Gen AI companions and the fight for the primary interface, the Road to Privacy in Personal AI, and tokens are the future of everything
Plus: An important building block for the new digital economy you’ve never heard of, and a quiet breakthrough for Empowerment Tech in the physical world
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Hi folks, welcome back to the Customer Futures newsletter.
In this week’s edition
The Road to Privacy in Personal AI
Gen AI companions and the fight for the primary interface
Tokens are the future of finance, the economy and everything
An important building block for the new digital economy you’ve never heard of
A quiet breakthrough for Empowerment Tech in the physical world
The importance of ‘Ownable Moments’ in an AI-driven future
… plus other links about the future of digital customers you don’t want to miss
Let’s Go.
The Road to Privacy in Personal AI
At the end of last year, Personal AI pioneers KIN published an excellent series on privacy in Personal AI.
Why it matters. How it can work. The obstacles and issues.
It’s a four-parter, and I strongly recommend you read the whole thing.
“Personal AIs will be your most valuable digital asset in the future. It cannot be kept in walled gardens and it must transcend ecosystems. It must ultimately be owned and controlled by you - its user.
“At Kin, we’re committed to a future where interactions between you and your personal AI are fully confidential. We believe it will be a prerequisite to building the foundation of trust necessary to fully leverage AI on a personal level.
“The road to full privacy is a multi-step journey, that can take different turns, but all lead to the same destination; fully confidential interactions between you - the user - and an AI.”
The series is a proper deep dive into the technical, the social, and the product sides of PersonalAI.
Part 1: Privacy in Personal AI
Part 2: Three Core Challenges in Data Encryption
Part 3: Solving the holy grail of “Encryption in Use”
Part 4: Building Privacy into KIN, and Personal AI
When you look at the way Apple just launched on-device ‘intelligence’ - by majoring on privacy, not the size or performance of the LLMs - you can see that this is a pretty important market dynamic.
The road to privacy in Personal AI is going to matter a great deal.
Gen AI companions and the fight for the primary interface
Paul Sangeet Choudry churns out consistently excellent posts that should matter to everyone working in Empowerment Tech.
They are easy to understand, and bring deep insights into the new digital economy. Especially around how today’s data value chains are being disrupted by GenAI.
His latest take on GenAI interfaces is another must-read this week.
“Our real-life companions combine three key attributes.
“They have empathy, they understand us deeply. They bring expertise to a situation (particularly if they play the role of assistant, advisor, mentor, or coach). And they have the ability to engage and influence.
“Companions combine empathy, engagement, and expertise.
“Empathy requires deep understanding. This is productized and scaled digitally through data capture and learning models. Engagement and the right to be a companion requires real-world connection. Over the past decade, we’ve perfected the (dark) art of productizing this through habit design.
“Expertise requires knowledge. This is now productized through LLMs and subsequent fine-tuning towards a context.
“Over the past decade, we’ve combined empathy (data capture) with engagement (habit design) to capture the primary interface. The news feed (think Facebook), the infinite scroll (think Pinterest), and the infinite swipe (think TikTok) have all worked on this paradigm to gain an ever-increasing share of the primary interface.
“GenAI presents a potential discontinuity to that paradigm by leveraging expertise to dismantle the advantages of empathy (share of data) and engagement (share of usage).
“Or, conversely, as I explained in How to lose at Gen AI, it will merely reinforce the ‘companion’ position of current players, who will combine their advantages in data capture and habit design to now embed expertise into their interface.”
This is brilliant stuff. But particularly important for those working on:
Personal AI (companions)
Digital wallets (verifiable personal data)
Customer experience (engagement)
… which should be every business on the planet right now.
Tokens are the future of finance, the economy and everything
I point to Simon Taylor’s writing frequently.
Why? Because a) the Fintech market is exploding, shifting in 16 different directions all at once, and it’s hard to keep up and b) Simon is one of the best at sense-making, joining the dots for us mere mortals.
I’ve been thinking about ‘tokenisation’ a lot recently. Partly because FS folks often look at customer identity as a ‘token’. But also because, as Dave Birch reminds us, identity is the new money.
Meaning tokens are the new identity.
I know that we in the decentralised identity community talk more about data privacy, portability and customer control.
