In this episode of The European Perspective, Jens Heitland, Stephen Brooks and Stewart Guenther discuss what recent deals reveal about Europe’s growing reliance on US technology, starting with the AstraZeneca and Oracle partnership and Amazon’s 16 billion investment in Germany, and moving into compute shortages, energy constraints and the opportunity for European engineering in smaller, more efficient AI infrastructure.
The panel looks at why Volkswagen and the wider automotive industry are struggling to adapt in markets such as China, how organizational culture determines whether companies can implement AI successfully, what Jensen Huang’s communication style shows about leadership, and why recent cyberattacks on legacy systems are bringing decades of technology debt into focus for large organizations.
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The Culture Question Behind Europe’s Technology Dependency
Over the past weeks, two announcements described the same arrangement from different angles. AstraZeneca, a European company with decades of clinical trial data, agreed to work with Oracle, a US company with the compute and technology to make sense of that data. Shortly after, Amazon announced a 16 billion investment in Germany, with a meaningful share directed at AI infrastructure. Each deal makes sense on its own terms and will likely create value for everyone involved. Seen together, they describe a pattern that has become difficult to ignore.
Europe holds the knowledge, the data and much of the capital. The technology layer that turns those assets into scale increasingly comes from elsewhere. Dependency is an ordinary feature of a global economy, although it carries more weight when compute becomes scarce and energy in Europe remains constrained. Organizations relying on capacity they do not control can find their options narrowing faster than expected. Stewart Guenther pointed to an opening within that constraint: limited energy will reward smaller, more efficient AI infrastructure, an area where European engineering already has a long and credible history.
In my experience inside large organizations, the limiting factor is rarely knowledge. The engineering capability is present, and entrepreneurial ideas exist inside these companies, often among the people closest to customers. The difficulty sits in culture, in decades of habits built around protecting what already works.
The automotive industry shows how this plays out over time. For decades, a long design cycle signalled stability. A car was tested over years and launched when it was ready, and customers trusted that rhythm. In markets such as China, younger buyers now judge a vehicle by its software, its screens, and how it connects to their lives. Stewart described this on The European Perspective as a new tolerance for friction, where customers accept imperfections because they want to see a product evolve with them. A company built over generations to avoid friction finds that adjustment very hard, and Stephen Brooks noted that the signals of this shift have been visible for a long time.
Leadership communication becomes central at this point. Jensen Huang’s recent conversation with the German chancellor offered a useful example. He described how Germany’s engineering history could carry into an AI future, and he did so without making anyone on the other side look smaller. Leaders who communicate direction with that kind of respect give an organization permission to move, which no process change can provide on its own.
The cost of postponed change is becoming visible in other areas as well. Large organizations carry years of technology debt, often managed through five-year programmes that address a small piece each year. Recent attacks on older web infrastructure, and an incident that stopped refrigeration in a French supermarket, show how quickly legacy systems become exposed when attackers work with AI that never pauses. Spreading the work across a long timeline was a reasonable choice when threats moved slowly, and that assumption no longer holds.
Over time, the organizations that move the human side of change will be the ones that implement AI successfully. Technology can be bought, rented or reached through partnership, while culture has to be built from the inside, at the speed of the people leading it.
Timecode:
00:00 Welcome
00:26 AstraZeneca and Oracle
08:40 Amazon’s investment in Germany and Jensen Huang
14:20 Europe’s technology dependency, compute and energy
16:06 The opportunity in smaller AI infrastructure
20:53 Leadership and entrepreneurial culture in Europe
23:10 Small and mid-sized businesses and AI
28:14 Industry deep dive: Volkswagen and the car market in China
36:08 Why culture decides AI success
42:49 What Jensen Huang shows about leadership communication
44:08 Personalization and the automotive aftermarket
46:56 F-up of the week: cyberattacks and legacy systems
52:37 Technology debt and strategy
53:49 How bug bounty systems work
56:56 Closing
Guest Links
Stewart Guenther: https://www.linkedin.com/in/smguenther/
Stephen Brooks: https://www.linkedin.com/in/stephenabrooks1/
Transcript:
[00:00:05] Jens Heitland: Welcome to The European Perspective. Stephen Brooks from the UK and Stewart Gunther from the US and myself from the Netherlands, and we are talking about business in Europe. Gentlemen, great to meet you again. Looking forward to chat
[00:00:23] Stewart Guenther: Looking forward when we make this an actual habit
[00:00:26] Jens Heitland: Yes. A lot of things have happened since we last recorded. one of the stories was that AstraZeneca and Oracle agreed to work together basically. And what, what is fascinating for me that finally AI is far enough to then really look deeper into how can we help healthcare and make sense out of the data that we have already.
[00:00:54] Jens Heitland: And then AstraZeneca is one of the companies that has a lot of data on, like, the, the trials they, they do, the clinical trials they do, and obviously Oracle has the compute and the, the technology power. Thoughts from your side? Let's start with Stuart.
