Between 2003 and 2021, there is a time gap of 18 years. Between the ideation of DVIIS and E Rupee has been such a distance in time. DVIIS was invented and proposed by Naavi and E-Rupee has been introduced by the Modi Government.

In between, DVIIS or Digital Value Imprinted Instrument System was proposed for patent and discussed with many IT companies including Cognizant, TVS Electronics, TCS, Mind Tree, Infosys etc. But none of these IT wizards could understand the utility of this idea called DVIIS. Subsequently, the ITZ card. It was also discussed with a couple of so called “Venture Capitalists” who were supposed to identify innovative projects ahead of times.

It has however taken 18 years for my idea to come into wide use and perhaps the vision of all the wizards in IT was inadequate to spot a project that was that much ahead of time.

I am however happy that Modi’s Government has taken up the idea independently through NPCI and has replaced the “Paper Token” which I had proposed in 2003 to a “Digital Token” which is the order of the day.

This is not to claim any IPR related issue in the Government using the idea, and I am happy that the Government is using it. But I wonder if it takes 18 years for such a simple idea to be understood and absorbed, how long will some of my ideas of the current years take to become a reality. But life must go on. We need to keep ideating and some day it may become useful.

I will take a little time to explain what I proposed as “Digital Value Imprinted System” which was also proposed in operating form for Stock Holding Corporation of India, Bangalore Corporation etc., but was not approved for usage.

DVIIS is a system where a pre-printed paper token would be issued as a scratch card with a hidden serial number. The number would be used to load value in a digital server. The card would be hand delivered to a payee who would download the value of the card. It was meant to be used as a Digital Stamp, alternative to cheques (at that time UPI and other digital payment systems were not in place), bus ticketing, etc. (One sample instance of the digital stamp system is available at https://naavi.org/dviis/Website/index.htm).

I had spent nearly one year with a Cognizant team to develop the idea into a product but the company was happy as a service company and did not want to develop a new product all on its own.

The Arbitration.in was another such idea which was introduced in 2005 and was even taken to the Supreme Court IT committee for introduction of E Courts. But it took the Covid to make the Supreme Court realize the potential of the ODR system and accept it.

But these were footprints in the sands of time that make us realize that one needs to be at the right time at the right place for any work however good it is to be considered a success.

I hope PDPSI and DVSI would not have to go through this 1-18 year gestation for the idea to be realized. Probably the army of FDPPI which was not in existence in 2003-2005 will ensure that PDPSI and DVSI will realize the potential for which they were created.

Naavi

P.S: The name ZEMO I used at that time for Zero Memory card to replace smart cards is now being used by some Game!

Also refer:

Black Money Policy of Narendra Modi.. Here is My Idea

(Continued from previous article)

The world is today speaking of “Data Driven Organizations”. Essentially, this means that “Data Engineering” is used to increase the productivity of companies. There could be several ways  by which “Data” can help a company to earn revenues beyond the simple observation that “Better quality”, “More accurate” and “More innovatively processed” data can improve the productivity.

Recently Zomato made a public issue of shares and raised Rs 9750 crores. The company had accumulated losses of over Rs 4211 crores in the last three years but investors were prepared to buy its shares at a fantastic price of Rs 76 per share and it is now traded in the stock markets at a higher value than at which Vodafone global shares are traded…around Rs 130 over 120.

The magic here is the monetization of the perception that Zomato has data about its customer’s eating habits which when filtered through an efficient data analytics system can enable the company to improve its earnings in the next 10 years and turn it around into a profitable company. For Zomato which is still not able to show a profitable stream the projections that “It has data that can be monetized and share holders can take that future potential for current valuation” may be a highly speculative proposition. But for Vodafone which has a global potential proven for many years, any such thought that its data is valuable and can be monetized better is a certainty.

If Vodafone floats a tender for Big data companies to make proposals on how its data can be monetized, then they will be surprised to know that the data of 27 crore customers and their behavioral pattern can generate very interesting proposals.

