Posts Tagged ‘Nokia’

2014: The Year of Digital Renaissance?

Tuesday, December 31st, 2013

Digi Renaissance firework 2013As fireworks fill the skies tonight and 2013 comes to a close, it seems a good time to reflect on the current state of the telecoms and ICT industries, and what has changed in the last five years. Having just participated in the 2013 ITU Telecom World Conference in Bangkok, this gave me the opportunity to assess whether the Digital Renaissance that we at KeySo Global have being predicting has in fact transpired.

In 2009 the world was reeling from 12 months of global financial turbulence and anxiety levels were high. WiMAX was causing angst for U.S. carriers and the iPhone was forcing the rethinking of how Wi-Fi and cellular could effectively inter-operate. Data congestion on overloaded 3G networks designed for voice was reaching critical levels as operators adjusted to the realities of YouTube video upload and downloads. The European markets and technology suppliers were firmly in control of the industry, with Nokia the dominant handset supplier controlling 38% of the 1.1 billion phones sold that year. Apple, on the other hand, was gaining credibility and achieved a respectable 2%. ICT was the main theme of the conference as cellular held center stage with 67% market penetration, having enabled 4.6 billion people globally to have access to personal communication capability. In 2009 the prime discussion, therefore, was around internet connection and the role that mobile could play here.

graphic oneFast forward to the 2013 conference in Asia and the global economy, having experienced five years of unprecedented instability, is still in a volatile state where virtually every treasured economic rulebook has been proven ineffective in controlling a 24/7 interconnected digital world. This has been facilitated in part due to cellular penetration reaching 96% and 6.8 billon people having access to cellular – 3.5 billion of whom are in the Asia Pacific region. More significantly, the number of people now online has increased from 26% to 39%. The single biggest contributor to this has been mobile broadband access which has grown from below 10% in 2009 to 30% penetration this year. This growth is closely tied to smartphone growth as well as the availability of lower cost data packages.  In 2009 smartphonesgraphic 2 accounted for approximately 10% of handset shipments, whereas in the 3rd quarter of 2013 smartphones totaled 250 million units, over 55% of total phone shipments that quarter. The biggest loser in this dramatic shift in emphasis towards smartphones and operating systems has been Nokia, but others such as Sony Ericsson, Kyocera, Sharp, Rim, HTC and Motorola have been damaged along the way, to greater or lesser degrees, by the shift to an Android world.

In conclusion, we are living in a far more connected world than we were five years ago. However, the extent to which the interconnection of this increasingly complex human digital and physical world is understood is limited and the ripple effects of these technologies on industry structures have only just started to appear. Telecoms and ICT are certainly not immune to these, as we have seen, but within the next five years we will see the boundary industries of automotive, medical, retail, utilities and manufacturing become increasingly subject to the transformative effects of the mobile internet.

Of greater interest will be the unanticipated consequences that will undoubtedly emerge from the mobile internet and Internet of Things blending with big data analytics, and the unavoidable impact this will have on digital life and behaviors. As an increasingly urbanized planet adopts these technologies to facilitate ever smarter cities, the opportunities for ICT to make a difference to societies are colossal – but the question is how to bring the people along with these changes, and instill trust in them that technology will be used for good and that ethical government will prevail? Clearly, the recent Snowden revelations on the NSA and other agencies have given everyone pause for thought.

As we enter 2014, it is clear that the Digital Renaissance is technically well underway but the structural and behavioral implications are only just beginning to emerge and, when they do surface, I suspect that the predominant challenges we face will be societal. In shaping the future of this brave new world we need to engage its citizens, understand their needs and manage the “Faustian bargain” that will be a fine balance between a surveillance state and the right to privacy. None of these challenges are unsurmountable but they are ones that will need careful monitoring, open conversations and perseverance on the part of governments, industry and citizens around the globe.

Steve Bell, President, KeySo Global

BlackBerry and JC Penney: Two Giants That Have Lost Their Way?

Monday, August 26th, 2013

What do BlackBerry and JC Penney have in common? Possibly more than you might realize.

1. Both missed the shift in their industry.

2. Both changed leadership.

3. Both implemented radical change.

4. Both achieved less than impressive results after this change.

5. Both implemented change following agitation from Wall Street – even though Main Street reacted neutrally or negatively to the change.

