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AI-capable PCs to be the most compelling innovation in the industry

Mohammed Fahad

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January 8, 2024

AI-capable PCs to be the most compelling innovation in the industry

AI-capable PCs will boost current and future replacement cycles.
PC vendors are set to launch a slew of AI-capable PCs in the coming quarters.
Despite its advantages, Apple faces challenges in penetrating a market where Microsoft’s Windows is deeply entrenched.
Commercial adoption is expected to pick up more rapidly from 2024 onwards, and by 2027, 60% of all AI-capable PCs will be shipped to businesses.

Major PC vendors have publicly signaled that AI-capable PCs will be the most significant upcoming innovation that they are looking to leverage as an accelerator for market recovery in 2024 and beyond.

The launch of ChatGPT in November 2022 was a watershed moment, and after rapid growth, generative AI is now positioned as the single most impactful accelerator across nearly every facet of the technology industry.

However, according to Canalys Special Report on “Now and next for AI-capable PCs”, effectively capturing the opportunity will require a growth mindset from all players.

Firstly, PC vendors must develop business models that stretch beyond hardware sales to deliver differentiated native AI capabilities.

Secondly, businesses and users must view AI-capable PCs as part of a larger goal to modernise operations, upskill workforces and participate in the AI revolution through enhanced efficiency and novel experiences.

Finally, AI solution providers require an evolving perspective to optimize models for on-device use, enabling ambient computing across edge devices within the broader landscape of hybrid AI experiences.

Fundamentally, AI-capable PCs will only fulfill their potential if industry leaders adopt an open and forward-thinking approach.

Opportunities

Canalys proposes an initial definition of an AI-capable PC as a desktop or notebook with a dedicated chipset or block to run on-device AI workloads.

As technical capabilities, use cases, AI tools and customer requirements evolve, additional hardware will need to be considered to identify PCs that are optimised for on-device AI workloads.

Examples of these dedicated chipsets include AMD’s XDNA, Apple’s Neural Engine, Intel NPU and Qualcomm’s Hexagon Tensor Accelerator.

“Vendors must build trust and be transparent around privacy and ethical AI practices to overcome user resistance. Companies need to pilot on-device AI to quantify outcomes and construct business cases to convince partners of the opportunities.

Individuals must understand the technology and provide feedback to shape its development responsibly. With collaboration, AI-capable PCs can transform how we learn, work and create for the better, delivering new innovations and capabilities,” the report said.

Alongside current Mac products, AMD Pheonix and Intel Core Ultra devices, PC vendors are set to launch a slew of AI-capable PCs in the coming quarters.

From a strategic perspective, bringing these new products to market amid the peak wave of Windows refresh will help provide a more compelling reason for customers to transition away from Windows 10. It will also drive users into more premium price bands, with AI-capable PCs expected to be 10% to 15% more expensive than similar models without embedded AI capabilities.

But the success of this effort will depend on the vendors working with their key partners (including Microsoft, chipset vendors and B2B and retail channels) to deliver a very clear and unified message about the specific benefits of on-device AI to consumers, businesses, educators and others.

Market forecast

Canalys forecasts that 19% of PCs shipped in 2024 will be AI-capable under its initial definition and will ramp up quickly with the tailwind of a refresh cycle, leading to 60% of PCs shipped in 2027 being AI-capable.

Commercial adoption is expected to pick up more rapidly from 2024 onwards, and by 2027, 60% of all AI-capable PCs will be shipped to businesses.

The report said that the emergence of AI-capable PCs brings with it several key opportunities for industry players, including a boost to current and future device refresh cycles and the chance to meaningfully differentiate with out-of-the-box AI tools and attached services.

The AI-capable share of total PC shipments is expected to rapidly escalate from 2025 as customers are pushed to refresh devices before the end of service for Windows 10 in October of 2025.

From 2026 onwards, AI-capable PCs are forecast to account for most PC shipments.

More nuanced grading system

The long-term trajectory for commercial adoption of AI-capable PCs will be positive. In 2027, shipments just to businesses are expected to exceed 100 million devices out of a total of 174 million.

More than 60% of all PCs shipped to businesses will be AI-capable, representing a 94% CAGR for the category from 2023 to 2027.

Though the CAGR for AI-capable PC shipments to consumers will be a more modest 42% over the same timeframe, the category’s share of the overall consumer PC market will catch up to the commercial sector in the longer term.

As AI applications proliferate over the next few years, this will also set the stage for a more nuanced grading system based on each PC’s AI functionalities and capabilities.

