundamental technology that underpin it is Internet which gives the speed far beyond what we can imagine today. I also might put fibre everywhere, but if I’m AT&T, I have already done that. Google is trying to catch up with me by the way and putting their own fibre everywhere and at the end of the fibre points, put wifi on steroids, I’m talking 60 gig wifi, not conventional wifi, but very high speed and long range wifi, basic wifi format but different to enable me to give a richer mobility experience to my customers. I’d also take advantage of that pure optical data centre to evolve into an optical computing backbone That literally processes information in parallel so again thousands of times faster than traditional serial processing that we’re all familiar with That enables associative memory, the way our human brain remembers data. Processes in parallel, the way our human brain processes, has image recognition from a little piece of an image, can recreate the entire image and enable puristic search, search that reads my mind, understands what it is I’m looking for without language getting in the way and serves it up to me. And finally I’ll invest heavily in Quantum communications and Quantum encryption which has been shown is essentially unhackble or at least if you hack it, you can’t do so without the telecommunications company knowing about it there was you can invalidate the package and keep it secure so if I wanted to do all that, where on earth could I go? Where could I go? I might go to astrommy Seems like a strange place to go, but I might go to WA to the Australian square kilometre array, where there’s a one peta byte computer, that’s very fast by the way. Certainly the fastest in the southern hemisphere, that processes the whole data of mapping the whole universe Forget mapping the world, imagine mapping 600 known galaxies in the known universe Each one of the antennas runs at terabits per second! That’s more than the global Internet traffic was a few years ago, and it’s already exceeding the global Internet traffic today Now, all of that data, so more than ta global Internet traffic today, all of that data gets processed in a 10 by 20m room At native 100 gig optical line rates. It all gets compressed and encrypted on site and through some magic, which I’m not going to explain today, we’re able to transmit it over existing optical fibre infrastructure to be processed To put that in context, if anyone’s visited the Dish, we did a famous survey of a galaxy called centaur Russ a, that took 12,000 hours of compute time to process, to call bait ASCAP, we

did the same survey in 15 minutes. That’s a profound shift. So if for any reason you think the capability to do what I described previously about increasing compute power, increasing processing speed and optical backbone data centres doesn’t exist in this country, you’re wrong. It does. It doesn’t exist in an obvious place, but it does exist. It may surprise you to learn that Australia built the world’s first working digital computer I have to calibrate that because it was working. The US beat us in building it, but they had problems running code through it. Where a few months later, ours ran code successfully Feel proud of the accomplishments that Australia has and can again make. There’s a lot more here than meet it is eye — meet it is eye. Let me come to digital. I have spoken to a lot of companies since I have been back. Companies in the US and in Europe and the rest of the world have the same dilemma as the companies here, they’re not really that much more advance, they have a bit, but not as much as you might think But roughly just under 90% of companies clearly understand they’re going to be disrupted by digital technology. But only 7% have a plan for how to deal with that. When I came in, one of my conditions for running in this amazing organisation, was to save the national ITT lab of Australia. It’s a very unique and really important piece of data science capability that I think otherwise would have gone away if we hadn’t put our arms around it. So we have created this new group by combining NICA, with the digital group It’s called Data 61. And Adrian who by the way was the founder of the company I mentioned, one of the first Internet of companies, Mecana, he’s the chief executive of Data 61. A deep understanding of Internet of things and security and connectivity. He’s on a mission to help Australia create its data-driven future. This is the other place we can go for help with adapting to the digital age. It’s just over 1,000 scientists, data scientists It’s arguably one of the largest groups of data scientists in the world. And it’s focused 100% on helping Australia navigate through digital disruption Make no mistake, that disruption will impact every part of our nation from Government to enterprise to transport, to telecommunication and traditional industries like agriculture, mining, health and so on. The way that that group accesses those other industries is by using the broader CSIRO, which has business units in each of those areas as a channel to market. It’s a combination of domain expertise of the CSIRO Ag Group and the digital expertise of Data 61 to give the best values of our customer which is is all of the people and companies of Australia. So mining is one of the first areas that really seemed to embrace, outside of telecommunication, one of the first traditional industries that really seemed to have embraced the ability to disrupt using digital technology and we have done a lot with the mining industry from robotics to help them mine more safely, and to get humans out of harm’s way, but also in putting unique sensors on every part of the mining value chain to enable the big mining companies to figure out what their process is doing and how to optimise it. Things like sensors that go survive the explosion, and provide really valuable data on the nature of that explosion so the mining company knows where all the minerals went Remarkable information you can gather from this type of data Sensors on all of the motors, the trucks, the conveyors to measure the efficiency of the process. Putting that together in a platform so unique hardware technology that can survive in that environment, you need data science to make decisions and optimisation of the process, we’re slowly seeing a convergence there Traditionalery, that industry was resistant as many Australian companies are to technology, seemed a little scary, a little too sciency, but now they’re really starting to embrace it and I’d argue that Australia could well be one of the most

advanced in mining technology in the world as a result of that change. But it’s a painful change. It’s a scary change for traditional industries Agriculture is the other one So CSIRO places sensors all over the country on certain farms to help understand how to understand moisture content, soil qualities, we have climate models that help the farmers to determine when to plant, when to sow, where to put out – when to rotate pasture yours and go from one crop to another or to grazing. All of this data, it’s a rich data set but it takes a long of heavy compute power and a lot of heavy analytics to get the most out of it eHealth – we haven’t had that much success in eHealth outside of Queensland. Queensland has been a remarkable state for us They’re the first place in the country to give us access to their state health data base We have already shown very conclusive evidence of improved mortality through Queensland hospitals as a result of our data mining, and feedback to them that enable them to improve their processes. So many, many people are alive today as a result of those improvements Just an example of how data science can help improve processes also in aged-care which is going to be a big issue in Asia as it is in this country, eMedicine enables new types of sensors to be placed around an age care facility, that enable monitoring of the people in that facility without interfering in any way shape or form, with what they do everyday I mentioned the honey bee initiative, this is a global initiative. We’re trying to get this technology and the globe because 30% of our food depends on these little guys doing what they do industrial Internet, I’ll show you Zbd later when we talk on the panel but we’re able to 3D map inside mines in a GPS denied environment and yes still get geopositioning data, we have taken that technology to a number of other industries to enable a fundamental connection between the physical world and the digital world the soil map – so we have flown drones over most of Australia, gathered the soil data, the mineral data to help with precompetitive analysis Imagine taking that rich data set and making it available to everyone? Completely open data set. Imagine connecting tell all together, and making them accessible to global industry so that data can be mined and the economies can be improved We’re working on a thing we call OZ gnome , I know it’s a terrible name, it’s a gel that enables if data set to be preserved but updated. It’s a bit comply cased to explain in a short time. We put a lot of effort in mapping the future of the nation, hue it will be disrupted by all types of technology, but particularly digital technology so CSIRO, our mission for the next five years, Australia’ innovation catalyst, we’re here to help. If you want to – if you need help navigating digital disruption or any kind of technology disruption, please come to us. We work with 3,000 companies every year, we work with all of the universities, we’re going to do more and more of that, we want you of the best customer experience you possibly can. If we work together to collaboratively, we really can navigate this future Disruption will lead to growth, will lead to profession perty and good things. But we have to work together to make that work Thank you (APPLAUSE) UNKNOWN SPEAKER: Thank you very much. I cannot believe that we have had drones fly over and do the soil map Stay with us Stay with us, because we’re going to welcome some other team members up for some Q&A. So, Brian, if you can join us again and while you’re coming up, I’ll also introduce Gerd Schenkel, the executive drector of Telstra Digital. He’s to ensure a bright future of Telstra in a digital world, and every now and then you ask me to help you out with that. Welcome GERD SCHENKEL: Thank so much for both of you for two mind-blowing presentations. I think the – the surprise in particular the amazing work CSIRO has done and is doing, and if some ways, you are the first and most digital organisation we have in Australia, I think it was founded in 1926. You were the first organisation to use the Internet according to Wikipedia that is, so it must be true! And you are also the first – the first organisation to use a

computer in Australia. In fact the fifth compute ner the world So — computer in the world The digital credentials is certainly second to none. I think the question is how can we compete – how you can compete and help Australia to compete with unicorns and $10 billion research budgets and Google and Facebook and the likes. Clearly you have the credentials but are you able to keep up with those kind of budgets and competitors? BRIAN SOLIS: Budget-wise probably not. But in order to be successful we have to focus I know it’s not a popular saying in Government here to pick winners, but I don’t know any other way to win but pick winners. We have to focus our resources in areas where we can make a difference. The first organisation to use Internet, yes. Organisation that invented wifi, yes. Organisation that built the world’s first working computer that can run code, yes But we can’t rest on our laurels. We’ll be defined by what we do to help this nation evolve to digital GERD SCHENKEL: You heard Minister Fifield this morning put out a new set of language of our Government, certainly not – putting out the initiative of being a leader in the digital economy. And you heard Larry displaying the credentials. Are you convinced or would you say, “You know, not convinced yet?” BRIAN SOLIS: First, Larry (LAUGHTER) Briens briens backpacks on bees, I mean?! It’s brilliant Something that you said, though, that I got, you know, use in the response, is resting on laurels, that was – that’s exactly right, but most businesses pride themselves on those laurels on how they got here today, and continue to think that’s the source of their superpower moving forward, and that comes to your question then, you know: Are intentions and statements good enough anymore? And I think that for the most part, the aspiration of trying to do something is noble. It’s – you’ designed by your actions and your words. I can tell you travelling the world, every minister I have met with, has the right intentions to do the right things and make the right investments but things like the culture of the country, things like vision, things like laurels, those sort of become either the defining attributes or the defining distribution point which then ables whatever you define as greatness. I can tell you with a lot of scientists I work around the world, a lot of them are hampered by the things that are trying to do the right thing but not looking big enough or great enough. And to your point about unicorns, for those who don’t know – start off with a billion dollar evaluation, that’s now starting to become common-place Those unicorns, if you look at Uber’s, they’re – they’re rumoured to get another big round of funding here that’s going to soar that valuation up through the roof. But it’s not through technology — certain why not for technology and for kittens. It’s to fight Governments and change legislation and essentially break down all of the barriers that prevent and indhinder — hinder innovation. The idea is good enough. The money and support to build those ideas is good, but it’s also: What are you going to do that changes how society operations UNKNOWN SPEAKER: Is the role of Government then to get out of the way and let the Uber will innovative. And not fund amazing things like the CSIRO UNKNOWN SPEAKER: I think the role of Government is to deal with what is best for the people. I don’t know about you, but a lot of Governments around the world don’t do that. And I think that in many cases what is best for the people, it’s not just saying what is best, but understanding what they cannot do today and what’s great to be competitive around the world, and becoming an enabler, becoming like a venture capitalist of human intentions and aspirations to bring those alive UNKNOWN SPEAKER: A specific question about the war on logistics, you mention so many stwris, this question is about logistics, can you help break out that issue on the last mile,