JC Penney even went as far as to hire the retail guru from Apple, Ron Johnson, as its new CEO to turn the company around but, in so doing, the needs of the customer were ignored. The introduction of tablets at point of sale, a relaxed dress code for the sales staff and the removal of coupons and store cash registers confused the target shopper – a very different shopper to the one found at the Apple store. The application of technology in this case was not the issue. The crucial question overlooked was whether the benefits of that technology outweighed the resistance to adopting it; in the case of JC Penney they did not. Not only was there resistance from the customer but Ron Johnson failed to gain the collaboration of staff and management, which proved to be a critical mistake.

Sales of the new BlackBerry 10 operating system based products – the Z10 and the Q10, and most recently the Q5 – are down as BlackBerry has lost significant market share to Apple, with its sleek and easy to use operating system and beautifully designed product. It was BlackBerry’s misconception that its superior new operating system and good design would enable it to reclaim its former position in the market. The reality was that BlackBerry started as a technology but developed into an experience. In the early 21st century the device became widely known as a “CrackBerry”, referring to the excessive and obsessive email-checking by its owners, for both business and personal use. The technology was convenient and secure and, most importantly, BlackBerry had become a trusted household name.

BlackBerry’s demise, however, was not just related to the fact that the operating system did not evolve; it put too much focus on the consumer and lost sight of its valued customer base, the corporate IT customer, whose growing desire was to access both their corporate digital networks and their social media networks on the same device, but this was ignored by BlackBerry. The infamous “BlackBerry outage” was the final straw and violated the trust that former loyal consumers had in the BlackBerry experience. RIM, as it was, was an engineering company that had no idea how to continue to design experiences and now, as “BlackBerry”, does not have the marketing knowledge or clout to rebuild consumer trust in the brand.

Both companies tried to emulate Apple in a classic “best practices” way but failed to understand that the Apple store and its devices were designs that embodied feelings and experiences, and created by a man with exceptional vision; someone who posed questions such as “how do we reinvent the store?” and “how do we do things differently on a phone?” Steve Jobs never just produced a “me too” product.

So, what’s the walk away? Wall Street hates failure but, more than that, it’s terrified of change. Both however are essential for innovation and creativity which are cornerstones of modern day business success. Wall Street’s demands for continuity of performance can ultimately result in giants being brought to their knees. What’s more dangerous is that when Wall Street sees these giants falling they demand a change of leadership. This new leadership is then faced with the challenges of innovating and risk taking to enhance performance when, in reality, all Wall Street wants is to preserve the status quo. JC Penny and RIM, as well as Motorola and Nokia, are prime examples of this. Apple looks as if it is unassailable at this point of time but calls by Wall Street activists to withdraw cash from the company will ultimately weaken its ability to take the risks that are necessary to sustain it going forward.

Steve Bell, President, KeySo Global

Apple and Huawei – Zen and the Art of the Long View

Monday, April 29th, 2013

Article first published as Apple and Huawei – Zen and the Art of the Long View on Technorati.

The telecoms and technology markets have always taken the long view with regard to product and business development. This week has seen two companies look to the future in different ways. Apple, the original Zen Master of strategy, coming to grips with an apparent hiccup in their recent string of successes and Huawei struggling in the aftermath of rejection by the U.S. government.

Apple has been in the press recently due to the substantial fall in its stock price and the increasing demands from shareholders to receive part of the $145 billion cash mountain that it has amassed. Apple CEO, Tim Cook, finally acquiesced and has just announced a capital buyback program that will increase the return to shareholders from $10 billion to $60 billion, as well as increasing its quarterly dividend by15%. This may quell the unrest of Wall Street investors in the short term but it exposes the company to a significant long term threat to their enterprise viability due to their increasing risk adversity and lack of innovative product introductions, particularly when compared to those of Samsung. It’s very easy to slip from grace and require cash to sustain operations if you miss market turning points – have a look at what happened to Motorola, Nokia and Rim! Steve Jobs, with his Zen Master ability, excelled at recognizing long-term future opportunities and betting the company in order to secure that future. He was protective of the cash, understanding that to “bet big” you need to cover the downside mistakes. Unfortunately, that doesn’t appear to be the case with Apple today.