While most PCs shipped after 2027 are likely to meet Canalys’ initial definition, it will be important for customers to be able to distinguish the devices that are best suited to run their specific workloads and that can optimally leverage the suite of AI tools that they choose to invest in. Long-term considerations could include:

AI-capable PCs could incorporate large language models (LLMs) of a certain parameter size that come pre-installed on the device.
AI-capable PCs could be benchmarked on the speed of on-device text and image generation. Some benchmarking examples to be considered from 2025 and beyond are listed below, with the specifics likely to evolve over time as on-device AI capabilities improve.

Microsoft to be an influential leader

Microsoft is perhaps the foremost example of a company betting big on AI to define its future success. On top of its estimated $13 billion commitment to OpenAI, it has also invested in companies such as Inflection AI, Adept AI and Builder.ai.

While a large part of its AI strategy is focused on providing cloud-based services through Azure, its massive global Windows PC installed base represents a crucial vehicle for delivering new AI experiences to users and convincing developers to create the best AI applications for its ecosystem.

A significant focus during Microsoft Build in both 2022 and 2023 was the development of hybrid AI experiences spanning cloud-to-device to leverage the benefits of each as use of AI tools proliferates.

It has recently made the “Hybrid AI Loop” available, an open-source ONNX Runtime that “supports the same API for running models on the device or in the cloud, enabling hybrid inferencing scenarios where [a developer’s] app can use local resources when possible and switch to the cloud when needed.”

Microsoft’s decision in November 2023 to bring Copilot to Windows 10 devices is another strong signal of its commitment to driving user adoption of its native AI tools as part of its AI strategy.

Microsoft clearly has a strong desire to migrate its PC user base over to Windows 11 as quickly as possible, with the end-of-service date for Windows 10 looming. But it has also recognised that a slow transition must not be a roadblock to people and businesses incorporating AI experiences into their everyday lives and work.

The short-term goal must be to increase penetration and deliver compelling use cases to users with a longer-term view to making the move to future Windows versions exciting by offering new features and significant improvements to AI experiences.

Apple has AI at the core of its Macs

Macs have been the only mass-market AI-capable PCs since 2020, when Apple began transitioning from Intel processors to the M1, bringing the Apple Neural Engine (ANE) to the Mac portfolio. The first-generation ANE was released as part of the A11 chip, found in its 2017 flagship smartphone, the iPhone X. Today, every shipping Mac has the Neural Engine.

But the company has taken a conservative approach when it comes to incorporating the term “AI” into its product marketing. When asked about the company’s apparent lack of “AI” announcements during its Q4 earnings call, Tim Cook stressed the integral role it has in virtually all Apple products, but that the company tends to “label them as to what their consumer benefit is.”

This is true, Apple has integrated many features into macOS that are powered by machine learning.

Apple has significantly grown its market share among commercial PC deployments in the last several years, catalyzed by the transition to Apple Silicon. F

Furthermore, a wave of PC refreshes from the Windows version transition is often seen by Apple as an opportunity to make further share gains, especially among businesses.

The question facing Apple now is whether Copilot and the slew of Windows-based AI-capable PCs represent a big enough threat to Apple’s further growth, especially in the short term.

Apple’s share gain in the commercial sector did not occur because organizations moved away from Word, Excel and PowerPoint to Pages, Numbers and Keynote. The Mac’s value proposition has been highly powerful computers, an increased return on investment and, most importantly, how it fits within a company’s existing IT ecosystem.

As of today, the Office suite can run natively on Mac and essentially all existing Copilot features are able to run on Mac because the functionality sits in the cloud.

But if and when Copilot moves to a hybrid cloud/on-device setup to capture the respective benefits of each, this could change the dynamic. Although this assumes that the trend of collaboration between Microsoft and Apple reverses or slows, and that Copilot would not be brought to a hybrid version on Mac.

Despite its advantages, Apple faces challenges in penetrating a market where Microsoft’s Windows is deeply entrenched. Many businesses are heavily invested in Microsoft’s ecosystem, with established workflows and legacy systems.

Apple’s strategy, therefore, might focus not on displacing Microsoft entirely but on carving out niches where its unique strengths in design, user experience and AI capability can be fully leveraged. Apple’s focus is on select verticals, “Pro” users and industries where its products have traditionally been strong, such as creative fields, marketing and software development.

