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Even experts find Apple’s iCloud baffling. What hope is there for the rest of us?

iCloud Rain

The theft of celebrity photos from Apple’s iCloud has highlighted two things. The first is that people don’t know, or understand, what happens to their digital property when they tick the “backup everything to iCloud” check boxes. The second is that Apple (and other cloud providers), in their eagerness to make the process as simple as possible, do a really bad job of explaining what is going on, and importantly, what can happen if things go wrong.

If you think that this is because the average user would struggle with any basic technology, even security expert Christopher Soghoian had to resort to reading the manual to find out if iCloud backed up photos by default.

Security experts RTFM Twitter

In fact, the entire interaction with iCloud is actually not that simple. Apart from backups of your iPhone or iPad, there is the ability to “import” photos from your devices to a Mac or Windows PC. And then there is My Photo Stream which allows Apple users to share photos with other people. Very confusingly, this services uses iCloud but is not a permanent backup of photos. They last only 30 days and Apple’s advice is that if you want to back them up, you need to use, you guessed it, iCloud.

Again, it is not just ordinary users who have been confused by all of this. A Forbes reporter claiming to be telling readers how to “Disable Apple iCloud” actually ends up telling them how to switch off “Photo Stream” and not the iCloud backups.

The general frustration with iCloud was summed up in a tweet by Kirsten Dunst who declared iCloud a “piece of poo” (paraphrased).

Kirsten Dunst’s opinion of iCloud Twitter

Keeping track of where every photo you ever took is actually located is not that easy. It could be on any number of devices, in any number of apps and in any number of cloud services. The other cloud services like Dropbox, for example, also have photo syncing capabilities. This means that photos could potentially find their way on to a range of other machines and devices if Dropbox is enabled on them.

In our hyperconnected world, digital objects have inherited the property of stickiness. Photos end up everywhere and it takes not only the knowledge of how all of the synchronisation works to understand where, but also a determined approach to e-Cleaning to make sure that they are not in places you didn’t expect.

Of course, on top of all of this is understanding the different ways that people can actually gain access to your account to get hold of things that you have uploaded, backed up or synchronised. In the case of the celebrity photos, it may have been a trial and error guessing of passwords on an iCloud service that didn’t check for repeated failed login attempts. However, previous iCloud hacks used social engineering and other tactics to gain access to people’s accounts.

In the end, the safest way to avoid problems is to not store photos, or anything else private for that matter, on a cloud service. Or at least if you do, do it in a controlled way where you actually know where the photos and other documents are. This, of course, is likely to be impractical for most people.

An alternative is to do what most teenagers are now doing and treat the entire Internet as ephemeral. If you are going to take photos, use a service like Snapchat. If you are going to send emails, use Confide, which destroys the emails after they have been read. This actually may make the most sense because after all, when was the last time you managed to not only want to look at a photo you took years ago, and actually find where you saved it?

How to explore your past, present, and future through your personal genetic code

Ancestry Composition from 23andMe

The personalised genetic testing company 23andMe has had its share of supporters and critics. The critic with the most impact has been the US Food and Drug Administration (FDA) who in December 2013 forced the company to cease providing a health advisory service based on the genetic testing. It declared the service as a “medical device” which would require FDA approval, which it did not have.

23andMe has still not succeeded in resuming its health advisory service, but it has continued in the meantime with its genetic testing and offers genetic-based ancestry reports instead. It does offer the raw genetic data from the test however, and this can be used to provide health-related information for those who are still interested in that information.

How does it work?

The 23andMe service is amazingly straightforward. For US $99 and shipping, a plastic vial is sent which is used to collect saliva and return for analysis. All human saliva contains cells and the first step in the analysis is to extract the genetic material from the cells and “amplify” it by creating copies until there is enough to analyse.

23andMe analyse the DNA by using machines containing special “chips”. These chips provide information about specific sections of DNA that are called SNPs (pronounced SNIPS). It turns out that SNPs are inherited and so once identified, they can be used to identify how much you have in common with another person and what population of early humans you are likely to have descended from. The 23andMe service can tell you who on their database you are directly related to and so it is possible to find immediate relations (brothers and sisters) and near and distant cousins. If you have set your profile to be publicly available, you could even get into contact with these relatives.

Exploring your past

A person’s paternal and maternal lineage also can tell you which part of the world your distant ancestors came from and which particular groups you were descended from. The timing of these origins is about 500 years ago, before transportation and migration blended the genetic makeup into a more homogenous mix.

An immediate benefit of having this data is to get a sense of how connected we are to others around the world despite where we happen to be at this point in time. It can also lead to some interesting insights when you discover that you have asian or jewish heritage for example, or both.

Exploring your current and future health

23andMe does not provide a health report based on the composition of a person’s DNA. However, the raw data from the analysis can be downloaded and then submitted to other services such as Promethease. This analyses the SNPs in a profile and then compares it with a database of research that has previously linked a particular SNP with a disease or human characteristic or behaviour.