[00:01:11] Stewart Guenther: So I I agree with you but I think there's a couple things that are and you highlighted it and that is Oracle brings the compute there's several things that have actually going on even from the time of COVID using compute as a way to try and analyze protein folding analyze drug interactions do really deep dive analysis prior to any actual animal testings It's consistently proving to be very very viable But there's a choke point and you hit it The choke point is the compute And so my read on this is AstraZeneca is acknowledging that they need to tap into large capacity large compute pools that they then can run multiple projects on and run against the data as you say and against the research that they have what point do we start seeing What's interesting here is there obviously is a conversation between the two of them around the intellectual property around the access to the intellectual property around the weightings and the model learnings that are happening from AstraZeneca And what I anticipate we will likely hear about after the fact is that Oracle is providing everything from the bare metal all the way up to the app stack but then handing it over to AstraZeneca so they are maintaining the primary control of the input and the weights And in that regard this provides a mechanism for Oracle to put its compute to use because it needs to be able to generate revenue off of that to justify its large investment spend and then in turn allows AstraZeneca to get into the game directly and kind of either kick the can down the road about when they want to actually get into the data center space or are they going to be comfortable working with this type of a of a program And the last thing that's implied in this is for this to really work Oracle must be either demonstrating already they can have a follow the sun approach or they've demonstrated that the roadmap of their compute is allowing them to do a follow the sun approach so they can keep up with AstraZeneca and AstraZeneca's needs
[00:03:16] Jens Heitland: Yeah. Steven, thoughts from your side
[00:03:19] Stephen Brooks: The ship announcement is a result is it It's just we're gonna work together let's see
[00:03:26] Stephen Brooks: let's see what happens and and how's that gonna you know improve the current baseline Who's gonna own the results How are we gonna monetize it A major technology partner like AstraZeneca reduces procurement risk I get that but does it remove the management responsibility healthcare especially I think someone needs to own the clinical decision and that data and that outcome So
[00:03:52] Stephen Brooks: decide
[00:03:52] Stephen Brooks: to work together,
[00:03:55] Stephen Brooks: I I think you know for
[00:04:00] Stephen Brooks: Zeneca
[00:04:01] Stephen Brooks: they know
[00:04:06] Stephen Brooks: use Oracle for But for
[00:04:09] Stephen Brooks: how how are they
[00:04:14] Stephen Brooks: be better off looking at,
[00:04:19] Stephen Brooks: partnerships and and and other obviously a
[00:04:24] Jens Heitland: the huge market What what is interesting for me and that's that's more behind the scenes if we look at the macro perspective is a European organization that has the in-depth knowhow and data and a US technology company that has the compute and let's say most probably the AI models as as well that they can leverage to do the work Which for me at least means there's no European player in the AI or in the tech industry that can do the same things And being European that's sad to see because I think we're losing that technology game right now at least my personal perspective And we need to figure out what that means going forward So I hope that AstraZeneca is building that into the contract and the way they work that they keep like you said Stuart the knowhow and the IP in Europe so that that's growing with that and through the data and the knowhow that they have then build the leverage to monetize it going forward But it's it's it's just for me I think a wake-up opportunity for for European tech to look into why are we not competitive to Oracle to others and then really ramp up Because if we just look I mean I'm not a technologist in an AI context at least I think there are opportunities to catch up with the the models with open weight models with other technologies to train models inside of Europe that get quickly at least close to the frontier models But I don't I don't see at least right now any big companies
[00:06:17] Stewart Guenther: Let let's break down some things because I I I believe that one of the things that's going on is this has actually formed a donut hole and what I a donut with a donut hole And what I mean by that is Oracle is offering the core infrastructure and the core compute They also as a company are long history of very large data sets and managing applications that sit on top of those data sets and they offer that as a service to these customers So Steven your point is well made in re-in regards to should they be also looking at at finance But I believe one of the things Oracle's trying to demonstrate is look we are the top of the stack and the bottom of the stack You bring the data you bring the application and you specialize the application set around your data and we'll serve you But actually to your point Jens this is still dealing with a it it it's acknowledging a donut hole This is not actually as far as I can tell clearly defining nor should it yet what the actual models are in terms of transforming and doing the work So I would anticipate that.
[00:07:22] Stewart Guenther: we will see other partnerships and other agreements moving forward on how that transform and and and who gets to bring what to the equation I predict that what Oracle's looking to do is demonstrate that they can provide a fuller solution to the healthcare vertical cause they love verticals just as they're likely going to be doing a similar thing in finance and industry et cetera So they wanna show that.