But the tokenisation angle matters.
“In financial services, we're heading towards an explosion of tokens, and they'll become the battleground in technology, payment rails, and network effects for the next decade (they are already for cards).
“Payment method tokens. Take a payment instrument like a credit card and turn it into a token to "live" inside a phone (or Vision Pro, perhaps). Conceals the underlying account or card number with a secure "token."
“Identity or data tokens. Converting personal data (like a date of birth) and tokenizing it so it can be moved securely. Placing a driver's license in an Apple Wallet and passkeys replacing passwords are also in this category.
“Asset tokens. Recording cash, stocks, or intellectual property as a token instead (or in addition to) recording it on a traditional accounting ledger. This makes the asset move like physical cash (i.e., when I give you $10, you now have that, and I no longer do. It has instant settlement).
“In finance, we're always looking at a slice of the issue. But the key insight from this Rant is that the combination of them will define the next decade.”
If ‘payments is the killer app for identity’, then you need to be paying attention to the tokenisation of everything.
Because digital wallets and credentials are going to fuse with payments and tokens very, very soon.
And the Empowerment Tech market needs to be ready to explain how it all fits together.
An important building block for the new digital economy you’ve never heard of
Iain Henderson is one of the very few experts in the world who deeply understands personal data from both the enterprise side AND the customer side.
He’s not only worked across customer data platforms and CRM for decades, but he’s one of the founding fathers of the Empowerment Tech movement, before it had a name.
Lately, he’s been working on personal data standards at the IEEE, around ‘Information Sharing Agreements’ (ISAs). Where customer consent and data contracts aren’t just one-sided, but rather mutual.
Here’s a snippet from one of his latest posts on the work:
“The current norm is that each and every organisation decides what data it wishes to gather, manage and use. They then brief their legal team who come up with a set of terms wrapped up in contractual agreements that are designed to:
“Enable the organisation to undertake the data processing they perceive to be required for their organisational purposes
“Illustrate to regulators how the organisation is meeting its privacy and data protection (and other) obligations.
“The model above has been the norm since the World Wide Web emerged as a commercial channel in which individuals and organisations could interact and transact.
“There is plenty of evidence that this model is very broken, and that clicking ‘I agree’ without reading the agreement is the norm, not last because people know that at the end of reading them they won’t have a whole lot of choice anyway.
“It does not have to be that way. A contract is a contract, there is nothing in contract law that says such things can’t be proposed by an individual, or an intermediary; i.e. one with an orientation that originates with and for the individual. '
“However, individuals are highly unlikely to propose their own terms from scratch for a data sharing relationship; they do not have the time or resources to do so. Nor would organisations accept such a proposal from single individuals.
“But work is now being done in the IEEE standards body (IEEE7012) to create the concept of standard, machine-readable information sharing agreements.”
Think of it like a new framework from Creative Commons, but for personal data sharing online, rather than digital copyright.
This work comes at a critical time.
Because if Personal AI is to emerge as a new capability that stands on the side of the customer, not the business, then we are going to need new models for digital accountability and digital governance.
Who can do what, why and when.
More precisely, we’re going to need auditable records of what was shared with whom, when, how, and for what purpose.
That’s no mean feat. And you can imagine a wild west of consent flow formats soon emerging. Together with some awful UX dark patterns to wrangle customer consent for data sharing with every new AI model.
That’s what Information Sharing Agreements (ISAs) are going to tackle.
To define contracts between people and organisations. Recording the what, who, why and when of data sharing.
But here’s the kicker. One of the enormous implications is the likely shift of the legal basis to process data. From Consent to Contract.
Contracts don’t work today for customer interactions because:
Those contracts are largely written by lawyers, for lawyers, not average Jo. They are difficult to understand, lengthy and dense. Which is why no one reads them (it’s the greatest conceit on the web); and
Those contracts are one-sided - there’s no way for individuals to express their own terms (which is what a ‘contract’ should enable)
This rigid one-sided approach to data sharing is why we get the crappy checkbox flows on the web today.
But with the IEEE7012 standard, customers can be given a way to form a mutual contract with businesses for data sharing.
Of course, these contracts will need to be normalised. With a small, manageable number of contract variations for different customer contexts e.g. cookies or marketing (opt-in/out) and sectors (health vs. car hire).