These are all fields that will see large benefits from workers upskilling through leveraging AI. These fields have also been identified by Canalys as the early adopters of AI-enabled PCs. Success here will help Apple then expand to other sectors by showcasing the benefits of its AI capabilities and ecosystem integration.

As Intel, AMD and Qualcomm progressively integrate AI capabilities into their CPU product lines, Windows-based AI-capable PCs from a variety of OEMs will become major growth drivers.

The significant improvements in efficiency and productivity are particularly appealing to the commercial sector, especially for tasks such as data processing and content creation.

Commercial sector to lead adoption

Commercial adoption of AI-enabled PCs is set to begin in a very targeted manner. Higher prices and a cost-sensitive market will initially limit these powerful devices to niche roles within organisations.

As businesses recognise the productivity gains and operational efficiencies enabled by AI, Canalys expect a shift toward mainstream acceptance.

Pioneers in this space, such as research and development professionals, data analysts, and creative designers, will showcase the tangible benefits of integrating AI into their workflows, setting a precedent for broader corporate uptake and IT decision-maker buy-in.

The commercial sector is on the cusp of transformation, with AI-capable PCs at its core. Strategic adoption by tech-savvy businesses will catalyse this change, prioritizing job functions where AI’s impact is immediate and pronounced.

The future of work will be redefined by AI-driven features that enhance collaboration, streamline content generation and optimize audio and video for a more connected and efficient workplace.

Consumers seek productivity improvements

AI-capable PC adoption among consumers is expected to be lower than in the commercial segment in the long run. But consumer interest in generative AI applications is growing and use is becoming more sustained.

Users are gradually becoming aware of the array of services on offer and how they can leverage them to improve their computing tasks.

For those who have incorporated generative AI into their daily lives, use is robust, with a frequency spanning daily interactions to weekly engagements.

To leverage this positive trend in awareness of generative AI and usage behavior leaning toward convenience and ease of use, PC OEMs have an excellent opportunity to provide some differentiated AI features to consumers while operating system providers, such as Microsoft, fully control and unify the user experience around productivity and security features improved by AI.

Saudi-based Tabby secures $950m in financing

Ana Mary Joseph

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December 21, 2023

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Saudi-based Tabby secures $950m in financing

The fintech startup secures up to $700m in receivables securitisation from JP Morgan and extends its Series D round to $250m.
The Series D was also joined by US-based Soros Capital Management and KSA-based Saudi Venture Capital.

Saudi Arabia’s buy now and pay later platform – Tabby – has secured $950 million financing in a bid to reshape the personal finance and shopping experience in Middle East and North Africa further.

The startup has secured up to $700 million in receivables securitisation from J.P. Morgan, the largest asset-backed facility obtained by a fintech company in the MENA region and has extended its Series D financing to close $250 million with participation from Hassana Investment Company.

The Series D was also joined by US-based Soros Capital Management and KSA-based Saudi Venture Capital (SVC).

The financing bolsters Tabby’s balance sheet amidst increasing demand for its core buy now, pay later platform and enables more capital to continue expanding Tabby’s financial services and shopping products for its 10 million consumers and 30,000 retailers.

Major milestone

“Securitisation is a major milestone, not only for Tabby but also the first of its kind for the region. It mirrors the rapid growth and evolution of the fintech landscape in our markets. We’re incredibly proud of our collaboration with J.P. Morgan, Hassana, Soros and SVC,” Hosam Arab, CEO and Co-Founder of Tabby, said.

Over 30,000 global brands and small businesses, including SHEIN, Amazon, Adidas, IKEA, H&M, Samsung and Noon use Tabby’s technology to accelerate growth and gain loyal customers by offering flexible payments online and in stores.

Tabby is active in Saudi Arabia, UAE, and Kuwait, and is now valued at $1.5 billion in its last round of funding from Wellington Management, STV, Mubadala Investment Capital, PayPal Ventures, Arbor Ventures, Bluepool, Hassana Investment Capital, Soros Capital Management and Saudi Venture Capital.

“A vibrant and growing consumer lending sector is vital for the local economy and we are pleased to work with Tabby on this strategic initiative to support retail credit throughout the Middle East,” George Deves, Co-Head of Northern European ABS at J.P. Morgan, said.

“We believe in Tabby’s vision to empower consumers and merchants alike and reshape the future of financial services in Saudi Arabia and the wider MENA region. Tabby is poised for accelerated growth, further market penetration, and continued innovation,” Ahmed Al Qahtani, Chief Investment Officer for Regional Markets at Hassana Investment Company, said.