Let me make one point clear here… The exploitation of data of its customers by Vodafone will involve “Privacy” issues. But “Consent”, “Pseudonymization” and “Anonymisation” can be the “Trishul” with which Vodafone can prime its data holding for monetization even considering the upcoming Personal Data Protection Act of India.

We may recall that American Airlines, USA valued its frequent flyer customer base (AAdvantage) at around us$ 19.5 to 31.5 billion last year. Similarly the United Airlines also revalued its loyalty program data at about $ 20 billion. Caesar Entertainment cashed its total rewards customer data base for over $ 1 billion during a bankruptcy proceedings.

If these valuations were acceptable to investors then it is possible that post-Zomato success, revaluation of data of Vodafone could raise enough money to not only clear Vodafone’s AGR dues but perhaps its entire debt.

If Vodafone does not know the value of its data and the potential, I urge the Government to  take a pledge of Vodafone customer data for AGR dues and create a SPV to monetize the data value. It may be able to realize much more than the AGR dues.

Will the Telecom Minister consider such a possibility?

Naavi

Vodafone is facing a financial crisis. (Refer article in New Indian Express) A company which has 270 million customers is in financial crisis and is unable to face the loss arising out of the Supreme Court decision which had made it liable for payment of substantial dues to the DOT. Even a 10 year spreading out of the repayment appears to be insufficient for Vodafone to come out of the crisis.

According to  information available, Vodafone woes Rs 58,254 crores to the Government as AGR dues of which it has paid Rs 7854 crores. This is the annual license fees and spectrum usage charges which the company failed to factor in its operations earlier due to a wrong advise it received from its financial and legal professionals.

It is said that Telecom operators interpreted that  they would be charged the license fee on the basis of their core business conducted using the spectrum while DoT held that the definition of AGR included items like dividend, interest, capital gains on account of the profit from the sale of assets and securities and gains from foreign exchange fluctuations.

It is futile now to discuss the legality of the issue since the Supreme Court has settled it in favour of the DOT. The telecom operators together are guilty of not having provided for this possibility while they made merry during all these days under the mistaken interpretation.

However, this is not the time to gloat over who was right and who was wrong. We need to look at ways by which the issue could be resolved because the damage that a failure of a big company like Vodafone could cause to the economy is immense and is avoidable.

The per-capita burden of Vodafone dues of Rs 58000 crores on 27 crore subscribers is about Rs 2000 per customer. Current share price of Vodafone is around 120 per share.

If there is a further issue of shares at around Rs 100 per share, the dues can be met with an issue of 20 shares per customer as “Rights”. (Technically it could be called a Private Placement). This issue of 540 crore new shares would dilute the share holding by 20% but can enable the company to sail over the current difficulty and increase the P/E multiple so that the loss could be adequately compensated.

While the above thought is a traditional thought, there is a more exciting thought based on the new concept of “Value of Data as an Asset” which we shall discuss separately in the following article.

(Continued)

Naavi

In computing the intrinsic value of data as an asset, cost based method is one of the choices that a Data Valuer needs to explore. Current market value if available could be the second option while Net Present Value of future earnings expected from the asset could be a third option.

In Cost based approach, it is necessary to make a distinction on “Cost of Collection of Data” and  “Cost of cleaning up data by removing unwanted collateral data”. After this “Data Preparation”, the data would e ready to be used for some purpose. The asset needs to be valued at this stage by computing the cost upto the preparation of data ready for exploitation.

One example is that a company X has a license from Twitter or Linked in to parse its data and extract useful data. In such cases, the cost of data is easily determined by the license fee paid to Twitter or Linked in. Once the gross data is so gathered, the company may use its own filters to reject some data and retain some. This retained data is the data that is useful as raw material for the company. The cost of filtering may be ascertained by the specific software used for the purpose and the manpower cost assigned to the activity.  Additionally a share of the fixed costs can also be allocated. This total cost would be the cost of data in this context.