[00:07:47] Stewart Guenther: they've got more of a drag and drop solution for other customers AstraZeneca is gonna be looking to try and demonstrate they can monetize and unlock more of the insights and more of the productizable insights from their data set but they are still gonna need to get to your point Jens Is this an internal model Are they using open source closed source Are they gonna be managing they meaning AstraZeneca gonna be managing their own weights Are they gonna be relying more on Oracle to help them with those weightings I think this is still early early days This is a hype cycle piece and if either side can deliver on it it's gonna give them it's gonna give them the type of news they need to move the stock in the near term The question is gonna be Does it demonstrate reoccurring revenue for Oracle and does it demonstrate new product mix for A-for AstraZeneca
[00:08:38] Jens Heitland: let's move to the next story
[00:08:40] Jens Heitland: Success stories is the next chapter Germany had a huge investment discussion over the last couple of weeks and this forum or conference let's call it like this and a couple of deals happened during that One thing which I'm super fascinated about and that's just one part of the the total story was because it's super present everywhere right now Jensen Huang how he was talking to the German chancellor And for for me just being a nerd in in these topics it was a masterpiece of thought leadership It was a masterpiece of corporate leadership how he explained how Germany can can leverage all the knowhow and the knowledge and the the history that Germany has and put that into the future and then he went home with a huge deal in the pocket Super clever But let's get us to to the to the the the topic in more more details Amazon as one of the many has announced a sixteen billion euro or dollar investment in into Euro into Germany I mean this are this are numbers where things are moving and it's all about having having common discussions around implementing things and investing into the right things But again we see US and we see Europe or in this case Germany getting together and figuring out how do we work together so that somehow Germany keeps to be competitive Let's let's move and start with Stephen on this one
[00:10:24] Stephen Brooks: listen the the 16 billion figure is impressive And and y yeah again I think know demonstrates that the US businesses are very interested in large investments into Europe because they see them as being very lucrative But it this particular investment several
[00:10:49] Stephen Brooks: and
[00:10:52] Stephen Brooks: already
[00:10:54] Stephen Brooks: So
[00:10:58] Stephen Brooks: and
[00:11:02] Stephen Brooks: It,
[00:11:05] Stephen Brooks: y right I
[00:11:13] Stephen Brooks: I I think you've
[00:11:15] Stephen Brooks: are they looking to
[00:11:17] Stephen Brooks: and at the
[00:11:24] Stephen Brooks: I,
[00:11:27] Stephen Brooks: and
[00:11:28] Stephen Brooks: capacity baid
[00:11:30] Stephen Brooks: based
[00:11:30] Stephen Brooks: like this You'd want to
[00:11:35] Stephen Brooks: used
[00:11:37] Stephen Brooks: and and how that money was gonna be used and and then look at what you might want to deliver in the meantime
[00:11:44] Jens Heitland: Yeah I think part of it was or around 5 billion was into AI infrastructure But yeah we will see Stuart thoughts
[00:11:54] Stewart Guenther: so my read on this is so first of all I remember when $16 billion was a large amount of money Isn't that crazy In the in the current environment with the amount of spending with the amount of building out what's going on $16 billion is a s tremendous amount of money also believe that the on both sides why are they highlighting such a large number and how does this both serve the local and the state politicians and the regulators as well as AWS and and Amazon overall They're saying they're declaring We're willing to invest a significant amount of money We need your help with the regulatory environment We need your help with the permitting environment We need your help in in the ecosystem and to the other economic partners I hear you loud and clear Stephen about you do not want to just assume Hey this is a press release therefore I lean in But they're putting enough money to work that they're communicating to their supply chain you can invest here because we're going to be putting more money into this space So I agree with you This is packaging what was already designed This is looking to try and highlight a specific cause celeb of AI to pull it in but it's
[00:13:03] Stewart Guenther: large enough to move the needle if this can enable the permitting and the regulatory system to allow them to function at speed cause that's the next part It's one thing to invest but if I'm investing not at speed there's a real problem And let me give you a US example of what this could mean is has identified a significant investment through the CHIPS Act throughout the United States and the largest overwhelming more of their spend was actually in northern New York State what they have done over the past year is they've been moving a large amount of that money It's still the majority is happening in New York but they've been reallocating their investment out of New York and into Idaho because it's easier for them to get through the regulatory and the permit basis to actually do the build I would not doubt that we'll see firms like AWS only because they've got a long history of this of
[00:14:06] Stewart Guenther: state
[00:14:06] Stewart Guenther: and the national level of you need to come through and allow us to build or we will find a place that's more permissive
[00:14:13] Jens Heitland: Yeah, for sure. Similar to what Elon did in the past, I guess.
[00:14:19] Stewart Guenther: 100
[00:14:20] Jens Heitland: in the end, a-again, if we look at macro perspective, it's again, technology US that supports Europe and, and helps, like in this case, Germany to get ahead. I mean, there, there were a couple of other mentions, space industry investments and so on as well, but I think it just shows that Europe is not there when it comes to technology.
[00:14:43] Jens Heitland: I need to highlight it again, sorry. Ev- and, and it's, for me as, as an engineer, it's just pity because if we look at, at Germany, it's the engineering coun-country. and it seems like there is not enough engineering power that drives the technology stack from, from within. So we, as Germany in, in general, is reliant on Amazon and, and companies like Oracle to support with this.
[00:15:15] Jens Heitland: So, l- it's, it's more a-again, with, with the glob-global, let's say, discussions that we have in the moment and the polarization on all ends, we're, we're building dependencies and no-nothing wrong with that, but we have seen in the past as well what happens with too much dependencies. Because if, if we end up in a situation which, I see coming over the next couple of years where, where we have problems with data center, which means we don't have enough compute, and then on top of that, specifically in Europe, we don't have enough energy to run the compute.
[00:15:52] Jens Heitland: And if we don't solve this in Europe, we're going to have bigger challenges than working, like getting Amazon supporting us. But it's not solving that as far as
[00:16:06] Stewart Guenther: You, You just highlighted the good news out of bad news and that is while it the power constraint problem is somewhat uniquely acute within Europe it is by no means Europe only amount of CPUs that are going to be idled over the next twenty-four months due to lack of power on a global basis and it's not just Europe it's on a global basis is legion And that's gonna drive two areas of opportunity which Europe can jump into and that is leverage the engineering expertise to focus on the microtization and the miniaturization of AI and AI infrastructure That's everything from what's happening on the actual server racks to the actual design of the desi of the data centers themselves This does not sidestep the massive requirement of power but while we're figuring out how to deal with that dearth there's gonna be an opportunity This is a classic call for startup How can European startups start to build the small form factor AI solution set Because just as there are LLMs we're now seeing more and more orientation around specialization and smaller SLMs and the like and MLMs and the like They're gonna need increasingly tailored infrastructure for that need and the sell is going to be I'm giving you the same compute I'm giving you more importantly the same impact at a lower energy consumption cost and that's gonna resonate very strongly I believe in Europe
[00:17:38] Jens Heitland: Yeah And I think the I mean the technology progress will get into that direction but we still lack um compute and we la-- we are going to lack energy. What, what was interesting, I think it was announced last week from NVIDIA, where they built this shipping container size, um, small components which you literally can drop into your garden.