or the last 1,000 miles. We got Australia Post, we got some – a small number of logistic companies, but many e-commerce companies, in particular, don’t feel we have the same innovation that we have in the US. Are you guys active in that space at all? UNKNOWN SPEAKER: Sorry, when you say logistics, I was thinking of northern Australia. So we map actually the whole of Australia, but particularly northern Australia because we’re trying to figure out how to monetise that region. So figuring out the transport and logistics for northern Australia and indeed all of Australia to move goods more efficiently at lower cost without them spoiling. We’re also doing a lot of work in India. I don’t know if you’re aware – 30% of food in India is wasted because it spoils before further gets to market. It’s a big problem But is that the logistics you’re talking about? UNKNOWN SPEAKER: I’m not sure it was on the wall. Whatever logistics you feel like! (LAUGHTER) UNKNOWN SPEAKER: I mentioned the digital maps, so UNKNOWN SPEAKER: There you go UNKNOWN SPEAKER: I know it’s a bit wobbly, if you can… so we – in Australia, we often confuse particularly in research, we often confuse invention, you know, we invented wifi with innovation. And we think that the invention is the value when, in fact, it’s just the start of the journey and the innovation that delivers the value. And we really need to understand that profoundly if we’re able – going to deliver the value from the wonderful science, the 41 universities in this country produce. The reason I show this, we did this for BHP. So they could actually map inside their mines and use it for robotic vision. They have this on their vehicles It’s the Vision System. Kind of a version of a predecessor, I should say, to Google’s spinning camera, that’s on the car that does Google maps, but bounces around and produces a HD digital image of the inside of the environment, like a mine. That was an idea on a lab bench. But it had no value until we physically embodied it in this product. Now, we had to do that ourselves because it’s perceived as, it’s sciency, a bit too risky. You can’t blame Australian business for feeling that way, by the way, because they haven’t felt the profound impact of innovation. So I feel it’s up to us to actually take that risk to fund these things to get them at least halfway to industry so that industry can pick up the torch and run with it and take it the rest of the way to market. We got to bridge this gap between the lab bench and, you know, invention and actual the value creation caused by true innovation UNKNOWN SPEAKER: I mean, you have an incredible resume yourself, you know. What attracted you to the role? Why work for the Government when you got a history of start-up yourself? UNKNOWN SPEAKER: I’m not allowed to stay what the Prime Minister said, so I was asked a very high level politician (LAUGHTER) UNKNOWN SPEAKER: Larry, why do you want to be a public servant I said, gee, I have to do that, is that part of the requirement? I don’t think any of us feel that way as public servants Most scientists get up out of bed in the morning to go and change the world. I peen, they really — I mean, they really believe passionately their science will make a difference, whether they’re doing environment science or digital science. For me, when I met the people inside the organisation, it reminded me of every start-up I had ever run, which was populated by missionaries wanting to change the world, rather than public servants UNKNOWN SPEAKER: So, Brian, listening to that story, what’s your advice for Larry? Personally! BRIAN SOLIS: I don’t think he needs any advice from me personally. Maybe the other way around! I don’t know that I have any advice for you, Larry, other than, you know, maybe keep bringing that prop with you everywhere you go! (LAUGHTER) BRIAN SOLIS: Certainly a conversation starter UNKNOWN SPEAKER: How do you innovate – Brian, if you put yourself in Larry’s shoes, how do you innovate when you sort of in between? You’re a scientist or in charge of thousands of scientists, you ultimately reliant on the Government but yet you’re seeking obviously proximity to industry and customers but don’t have direct customers necessary why or maybe you feel you do. How do you innovate in that position where you don’t have maybe that commercial pressure than as much as some other companies do, or that commercial reward, no doubt

you’re going to make a billion dollars if you’re very successful and your executive team, how do you invo investigate in that — innovate in that situation BRIAN SOLIS: If you allow me to psychoanalyse you at the moment I would have to imagine he is where he is, maybe we’ll talk like you’re not here! He is where he is because he is – because he’s an entrepreneur at heart. He has the passion to — has the passion to do and create and invent and make. Those are the attributes of an entrepreneur that as long as he doesn’t lose that within a Government body, I mean, that’s exactly what the Government needs. It’s just hard to attract people like Larry to roles like that because other – there are often outdoing — out doing those things. It’s true for any business also chsmt is why we have to create cultures, I think, that an environment that fosters that creativity and rewards that creativity in ways that are meaningful to the people that are creating, otherwise they leave and they go and do their own thing or do it with someone who’s going to appreciate that And to just one more thing on that: You’re very lucky that Larry is incredibly successful without this job. You know, he – probably not doing it for the pay cheque. So we have to find ways to reward these types of thinking, even if it’s failing faster than it is creating, to sort of reward this behaviour It’s something you said earlier which I thought was brilliant, one thing in particular, that we can all learn from the a lot of times we tend to look at our own competitors for what we need to do and how we need to respond But in the one example where you look at astronmy as one possible way of bring to life, it’s not as an innovative as what you’re doing, but they whether tell you that they do not compete against coffee companies, they compete against consumer technology companies That’s why a lot of their infrastructure is – has been completely reinvented because they’re not acting like the company you think they are So I just think a lot of this work is cultural in nature UNKNOWN SPEAKER: One question here specifically for your, Larry: What can you do or the CSIRO do specifically to help others navigating the digital disruption or digital economy? What is it – you invited essentially people to engage with organisation, but what specifically would you do for them? LARRY MARSHALL: Probably what we did for a couple of the big mining companies where we kind of went in and pitched the notion of data mining, which is the wrong terminology use to with a mining company, but the idea of making decisions based on data and predictive analytics . One of the really profound outcomes of that, we took an old technology that we developed years ago as part of Radar. I don’t know if you know, but CSIRO built Australia’s first radar air defence system and actually the first portable radar in the world apparently Because we had to get it up to Darwin in about three weeks and get it deployed to defend Darwin. So the necessity drove the invention there. That same group developed this technology where you can beam energy into an orb body and make the mineral, what you’re trying to extract, make it resonate and literally can measure very accurately the percentage yields that you’ll get from that body We have deployed that in Bada We need to be in Badar a lot more often. We need to be there all the time. But we’re able to deploy that on a main conveyor line for a big Australian mining company so they could measure the yield before they crushed the ore, and figure how to blend them. It gave them a much higher value end product from a piece of fundamental science, invented for something completely different. So I think to go more broadly, we need to engage much more deeply with our customer-base, traditionally we haven’t engaged deeply enough with other big industries in Australia, like Fintech. Like companies like Telstra. We need to do more of that. We need to start the conversation because it’s through interaction with you that we can help craft our vision of what our science and technology can actually do for you, and you in turn can help us figure out where to invest our funds to go and create the technology, so when you market gets to where you think it’s going to be, the technology is going to be there to support what it needs at that time UNKNOWN SPEAKER: In mining, I heard a few people recently in the US talk about mining

asteroids and points out an asteroid, whether it’s platinum in the asteroid is worth $5.3 trillion. They said the first trillion nair is going to be the one going to mine the as strait UNKNOWN SPEAKER: We’re really getting out of the box here, aren’t we! That atronmy group I mentioned, which by the way is the group that build the radar, which invented wifi. So they’re an innovative group. Even though they’re way out in the fields mapping galaxies. Very innovative group. So, yes, they have looked at a lot on that and they day dream a lot about that. What we haven’t done enough of – is customer engagement and it’s not – most scientists are introverts, it’s not our natural state to go and talk to customers, but you can really help us. We need your help as much as you need ours because if we can get this conversation really going, really deep conversation about innovation, it will help us steer our technology, our science, far more effective why to what – to deliver what you need UNKNOWN SPEAKER: Brian, would you consider investing in the asteroid mining venture? BRIAN SOLIS: Considering what I have to invest, I’m sure I wouldn’t get very far. Yeah, why not, 5 trillion return on the smaller investment, sure! But, yeah, if I get that opportunity, I will and I’ll also tell you – I’ll call you on the spot, “Guess what I have an opportunity to do right now?” UNKNOWN SPEAKER: That’s a good risk profile you have got there With the remaining 30 seconds, I wouldn’t mind asking each of you, or giving you the opportunity to provide advice to people in the audience. We have a diverse group of people, but I’m sure many of the audience would think – am I wasting my time in my current job, should I be working for Telstra, or should I quit working for Telstra, or move to the US. The opportunities are so amazing, what advice would you have for people in the audience in making those kind of decisions? LARRY MARSHALL: I think Australia is on the cusp of really generational change, fundamental ground-shifting change. We’re so close. This feels like, pardon me, andcy, but it feels like silicon value why in the ’80s. It feels like we’re so close to a fundamental shift in our innovation ecosystem. It needs some nudges and some direction, but I think we’re so close to that. And whatever it is that you do, can I remind you that you can always reinvent. So this is (LAUGHTER) LARRY MARSHALL: This is a circuit, all USB dahhate circuit in cloth. It’s the material itself, you can fold it and wet it and still maintains connectivity. This was invented by the same group that worked on wool that made wool an industry in Australia. Figured out how to make pants and butt pleats in them. And now they’re making things like backpacks and coats that charge your iPhone by your physical movement. With no circuitry at all. I think you can reinvent any industry and reinvent yourself and don’t be afraid to do it. It’s opportunity UNKNOWN SPEAKER: I wonder what else you got in your pocket?! (LAUGHTER) UNKNOWN SPEAKER: Thank you very much, both of you for your amazing insights That was just brilliant. Thank you very much Gents. A woollen USB, bring it on. Asteroid mining. Who apparently?! It’s that time of the day where we look at how we support a start-up business or a number of start-up businesses, and it’s time for the 2015 Australian Digital Scholarship I’m going to stage Claudia Grinzi. She’s Telstra’s service lead, one of our star performers, our game changing winner for 2015. Annie Parker will join Claudia as well to host our scholarship finalist Please join me in welcoming the team to the stage (APPLAUSE) UNKNOWN SPEAKER:

It’s an absolute pleasure to be here today and to listen and learn from some extraordinary humans For me, receiving the Telstra Digital Game Changer award, really meant a lot. Ever since I was a young girl I was inspired from Gandhi’s quote of be the change you want to see in the world. I wanted to see a world with more compassion, positivity and happiness. I ul always thought that meant I had to be part of some global humanitarian effort or a charity. After some time, I realised I could actually make that change right where I was, right in the workplace. That just by being myself and bringing my version of compassionate and empathetic leadership, and playing outside the lines, that I could bring about change and influence people’s happiness, job satisfaction and positivity. So I’m delighted that Telstra Digital has embraced my version of leadership, and valued it highly enough to award me the Game Changer Award. And with that, I also have the honour of awarding and hosting the winner of the 2015 Australian Digital Scholarship winner to South by Southwest Interactive in Austin, Texas next year. I have never been, I’m so excited. I heard the stories, Monty! (LAUGHTER) UNKNOWN SPEAKER: As you heard, South by Southwest, is one of the world’s biggest digital events. And this prize is a way that Telstra can support start-up businesses. So they can share and learn from other businesses that they might not otherwise get access to so it’s a pretty amazing prize So let’s find out who’s vying for it and let’s meet our three short-listed superstar start-ups. Annie, other to you ANNIE PARKER: Nice to see you again. This is the second time I had to follow Larry, and him and his bag of props, trust me, they go everywhere! But for those who are from a British background, I am going to use a analysis. So you’re going to see three different entrepreneurs pitching today Just quickly in terms of background. One is in Sydney, our in from our second class, and the third is from Brisbane We have a real breath in terms of experiences they have had, and how long they have been going in the start-ups as well Ken, Gary, Andrea, please join us on stage is from Green Silks. She’s from Brisbane. Ken is from Chatty Kidz who is from our class one, and Gary from Disrupt – disrupt Thoughts (?) is part of our second class. Each of the guys are going to get an opportunity to pitch to you and you get to vote on which one you believe has done the best pitch and deserves that trip out to the US. Back to you. So you can explain the process UNKNOWN SPEAKER: This is how we’re going to role. I’m going to kick off with a few questions so we get to know our entrepreneur as bit better. Get under the skin a little bit It’s during that time you in the audience or anyone online has a question, I ask – invite you to SMS your question to 0484100600 We’ll get the start-ups to do their two-three minutes pitch And then after all three pitches, I’ll open up the voting lines and I’ll explain how that works in a moment. So, firstly, I wanted to congratulate you all for making the short list You’re deserving power must be very high and your eight to hustle — ability to hustle must have impressed our selection team. Ken to you first. As – I know the working parent trying to find the time to get involved in my kids’ education can be a bit tricky. So your Chatty Kidz app can potentially solve the problem. When did you and Annabelle, your wife, come up with the concept of Chatty Kidz? UNKNOWN SPEAKER: It started

about three years ago, I’m Scottish, not from Australia You may recognise! And my mum complained to me that I was a bad son because my children wouldn’t speak to them. So I gave myself the challenge of trying to engage my kids to talk to my mum on a video call. I discovered that using education meant my kids would sit and talk to my mum for half an hour, 40 minutes. Quick! UNKNOWN SPEAKER: Great. Wow, it’s – when it comes from real personal experience, you know you got something going on there. Gary, so you are creating the world’s first fully customiseble sports gear platform and using 3D technology and it’s growing to quickly What has been your most surprising customer moment? UNKNOWN SPEAKER: OK, I’m going to put it into two. The first one, I think, for us was the – as a couple of sports pieces on there, our first one was in surfboards. Then we had an Aboriginal artist from SA to approach us to put some artwork on a line of boards he wanted to make. For him it was about the old Australia and new Australia combining and creating something that is both useful and artwork And on the second side of it: Several weeks ago, we had about 100 local manufactures here and overseas, one of the sons was making cupcakes and said thank you, you funded my holiday UNKNOWN SPEAKER: Lovely, thank you. Andrea, you and your business partner have created an online lawn mowing marketplace, a bit aiming to create Uber from lawn mowing. What has been your biggest ah-ha moment UNKNOWN SPEAKER: One thing we didn’t expect is just how many people would pay extra money to get their lawn mowed quickly It’s amazing how people just want their problems solved so fast. But probably the second ah-Ha moment is we started this business so we didn’t have to talk to the mowing guy. We spent all day talking to the mowing guy! (LAUGHTER) UNKNOWN SPEAKER: Thank you. I might ask a few more questions So, Gary, what would be your personal advice to an early stage entrepreneur who’s thinking about starting up a digital? UNKNOWN SPEAKER: Don’t do it, don’t do it! (LAUGHTER) UNKNOWN SPEAKER: My advice? YouYou’re never going to be ready You can prepare yourself as well as you can, but you’re never going to be ready. Make sure that every says jump in the deepend, I would say not doing that. Find out as much information as you can. And make sure you have enough bank to keep you going. Running a business is hard and you have to keep yourself going and eating You only get one shot of that And then apart from that, you’ll know if it’s right for you You’ll feel it and it will be a feeling. Just go for it. I’m on a good day today UNKNOWN SPEAKER: What about you, Ken, what’s been the most surprising thing you have learnt about starting UNKNOWN SPEAKER: How long it takes. You can do things very fast, you can get through things, but doing business and growing a business and getting things started takes time Takes years. So start-ups, if you’re an entrepreneur be prepared for three, four, five years of hardly any cash. All these successful companies are all 10 years’ old already UNKNOWN SPEAKER: OK. And, Andrea, like I said to you, do you think the Internet has levelled the playing field for entrepreneurs? UNKNOWN SPEAKER: Absolutely That question comes at young entrepreneurs but it has levels itself to all ages of entrepreneurs. It’s just amazing what you can do for such a small amount of money compared to five or ten years ago in starting a business UNKNOWN SPEAKER: OK. Thanks, everyone. Let’s get on to the really exciting part – the pictures. Alright. You have each got about two to three minutes max to convince the audience and everybody online why they should vote for you, and award you the Digital Scholarship. So, Ken, you’re closest to me, let’s start with you (APPLAUSE) UNKNOWN SPEAKER: So kids all over the world have to learn to read and

speak English. But nowhere is that need greater than in China where most of those millions of kids learning English are taught by teachers who speak English as a second language. They produce students that can write and read English well, but when they travel, speaking an understanding English is a different ball game. Especially when you’re thick in an accent So Chatty Kidz solves this problem. We have thousands of videos of native English speaking kids reading books, all structured based on level of difficulty From easy to hard. So that kids all over the world can read and can learn English by watching videos. How easy is that? We also got thousands of books throughout our global partner, Pearson Education, structured on the level of difficulty, so kids can practice the reading themselves. Oh, yeah! There you go. Based on level of difficulty so that kids can practice reading themselves Can also record themselves reading books, that is peer reviewed on our platform. They can also get on a real-time video call and chat in English with kids in Australia. All the time we’re collecting data, valuable data. We’re even analysing the videos the kids are recording so we can assess the reading ability at any point in time, avoiding the need for boring tests. The data creates reports that are valuable to school, teachers, pants, and — parents and students. Imagine how easy it is to watch a kid reading a book, and compare that to a kid reading that six months ago. You can see that kid’s learning progression There’s lots going on. One of the biggest opportunities we’re working with at the moment is an agreement with the biggest education company in China Today has 16,000 schools and 10 million kids. We’re creating a partnership with Australia and China. Connecting schools and students. The opportunities are huge. One of the biggest deals with negotiating at the moment is a commitment for 1 million paying users in China. It’s very exciting. So look, if you want to get involved and help me scale China massively. If you want to invest, rounds closes in two weeks of things I love about Ken – he completely forgot he’s got slides, and that’s one of the things we teach these guys when we take them through the program is to make sure they’re ready for anything to happen. So, Ken, as you very quickly understood, can actually do that whole presentation without any slides whatsoever! (APPLAUSE) UNKNOWN SPEAKER: Thanks, Ken Gary, over to you UNKNOWN SPEAKER: I don’t teach kids to read! But my name is Gary, and I’m the cofounder and CEO of Disrupt and what we do is customise the world’s sports equipment. As an interactive session, raise your hand if you’re into sports of any kind, you watched sports, played sports. Yes 95% coverage Hopefully you’ll appreciate the problem we’re trying to deal with. If you’re into sports, you’re incredibly passionate about what you do, most of us it defines us as individuals, I’m a surfer, a really passionate snowboarder and I’m a terrible cricketer. Yes, I know, I’m English! But the probable we got is that – I can’t use a clicker! That is a massive problem that we’re trying to solve right now There you go! The problem we’re trying to contend with is even if you’re incredibly passionate and sports defines you, this is what you’re stuck with: It’s boring, and not made to your individual ability and style, and it takes up to 18 months from product innovation from lab to in store where you can purchase it. Everyone takes their mark-up in between that On the flipside, you got hundreds of localised manufacturers right here in Australia that are incredibly brilliant at advanced manufacturing. Their issue is they can’t compete on a global scale or with Asia where the wage rates earned are lower, but what they do have a special skillset. That’s where we come in. We got a 3D customisation