Once data is kept in store for further use, some user department may recall the data and create value added products (eg: a saleable report based on the information). This would be cost of production of the given product.

If the raw data is collected from say the website of the company X where a service is offered and customers register for the service using a web form, the cost of collection would be the cost of hosting the web form and a share of the fixed cost attributable to the maintenance of the website.

In a practical situation, companies may not be able to clearly identify the source of data and cost of its acquisition. However, in the days of data protection, it has become necessary for companies to set up an appropriate organizational structure to identify the sources of collection of data and hence it may be possible to attribute direct cost of collection.

However, this exercise of ascertaining the cost of data belongs to the domain of Cost Accounting and it will be necessary for the company to have the Cost Accountant work closely with the technology department and the DPO to arrive at a reliable cost of data.

Naavi

(DVSI stands for Data Valuation Standard of India… Refer www.dvsi.in for more information)

Companies often face the dilemma on payment of ransom when their data is captured and held hostage by a ransomware attacker. The attacker fixes a certain price for the release of the decryption key and often places the data for sale in the dark web. Acer had a demand of $50 million, CNA Financial reportedly paid $40 million and Colonial Pipeline paid $4.4 million. In India itself we had a demand on Cognizant for $ 5 million and different smaller amounts in different companies.

It is clear that in these cases the hackers had a perception of the value of the data they had captured and the companies paid the ransom because they felt that there was an opportunity cost in refusing to pay.  Insurance companies have their own practices on dealing with such instances and some may cover the ransom as part of their policy.

Further, darkweb often quotes a price list for many kinds of data. One such laundry list is here.

When thieves set a value for the data they may target and steal, it is necessary for the organizations which have these assets to also know that they have assets which are vulnerable to be stolen.

Managements often express surprise when a ransom demand is made and wonder “Do we have that kind of data with us”?. The reason is that so far the CFOs and CEOs were never told that Data is an asset though on the balance sheet it does not show up.

Corporate Managements need to ask themselves, if they are not representing the true value of their assets in the financial statements which they certify “This is a fair and true representation of the company’s financial position”.

If the CEO/CFO knows that the company has a Rs 5000 crore of data asset, they would not crib to appoint a DPO or CISO at the kind of remuneration they deserve or to invest in security products or employee training or atleast to harden their operating systems which they keep postponing.

Let’s therefore look to the future with confidence by valuing our data assets and bringing them into our balance sheets. …

Let our shareholders know what we are worth.

Let our competitors know what it would cost to take over our company.

Asatoma sadgamaya…tamasoma Jyotirgamaya…Oh DVSI, Oh DVSI…

(meaning From Ignorance, lead me to truth, from darkness, lead me to light..Oh Data Valuation Standard of India)

Naavi

(With apologies to the Rishis who gave us the Upanishad Vaakya)

After the Delhi High Court and Orissa High Court indicating that Right to Forget can be extended to a right to remove reference to an accused in a Court Judgement, the Madras High Court has now rejected the “Right to Redact” the identity of an accused from the Judgement.

In a Judgement delivered on 3rd August 2021 by Justice N. Anand Venkatesh in the WP (MD) no 12015 of 2021, the Court rejected a request from a petitioner Mr Karhick Theodre who had been charged earlier for an offence and acquitted , that his name be redacted from the judgement records.

Similar consideration had come for discussion in two other cases one in Odisha High Court and another in Delhi High Court where the interim decisions were in favour of the accused and acquitted person to get his name removed from access through internet searches.

Naavi.org had observed that the decision was faulty since it interfered with a “Fact” and enabled suppression of the right to information.

The earlier Supreme Court decision regarding the victim of a rape or sexual abuse or in cases of Juveniles, to be conceded such a right does not apply to the case of an accused who may be acquitted for reasons other than being innocent.

This current judgement of the Madras High Court is well reasoned and refused such a request.

We appreciate the decision of the Court which was assisted by the Amicus Curie Mr Arun Anbumani. It is also notable that the hearing was conducted virtually and concluded in quick time.

Naavi