Contrast this with Huawei that announced within the last 48 hours that it would abandon its pursuit of penetrating the North American telecoms network market after five years of battling the U.S. government. At the same time as this apparent retreat, however, Huawei has begun focusing on building its consumer product brand in the U.S. The company’s introduction of new products at this year’s CES gave it significant presence, and this month it announced a new marquee handset along with sponsorship for the Jonas Brothers tours, starting in Chicago. Huawei appears to be adopting a long term strategy to establish itself at the heart of the U.S. psyche as a “brand of trust”, potentially making it more difficult for them to be politically blocked in the next round of network purchases. Equally, since 4G networks have effectively been sold and rolled out in the U.S., the market opportunity is now elsewhere. The reality is that the market momentum of Huawei globally over the next five years will probably cause two of the five remaining network providers to be eliminated, meaning that Huawei will be the only real alternative to Ericsson when network operators look to upgrade their systems in 5 years time. The bet is that the U.S. government will have little choice but to reluctantly accept Huawei, even if it’s not with open arms.

The Zen Master, it seems, has actually moved back to China.

Steve Bell, President, KeySo Global

Could TomTom Provide the Roadmap to Success for Apple?

Sunday, February 17th, 2013

Article first published as Could TomTom Provide the Roadmap to Success for Apple? on Technorati.

Much has been written about Apple’s $135 billion in cash and the desire of some shareholders to see part of it returned. Technology companies that thrive in their heyday often face the challenges of a post-glory period when their product ceases to appeal or the market has moved on. Nokia and Blackberry (formally RIM) are recent examples of this, and Motorola is another within the mobile space.

At times such as this, a company’s cash reserve is the only thing that allows for continued investment in R&D; it enables them to try to hit the next product cycle and provides coverage for a cash flow shortfall should the company no longer have the volume to generate profits. Having cash on the balance sheet also provides a company with the opportunity to invest, through acquisition, in new technology and intellectual property to ensure enhanced offerings.

In the case of Apple, the recent debacle over the new Apple Maps app on their iPhone 5 emphasizes the fact that when they’re looking to create a new experience, Apple is better off using in-house software. Dutch navigation company, TomTom, which provides the map software for Apple, has recently been reported to be struggling as its hardware sales begin to falter. For the last couple of years the company has focused on selling their map software but they haven’t had the financial resources necessary to successfully compete against the deep pockets of Google or Nokia (Navteq).

TomTom could, however, be an ideal acquisition candidate for Apple. Within their portfolio they could provide the inspirational innovation to blend hardware capabilities with location, content (iTunes) and contextual information to create new and engaging consumer experiences that enhance the digital life of the consumer. In reality, this mapping capability is already within the portfolio of Google and Microsoft, their main rivals in the operating system space.

Steve Bell, President, KeySo Global

Say “Cheese” and Celebrate the Evolution of Mobile Photography

Friday, December 21st, 2012

With holiday parties in full swing and greeting cards arriving daily, it’s difficult not to see how they have both been impacted by the instant simplicity of taking a snap and sharing it with the world via social media, Snapfish, Shutterfly, Flickr or one of the many other digital photo printing and sharing services.

Pulling out our phones, snapping a photo and posting it for all our friends to see has become such  a normal part of our daily lives that it’s tough  to believe that it was only 10 years ago that the first commercial mobile camera phone came into existence. The first picture, however, was sent as early as 1997 when Philippe Kahn utilized the Motorola StarTAC with an add-on Casio camera and shared a picture of his daughter’s birth with 2,000 people.

The first integrated system with a mechanism for uploading photographs and delivering them to the internet was deployed in Japan by J-Phone, now owned by SoftBank. In 2002 the European operators of GSM systems also deployed mobile cameras along with the multimedia system, MMS, for uploading and downloading pictures. The MMS system was a development beyond what was already in place – SMS – for texts which had been around since 1992.

The progress of development was unbelievably fast. Already in 2003 more cell phones with cameras were sold than stand-alone digital cameras and by 2006 half of the world’s mobile phones incorporated a camera. Nokia was one of the first companies to introduce a mobile phone with integrated camera, and at Mobile World Congress this year Nokia introduced their N808 phone which has an amazing 40 megapixel camera capability.