platform where you get to design your own sports equipment It’s 100% customised to your ability, and 100% – 100% design to your individual style, it arrives in your door in two weeks and it’s exactly the same price as retail. So it’s 100% customised, and exactly the same price as retail. With dit Runt, and we’re customising the world’s sports equipment — we’re Disrupt, and we’re customising the worlt’s sports equipment. The way we do it is we got integrated backend manufacturing system that links into these manufacturers all over the world. It allows them to make products at scale and fast without ever slowing down their productionline and we skip out all the people in the middle. I have got three others for you. The person would be jump on to your mobiles after this and vote for Disrupt, we not only want to go to South by Southwest. But we want to open up the US market for us. The second would be if you are an angel investor or interested in sports and technology, come and have a chat afterwards. And the third one – you’re likely all have marketing departments I’ll like to have an introduction to them. We do great corporate giveaways UNKNOWN SPEAKER: You really can hustle! Andrea, over to you, to hear about Green Socks (?) UNKNOWN SPEAKER: Hi, I’m Andrea Martin, and with my business partner, Richard, we are Green Socks, the easiest way to get your lawn mowed. Similar in son September with uber, we’re trying to inject quality control and convenience into lawn mowing. So let me tell you about Gabby and her friend, and the problem we’re solving for customers and why they’re so happy with Green Socks. Gabby working full time and superbusy, her husband says he’s mow the lawns but he’s busy too. She doesn’t have time for quotes and even if she did, she hates how the mowing guys make her feel when they show up late, don’t show up at all, or trying to haggle with her over price What we do for Gabby is give her the option to book on her smartphone or her computer in just 60 seconds, by clicking through some very fun pictures, she can get her price, book her lawn mowed and someone will come and mow the lawn for her like magic. After the mow, someone checks if she’s happy, and conveniently puts it on her credit card and she never has to talk to the mowing guy – problem solved. So let me tell you about the problem we’re solving for our typical mowing provider Graham can’t afford a mowing franchise to help him get customers so he has to do it by myself. He’s tried letterboxes but most people have no junk mail signs these days so that’s a business tricky. World of mouth is really slow. He’s tried the Australian lead sites where they charge him $15 up front for a lead. He doesn’t even get the job. He’s not quite sure what to do. Enter Green Socks We only make money when he makes money. And only send out guaranteed work. We’re providing more guarantee than a franchise but for at a fraction of a cost. Barely anything compared to a franchise, problem solved. If you think lawn mowing isn’t sexy. That’s what people thought about the LAN transport industry until Uber came across. Plus, ladies, depending which suburb you live in, and which day you book, we might just have a fireman or policeman mow the lawn too Because whilst most of our guys are full-time lawn mowing pros, we do have some guys who in between rescuing people from bad guys and burning buildings, will mow lawns for you. So we at Green Socks, is the easiest way to get your lawn mowed. If your business might be able to help our business, night this David and Goliath battle for these lawn mowing franchise around the world, we’ll love your help Thanks very much UNKNOWN SPEAKER: So, we are now going to encourage you guys to vote. Can you remind everybody how to vote UNKNOWN SPEAKER: Absolutely It’s now up to you. Everybody in the audience and online to vote. So what I need you to do is get out our phones, and SMS the name of the business that you think is most deserving of

the 2015 Australian Digital Scholarship. SMS to 0480333333 We’ll leave the lines open for a couple of minutes. So while you’re all voting, let me have a look at this and see if there’s any questions from the audience We got time for one. This is could be for any of you: What was the worst investor meet that you had? UNKNOWN SPEAKER: Is it a good one? UNKNOWN SPEAKER: Look investor meeting UNKNOWN SPEAKER: Won’t mention any names UNKNOWN SPEAKER: Not mentioning any names. They give you lots and lots of questions. Quite difficult questions. You know, I haven’t had – I can’t think of a good one, never mind of a bad one at the moment! They’re certainly tough UNKNOWN SPEAKER: I think a really good investor knows at what stage they’re investing at So if they’re asking questions that should be from a 4-year-old company at a 6-month-old marker, then they’re not the right investor for you. That is finding the right balance UNKNOWN SPEAKER: I’m going to answer one thing that was asked of me during the break: The first is how do I get involved? I asked you guys to pay it forward to get involved. For those of you who didn’t know, it starts this weekend at Sydney this week. Just go for a quick search online to start-up week Sydney. For those of you who do want to really get thrown into it, one of the really simple quick ways you can get your head around how to get involved in the echo system and learn – the other lady who asked, I think it was Yvonne, muru-D is an Indigenous world, it means the “path to”, and the D stands for digital UNKNOWN SPEAKER: The votes are coming in. So while we’re just finalising that, let me just remind you that the winner and their business partner will get a money can’t buy opportunity to go to South by Southwest interactive as well as Silicon Valley for some amazing meeting and mentoring opportunities, but no one is going to be going home empty-handed. All of you will walk away with $1,000 gards growing your — towards growing your business from Telstra (APPLAUSE) UNKNOWN SPEAKER: OK A few more seconds. Whilst we’re waiting, we have a couple of questions of you guys – these are the prizes by the way, you’re not getting them yet It’s $1,000 in $1 bills! (LAUGHTER) UNKNOWN SPEAKER: Look, we have asked the same questions of Holly and Kate earlier, what did you guys get out of being part of an accelerator, that you think you wouldn’t have gotten otherwise. Whoever’s got the mic can start UNKNOWN SPEAKER: It’s the mentor network. The – for us to go through something and learn it’s not right takes a week or two Hood is you have gone through all those issues we’re facing Please get involved. To have access to a mentor network, we can ask questions, and bounce ideas, it wasn’t much of a commitment. I have regular weekly phone calls and we catch up UNKNOWN SPEAKER: This is my second business, I started my first business in 99, and sold in 2007 and we had nothing like the network that I got access to. The experts, the advisors, people’s opinions, they’re not all good, but, hey, there’s lots of them But also getting kicked in the backside. It’s good UNKNOWN SPEAKER: Anything to add, Andrea? You’re only week six now into Brisbane UNKNOWN SPEAKER: Yeah, this is week seven UNKNOWN SPEAKER: I lost count! UNKNOWN SPEAKER: So I just oco the comment — echo the comments, amazing network and connections. If you’re going on an accelerated program, you’re going to be trading in your gym card for your access card You’re all the time husling and working hard UNKNOWN SPEAKER: Lines are now closed. Now, OK. I am very pleased to announce that the winner of the 2015 Australian digital Scholarship is Gary and

the team from Disrupt! Special award Congratulations! UNKNOWN SPEAKER: Thank you UNKNOWN SPEAKER: Great. Would you like to say a few short words? UNKNOWN SPEAKER: If you’re after some sports equipment, just go to Disrupt (LAUGHTER) UNKNOWN SPEAKER: Thank you very much, and it was a hard battle but we’re really going to the US to open up the market. There’s hundreds of small to medium sized manufacturers here, and there’s thousands of them and hundreds of millions of customers Please stay in touch (APPLAUSE) UNKNOWN SPEAKER: Yes So thank you all for making this session possible. All your pitches were outstanding and I know much success awaits all of your businesses. Gary, looking forward to going to Texas with you next year. And a big congratulations to you all and thank you from Telstra UNKNOWN SPEAKER: I’m going to say quickly – just be ready – Gary eats like a ganet Wherever there’s free food UNKNOWN SPEAKER: Looking forward to it. I wish you all a smooth day and we’re now breaking for test This is a test

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UNKNOWN SPEAKER: Welcome back, everyone. It’s been an

absolutely brilliant day so far and we’re not done yet. We’ve

got a fantastic final few sessions coming up for the day

before we can have a well-deserved brink later on this evening. — drink later on this evening. I’d like to welcome Karsten Wildberger for the Group Executive for Telstra Retail. He became Group Executive earlier this month after serving in another area An experienced telecommunications executive with a career spanning more than 18 years, he has a passion for leadership, customers and digital innovation. The Empire Strikes. Please join me and welcome Karsten Wildberger to the stage Welcome KARSTEN WILDBERGER: Good

afternoon, everyone. I hope you’ve had a great day so far I’m not sure about the title – The Empires Strike Back. We haven’t talked about the incumbents yet and it’s time to talk about all these wonderful companies that really make the world go round. And what I’d like to share with you, a few thoughts that we at Telstra and incumbents think about digatisation and the opportunity of digatisation Incumbents in any industry increasingly realise the possibility of disruption from digatisation And it opens up most industry to actually lateral competition, especially from software-griven companies. And the way I look at traditional value change gets deconstructed, and traditional business models get challenged but the challenges open opportunities. And at the core of digatisation in many ways are three things, in my view. One is most digital models provide marginal costs of zero, which fundamentally challenges lots of businesses. It provides the opportunity to create reach to customers on a global scale. And it provides richness in terms of functionality that it actually provides to customers In a few examples well-covered and well-known today, Air B&B are bigger than some hotel companies but don’t own any real estate Uber is bigger than all the taxi keams together but don’t own taxis. They are digital platforms that use the infrastructure. If you think of PayPal, they use the payment infrastructure of banks and card companies. Similarly, in telecommunications, Whattapp has paid hundreds of millions but uses the telcos’ infrastructure They need reinvent themselves and do it faster than they did in the past. New growth opportunities require innovation. Innovation is essential for any incumbent business. And the cycle of innovation is speeding up. Much faster than it normally allows Telstra is a great example of an incumbent in Australia. Wore an established business. We are a large player in the telecommunications market. And many years ago we used to be slow andcumbersome. Maybe some of you still think that we are, but we’ve become very, very agile, I think, in many areas today. But needless to say we always have to do better and strive to be better And today we are building some huge momentum in lots of areas Let me first of all point out in the age of digatisation, connectivity and network play a crucial role, because the demand on network, in terms of quality and security is increasing. And we are best positioned in Australia with world-leading networks, especially our mobile network, to satisfy that demand In the past five years we’ve also reenergised around customer service and the customer, which is at the core of digatisation customer thinking is at the cer of innovation and — core of innovation and the catalyst for innovation and growth We started our journey of digital transformation at Telstra about five years ago and our Digital Business Unit has played a very crucial role in changing Telstra. A bit disruptive in the beginning and still today and being the challenger. And now under Andrew Penn’s leadership, we’ve set ourself the new benchmark, to be a world-class technology company and at its core, it means we will be unrelenting in our focus on using technology to deliver value to our customers in Australia, but also overseas, because we are also becoming increasingly an international company. We have built a very powerful cloud business at our Network Application Service business is growing at very high rates Another example in a recent survey we conducted for Small Medium Enterprises, we asked them who they would trust most to be their solution provider We were surprised by the result Because they voted for Telstra 2.5 times more likely to trust us than any other nearest competitor. And that’s a huge growth opportunity for us More than half a million