Fintech sector poised for strong growth and innovation in 2024

Mohammed Fahad

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December 18, 2023

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Fintech sector poised for strong growth and innovation in 2024

Growing acceptance of cryptocurrencies by traditional financial institutions, along with regulatory clarity in many jurisdictions, is likely to contribute to their mainstream adoption.
Several central banks around the world are actively exploring or developing their own digital currencies, aiming to modernise payment systems and enhance financial inclusion.
The integration of AI technologies is reshaping the way financial services are delivered.
Fintech companies are likely to invest further in developing user-friendly mobile payment solutions, fostering a cashless society.
Fintech firms will invest in robust security measures, with a particular emphasis on biometric authentication methods such as fingerprint and facial recognition.

Financial technology, or fintech, is undergoing rapid and transformative changes. The industry saw a significant surge in mainstream acceptance of cryptocurrencies in 2023 as big and small financial institutions embraced digital assets.

How is 2024 shaping up for the fintech industry?

Nigel Green, CEO of one of the world’s largest independent financial advisory, asset management and fintech organisations deVere Group, explains the key trends poised to shape the landscape of the booming industry,

“2024 promises to be a dynamic and innovative period for fintech. We think it’ll go down as a landmark year for the sector.”

1. Rise of cryptocurrencies

One of the most notable predictions for 2024 is likely to be the continued rise of cryptocurrencies.

Over the past 12 months Bitcoin, the world’s largest digital asset has gained 155 per cent in value – this trend can be expected to continue as institutional investors pile in, especially in the form of Bitcoin spot ETFs, bring with them not only capital but expertise and a huge amount of influence and credibility.

This growing acceptance of cryptocurrencies by traditional financial institutions, along with regulatory clarity in many jurisdictions, is likely to contribute to their mainstream adoption. We predict that crypto will play an increasingly important role in diversifying investment portfolios and facilitating cross-border transactions, thereby reshaping the global financial landscape.

2. Rise of Central Bank Digital Currencies

In tandem with the ascent of cryptocurrencies, the rise of Central Bank Digital Currencies (CBDCs) is set to be a defining trend in 2024. Several central banks around the world are actively exploring or developing their own digital currencies, aiming to modernize payment systems and enhance financial inclusion.

CBDCs offer government’s greater control over monetary policy and the ability to streamline financial transactions. Additionally, these digital currencies have the potential to reduce the reliance on cash and improve the efficiency of cross-border payments.

As more central banks pilot and implement CBDCs, 2024 is expected to mark a crucial turning point in the evolution of digital currencies within the mainstream global financial system.

3. Fintech firms increase usage of AI

Artificial intelligence (AI) is a driving force behind the innovation in fintech, and in 2024, we anticipate a significant increase in its usage.

Fintech firms are increasingly leveraging AI to enhance customer experiences, streamline operations, and make more informed decisions. From robo-advisors to AI-powered chatbots providing customer support, the integration of AI technologies is reshaping the way financial services are delivered.

The predictive capabilities of AI also play a vital role in risk management and fraud detection. As financial institutions grapple with the evolving nature of cyber threats, AI algorithms are becoming indispensable tools in identifying and mitigating potential risks.

In 2024, the synergy between fintech and AI is expected to reach new heights, contributing to greater efficiency and innovation within the industry.

4. Soaring demand for mobile payments

The convenience and accessibility of mobile payments have made them increasingly popular, and this trend is set to accelerate in 2024. As smartphones become ubiquitous and digital wallets gain traction, consumers are embracing the simplicity of conducting transactions with just a few taps on their mobile devices.

Fintech companies are likely to invest further in developing user-friendly mobile payment solutions, fostering a cashless society.

The ease of mobile payments not only caters to the demands of modern consumers but also offers opportunities for financial inclusion by providing individuals in underserved regions access to digital financial services.

5. Focus on cybersecurity

As fintech continues to advance, so do the threats associated with cybercrime. In response, 2024 is expected to witness an intensified focus on cybersecurity within the financial industry.

Fintech firms will increasingly invest in robust security measures, with a particular emphasis on biometric authentication methods such as fingerprint and facial recognition.

Biometrics provides an additional layer of security, enhancing user authentication and protecting sensitive financial information. By incorporating advanced biometric technologies, fintech companies aim to bolster the trust of consumers and mitigate the risks associated with identity theft and cyber-attacks, ensuring the integrity of digital financial transactions.

6. Focus on global financial inclusion

An overarching theme in fintech predictions for 2024 is an increased emphasis on global financial inclusion. Fintech is playing a pivotal role in extending financial services to the unbanked and underbanked populations around the world.