The photography industry has been severely disrupted by our everyday use of mobile camera phones as they have radically changed the way that we utilize digital photography. Kodak, a name synonymous with pictures, has exited the industry and this week sold its portfolio of digital photography patents to a consortium of buyers that include both Google and Apple. Smartphones and iPhones contributed to the nearly 228 billion MMS messages sent in 2012, with another 5.8 billion over-the-top messages sent via WhatsApp and other such services. How boring would Facebook be without the 219 billion photos that are live on the system today? Back in 2010 it was estimated that 2.5 billion photos were being uploaded per month to Facebook. Currently Facebook has 600 million mobile users, many of them uploading photos daily to this site, not to mention the plethora of Twitter and Google Plus users who are also adding scores of daily photo updates for the world to see.

This week has also seen the other side of this issue emerge as Instagram (owned by Facebook) had to bow to public outrage and revoke its decision to change its terms and conditions that would have allowed advertisers free access to members’ pictures with no compensation. The issues of privacy, ownership, copyright and commercial interest are not yet clear in this digital world.

The mobile phone incorporated camera has sparked not only a picture revolution but also other significant developments, including the utilization of bar codes and QR codes for product identification, comparison shopping and bargain hunting during the busiest retail times of the year. It is no wonder that in today’s connected digital world the camera phone has become such an essential part of our lives, enabling us to capture those special everyday moments and sharing them instantaneously with the global community. Say “cheese”!

Steve Bell, President, KeySo Global

Which 3 Digital Technologies became Catalysts for Change?

Friday, August 31st, 2012

So what exactly have we recognized as being the three catalyst technologies or products that emerged in the year 2007? Below is an overview of each of these and highlighted are the main factors that we believe have influenced their evolution and subsequent relevance today.

WiMAX

WiMAX was an early 4G technology that started the move of the U.S. market to wireless broadband; it is often likened to “Wi-Fi on steroids”. The fact that Sprint and Clearwire, a startup that was supported by Google and Intel, could deliver blisteringly fast mobile Internet service forced AT&T and Verizon, the two largest U.S. carriers, to accelerate their deployment of 4G LTE. This development meant that standards needed to be agreed upon and formalized, and that network equipment manufacturers needed to accelerate production in order to provide for these large customers.

Having AT&T and Verizon focus on a single frequency (700 MHz) made it easier for device manufacturers to accelerate their development of 4G Internet products and deliver consumer-ready devices. The fact that some of these device manufacturers had been working on WiMAX devices in cooperation with semiconductor providers meant that they could accelerate products based on the WiMAX chipsets that almost 80% matched LTE.

Subsequently, both Sprint and T-Mobile have also either invested in or announced plans to build a 4G LTE network on top of their existing systems. What this means is that for the first time all four large U.S. carriers are offering mobile Internet services utilizing the same technology as the rest of the world, enabling global interoperability and roaming.

The iPhone

The second catalyst product was the iPhone which has received much acclaim for its elegant design and simple user interface. The real essence of the catalytic change that the iPhone initiated, however, was a shift in the consumer paradigm of a mobile device being used solely for communication to one that enabled interaction. The iPhone allows users to connect easily on-the-go and to share information, content, pictures and video simply and effortlessly. When it was first released, users found the interface to be so effortless that data volumes climbed exponentially and severely disrupted the AT&T network that had not been designed for large data capability! This forced AT&T, as well as other mobile operators, to rethink the entire concept of network architecture to include Wi-Fi as an offload mechanism. It also resulted in AT&T acquiring Wayport, and in the process becoming the single largest operator of Wi-F in the U.S.

Not only did the iPhone change the existing consumer paradigm and network architectures, it also broke the carrier stranglehold on its relationship with the subscriber. The iPhone was and still is provisioned via iTunes, which had previously been the domain of the mobile operator. This relationship with the subscriber, initiated at the time of purchase, was then solidified through the introduction of the app store and ultimately the iCloud. Apple effectively took the existing mobile business model, tore it up and replaced it with a hybrid that established a stronger bond with the consumer based on end-to-end user experience. The impact of the iPhone’s innovative design, end-to-end system, business model, user paradigm and elegant packaging of an everyday technology has had a tsunami-like impact on RIM, Motorola and Nokia, as well as on major mobile operators around the globe.