Australian businesses now use Telstra X Marketplace which is a one stop shop and management portal to make it easier to buy, find and use leading cloud-based businesses to boost their productivity. So we see ourselves very much in the sense of also driving productivity, offering digital solutions. We are very focussed on improving customer experience to also improve our cost position. So our digital efforts new provide more than 50% all service transactions online. This is fantastic growth over the last year. We’re investing and providing digital solution to all our frontline people with apps where they can provide and get information to make the interaction with customers more meaningful. By the end of the year we have rolled out digital solutions to more than 20,000 frontline colleagues We won’t stop there. We have a number of digital products in development and they are born digital. We’re not launching any more products that are not digitally enabled. We also used our competitive advantages in terms of national distribution and brand recognition. And we want to be and to provide the preferred axis to our customer’s homes and businesses using Digital Solution. The see sector for success in this — key sector for success enthis digital age for anyone in the organisation is looking at the opportunity and not at the threat And this requires often a cultural shift. It also requires a shift in thinking around agility, time to market, and in particular putting the customer in the centre of everything we do, because beautifully digitally designed solutions are all about the customer. And in that sense Telstra has, in our pursuit to become a world-class technology company, we definitely embrace the digital change. And with that I’d like to thank you for your attention (CHEERING AND APPLAUSE) UNKNOWN SPEAKER: Stay with us We have audio back here Fantastic. Stay with us. We’re going to welcome to the stage Brian Solis and Robert Scoble for a bit of a panel conversation. We have both sides of the ledger here. The future in Robert and the leader of our retail business at Telstra. And Brian to host the session. I was hoping we could get – Brian Solis I guess we can be thank youful for jetlag I couldn’t imagine that. With that said, excellent speech and I have to say that I’m a big fan of what Telstra has done, starting with the Sydney flagship store and demonstrating what’s possible with making digital space. I kind of want to start there, and then bring Robert into the conversation. My write-up after visiting the Sydney store last year said that Telstra has done something here that Apple could learn from. And I would love for you to just share a bit of the vision of what went in to the marriage of physical and digital in that flagship store? KARSTEN WILDBERGER: You said applicants can learn a bit but we didn’t pay you for that statement BRIAN SOLIS: It was in bitcoin KARSTEN WILDBERGER: Who has been to the Sydney flagship store? The vision was really to say often we think in channels in silos. You have the context centre and a retail business And often you think about competing channels, if you like And the reality is that customers today, they move they want they want to cross all channels. And in any channel at any point in time and on one journey they can pop up in different channels. The cer of the idea is how can we bring together the best breed of technology in the traditional retail channels based on digital to think, to really connect the challenges and make the journey more seamlessly? If you book an appointment in our store, we should recognise you through the technology today. Connect you before with your trusted advisor in your store and make it a more personal experience. During

the shopping experience you can tack with digital efforts, all the items you looked at and you can review them once we get back home online and go back to the store. It is about looking at the customers and what they want BRIAN SOLIS: For those who have visited and who haven’t, there was a lot of Disneylike behind the scenes stories that I found marvellous, like the translucent doors for all of the products, so that you never really had to lose your representative. They never went behind the scenes They were always in your view, the idea that you put tables so you could sit down together and almost at a family community spot, the slats of the ceiling that helps you visually understand where you were in the stores. Very thoughtful Robert, I don’t know if a lot of you know this, but Robert and I are practically neighbours back in Silicon Valley. And I know you have been at almost every Apple store and have been the leader in a lot of the lines when a new product comes out. I want to hear what’s your viewpoint on the convergence between digital and physical and what that means for the future of retail? ROBERT SCOBLE: I was at the Indy Race and a met a film crew from the Petersen Automobile Museum that’s being built. They’re going to have a space where you walk in and be faced with autoracing in 180 degrees. You get to walk in the front door and experience other racing all around you. And that’s where I’m going with it. The world is about to shift where the computing is on you, around you, in your pocket, on your clothes, in your car. I mean, think about what Apple is thinking about with the car. How would you design a new car with no constraints? No budgetary constraints? Apple has more money than most companies and most countries. How do you rethink a car from the beginning? I would get rid of all windows, maybe. Think about a jet fighter pilot. I visited an air force base and there are cockpits with orange glass which will have information on all surfaces, right? One of the pilots told me I’ll never lose a dogfight because I have better information. That’s how I want to be in business. I want tohave better information to make a decision faster BRIAN SOLIS: I have a question I was in Kodak Booth in 1989 and they had a digital printer there. They kicked me out of the booth because they didn’t appreciate that I knew more about their digital business and was more excited about digital photography back in 1989 than they were. They didn’t believe in it. How do you turn a business that some people in the business know there’s a disruption coming but they can’t convince the other parts of the business to get what the program and what the business wants? ROBERT SCOBLE: We could be subjected to that and you fail how your consumers are changing We saw the same thing with Netflix and blockbuster in the States. An engineer went to the board of Kodak in 1989 and introduced digital photography and the quote was, “That’s cute.” Ignorance is bliss until it’s not. How do companies compete in a digital economy when you’re still selling physical goods? How do you stay relevant? Last year David said that Telstra would always be relevant? KARSTEN WILDBERGER: First of all, in the digital world, especially with all the devices around us, connected devices, the importance of network and connectivity is actually growing. If you look at the opportunities of cloud business and if you want to use cloud at any point in time, there’s download and upload speeds you need to provide Security aspects are increasing So at the fundamental core, providing connectivity there is an incredible demand out there So I think that’s great news And our engineers and technical

people are all inovatinging and working with other global companies around the latest best technology to always be at the forefront of innovation when it comes to network technology That’s at the core. Equally, at the end of the day, the customer decides what they want. Lots of our products where you have to go into a store or a cactus centre and now you can do it online. A beautiful and simple intuitive experience is borne out of the idea that I can do it myself. I don’t need the manual That’s why we embrace very much digital solutions, to try to design customer solutions from a digital standpoint. If customers then still want to go to a store or want to call the contact centre, that’s perfectly fine We have an incredibly large store network and that will always be the case ROBERT SCOBLE: Listening to the customer very closely, not quoit a year ago I was at a big music festival that has 200,000 attendees. I was hanging out with the geek who built all the information systems. He put 90 beacons in the field and has all the digital and the bands and to check everything and stuff like that. He turned to me and said, “I just fired my cloud computing vendor. It wasn’t you, either.” He said, “I couldn’t get through to the customer service on my business day of the year, on the day when everybody’s trying to register their bands and look up their calendars for when they’ll come over the next three days, right?” Today we’re providing support for this company, for the cloud on another vendor Because we were listening Businesses who listen have a future, right? BRIAN SOLIS: This is an example, no matter how much innovation or even interation that you put your bets on, if you don’t change your infrastructure, if you do not change how you run that business, that innovation is going to be the very thing that takes you down. So you talk about digital first, Born Digital is what it was. What does that mean? What does Born Digital mean? What does it mean from a culture perspective as well? KARSTEN WILDBERGER: That’s a journey for us. Because that was not a traditional way that products and processes were developed in a telco world. And what it means is that the product design, end to end, we have a service product that manes we have the whole life cycle of a product from purchasing decision, you buy the product, you activate the product and you service the product, you have an assurance in there. And then you have a retention. Everything, the whole journey of customers is thought through, it has to work purely through a digital lens. If the customers want to, no manual or physical interface to a person that has to happen. That’s the ideal world. And that also means that data flows through the system in an automated way Digital is, digital – and that’s what our digital unit also supports the business – it is truly going to a legacy process to define them to make sure that everything flows through ideally automatically. Because at the end of the day we hold right, the first time, our own mantra we’re aiming for. There is lots to do. But this work is best in a fully automated digital way. I need to be very careful. At the end of the day about the customer, we will always have stores and contact centres. It’s the customer’s choice which channel they want to use. And the experience in a store oin a contact centre should be similar how it would feel if they were online ROBERT SCOBLE: CEOs tell me there’s two new business imperatives. The first is they need to know everything about everything. The guy who runs the four screens at a stadium, he can see how many hot dogs are selling for a minute. He can see which parking lots are filling up. He can see which has the longest lines. He can see all sorts of stuff that we couldn’t see three years ago in a sports stadium. And he’s been asked to know more because he’s making money with the data. Think about Uber. What is Uber? It’sidate off about the world of — it’s data about the world of