[00:18:01] Jens Heitland: Maybe not every garden in Europe , but in bigger gardens where you have complete energy production, including, uh, cooling and the whole server rack and everything in one, um, container size. And, uh, that's one of, one of my future business models. I want to own a couple of those and then rent, rent the or sell the compute.
[00:18:25] Jens Heitland: So if anyone is interesting, let me know. Steven, before we go too much into business ideas
[00:18:32] Stephen Brooks: when you you lose me sometimes when you talk about of this technological stuff you know I'm a I'm a p man in the hands in the dirt and and just doing it e every day But there's a couple of things You mentioned uh Jensen's uh comments to the the chancellor earlier on Jens And I was While we were talking I was looking up that article and I just wanted to pull out a couple of quotes that that he made which I think are really quite significant and and that we shouldn't forget One of them is AI can only augment your capability it can't replace your your capability I think that's really
[00:19:11] Stephen Brooks: And the
[00:19:20] Stephen Brooks: you can't regulate something you haven't build right?
[00:19:21] Stephen Brooks: Uh
[00:19:24] Stephen Brooks: which
[00:19:29] Stephen Brooks: Germany engineering
[00:19:31] Stephen Brooks: know
[00:19:33] Stephen Brooks: superpower
[00:19:36] Stephen Brooks: car
[00:19:39] Stephen Brooks: in
[00:19:40] Stephen Brooks: in or
[00:19:45] Stephen Brooks: Mercedes I could
[00:19:47] Stephen Brooks: Um but
[00:19:48] Stephen Brooks: have we uh
[00:19:56] Stephen Brooks: you know out
[00:19:58] Stephen Brooks: Tesla
[00:20:00] Stephen Brooks: we've
[00:20:04] Stephen Brooks: So right
[00:20:10] Stephen Brooks: know
[00:20:12] Stephen Brooks: amazing
[00:20:13] Stephen Brooks: capabilities for for Europe and then then I think we can compete Then
[00:20:22] Stephen Brooks: investment which
[00:20:26] Stephen Brooks: Stuart
[00:20:28] Stephen Brooks: in
[00:20:29] Stephen Brooks: in economy So I
[00:20:31] Stephen Brooks: I'm I'm somewhat
[00:20:40] Stephen Brooks: crates into people's gardens that's great If it We can turn it into a business model Jens we'll we'll get some money together and give it a go But at at at the end of the day I'm I'm cautiously optimistic I think
[00:20:53] Jens Heitland: I have to, I have to say. Because there is so much engineering knowledge inside of Europe and, and not just Germany because I'm German. It, it is more about how do we bring in this entrepreneurial spirit into the organization. I mean, Stuart, we were working in big corporate years back, I mean, it's more than 10 years ago already together, and looked into what is the limiting factor of an organization to innovate and what's the human factor that was the limit.
[00:21:25] Jens Heitland: And I think it is, is still valid today. So if we take Europe, the know-how is there, the money in the end is there as well. The entrepreneurial ideas inside of large organizations are there as well. So for me it's a leadership problem inside of these large organizations and even countries, um, and we are not talking about politics, to, to solve this.
[00:21:49] Jens Heitland: So I think it's more about how do we turn around as Europe and look into how can we work together across, um, countries and really focus on how do we move the culture, how do we move things forward? Because I mean, we-- before we started recording, we talked about what's happening in France or Southern Europe right now with the riots and so on.
[00:22:11] Jens Heitland: I mean, the, these are all topics if we, if we put a positive leadership into the future and say, "How do we solve this? How do we focus on these things?" It's going to move. It's just a question how we are getting there.