In 2024, initiatives focused on financial inclusion are expected to gain momentum, with fintech companies leveraging innovative solutions such as mobile banking, microfinance, and blockchain to bridge the gap. By expanding access to financial services, particularly in developing regions, fintech is poised to contribute to poverty reduction and economic empowerment on a global scale.

“The fintech sector is poised for unprecedented growth and innovation. The rise of cryptocurrencies and CBDCs, the increased usage of AI, the surge in mobile payments, the heightened focus on cybersecurity, and the commitment to global financial inclusion collectively paint a picture of a dynamic and transformative year for the financial technology sector.

“The convergence of these trends is not only reshaping the way we conduct financial transactions, but also redefining the very nature of the global financial ecosystem.”

5G rollout continues

The pace of 5G rollout remains robust, reaching 1.4 billion subscriptions globally, according to Ericsson’s latest Mobility Report.

Although 5G performance has shown improvement in 2023, not all consumers are satisfied with it. According to Speedtest Intelligence data for the third quarter, the global median 5G download speeds were 7.37 times faster than 4G (203.04 Mbps compared to 27.51 Mbps), and uplink was 2.3 times faster (18.93 Mbps compared to 8.21 Mbps).

However, 5G latency failed to impress, with global median 5G multi-server latency at 44 ms compared to 52 ms for 4G, showing a mere 1% year-on-year improvement.

Telecom operators have invested heavily in 5G infrastructure, but they find it challenging to recover these investments.

Without new value-added services that use 5G bandwidth, consumer sentiment looks bleak, with the Net Promoter Score (NPS) for 5G falling in mature markets.

The challenge for the 5G industry in the year ahead will be to find ways to monetise 5G beyond Fixed Wireless Access (FWA) use cases and to support investment into standalone (SA) 5G as the industry readies for 5G Advanced ahead of the 6G era.

Phasing out legacy networks

As 5G takes center stage, legacy networks such as 2G and 3G will gradually fade away. Similarly, the copper switch-off will continue.

As 4G LTE and 5G technologies are much more efficient in terms of spectrum, network operators are phasing out their legacy networks. This move is motivated by freeing up spectrum and refarming it to deliver faster, more advanced, and more efficient networks.

In 2024, operators in Europe and APAC, in particular, will continue to migrate customers away from 3G as they witness a decline in network traffic over 3G and seek to achieve efficiency gains and Capex reduction.

Private networks steadily carry on

Private mobile networks have become increasingly important for organizations with growing data and security needs as they cater to their specific Industry 4.0 goals.

As enterprises of all shapes and sizes increasingly rely on data-intensive applications and IoT devices, legacy networks may struggle to keep up with the growing demand. WiFi and 5G technologies complement each other in modern enterprise networks, with 5G adding a new dynamic to replace legacy network functions where greater flexibility is required.

GSA has recognised 1,279 customers deploying private mobile networks in Q3 2023, of which 45% using 5G.

.3GPP Release 16 of 5G New Radio (NR) supports a wider set of industrial IoT use cases which should come to the fore in 2024 as more industrial 5G-ready devices that use chipsets based on the Release 16 standards enter the market.

Moreover, the industry is already discussing NR Reduced Capability (RedCap), which is specifically designed for devices that do not require the full capabilities of 5G to further enhance cost efficiency and offer precise positioning.

Those enterprises that base their networking strategy on problem-solving are well-positioned to meet their objectives no matter the technology they choose.

5G SA is still at Proof of Technology stage

Although 5G Standalone represents the true potential of 5G, its rollout has been slow due to the extensive investments required and a challenging macroeconomic environment.

As of October 2023, only seven per cent of global mobile network operators (43 operators) in 29 counties have launched 5G SA networks.

On the public network side, early network performance data from RootMetrics indicates that 5G SA outperforms its NSA 5G counterpart across various metrics, including latency and time to start playing video and start the file download.

However, speeds remain similar due to identical NR bandwidth. In 2023, the focus was on demonstrating the power of 5G SA, including network slicing, through demos and proof-of-concepts.

The crucial task for operators now is to translate these promising developments from controlled environments like laboratories and testing into real-world commercialization.

Open RAN faces a challenging year

Beyond continued questions on its performance and limited traction beyond greenfield networks, there is growing concern over how open Open RAN will really become.

Industry sceptics point to solving interoperability challenges across hardware and software stacks, slowing down its progress and adding to implementation timelines.