The SNP called rs7574865(T;T)) for example is related to a 2.6 times risk of rheumatoid arthritis; 3.10 times risk of SLE; 2.28 times risk of Sjögren’s syndrome; increased risk of type-1 diabetes; and increased risk of primary biliary cirrhosis.

The pluses and minuses of knowing your genetic code

If that all sounds slightly overwhelming, well it is. And here is one of the problems with what 23andMe are trying to do and why the FDA objected to it. The problem is that knowing this risk means very little at this stage. There is nothing you can do about avoiding something like Rheumatoid Arthritis and knowing that you are at increased risk of getting it is not that helpful. It is like knowing that living in a city increases your risk of schizophrenia compared with rural life.

However, if you have got Rheumatoid Arthritis, knowing that you have certain SNPs could turn out to be critical in determining whether particular drug treatments will actually work. In the case of this disease, for example, a certain class of drugs called anti-TNF alphas work better on people with certain SNPs. The treatment of these types of conditions can be made much more effective and less expensive if you know that something is likely to work or not.

As with all information, it is not having the information that poses the problem, but what you do with it. Having information about yourself puts you in a position to use that information to understand yourself better by understanding your place in the world and how your genes are likely to affect your emotional and physical well-being, and how they interact with your environment. That can only be a good thing.

The tax office declaring Bitcoin is not a currency should come as no surprise

Bitcoin and Dollars

In a move that has dismayed the Australian Bitcoin community, the Australian Tax Office (ATO) has provided tax guidance declaring that the crypto-currency Bitcoin is not actually a currency at all, but an asset like shares. This has a number of consequences for both consumers and businesses wanting to buy, sell and exchange Bitcoins in Australia, which has led some Bitcoin commentators to warn that the rules will drive Bitcoin business offshore and generally stifle the growth of its use in Australia.

ATO decides Bitcoin is not a foreign currency

The ATO arrived at their decision through a considered, but straightforward process. They asked the question whether Bitcoin could legally be considered to be a foreign currency according to Australian taxation law. The argument that the ATO kept coming back to in this deliberation was that a currency is something that is essentially recognised and legally controlled by a State (country). This was the means by which the Currency Act (1965) defined Australian currency and further, that foreign currency was defined as any currency that was not Australian.

Others would argue that the question of whether Bitcoin is a currency rests on whether it meets the functions of money which are that it is [1] a medium of exchange, [2] a unit of account and [3] a store of value.

The ATO decided that even though Bitcoin seemed to satisfy some of these criteria, its use was not widespread enough nor was it a generally accepted medium of exchange. And besides, it had already decided that it didn’t meet the criterion of foreign currency anyway, making the discussion moot.

Others agree Bitcoin is not money

The fact that Bitcoin fails to meet the basic functional characteristics of money is something finance experts such as Professor Yermack of New York University have also argued. Bitcoin is not a generally accepted medium of exchange because its use is still very low. It also can’t really be considered to be a unit of account as in a measure of value in its own right because when people consider the value of Bitcoin, they immediately see this in terms of dollars or some other currency. Businesses which accept Bitcoin typically don’t hold onto the Bitcoin itself. As soon as they receive a payment in Bitcoin, they exchange it for another currency.

In a nutshell, for Bitcoin to really qualify as money, many more people and businesses would need to be using it. The Catch-22 here is that many more people might use it if it was first declared to be accepted as a real currency. For this to happen, Governments would have to change laws, or some nation state would need to declare Bitcoin to be its national currency.

The ATO’s decision that Bitcoin is not currency is also in accord with the US Internal Revenue Service who came to the same conclusion.

Charging GST for Bitcoin

Once the ATO had decided that Bitcoin was not a foreign currency, it then really had to decide that it was an asset and so businesses selling Bitcoin would need to charge GST. Consumers, on the other hand, can use Bitcoin to buy goods as long as the amount of Bitcoin they are using is below $10,000. For amounts above this value, it seems that there may be capital gains implications, and certainly this would be the case for businesses.

Businesses will have to keep records of all Bitcoin transactions and paying someone a salary in Bitcoin will also attract Fringe Benefits Tax.

What does the ruling mean for Bitcoin in Australia?

The question is whether this ruling will have an overly negative impact on the use of Bitcoin. From a rational and unemotional perspective, the answer would have to be no.

Being charged an extra 10% on a purchase of Bitcoins is actually not a disincentive for a currency whose value can fluctuate by a great deal more in a single day. The value of Bitcoin has dropped by 18% over the past week for example. If you are buying Bitcoin then you are mentally prepared for the volatility and an extra cost up-front would just be factored into the overall decision to buy.

From a merchant’s perspective, if they are using a service to handle Bitcoin transactions, then most of the record keeping and exchange rates would be handled for them, as would the ability to add GST.

Whilst doing this for selling small items like coffee might be an issue, the number of these transactions is so low that overall it will not make that much difference.

The idea that governments, or their financial institutions, will exhibit progressive thinking on the basis of promoting Bitcoin is clearly not going to happen. It is simply too small a concern and carries too much inherent risk for it ever to be a priority for governments. So we shouldn’t really express much surprise at the ATO’s announcement.