[00:22:24] Stephen Brooks: Jens that sorry to interrupt but it's interesting we come back to leadership of these things come back to to leadership at the end of the day and people having the courage to fail right Because through failure you you you you gain success And and it it's no surprise we're seeing we're seeing
[00:22:49] Stephen Brooks: in in Europe because I think there's a there there's an immense amount of frustration A about the economy and and w we're not gonna get into that I know but also I think that that European young people are maybe f looking for something a bit more than what they're being presented with right now That's my perspective
[00:23:10] Stewart Guenther: Let me see if I can Let me pull together a couple threads of cause I think you're you're both of you touching some very important threads of what's coming So I am a lot less sanguine and a lot more op a lot more optimistic on a global level but even for Europe So some things that I see Europe has a long multi-century history of being around the mid-size and small-size business large-scale business is simply replacing what the sovereign used to do over the last thousand years And also when you have new technology waves you're gonna have the large business and the large pools of capital that are gonna end up being we hope the early adopters cause that drives large amounts of revenue that validates the technology and we hope leads to diffusion At the
[00:23:58] Stewart Guenther: time though Steven's exactly right At the end of the
[00:24:02] Stewart Guenther: putting their
[00:24:03] Stewart Guenther: That's
[00:24:05] Stewart Guenther: Where
[00:24:07] Stewart Guenther: growth historically within Europe And this is
[00:24:11] Stewart Guenther: It's gonna be at that small to mid-sized business That small to mid-sized business does not need a frontier model and a follow the sun approach That small to mid-sized business needs solutions that are tailored to their analog space tailored to their customer set and that is not necessarily going to be served by parsing off or doing some cycles of a much larger uh a much larger
[00:24:36] Stewart Guenther: Another factor to throw into this and that is technology since the 1950s has followed a decentralization and a centralization approach Early technology leads to the large centralization of data centralization of processing centralization of access and then the diffusion becomes when do we have access at first it was the desktop and then to the handset We're going to see the exact same thing and we're already seeing the use cases pushed to the edges of the network pushes to the edges of the analog use case Why do I bring this up That is all still aspirational right now That is not actually fully defined Jensen's showing us the way As much as he's got the I can drop this in your back garden he's also shown the device that fits in your hand that can actually run models that actually can deliver work And it's going to be when we have AI in the hand of the street vendor and I'm not being funny materially changing his or her engagement with his market and with the analog steps he's doing or she is doing that's when we know we're really seeing diffusion And this because there's so much focus on how do I
[00:25:54] Stewart Guenther: this to solve all the Fortune 500 companies that's leaving a tremendous opportunity stack for innovative companies and innovative entrepreneurs to find solutions for that entrepreneur on the street And I'll end with this This isn't just aspirational Look at Central and South America Look at Southern Europe Technology is consistently focused around how do I help that small margin small dollar vendor and how do I scale that quickly And by providing a meaningful solution to them for with a very small margin I end up getting a very large piece of the overall stack
[00:26:32] Stewart Guenther: serving that underserved part of the market AI is going to be no different And then leading back to Germany and France and Northern Italy and elsewhere we've got history of microelectronics We've got history of engineering that orients around these smaller form factor electronics that fit within a larger
[00:26:51] Stewart Guenther: We just need to dust that off start to productize it and then deploy it into the space I This Let me
[00:27:00] Stewart Guenther: It's
[00:27:02] Stewart Guenther: gonna take up the mantle and and actually capture the revenue
[00:27:06] Jens Heitland: Yeah I, and I, I was talking to a couple of companies over the last two weeks. Well, one, one that was interesting and that was a podcast interview. I interviewed, um, CEO of a waste company, and they turned basically to be an energy production company, which was super smart. Um, it's coming out in the next four weeks.
[00:27:27] Jens Heitland: But so that was one example. Then a Dutch-based AI company, they're helping small, medium-sized businesses to implement AI with the empowerment of their teams, which, which I think was a fascinating way of working. So it's basically not we come in and we do it for you and, and, and, and basically dump AI at, at your company.
[00:27:54] Jens Heitland: We help you implement it with the people in the driver's seat internally, which I think is also fascinating. So there are a lot of solution, a lot of ideas growing. It's, it's all, all about getting to know them and, and share, share these ideas, sh-share the solutions, make these companies better known.
[00:28:14] Jens Heitland: we haven't talked about the industry deep dive, which at least in our preparation is all about Volkswagen again. Couple of episodes back when we did, still did the test episodes on my podcast with Annette at that time still, we talked about Volkswagen and how difficult it is to, for the Volkswagen leadership team to turn it around and move it into a direction.
[00:28:40] Jens Heitland: And one of, one of the Reuters stories that came out over the last weeks was that they're having problems in China as well. Li-little anecdote. I was talking with someone the last days about cars in China and young people buying new cars and how, they validate cars in China. One of the things was that they're validating the cars they want to buy based on the entertainment setup.
[00:29:11] Jens Heitland: Not like when I grew up on the motor or like horsepower and this kind of things. It was all about how many cameras do I have onto myself so that I can live stream while driving or while this car is driving itself. So fascinating story, but let's start with Stephen on this one
[00:29:33] Stephen Brooks: it's interesting you bring that up It's the major reason reason that the Porsche electric vehicle failed in China The technology A was was iffy to say the least but it didn't offer enough technology to satisfy the market And and Porsche went all in with that and and we've all seen what's happened to their financial results in the last last 12 months So you're absolutely right that particular market is all about what's the tech What does it do How many cameras What's the music Has it got self-driving Oh you know all all the
[00:30:09] Stephen Brooks: Europe on
[00:30:12] Stephen Brooks: of
[00:30:13] Stephen Brooks: we
[00:30:14] Stephen Brooks: uh but
[00:30:16] Stephen Brooks: you know,
[00:30:20] Stephen Brooks: on you know
[00:30:24] Stephen Brooks: And it's
[00:30:27] Stephen Brooks: distinctive
[00:30:30] Stephen Brooks: I said like
[00:30:33] Stephen Brooks: are
[00:30:34] Stephen Brooks: uh Tesla at the moment
[00:30:38] Stephen Brooks: the
[00:30:39] Stephen Brooks: and
[00:30:41] Stephen Brooks: Um of course I'm sure we
[00:30:48] Stephen Brooks:
[00:30:50] Stephen Brooks: keen
[00:30:51] Stephen Brooks: us to get one of those just just as a a as a point But um the a again you know that's that's kind of competing with well we don't know what we could Oh we'll
[00:31:01] Stephen Brooks: That There you go that's better technology uh Volkswagen has its issues We know about this Um we we did it we did say to them If you want us to come in and talk to you about how how to change leadership we'd be happy to do that But I don't think they ever got back to us Jens did they Um
[00:31:18] Jens Heitland: to me
[00:31:19] Stephen Brooks: no no me.