GenAI capturing attention

GenAI, short for Generative AI, like ChatGPT, has seen recently increased acceptance, particularly during 2023.

Telecom operators can benefit from using GenAI in various ways, such as optimising and managing their network without human intervention (zero-touch network management).

When implementing GenAI, telecom operators usually follow a phased approach. They start by experimenting with GenAI for internal processes, such as marketing tasks like creating promotional content or analysing market trends.

After successfully implementing and experimenting with internal processes, telecom operators can gradually introduce GenAI into customer-facing functions.

For instance, GenAI could automate customer support, offer personalized service recommendations, or manage network aspects based on customer usage patterns.

2024, however, will bring a degree of scrutiny. As the capabilities of Generative AI continue to expand, there will likely be an increase in calls for tighter regulation due to concerns about accuracy and potential harm. Industries, including telecom, must navigate these regulatory challenges and use GenAI responsibly.

Cloud gaming market bounces back

Mobile cloud gaming provides an accessible alternative for casual gamers who cannot afford or do not have access to a dedicated game console.

By eliminating the cost barrier, it considerably expands the addressable market for gaming services. It allows for direct monetization and presents opportunities to generate revenue through advertising.

Recognizing this potential, Samsung could launch its cloud gaming service in the first quarter of 2024 to reach over 1 billion handset and tablet users worldwide.

Netflix also started testing its cloud gaming service in 2023, targeting casual gamers on larger screens with nearly 250 million paying subscribers to its video streaming services in the third quarter of 2023.

The adoption of cloud gaming services will stimulate the demand for high-speed and low-latency connectivity at home and on the go.

Operators can also leverage their edge computing capabilities and connectivity infrastructure to deliver an immersive and lag-free gaming experience.

Satellite technology coming of age

Globally, satellite already plays an important role in providing network backhaul for 2G, 3G, and 4G technologies in rural and remote areas while also connecting a range of enterprise verticals such as logistics.

Starlink, which uses Low Earth Orbit (LEO) satellites, has proven that it performs better than GEO satellites and offers a viable alternative in locations where terrestrial networks aren’t present.

Despite Qualcomm and Iridium terminating their partnership, the excitement around satellite will continue in 2024 and we anticipate greater terrestrial and non-terrestrial network (NTN) integration.

We also expect more partnerships between satellite providers and telecom operators to build a seamless and robust communication infrastructure that can address connectivity challenges in underserved regions.

Monetising 5G through FWA

Fixed Wireless Access (FWA) continues to be a poster child for 5G, as it is one of the only ways carriers has found to monetize 5G separately, leading many operators to pursue FWA actively as part of their 5G strategies.

According to Ericsson, there are 121 service providers offering FWA services over 5G, representing 50% of all FWA service providers. FWA provides an opportunity for telecom operators to serve rural locations better and offer an alternative for customers dissatisfied with cable or other incumbent broadband providers.

Navigating fair share and regulatory horizons

With the threat landscape and communication networks evolving, governments and regulatory bodies need to keep up with the rapid advancements in telecommunications.

The ongoing “fair share” debate centers around how networks are funded and the contributions of different entities toward telecom network costs.

The European Union is discussing the contributions of Big Tech companies to the costs of the telecom networks they benefit from, while in the United States, a similar debate centers around net neutrality, financial contributions for network infrastructure, and how to ensure a level playing field for various stakeholders in the telecom space.

Yango blends Islamic and Arabic culture into their smart speaker

Naushad K. Cherrayil

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December 13, 2023

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Yango blends Islamic and Arabic culture into their smart speaker

The smart speaker will be available in the UAE and Saudi markets in the first quarter of 2024.
Yasmina can understand multiple Arabic dialects and respond in GCC Arabic and English.

There are many AI-enabled smart speakers on the market and their popularity has been increasing, providing users with convenient ways to control their smart home devices, listen to music, and get useful information through voice commands.

There are Amazon’s Alexa, Google Assistant, and Apple’s Siri and there are other brands that provide compatibility with these OSs. Apart from these, there is Amazon Alexa Arabic for the Gulf Cooperation Council (GCC) markets, and does the market need another smart speaker?

Yes, said Samer Mohamad, Regional Director for Yasmina MENA at Yango, the ride-hailing app owned and operated by Russian tech group Yandex.