transportation and that turns into features that pleases customers. Knowing more about everything. If you can figure out something in that store that you don’t yet stud study digitally with a camera or a sensor, you’re not yet there You’re not yet 100% in the digital world, right? The second thing is they are being asked to know their customer in far deeper debail. I was talking to the Ritz’s executive team He goes, “Dude, do you have any clue how the Ritz started 100 years ago? We used to have a room in the middle of the first Ritz with index cards and they’d go through your trash and see if you ate an apple or had a candy bar and have an apple on your pillow the next time you came to the Ritz. This was 150 years ago. They knew the customer really well back then Whether they had allergies or your kids had some special needs. Today we don’t know that But we’re going to get it back And Levi Stadium was a great example. They will know you when you come through the front door. “Can I take you to your seat, please?” BRIAN SOLIS: The answer is, “Yes, you can. Especially for the Super Bowl.” ROBERT SCOBLE: Going through the trash, it’s kind of in a strange way the original data We have BRIAN SOLIS: We have one minute left. The world of incumbents and the way I want you to spin this, Robert, is the Uberes and Amazons. How do you compete against what it is that you do not know? These customers that are able to create and operate from scratch? And you’re having to inovate based on legacy? What advice do you have for companies in a similar position? KARSTEN WILDBERGER: There is always the risk of disruption and the risk that technology can make someone less relevant and it’s important to watch that space. As I said before, with many of the companies that people call to disrupt us, we partner many areas. So I think there is a great space of co-existence. Fundamentally at the core of what we provide is connectivity. And that requires huge investment, huge technology, security aspects become more and more important Quality of network, more demand We’re very positive of actually having our space with increasing demand. And I believe it’s important to work in partner in today’s world and find the opportunity BRIAN SOLIS: When will Melbourne get the flagship experience? KARSTEN WILDBERGER: End of November and I hope to have another chapter in your book BRIAN SOLIS: Robert, what can companies learn about from companies like Amazon? ROBERT SCOBLE: We were competitive for a long time and now we’re a partner. We figured out we’re not going to be able to beat them on their game They’re going to be able to play our game. We have something they can’t do and we can now partner That’s why I’m here, right? How can we get along? Last time I was here, Gerd and I were locking down towards the beach and counted how many Telstra boxes were there. One every 30 feet. I won’t be able to compete with that. So if I want to get a beacon on every street corner I’m going to have to partner with Telstra. When I come along with the magic leap, I will need something in that box to make the world smart. So when I walk down the street it tells me stuff about the local street BRIAN SOLIS: Ladies and gentlemen, thank you UNKNOWN SPEAKER: That was awesome. Thank you. Thank you very much, gentlemen. OK. Two more fantastic keynotes to go to close out the day. Shel Israel was a best-selling author and speaks about technology’s impact on business and life. Been a keynote speaker on all continents. I think we brought you here for the first time too Might have ticked off Australia now. Two previous books were written with Robert Scoble and this is a sequel The former book focussed primarily on technology. This new work examines how the impacts retail and other public safety enterprises. All the way

from California, welcome to Shel Israel SHEL ISRAEL: Isn’t that beautiful? It’s not like militaritelligence or aeroplane food, it actually has a meaning It’s one that started about five years ago when I was in a bar somewhere, I think Seattle – I’ll get to him in a minute Lethal Generosity, what it means, if you treat your customers with great kindness, if you give the kind of experience that was spoke about earlier today, you will absolutely screw the competition. There is no way traditional marketing can take a customer away because of a price of a weekend sale or a deal. I started to learn this five years ago with this guy Does anyone recognise him? He’s strange and in some far off land. I’m not quite sure. But Robert and I were sitting in a bar – I think it was Seattle – he told me a story about his first job. He was in a camera store in California. Every now and then he would pull a trick Someone would ask for a camera and Robert would say, “I’ve got that camera. The guys around the corner have a sale on for 20% off.” They would step back, go round the corner, buy the camera. Sooner or later come back in and say, “That was nice of you. That was a great deal. I need a camera case, a tripod.” Those of you old like me will remember this stuff called film And they would keep coming back They would have something to talk about to this guy who sent them away. And listen to Robert’s story and I said, “Why did you do this?” He said, “You can lose a sale and gain a customer and the customer is a lot more valuable.” I said that was cool but at the time we’re in the glory of the fame and almost fortune of Naked Conversation, our first book together – a little while later I finished a book by myself called Twitterville and a company in Canada, I know this stuff is as bad as Foster’s but it’s a story about them. It is now Corr’s and the largest brewery in Canberra. They have had a marketing campaign about responsible drinking which is a pretty good idea if you’re a traditional beer-maker. In 2009 when I was writing Twitterville, the City of Toronto had to have some budget cutbacks and cut $80,000 out of the public, eliminating free transportation on New Year’s Eve, the biggest drinking night of the year. And Molson stepped up and said that private industry has to step in This is for the public good. We need $80,000. We call upon the business community of Toronto to put up the first $20,000 and to show our civic mindedness, we call upon our most bitter rival to match our $20,000. This is very noble, but they did it on something that was brand new Something when Robert was in the camera store wasn’t around yet, it was called Twitter. And the people at Molson were using Twitter and the other company was not. It started going around that people in Toronto were just getting into Twitter, particularly young adults, young social adults, the prime customers, the customers you can have for 50 years. And so they started talking about how cool this was that Molson, the challenge. Molson never said that. The users started saying that and it started going around. About five or six days later there were over 20,000 tweets which probably you got more than that today but back then that was a lot of tweets The local newspaper picked it up and ran a front page story about the Molson Challenge. And they called up the other company and said, “How will you respond?” And the company said, “What’s the Molson Challenge?” This was the first example of technology

playing a role in a brand, using conversations to get to customers while the competition stood there clueless, putting their money into advertising and other traditional activities I wrote about this in Twitterville and called it Lethal Generosity. A lot of people love the expression. It was suggested I wrote a book about. It I researched it at the time and couldn’t find enough stories. There wasn’t enough technology out. There certainly weren’t too many brands in the world who were paying attention to this stuff yet. The blue bottle in the corner is the other company and they were caught in the quandary. They could follow the challenge of their leader and establish Molson as the thought leader, or they could say, “No, and support irresponsible drinking on New Year’s Eve.” They ponied up the $20,000 and adhered to the competitor’s challenge This story I got in 2013 – the guy in the middle is an old hippy. He went to UC Berkeley and got into the out of doors movement. They started a company that got based in Berkeley called The North Face. It’s a brand challenge and named after the Eiger Pass. He didn’t have any money for advertising and marketing He said, “We couldn’t even afford rent most wunts.” But he came up with an idea and called it the lifetime guarantee. And this guarantee was if anything goes wrong ever, we’ll make good on it. Around the corner was Sierra Designs They said, “We do that too.” So a Sierra Designs customer comes in and goes up to the chief salesman there and the cashier and a whole lot of other things at the time that he was – I got this thing from Sierra Design and it’s a backpack and the zipper is broken. They said they’ll make good on it but they’ll send it to the manufacturer and they said ask The North Face what they can do They said, “Come on in. Have a seat.” He went to the other side of the building where they were making the stuff. The stitcher stitched it up. Handed it back to the customer. The customer said, “Fabulous. I can go on this big trip this weekend. How much do I owe you?” He said, “Just enjoy your trip. Have a nice time.” That guy has been a customer of The North Face for 50 years. He has broughtane an incaliable number of people This story appeared in a column I wrote for Forbes. It was a way of branding the company as the company that is centred on the customer and what the customer needs. They will guarantee what they do no matter what has gone wrong with it. If you have a problem and you’re in our community we will help you because we’re in the same community. The result is Sierra Design was flipped over. That’s why you see an inverted logo there. It landed on its head because there is nothing sweeter than being kind to a person and stealing them from your competitors. In the book I wrote with Robert in 2013, we talked about the convergence of five technologies – social, location technologies, sensors, and mobile and data. This book talks about the convergence two years later of those technologies with the new generation of humans The millennials. Self-absorbed, much-maligned and a lot of books and magazine articles and TV commentaries written by old people like me disparage them. I dedicated the book to them. I think they’re the best hope for the planet. And I think that they are, above everything else, the generation, the first generation in the world to be born comfortable with the technology. Most of us, if we learn a language before we’re 14, we can speak without an accent. If you learn it after roughly the age of 14, you’ll always have an accent. Most of us in a reek of a certain age were still a little

uncomfortable with technology, as much as we use it and love it, it’s still uncomfortable When I was a kid I wondered how the little guys got into my radio. They’re so natural with it, when you think of sales and the places and the factors that are involved, you overlook the phone, you’re missing the most important companion. What’s real important about the millennials is there’s a lot of them. The last watershed generation that impacted the marketplace are boomers and boomers are getting old and as nature will have it we’re diminishing in numbers now. In 2015, millennials took over in the global marketplace to be the largest geographic segment because they’re having fewer babies than prior generations. They’ll be dominant for another 50 years according to experts There’s a lot of things about them that are universally true It can’t be denied anymore. One is that branding efforts to get them to want something don’t work. What works is friends talking to friends. What works is customers talking to future prospects. This turns marketing upsidedown. There is a power shift that’s going on. And the shift is not complete, not total, but it’s going from the brand marketer to the customer The customer is now in control for the first time in marketplace history since the good old days of the shop on main street – that’s a US cliche. But simpler times when the clerk behind the counter knew every customer As employees, millennials are a different breed. Many people would complain they hire adbatch of millennials and they sit around talking to each other, using their phones, looking all the time saying, “That’s good stuff.” A lot of millennials have this attitude that their elders and their employers sometimes don’t like ’em. If you want to get my trust, do something to trust me. When I first heard this I was clueless I didn’t know what it meant This guy, Dave Donovan, works for United Software in San Francisco. He was in a company that hired a bunch of millennials because they wanted to get more millennial customers and wanted all the collaboration and the good stuff. And what he did was he opened up one morning and someone directly reported to him and asked him to be his Facebook friend. Seemed simple enough. Seemed easy enough. The problem was that it had never happened in the company. He did it. And low and behold other employees started asking their bosses to friend them. And within a year the company completely changed, better ideas were coming from younger in the organisation, meetings were eliminated. They started a private Facebook group and started to exchange ideas and information all the time every day over there. If you want to get lethal, let’s talk about incumbent companies facing contextual competitors. There are three basic groups of these competitors – the sharing economy is the one that’s talked about the most. Like Brian and a bit cynical about how much sharing is going on in this sharing economy, with all deference to the gentleman from Uber who I don’t see anymore What is different about the sharing economy is as a software platform and it’s competing with brick and mortar and the advantages of an established brand. And the efficiencies of us in marketing and sales and everything is enormous and unstoppable. The customer becomes the channel which is a part of most millennial marketplace strategy. Or it should be. And what the sporns they had in the store matters most than anything. Millennials in particular and the rest of us have fallen for this – listen to what I say I want and stop telling me what you think I wants and maybe we can do a deal. If you want my data, that’s great. What will you give me for my data? A second category millennials have spawned was started by the guy in the upper left hand corner How many of you have heard of this? My wife likes it. They cost less than the shoe she used to buy. The thing is every time you buy a pair of their shoes they give a pair of shoes to a poor kid that needs them somewhere in the world. When