Most importantly though, these new customer contracts will be machine-readable.
That means software can read - and interact with - the contracts. In other words, Personal AIs can now enter into Information Sharing Agreements using standard terms set by the individual, not just the business.
It’s still early days. But the IEEE7012 standard might just be one of the most important building blocks for the new digital economy you’ve never heard of.
A quiet disruption for Empowerment Tech in the physical world
With all true market disruption, you need to look in the unexpected places to see what’s coming.
For digital wallets, that might just be Electric Vehicle charging points.
You will have heard of neither PassiveBolt, nor LEGIC Identsystems. But their newly announced partnership might be an important disruption in the use of digital wallets in the physical world.
These two businesses have recently showed off the use of decentralised ID tech to activate EV charging stations. All using verifiable credentials held in a digital identity wallet.
Using ‘KeyShare’ (PassiveBolt’s digital identity wallet and SSI platform) and LEGIC’s security modules (capable of processing verifiable credentials), users can prove all sorts of things in the real world.
Here are some of the use cases they point to:
“Hospitality access control: Transforming the guest experience, this application allows hotel guests to access their rooms and facilities using digital keys in their identity wallets
“Workplace security: Combining logical and physical security for more efficient workplace environments through digital credentials that enable access control and identity verification for employees
“Smart City applications: Facilitating access to public transportation, municipal services and more, improving the convenience and security of urban living
“Healthcare ID management: Offering secure and private management of healthcare IDs and records, simplifying patient and provider access to facilities and information
I’ve seen, and been part of, live demos of digital wallets for physical access since 2018. But this announcement, with the potential to scale, looks different.
Issuing an ‘access’ credential to an approved person is already relatively easy. But this announcement stands out because it’s the acceptance point that’s hard to crack in the physical world. That’s where PassiveBolt comes in.
Physical access and real-world experiences may become the breakout use cases we’ve been waiting for. Because they speak to real-life things that people need - and want - to do. Real ‘jobs-to-be-done’.
For too long the decentralised identity community has fiddled with the tech. It’s now time to reimagine real-world experiences using digital wallets and verifiable credentials.
Yes, this partnership is ‘below the waterline’. But it might be one of the quiet disruptions coming that truly enable Empowerment Tech in our physical world.
The importance of ‘Ownable Moments’ in an AI-driven future
The excellent design agency Else has just written about how businesses need to maintain the human connection. Especially as AI sweeps through and disrupts today’s digital customer experiences.
“While efficiency and convenience are at an all-time high, something essential is lost in this overly automated environment: the human touch.
“In this future of pervasive automation, brands risk becoming indistinguishable from one another, their unique voices drowned in the uniformity of machine-generated interactions.
“The need for what we call at Else, Ownable Moments™ in the customer experience becomes more critical than ever for brands striving to differentiate themselves through their customer experience.
“The overarching principle in this AI-driven future is the preservation of the human element in customer interactions. As AI handles more routine tasks, finding the moments to deliver human creativity and empathy becomes the differentiator.
“Creating Ownable Moments™ that resonate personally will differentiate brands and build meaningful customer connections. The opportunity lies in using AI to enhance human creativity and empathy, making interactions both intelligent and heartfelt.”
I couldn’t agree more. It speaks to my recent post on the same: What if we design for customer friction?
We need to separate the Bad Friction (the boring, irritating steps we can remove) from the Good Friction (where businesses can truly engage the customer on a human, emotional and memorable level).
ELSE’S OWNABLE MOMENTS, DESIGNING FOR FRICTION
OTHER THINGS
There are far too many interesting and important Customer Futures things to include this week. So here are some more links to chew on:
Event: Mindful friction in AI (London) ATTEND
Post: Why you need to say please when prompting ChatGPT WATCH
Article: The digital marketing did not cause the sales READ
Webinar: How to create a decentralized reusable identity strategy (by MISSION) WATCH
Post: Where’s Our Digital Public Infrastructure? READ
Article: Marketers ‘overestimate’ chances of achieving brand loyalty READ
And that’s a wrap. Stay tuned for more Customer Futures soon, both here and over at LinkedIn.
And if you’re not yet signed up, why not subscribe:
Always helpful commentary Jamie!