“Amazon Alexa is a beautiful product, but we have different strategies. From our side, we built a human-like AI assistant that has been trained on the voices of local people and used the expertise of our team for the development of its software and hardware. For example, even when we look at the name of Yasmina – it is tailor-made for the region and more blended with Arabic culture. As for the tech side of things, people will be able to judge for themselves”, he said.

Meaning of Yasmina

Yasmina can understand multiple Arabic dialects and respond in GCC Arabic and English.

The meaning of Yasmina in Arabic means “A beautiful flower that shines” or a Jasmine flower. Yasmina is a girl’s name with Persian, French, and Arabic origins.

“We started working on the Yasmina product more than a year ago. The Arabic language model is ready, and we are fine-tuning the remaining parts. We believe in local tailor-made products and the persona should match the region,” he said.

There are more than twelve million distinct Arabic words and with various dialects, adding a layer of complexity to voice recognition technology compared to 170,000 words in English.

Even though Arabic is mainly subdivided into three main versions – Quranic or Classical Arabic, Modern Standard Arabic, and Colloquial or Daily Arabic, it is estimated that over twenty-five dialects of Arabic are spoken globally.

Receives positive response

“We have been working with multiple copywriters from the region to create the assistant’s personality and studied what people are searching for and how they react to it. The Arabs in the GCC speak different dialects, so Yasmina understands different Arabic dialects and responds back in Khaleeji. Yasmina understands who is speaking to it, whether it is a child, a male, or a female. It responds accordingly and avoids turning on inappropriate content if the child is using it. It also speaks in a very human-like manner, leaving no one indifferent”, Mohamad said.

“When the product was announced and showcased at Gitex, we received a positive response from the visitors and the smiles on the faces of Khaleeji people gave us the boost and confidence to launch the product.”

There is no denying that smart assistants are the future, and technology will continue to drive and shift consumer behaviour.

In the West, people use smart speakers to search, advertise, content and for e-commerce.

Smart speaker demand

According to industry reports, the global demand for intelligent speakers is forecast to reach $41.40 billion by 2033, compared to $8.97 billion in 2023. In 2022, the market was worth $7.80 billion.

However, the smart speakers’ market is fragmented with multiple platforms, and this can lead to interoperability issues and limit the seamless integration of intelligent speakers with different smart home devices.

When asked whether standardisation and regulation are required to address these challenges, Mohammad said that he does not think, personally, any regulation is needed.

“What is needed is a common protocol for it to work and communicate with each other. You cannot force everyone to use the same operating system and the OS is the one that differentiates the product from others. Naturally, everyone is following the standards and the communications, and they came without forcing any regulations.”

“I don’t think any regulation is needed for smart speakers, same as the way for USB. No one said that you should use USB, but it came in handy because everything could interoperate,” he said.

Data privacy

Intelligent speaker manufacturers are expanding their ecosystems by partnering with third-party developers and integrating with a wide range of smart home devices such as lighting, thermostats, security systems, and home appliances, using a single voice-controlled device, and services.

According to Samer, in addition to the standard smart assistant capabilities of speaking and answering queries, Yasmina can integrate with major IoT and smart home devices that run on ZigBee or Matter protocols.

Matter is an open-source connectivity standard for smart home and Internet of Things devices while ZigBee protocol is an openly available wireless communication standard that is used to monitor and control home automation devices.

Another big issue with smart speakers is the collection and processing of user data to provide personalised experiences, which raises concerns about privacy and data security.

Reports have revealed that Amazon employees listen to Alexa voice recordings or random families having their conversations.

When asked Samer how Yasmina plays its part in data privacy, he said that they are fully committed and fully respect the privacy of the users and the regulations in the GCC.

Adoption to rise further

“We are assessing where the data should be stored in the GCC when the product hits the shelves in the first quarter of 2024.

“We are in talks with the regulators in the region to fine-tune the product,” Samer said.

“Our focus will be on the UAE and Saudi Arabian markets because they are the biggest in the GCC. We are receiving interest from established retailers and distributors from these markets for distributorship. As the infrastructure and resources are ready, we will enter other markets. It is just a matter of time,” Mohamad said.

The rising adoption of connected devices and the Internet of Things is likely to fuel the demand for smart speakers in the coming years and Mohammad added that the adoption of AI voice assistance is going up as the technology is getting advanced and people understand that AI can simplify their lives and help them in their daily routines.

The Qakbot takedown

In August 2023, the FBI alongside a laundry list of international partners executed a well-coordinated operation aimed at disrupting the Qakbot threat actor’s infrastructure and seizing approximately $8.6 million in associated cryptocurrency assets.