they do that the customer feels like they’ve done social kid When somebody tells my wife that these shoes go niceply with those slacks. She ez, “They know to kids that need it. The girl in the middle is not a customer, she is wearing some glasses It’s a millennial start-up that is growing in very, very rop udly, selling on websites. They give a pair of glasses every time that a customer buys one They buy them for cheaper than they can in other stores. The third guy is less known. He started a company. He takes personally good vegetables and turns them into health and beauty products. Cucumbers, carrots, blueberries and so on down the line. He’s now said nine companies with the same model, each one of these companies does something organic in this area and then contributes significantly to a cause that’s connected with it, and as he said, and repeated questioning, “My marketing strategy is my customer. What I have to do is keep my customer happy. And they will get me other customers and it’s a lot cheaper than advertising.” He’s making millions and doesn’t spend much on advertising. I can’t say zero but it’s very minimalist. What’s a big company to do? You’re being hit with all these new business models None of these companies have the luggage, the legacy and the continuing advantages of brand There is something to be said about brand that’s been established, been around for years. It does have familiarity And still it maintains trust Although that’s all tapering That’s been discussed quite a bit today My advice is if you can’t beat ’em, join ’em. Robert wanted me to name this book Uberise Everything. I decided not to do that. Uber was involved in one of its larger controversies which we won’t go in to now. But I think what you need to do is Uberise what you can. If you’re a big company find things you can do to join up with this marketing and join up with automating everything you can to make the experience of the customer as seamless, as frictionless as you possibly can. This is an American chain of stores that are very successful. They compete with a bunch of other stores which are also developing their own strategies. In this first picture, it is located exactly in the flagship San Francisco shore where Nine West had been located the year before. They find they’re more popular and more sales are being made with them being in the middle. A woman’s collective is part of that as well. They’re located in Sub-Sahara Africa. They make beaded jewellery and pottery in the tradition of their ancestors. And through the affiliation there, these goods are now sold on the shelves with a little card about what the story is about them and the competitors are the only ones who are not allowed to do the right thing. The guy on the right shows another company that’s good. Everything he’s wearing from shoes to glasses comes from lace retrieved from the ocean. Some parts are seaweed that’s been recycled and turned into thread. The rest of it is trash pulled out of the ocean. Has anybody heard of a company called Telstra? Yeah How many have you have gone into their store? Yeah. Yeah. I usually will eliminate someone who generously sponsored part of my book and invited me to come speak here and is going to give some of you books out in the lobby later, but I couldn’t help but make my first tourist attraction – the Telstra store – I was also on my way to the Opera House. I stopped in there for a visit and the very nice sales lady who never had heard of anybody I knew at Telstra, took me around and showed me everything there. She was curious as to what I was doing and why I was asking the questions I was. But from when I entered there and I was asked

to go for an appointment, I realised one of the magics of what Telstra is doing that I haven’t seen anywhere else They’re becoming truly omny channel. If you’re in retailing or branding, you understand that means that your sex works with your store, it works with — your website works with your store, it works with other areas too. It just doesn’t happen that way because there’s a bunch of silos. When you go into this store, if you’ve opted in, they know what you looked at on the website the night before and can have those goods ready for you products, you can compare them If you still can’t decide, you can go to another silo which is your own home, with an old technology and a C card and look at the dita more closely before you make a decision. You can buy online or around the store or wherever you want. I think this will be very imitated Coming soon and I’ve run out of time, so I’ll be very quick. To the left are a bunch of mannequins in the store window They don’t exist yet but they’ll have beacons on them. And in the future they may be connected to something, a peer to peer technology coming along. But these beacons will take a signal from a phone, through the cloud, of course, and let the store know that you’re interested in those goods. And if they happen to know who you are because you’re a loyal customer, they’ll know your size and the colours that you probably prefer. The person in the middle there is using a phone store. Retailers know this – browsers are before you go to the dressing room. So when you’re browsing, you probably want to be left alone, but as soon assia go into that room and come out wearing something, you want help. And the browser becomes a customer at that point. One you’re probably familiar with – Apple pay and that kind of stuff? Wow. It’s coming to Australia very soon It means the death of the plastic card. It means the death of the long wait with that little gizmo that says processing. It’s one more way where everything is being Uberised one piece at a time When you get out of Uber, you don’t pay, you just leave, and it gets recorded along with the tip. That’s going to be every you buy. Ultimately, what I’m talking about is pinpoint marketing. Pinpoint marketing is the ability to understand every customer on a global basis, who they are, where they are and you can predict what they want It’s very powerful. And it doesn’t take putting any messages at all in front of them. One factor I would go over comes from the CMO of Vision Critical, a company that does business in Australia He told me at the end of the day it isn’t about technology, it’s about people. That’s my story I’m sticking with it. Thank you very much. Thank you for your time MONTY HAMILTON: Thank you very much. Well, on the topic of lethal generosity, Shel will be signing his book outside at about 530 clc. I’d like to welcome to the stage Karen Stocks. Her second porns at the digital summit — her second experience at the digital summit. Take tuway, Karen KAREN STOCKS: Thank you. Turn the volume up for me, please? I thought we could start up with something pumped up. I have the last slot before drinks. So get some energy going. Get up and dance if you wants, if you have the urge Pthe urge Um, absolutely delighted to be here. Thank you for having me We have seen this all through today. Mobile has disrupted absolutely everything. I think a lot of people have seen this tweet and wouldn’t be surprised around, “Really, what is this dude doing? Hasn’t he got a life? Doesn’t he have a mobile device?” Twirt is a company that

was founded — Twitter is a company that was founded on mobile. It was found with a simple text message to the public which said, “What’s happening?” By asking that simple question, getting more and more people to answer it, what we find over time is Twitter is a window into the world. It is telling us what is happening right now, what’s happening in this moment? As people ask this question, what we’re seeing on Twirt is what’s happening in the world is coming to you 10 to 15 minutes faster 10 to 15 minutes faster we’re seeing on Twitter what’s happening in the world, what’s happening in your local area, what’s happening with your customers, business and your competitors. There’s a great way for you to understand. By looking at Twitter, for people outside of this room, I can tell you primarily what people are doing at the moment. So in about 4:30, 5 o’clock on a Monday afternoon, people are picking up their devices and looking at videos. So this is the biggest trend we’ve seen happen in the past 12 months. As people hit the downtime towards the end of the day, we’re starting to see this kind of behaviour happen Mobile is growing really fast What we’re expecting to see between now and 2019 is mobile viewing growing by 13 X. On Twitter alone, and a lot of this is on Telstra, we’re seeing it grow 150 times in the last 12 months. That’s got a lot to do with some of the products we’ve released when it comes to video I’ll take you through those a bit later. 90% of Twitter views are on a mobile device. So we’re seeing again this trend of people looking for snackable content that they can do on the go when they’re in their mobile space. We’re seeing these moments happen on Twitter and whether some of our brands about what’s happening. People here like Cody Simpson. Or just media. And we’re seeing all of this content sitting on Twitter, on video. What else we’re seeing is live video that’s happening in the moment has an emotional response rate that’s 51% higher than normal. It has a personal relevance that matches basically receiving a personal letter Hands up if anyone has received a personal letter in a while? It doesn’t happen very often You know how special that feels So live video, when it’s timed right and delivered to you, has exactly the same personal relevance and the high emotional response of receiving a personalised letter. What we also see – and this is unique to the Twitter platform – is the power of the retweet. If you can put your content out there, you can earn media 5 to 10 X of what you paid for it. What we see is that video on Twitter gets retweeted on average six times more than just photos It’s a really popular medium that you’re seeing and something the businesses can take advantage of. That’s great. But what do we do? How do we create content on the platform that will engage our customers? I want to talk about a brand over in the US that deals with feminine hygiene products. And they wanted to take a position around something they’d seen in their customer base. That’s around girls from ages 10 to 12, as they’re going through puberty, lose a lut of their self-confidence. They use the power of video to get their message across. Let’s look at this. Hi. Hi. I’m going to give you some actions to do. And just do the first thing that comes to mind. Show me what it looks like to run like a girl. Show me what it looks like to fight like a girl. Now throw like a girl UNKNOWN SPEAKER: I’m 10 years old UNKNOWN SPEAKER: Show me what it looks like to run like a girl Throw like a girl. Fight like a girl. What does it mean to you when I say to run like a girl? UNKNOWN SPEAKER: It means run as fast as you can KAREN STOCKS: A fantastic program released there