The Amazon Kindle

The third catalyst product that has been an instrumental agent of change is the Amazon Kindle. This device did for a 500-year-old product concept, the book, what the Walkman or iPod did for music. Best sellers are now cheaper and easier to obtain via the Kindle which provides on-the-go access to the world’s largest library/bookstore. This simple to use, low cost device made the mobile Internet transparent to the user by incorporating the cost of access into the price of the book. Amazon achieved this by creating a blanket connection relationship with AT&T for global access. The fact that the Kindle e-Reader automatically creates a relationship with Amazon means that loyal subscribers are a natural evolution. Proof that this technological revolution is affecting the literary world is evidenced by the number of large bookstores, such as Borders in the U.S., that have closed, and Barnes & Noble swiftly producing their own e-Reader, the Nook.

The iPhone and the e-Reader together have evolved into an instant-on class of device – the tablet – that satisfies the mobile consumer’s need to instantly connect, be entertained and informed. While small enough to remain portable, smartphones and tablets facilitate sharing, learning, creating and interacting using wireless broadband connectivity (3G, 4G and WiMAX) and these in turn have become indispensable parts of our everyday digital lives.

Steve Bell, President, KeySo Global

www.keysoglobal.com

 

Google & Motorola- Chinese Whispers and Puzzles

Sunday, April 22nd, 2012

Why offloading Motorola Mobility to Huawei makes no sense

 

Even before the deal is finalized the Wall Street Journal is speculating that Google will sell Motorola Mobility (MMI) to Huawei and keep just the patents because it doesn’t want to disrupt the Android ecosystem. The analysts IDC commented that since “Google doesn’t have a hardware background”, they don’t know what to do with Motorola.

The reality is more complex than either of these speculations. In acquiring the patent portfolio, Google is astute enough to realize that in the converged technology world strong hardware and software combination patents are vital. Equally, they understand that this capability needs to be maintained in order to protect the ecosystem going forward, thus acquiring the means to do this. Now it just has to be creatively integrated into the organization in such a way that everyone sees the overriding future benefits.

When looking at Google’s major operating system competitors, Apple has both the hardware and software capability but completely integrated into a closed system; Microsoft with Nokia has an integrated approach as well, even though they are touting an open system. The requirement for hardware and software is without doubt paramount for the future.

Devices beyond smartphones need to be created in order to achieve Eric Schmidt’s (Chairman of Google) objective of connecting the world. While Android in smartphones is growing rapidly, Apple still dominates the tablet space. Concepts such as Google Wallet and Google Glass will need help transferring into the world of commercial production. The acquisition of MMI provides Google with a mechanism for rapidly commercializing technology concepts into simple to use devices.

Does MMI have too many phone design teams and engineering resources for this scenario? The answer is “probably”. Could elements of this be offloaded and would Huawei be a logical acquirer? The answer is “possibly”. However, the core capability will be retained within Google in order to enable the enhanced technology future that Larry Page, Sergey Brin (co-founders of Google) and Eric Schmidt foresee for the world. This future includes enabling mesh type communications for the emerging world, facilitating the digital living room and creating the autonomous automobile. None of these will be successful without the opportunity and means to integrate hardware, software and creative vision. This is the capability that Google has acquired with MMI.

Article first published as Google & Motorola – Chinese Whispers and Puzzles on Technorati.

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Turbulent times –a seed bed for creative growth

Friday, February 18th, 2011
This week GSMA Mobile World Congress, Europe’s premier mobile telecom and internet industry conference took place in Barcelona. As the industry shared the latest gadgets, technology and service developments, it was also trying to determine the real significance of the Nokia Microsoft partnership.

It is clear that as mobile telecoms and the internet come together, nothing is guaranteed. Two of the most successful players of both industries have struggled for relevance in the converged space of the mobile internet and smartphones. This converged space and the impact that it has on society has been our focus at KeySo Global for the last 3 years, and we refer to it as Digital Life. This phenomenon is spreading virally and facilitating increasing globalization of politics, economics, education and societal change.

Efficient real time communication and “anytime anywhere” access to information sources are fueling a broader societal perspective and increasing peoples’ expectations for leaders to solve the issues that negatively impact their lives, especially among the younger generation. The impact has stunned industry veterans like Intel’s Paul Otellini: “I would not have thought that technology would change politics or democracy. But it changed the American electoral cycle, it just changed two countries and it’s not going to stop there. It’s a liberating technology.”