This activity undeniably dealt a significant blow to the threat actors behind the Qakbot malware, but emerging evidence indicates that that the blow was somewhat less than fatal. Researchers from Cisco’s Talos noted that a new campaign, begun shortly before the law enforcement action, remains ongoing and that the disabled infrastructure probably represented only a part of the whole.

While the takedown succeeded in dismantling the Command & Control (C2) infrastructure, it fell short of impacting their spam delivery capability, meaning that Qakbot continue to service customer demand and profit from cybercrime, perhaps also affording them the means and opportunity to build back better.

This incident raises important questions about the efficacy of such actions and prompts a closer examination of the broader landscape of cybercrime.

Merits of infrastructure takedowns

Infrastructure takedowns, when successful, can lead to immediate disruptions in cybercriminal operations. By targeting key components, such as C2 servers, law enforcement can sever the communication lines between malware and its operators.

This disruption can hinder the execution of malicious activities, providing a respite for potential victims. As was the case with the Qakbot takedown, there is also sometimes the technical possibility to leverage the seized infrastructure to remove the malware from compromised devices, significantly complicating any form of resurgence.

Takedowns also offer a valuable opportunity for law enforcement agencies to gather intelligence.

Examining the dismantled infrastructure can provide insights into the tactics, techniques, and procedures (TTPs) employed by threat actors. In addition to collection of evidence for the positive identification of the people behind the criminal operation, this intelligence can be crucial in enhancing cybersecurity measures and better preparing for future threats.

Publicising successful infrastructure takedowns can serve as a deterrent to other cybercriminals. Knowing that law enforcement is actively targeting their infrastructure may dissuade potential threat actors or make them more cautious, contributing to a more secure cyberspace.

Challenges and limitations

Despite the apparent immediate success of infrastructure takedowns, cybercriminals have proven to be remarkably resilient. The Qakbot incident illustrates this point, as the threat actor quickly adapted by maintaining their separate spam delivery infrastructure. This adaptability challenges the long-term impact of such actions.

Notably, threat actors are often quick to recover from infrastructure takedowns. They may establish new servers, change communication protocols, or adopt other measures to resume their activities.

The transient nature of the digital realm allows cybercriminals to regroup and continue their operations swiftly.

Often learning valuable lessons from prior law enforcement activity to build more resilient infrastructure the next time around.

These takedowns can have further unintended consequences, affecting not only cybercriminals but also potentially innocent entities that share the same infrastructure. Shared hosting environments or compromised servers may inadvertently become casualties, causing disruptions to legitimate services.

Emotet

The Emotet malware, known for its sophisticated and modular design, experienced a significant takedown by law enforcement in 2021.

However, the malware resurfaced in 2022 with a hardened C2 infrastructure and a more capable malware, demonstrating the ability of threat actors to regroup and adapt.

Emotet’s revival underscored the challenges in achieving a lasting impact through infrastructure takedowns alone.

TrickBot

TrickBot, another notorious malware, faced multiple takedowns over the years. Despite these efforts, the threat actor behind TrickBot managed to revive the malware and continue its campaigns.

The ability to recover from infrastructure disruptions highlights the cat-and-mouse nature of the ongoing battle between cybercriminals and law enforcement.

While law enforcement actions targeting cybercriminal infrastructure can provide immediate relief and valuable intelligence, their long-term impact remains a subject of debate.

The August 2023 FBI takedown of Qakbot’s C2 infrastructure serves as a recent example, and highlights the challenges posed by resilient threat actors.

As the digital landscape evolves, a comprehensive approach that combines takedowns with proactive cybersecurity measures, international collaboration, and public-private partnerships is essential to effectively combat the persistent threat of cybercrime.

Balancing the need for immediate action with the recognition of the dynamic and adaptable nature of cybercriminals is crucial for fostering a more secure online environment.

Above all, these law enforcement joint operations must become more frequent and more personal. The considerable time periods between these headline-grabbing actions offers the threat actor far too much time and opportunity to regroup, reassess and relaunch with all the associated object lessons taken on board.

The unfortunate late of actual kinetic and financial enforcement activity against the real people behind these criminal enterprises also means that nay respite will always be temporary.

Even though the current state of geopolitics may be against us, the security and enforcement communities need to continue to work together to improve information-sharing and collaborative endeavours with the concrete aim of identifying, arresting, and charging that relatively small group of people most responsible for the dizzying array of online criminal enterprise.

Rik Ferguson is the Vice President of Security Intelligence at Forescout.