It’s brilliant. And because they shared it on social platforms, because it had the abilities to be retweeted and had a conversation, it grew bigger and better than just the simple video they had. And some great tweets from other businesses that are jumping on the band wagon with a product that has nothing to do with them. And a great opportunity to use a product like video to do that What we feel we have seen with video on Twitter is we get an increase of 40% campaign awareness, an increase of 44% of purchase intent when people engage with promoted video versus those that don’t. Another great way to use video in the platform is Vine. It’s a 6-second looping app. It’s on your mobile device. What we’ve seen with the release of Vine is we’ve seen this great view world of really cool content created That is one of the best there is. What they do is they create these really unique videos that people can use and brand can use to get their message across One of the brands that hat used Vine really well – sorry, I could go back – was a company called HP with a Bend Their Rules campaign. They built this beautiful TVC to run on television, to run on prime time. They spent all of this money planning this TVC. They launched it. And it flopped Just didn’t go how they wanted to. The TVC was beautiful but didn’t get the message they wanted around the new product HP was putting out there. They went to a group and gave them the laptop and they said, “You go and make content.” Here are some things they came up with. So really clever unique ways from these groups of people that just think differently about how to package content. What HP went and did is they went and stitched the Vines together and created a TVC which was the first time a company had put a TVC based solely on Vine back on to mainstream television. What HP have done this year is they’ve done it again and this time they’ve done it with a new campaign. A lot more seamless than this one was. And done solely through Vine. Bend the rules of what’s possible. Just a really smart way. And HP got from this campaign s how do you get social connectors and content creators and move them to traditional media? Use the reach of the social content creators. These guys come with massive audiences businesses can tap in to and they’re a good way to engage the millennial audience. A lot of businesses I speak to say that we don’t know how to get in contact with these guys and how to relate to them Here are some great examples of Australian brands that are leveraging Vine. Some great examples whether it’s Dr Who, Coles supermarket, Seek, Virgin Mobile, Samsung And Qantas Really interesting unique ways to get your brand message across. What I wanted to talk to you about is a new product called Pair scope. — Periscope It is a product from Twitter For those of you who don’t know exactly what Periscope is, I’ll get Ellen to explain it. ELLEN: Have you heard of Periscope yet? We use it on the show, so you’re

busted. Means you don’t watch every show. You missed out. I’ll tell you what it is. It’s an app that lets you stream anything you want any time of day to strangers all around the world That’s the good news. The bad news is it lets you livestream anything you want any time of day to strangers all around the world. It’s actually pretty fun People Periscope themselves eating breakfast, lunch and dinner. And I even saw someone eating brunch KAREN STOCKS: When you talk to the founders of Periscope, what they wanted to do was create a platform that was the closest thing to telepertation. How could I teleport — teleportation. How could I teleport myself to any moment in the world realtime? The product has only been around for eight months UNKNOWN SPEAKER: Here we go. And we’re off UNKNOWN SPEAKER: We’re in Thailand UNKNOWN SPEAKER: Hey, guys UNKNOWN SPEAKER: We’re in a village in Nepal UNKNOWN SPEAKER: We’re at the observatory UNKNOWN SPEAKER: There we go UNKNOWN SPEAKER: People are getting on with life UNKNOWN SPEAKER: Hope you enjoyed it KAREN STOCKS: Um, one thing we’re really proud of and one thing we’ve been tracking is the amount of live video that’s watched daily. At the moment, after only eight months, we’re tracking at 40 years of live video watched every single day via the Periscope platform. A quick touch on some of the key product features because it’s a new product out there. What you can do is live broadcast from it. And it is a way to have a conversation so people can type questions to you while you’re actually broadcasting and you can see those come up on the screen and so can anyone else watching the broadcast. You have to ability to do Hearts which is great way for you to find out which parts of your Periscope are really engaging and people can start seeing those through the Heart. There’s a map that shows you all over the world how these Periscopes are coming to light. And you can follow other users. The Periscope stay on the system for 24 hours after they’re finished and then they’re gone. I want to take you through a business called Sky Scanner. They’re a booking company. They wanted to try and show some fantastic content because they didn’t have any content around the places they can take you through their business. And here is an example of what they did UNKNOWN SPEAKER: Ready. Hello from London, everyone UNKNOWN SPEAKER: Quickly wanted to show you this UNKNOWN SPEAKER: Hi, everyone UNKNOWN SPEAKER: Welcome to to this KAREN STOCKS: The whole idea of what they were trying to do was have a live Periscope for 24 hours where they had 24 bloggers, local bloggers positioned all over the world and they did an hour in each of those cities. Not only did they take their potential customers and audience on this journey, they created a lot of amazing content they can then go and use for their business. We’ve seen a couple of great local examples as well. Myer used Periscope for their Spring Fashion Show around some of the designs they’ve got coming out. I’m loving this next slide because I didn’t have to take it out today because some of you have been up since 2:30 like me this morning. A Periscope of when they ufnounced who would make the Rugby World Cup team Another great way for businesses to think about how they might use it. You can see the comments and hearts coming up as the livestream happened For a business, really quickly, how are some different ways you can use Periscope, how can you think about it? Product launches and announcements Livestream. People love hearing about it in the moment if they can’t be in the room themselves with you. Customer education Customer tutorials that you can

do. Common questions you’re getting and how can you answer those questions on scale in an authentic way because it’s live? VIP access behind the scenes Very similar to the Myer Fashion Show. For those closed events that you want to hoe the world but you can’t because you want to maintain exclusivity. How can you open that up to the world in a different way? Live events in general. KFC did a good Q&A in theback of their stores. One of the challenges they have as a business is what are you real eaf cooking? A lot of questions the fast food industry get They did a live Periscope in the kitchen with the cooks. So people could see what was happening and then the audience could ask questions at the same time and the KFC cook could answer it. What I did want to finish with because I have about a minute left, is when I spoke before around all the information that exists on Twitter and as a business or as a consumer, or as a brand, how do you find out about that and how do you make the most of it? One of the things we’re trying to do at Twitter is make finding that information much easier, much more emersive. And in a way that’s quick and easy. In the US earlier this month, you may or may not have seen this – we launched a product called Moment. Please don’t ask me when it’s coming to Australia because I can’t tell you. I wanted to give a sneak preview I get asked questions about this every single time. I thought I’d stho you this — I’d show you this video from the US quickly before I finish up The whole idea is you pick up your phone, you go to the little tab with the lightning bolt on it and flick through to the moments that are happening in the world right now and they are locally relevant to where you are. In the US all based on the US and tabs spor fort, entertainment, tabs for fun. And might be pictures of Trump or other interesting things. There is a really great way for people to see in an instance, through a really emersive experience around what is happening in your world right at this moment Thank you so much for having me It’s been a delight Thank you MONTY HAMILTON: Thank you so much. Thank you for joining us What an outstanding collection of videos. And the videos, it is enormous the growth of them Thank you very much, Karen, for sharing those insights on behalf of Twitter and Periscope. You can follow Telstra on Periscope There’s a couple of shows each day broadcasting from our team over in Adelaide. We’re just about done. A couple of closing remarks from Gerd Schenkel to wrap up thevent and a very important presentation from the incredible ticket sales we’ve had for today. Gerd Schenkel, please join us GERD SCHENKEL: If you didn’t have enough propaganda for Telstra, this would be my opportunity to even the score We had plenty offered and everyone has been very kind to us. What we’re really trying to do with the Summit is to create a platform for a diverse conversation about digatisation in Australia, what does it mean for you and for us? What’s good for Australia is good for all of us, including Telstra. I think we did have that today with an amazing array of speakers. We heard from Andy about Telstra’s future as a world-class technology company and we were talking about a multichannel environment. And we heard from the Minister, a new focus on technology. We heard about coding and the importance of teaching people how to code. We have heard from Robert Scoble about the post mobile era, not sof kind to Telstra perhaps. We heard from other start-ups about how it can be done in Australia and how start-ups can be global from the outset, right here in Australia. We heard from Rob about the power of communities From David about how Uber is changing every industry on the plan. We heard from Larry, Prince of Pockets as I call him, about how Australia can lead in cutting-edge signs. I was blown away that these things were going on here and didn’t know about them. We heard from Brian about how we have to inovate our day. From Shel how software breaks every time and finally from Karen about the power of video content. Lots to think

about. If I compared a conversation this year with the conversation at previous Summits, there is a renewed optimism for digital in Australia. I think it’s palpable. We heard from local people and from people from overseas that it can be done. I think Larry said we’re at the cusp of really assembling all the components of the innovation ecosystem right here in Australia and I think that gives us all renewed cause for optimism. Thanks to all of you for attending and making the conversation happen. We hope to continue the conversation on Twitter and over drinks right after this. Thank you to our corporate supporters who support the event financially and thanks to our amazing speakers There’s one more thing to do before we move on to drinks and Monty will join us on stage for that MONTY HAMILTON: Thank you very much GERD SCHENKEL: Not for me? MONTY HAMILTON: No, someone very special. I would like to welcome to the stage now. Welcome. Thank you for joining us. She has just started as the CEO of the NCIE and and look, welcome and we have had a long-running relationship with the NCIE for this event and Telstra through the Telstra Foundation. And is there any comments or anything you’d like to share with us about the NCIE briefly? KIRSTY PARKER: I want to tell you what it stands for. It’s a rallying call because it stands for the National Centre for Indigenous Excellence. And I want to say thank you, Monty, thank you, Gerd. And the NCIE and the Telstra Foundation have partnered for five years to bring Indigenous excellence together with digital technology. We’re very excited what can happen when we bring our young people and our perspectives together with digital technology for the expressions of our cultures which are the oldest living cultures in the world, with cutting-edge technology. The aim of NCIE is to liberate possibility and create opportunity for generations of young Aboriginal and Torres Strait Islander people and it’s hard to think of something that does that to a greater extent So our young people may inspire and are very proud. With the support of the Telstra Foundation and all of you because you all helped contribute to this magnificent big cheque, that they will also make everyone in Australia and beyond inspired and proud as we So thank you very much. — as well. So thank you very much MONTY HAMILTON: On behalf of tell truand everyone who was — Telstra and everyone who was a paying ticket holder, we’re pleased to donate $45,400 to the NCIE. Well done UNKNOWN SPEAKER: Thank you. We hope you’ll put it towards something nice MONTY HAMILTON: They’re incredible facilities and I think you’re doing an amazing job. Thank you for your support KIRSTY PARKER: Thank you MONTY HAMILTON: It has been incredible. Thank you for making it sure a special day. Drinks outside. So please stick around and have a chat. A lot of our speakers will be here for a drink as well. Have a fantastic night and thank you again (End of session.)