[00:31:20] Stephen Brooks: neither Me neither But it it does raise a point that that using you know l local technology does not guarantee local your
[00:31:37] Stephen Brooks: you're you're gonna
[00:31:40] Stephen Brooks: Uh and and I think that's why
[00:31:44] Stephen Brooks: certainly
[00:31:44] Stephen Brooks: vehicles companies popping
[00:31:48] Stephen Brooks: and it's a
[00:31:49] Stephen Brooks: and, and
[00:31:54] Stewart Guenther: I I would argue there's a couple things happening in in in China and It's easy to pound on China but if we look at emerging markets that when their middle classes form a very consistent theme within the middle class is they actually shift to a domestic preference where they have u they're used to buying internationally They're used to which is whether we mean to or not as the sellers into those markets we're communicating your products aren't good enough We're communicating your economy is not strong enough We're not doing
[00:32:28] Stewart Guenther: really
[00:32:31] Stewart Guenther: to get this utility get
[00:32:33] Stewart Guenther: get this convenience it
[00:32:38] Stewart Guenther: my local space So once we actually eclipse that and we can see this in Brazil we see this earlier in Argentina we're seeing this in every emerging market that ends up having a meaningful India we're seeing a a meaningful middle class That middle class historically then leans into the domestic market That's one driver But I think Steven and and Jens you hit the other part that's on top of it and that is a demographic shift Porsche uh released their brand new phenomenal vehicle if I remember correctly the day before or was it the day of the flying car To the point where there's some speculation that Tesla chose its release date specifically to counter Porsche And it completely eclipsed it which is unfair because the technology and the product that the Porsche has created is incredible But it's targeting the executive set It's targeting the fe the people who can afford to just enjoy the rumble and the power and the feel of that engine even though the likelihood they're driving two hundred and sixty kilometers to work is pretty small Two s An hour to Work right
[00:33:55] Stewart Guenther: solution The
[00:33:58] Stewart Guenther: how
[00:34:01] Stewart Guenther: to the middle class so they buy the appropriate product for their price point but feel they're tapping into that mystique that aesthetic that the executive set happens Same thing going on to middle class Middle class doesn't need nine thousand horsepower Middle class is looking and more importantly the young today they're looking for what gives them utility for them They're looking for what gives them enjoyment now which is not necessarily that nine thousand horsepower It's gonna be a lot of different things around it And this is excuse me this we're seeing this within the handset We're seeing this within the internet We're seeing this across the board Why should cars be any different And I would also say that that other technologies and other
[00:34:52] Stewart Guenther: right The phone is now
[00:34:57] Stewart Guenther: to call
[00:35:02] Stewart Guenther: That
[00:35:07] Stewart Guenther: within
[00:35:11] Stewart Guenther: One of the
[00:35:12] Stewart Guenther: phomen
[00:35:14] Stewart Guenther: they
[00:35:16] Stewart Guenther: they
[00:35:21] Stewart Guenther: and
[00:35:24] Stewart Guenther: it car
[00:35:29] Stewart Guenther: to recapture
[00:35:31] Stewart Guenther: of the utility that
[00:35:34] Stewart Guenther: the convenience and that feeling of of either affluence or that feeling of relaxation and incorporate that into their products That's what's gonna help them And that's not just in China That I predict is gonna be across the globe I I think this is a this is truly a shot across the bow I fear that we're gonna say this is a Chinese protectionism just like America spent 40 years trying to claim that Japan was protectionist because they kept wanting to drive on their side of the road versus our side of the road This is not viable We need to actually create solutions for the target customer
[00:36:08] Jens Heitland: G-going back to the organizations, um, talk-talking about building these products in different ways, doesn't matter if it's car, if it is technology, it requires you to think differently. And with that, I think that's the biggest challenge we have in Europe because we have so deeply rooted cultures and history in, in the organizations and in the countries that it's very difficult to change the culture of an organization.
[00:36:42] Jens Heitland: And I think that's specifically in organization like Volkswagen, where you have been successful over decades, switching from we have a 10-year lead, um, and design practice where we build something, we test something, and then in five years comes the new car that we tested five years ago. Um, it doesn't work anymore in, in, in this, this time, uh, specifically with AI and with, with the consumers of, of this time, which means it's only possible to change that, it-- not just on a process level.
[00:37:17] Jens Heitland: You need to change the culture of the organization to be able to be quicker, and that's so difficult, and that's, I think, one of the biggest challenges that Volkswagen, Deutsche Bahn, and all the others, um, are facing right now because you cannot switch the culture from left to right or from not innovating, protecting the past to innovating and really building the future car, which is a flying car or whatever it is.
[00:37:42] Jens Heitland: It's not that easy. And then obviously we ha- we are very, very highly regulated in Europe. It's even more difficult with that. You cannot just shift the company from left to right because there are a lot of people that need to be involved. I mean, I don't know if you have seen it, the, the, the other day, the backlash of Audi, where the, the CEO of the-- or the president of the US business was with, um, President Trump on the stage.
[00:38:12] Jens Heitland: It was hilarious to see from-- because I'm, I'm obviously focused on organizations and the communication of organizations. Super backlash. I mean... And it's also Volkswagen because it's Audi. So I think there are a lot of things organizations need to deeply look into and, and that's one of my predictions going forward.
[00:38:33] Jens Heitland: The organizations that manage the culture and get the culture shift moving, they will be implementing AI successfully. The ones that are not getting the human part moving, they're not going to implement AI successful.