2011 has continued to provide a constant stream of 24 /7 TV images and online reports of the problems in many countries such as Tunisia, Iran, Egypt, Afghanistan, Pakistan, Iraq and most recently Bahrain. Given this barrage, it’s difficult to deny that we’re living in uniquely turbulent times. Citizens in all countries have gained a louder and more powerful collective voice which is generating real and intense pressure on incumbent leaders to alter their policies or step down.

Since 1989 and the deconstruction of both the Berlin Wall and the Soviet empire, the number of democracies in the world has increased significantly, according to George Mason University. Some observers have noted the Middle East was an outlier in the trend to democracy and that the current events are evidence of the continued enlightenment and alignment of the global population. Others highlight the impact of a connected and educated younger generation and an empowered middle class. Both these factors are relevant but probably two of the most significant aspects of change are the democratization of information and the mobilization of people that these converged technologies enabled. Despite the desperate efforts of some existing governments to curtail, block and usurp access to these converged services, the inevitable outcome could not be prevented.

Returning to the question of the significance of the Nokia and Microsoft partnership – the deciding factor will be their ability to quickly unify their product strategy and collaboratively re-enter the market. As the pace of change accelerates they will be shooting from behind at a rapidly moving target. Compounding these challenges will be the added distraction of finding synergistic thinking among many different egos, overcoming turf wars and posturing which could further hinder the ability of both companies to collaborate effectively and innovate competitively. Nothing is guaranteed in this converged space but if these two can harness their combined depth of knowledge with proactive interaction with consumers and enterprise customers, they have the potential to win.

If you would like to learn how open innovation can be leveraged through internal & external knowledge networks and how to take advantage of Digital Life opportunities, contact us at +1 847-478-1633 or visit our website at www.keysoglobal.com.

Nokia and Microsoft – A window to heaven or 7 years bad luck?

Thursday, February 10th, 2011

In January at CES (the Consumer Electronic’s Show in Las Vegas) CNBC’s star reporter “Money Honey” Maria Bartiromo asked Microsoft CEO Steve Ballmer “What are you going to do with your $50 billion of cash? Are you going to buy Nokia or RIM?” Ballmer, of course, refused to comment. The consensus is, however, that Microsoft’s options for succeeding in the smartphone market are declining rapidly.

This week there is news that Stephen Elop, Nokia’s new CEO, has determined he and the company are on a “burning platform” and tomorrow is likely to announce a restructure of Nokia’s executive board, making it less Finnish; but more significantly, he is looking to make the company more successful, specifically in North America. Additionally, he is reportedly looking for a new head of operating systems, as well as a new head of research and development with strong software capability. This reorganization will be a major shakeup for Nokia. The question is (as was pointed out in a previous blog) will this consensus driven company that historically succeeded because of continuity of leadership make this transition, not only in strategy but culture as well?

Is this a marriage of convenience or desperation? Both Microsoft and Nokia are struggling in the smartphone arena, particularly in North America, where the latest Comshare subscriber data shows that Nokia has only 7.0% of the overall subscriber base and has no presence in the smartphone platform market. Microsoft is also desperately hanging on to 8.4% of Smartphone platform subscribers; this is compared to RIM that slipped to 31% under pressure from a rapidly accelerating Android and a solid Apple performance.

The scene is certainly set for some bold moves from a market share and business survival perspective, and this leads me to think about the outcome of potential acquisition activity. In reality the key question that should be asked is not “what are you buying?” but “what would the purchase develop into? “

The real issue is not about the strategic benefits and opportunities of such a merger, but whether or not the cultures of the companies can be positively blended. Does Steve Ballmer, in cooperation with ex Microsoft exec Steve Elop, have the stamina and fortitude to work with the Finn’s, where collaboration is more than just a word – it’s a national, cultural and management style? This culture is totally unlike most American “command and control” multinationals, and certainly nothing like Microsoft.

The probability is that tomorrow Stephen Elop will announce a close partnership with Microsoft on Windows 7 and next generation smart device operating systems. This will allow both companies to gain experience of each other, similar to an engagement. The final outcome of this is experimentation and open to speculation, but the reality is that, together or apart, the 2 companies are unlikely to be the dominant forces they were or currently are.

Contact us at KeySo Global if you’re interested in learning about the implications of digital life trends on your business. Call us at +1 847-478-1633 or go to our website at www.keysoglobal.com