[00:38:48] Stewart Guenther: Guys let me ask you a question Let me break down the automobile industry This is
[00:38:53] Stewart Guenther: one in which the stability of common look and feel of the car is critical don't change the 911 because it's a Tuesday You don't change the teardrop shape You don't suddenly decide that BMW is gonna be all about the the nimble the nimble drifter as opposed to the phenomenal ride on the Autobahn These are critical aspects to their brand and to the value they bring The five-year cycle was communicating for 60 years stability The five-year cycle was ensuring that when you bought the car In fact I remember hearing you never buy the first year or year And a half of a Volkswagen You let someone else do the product testing right And that's after the five-year
[00:39:39] Jens Heitland: And now we need a
[00:39:40] Stewart Guenther: And now we need to spin on a dime and say No no no no It is perfectly
[00:39:45] Jens Heitland: Nächster
[00:39:45] Stewart Guenther: for there to be flaws or there to be hiccups or there to be friction within certain aspects of the product because I need to see the innovation I need as a customer to feel that you're growing and responding to me And so there's a level of acceptance of that friction that was absolutely unacceptable in the 70s and especially the 80s and the 90s and the 2000s How can these companies We can just simply say All right you may need to change How do you steer that ship differently What are the things What are some are
[00:40:17] Stewart Guenther: quick things they can do to if nothing else start to build comfort around knowing you're going to be injecting friction into your customer experience and that's an okay thing
[00:40:28] Stewart Guenther: thing?
[00:40:28] Jens Heitland: Agree.
[00:40:29] Stephen Brooks: two two points before I forget? Because, and I had to write them down as well, which is even worse. Stuart you're absolutely right about we use MVPs in o- in other products, right? We get it w- how we need to develop the product and we move it forward Why should that be any different from the motor industry how we need to develop the product, I I appreciate all the safety aspects but just the feel the drive the aesthetics all of those things the point one Point two the drive,
[00:40:55] Stephen Brooks: motor industry change didn't just happen overnight
[00:40:58] Stephen Brooks: two, Change has been coming change in since the 80s and you've just you've just buried your head in the sand the '80s, You've you've the you've not innovated enough you've
[00:41:11] Stephen Brooks: not thought enough You've not you've not innovated
[00:41:15] Stephen Brooks: enough You've not thought enough you've not been bold enough You've not, not, c 2026
[00:41:22] Stephen Brooks: enough this business gonna look like in 2030 2035 2026?
[00:41:27] Stephen Brooks: we're seeing Volkswagen
[00:41:28] Stephen Brooks: like in 2030, 2035?" and that's why we're seeing Volkswagen struggling Porsche struggling Porsche launching a vehicle that is amazing, but who's
[00:41:38] Stephen Brooks: talking about it? Nobody right Because Elon stole the mark with a flying car this change didn't happen overnight and I think
[00:41:49] Stephen Brooks: that there's a lot of people and a lot of motor industry, businesses right now thinking, "I wish I'd have spoken up. "I wish I'd said, 'What about, what about, what about?'" and now they're suffering. Now they're suffering. And that's coming in, innovating.
[00:42:08] Stephen Brooks: know, norm in, in Europe. It's gonna be
[00:42:14] Stephen Brooks: the norm in America.
[00:42:15] Stephen Brooks: It's gonna be the norm in, in, in the rest of the world
[00:42:19] Jens Heitland: they know all of this inside as well. So it's not that they don't know. Everyone in the car industries knows. They, they might not agree with it, but they know that it is difficult. They know that it was not innovating. It's, it's easy to say from the outside, for, for us, but it's very difficult when you're in the inside, and these are huge organizations.
[00:42:49] Jens Heitland: That's why for, for me, a- again, I go back to Jensen Huang because he is a phenomenal leader and communicator, and he's doing the same thing, um, in, in, in different environments. I, I just spent two days analyzing him. That's why I'm so deep into this. It's fascinating how clever he is communicating, and doesn't matter which context with which company, who is on the other side, he's never letting the other side look bad, and that's so freaking clever how he's doing that.
[00:43:22] Jens Heitland: If, if you compare this now to, to Elon as one of the other extremes, uh, Elon, um, sometimes doesn't care how you feel on the other side. He's just shooting up and others as well. And the, uh-- for, for me, it's just very, very clever. And if you take this forward-looking leadership and communication that he has, how can he in- infect the European leaders that are in the same position?
[00:43:50] Jens Heitland: They can communicate the same way like he could if they put themselves out there, if they communicate in, in this way, I think it's possible. It's, it's just a matter of the willingness to step out and, and really put, put the flag into the sand and say, "Let's, let's, let's go there
[00:44:08] Stewart Guenther: Let me offer three threads that folks might pull on and maybe I'm all wet I'll, I'll target around automotive. Secondary market for the
[00:44:20] Stewart Guenther: folks who s-spruce up their cars In fact I remember 70s and 80s a lot of brands actually actively tried to suppress the secondary markets the spoilers the changes to the wheels the change to the
[00:44:33] Stewart Guenther: suspension
[00:44:35] Stewart Guenther: and actually that created a really interesting virtuous loop to or it it revitalized certain tier of product it expanded certain tiers of product It created an entire industry to the point now where it appears to me not an expert that there is an awareness and they allow some space for the secondary market the aftermarket to apply to these vehicles And then how do we then So it keeps the core drivetrain it keeps the core safety consistent within parts of the car It communicates clearly to the owner and it communicates clear to the secondary market You break these things you bought it that's on you and there's a comfort around that that there."
[00:45:17] Stewart Guenther: wasn't always That's one space Another avenue to it which is really interesting is the Mercedes Sprinter life The amount and the uh complexity with which people are itemizing and and really tailoring the Sprinter life the the the van life with within Europe within the United States It's a a derivation of that secondary market And then another one to look at is actually the way truck drivers drive uh
[00:45:45] Stewart Guenther:
[00:45:46] Stewart Guenther: spruce up their vehicles to communicate to each other and identify themselves These are small things but when we go all the way back to the Chinese influencer that you talked about Jens what are they doing They're taking a platform they wanna just trust the platform works and then how do they personalize it for their need and their aesthetic and then how do they communicate that outward I think this is a mechanism where increasingly I think large volume, established products become that foundation and the smart ones that actually layer a certain amount of personalization let that personalization be a secondary market even facilitate an almost like a software API expose the API of the product to the market I bet you that's gonna create if nothing else a a demand capture and a demand retention if not dema outright demand pull These are the type You don't have to completely be different What is the interim while you figure out what becomes next And I'm sure they're doing it Now they just gotta be deliberative about it
[00:46:51] Stewart Guenther: it.
[00:46:51] Jens Heitland: Yeah, I agree.
[00:46:53] Jens Heitland: Great point.
[00:46:54] Jens Heitland: Let's, let's get us to the last point.
[00:46:56] Jens Heitland: F-up of the week. Of the weeks even. I think one, one big topic that I have seen across the last weeks is cyber. Cyber attacks on different levels. So one was a French supermarket where the cooling didn't work anymore. Um, and then even bigger the last week, which was the PHP, the bug that was found and websites not working anymore or we-weren't secure anymore.
[00:47:25] Jens Heitland: And that went to private websites, but even more important for society's bank websites that were built on PHP and, and were not working or they needed to kind of switch them off to patch them and so on. I think that's something we haven't seen at that scale yet, but I, I, I just predict it's going to happen more and more and more with artificial intelligence that is getting smarter.
[00:47:52] Jens Heitland: So it's like almost we need to look into how do we do
[00:47:55] Jens Heitland: defensive
[00:47:56] Jens Heitland: co-scaling of
[00:47:58] Jens Heitland: like the other side, how do we protect us?
[00:48:01] Jens Heitland: Thoughts on your end, Stuart?
[00:48:04] Stewart Guenther: So
[00:48:05] Stewart Guenther: first the PHP in particular you hit the nail on the head This is just a canary in the coal mine We have a number of things If if you haven't I would listen to the thoughts of recent thoughts of the Palo Alto Network CEO talking about exactly this To the
[00:48:22] Stewart Guenther: PHP
[00:48:23] Stewart Guenther: there's two problems with what's going on If,
[00:48:26] Stewart Guenther: If this was a s if this was discovered and it was something you could quickly deploy across a common technology set that's one thing But as you're highlighting Jens there is so much old tech The tech debt of the last forty years forty years or more is now fully coming due because
[00:48:46] Stewart Guenther: AI does not sleep AI does not wait AI is constantly just doing what it's told and now what's been identified much like they almost never talk about bank robberies in the press Why do they do that Because once a bank robbery is discussed the copycats come out to play and then the more you talk about it the more the copycats come out to play A target set has been identified The hackers are now focusing on these type of solutions What's challenging for the white hats here is the amount of technology variance and the difficulty it's going to be to then go in and try and change these things What is that This is a call for startup This is a tremendous opportunity What w the reason why is in the past these were side technologies these were side systems These were thought to be isolated and we're discovering very quickly how much they are not isolated and how much they have an effect on different aspects of the overall infrastructure This must be addressed It is going to get worse It will be exploited Is this the end of the world No It's just gonna be rough until we find a new equilibrium and we address this and then we're gonna go back to white hat dark hat gray hat trying to find these things out and I'm excited to see what AI comes with to try and find solutions for us and who's faster Can we patch and fix ahead of what we discover and exploit what we
[00:50:15] Stewart Guenther: all need to prepare for and we're seeing this part of the reason that we're hearing different governments talk about Hey it's a good idea to have three days worth of food It's a good idea to have three days worth of preparation is because the French grocer is also a canary in the coal mine and we have become so comfortable as a society with forty-eight to seventy-two hour restock cycles within urban environments You have one of these things go sideways and shut two or three of these vendors down at the same time
[00:50:48] Stewart Guenther: you're gonna be just short on options over the course of the next week These are-- The I'm not saying one is driving the other but boy they sure do rhyme don't they
[00:50:59] Jens Heitland: Yeah, agree. Steven
[00:51:01] Stephen Brooks: Um, look, the... refrigeration incident just demonstrates that it's not just data that's at risk and information, it's you know, it's, equipment. And as you quite rightly said, Stewart you know, When, that s tarts to fail then there's all kinds of issues that're attached to that them Rover, same, and
[00:51:46] Stephen Brooks: I, I... You're right. The, the, the PHP thing is first of many. that canary in the cage analogy, by the way, Stuart. I think it's, it's very poignant. It really is. We have got for this. You know, when you see people like, as you said, affected just legacy as constantly other, things are So I'd... Just, prepare
[00:52:31] Stephen Brooks: up with tins, condensed
[00:52:34] Jens Heitland: to- Yeah, but I think a, a key part is,
[00:52:37] Jens Heitland: um, staying on the technology part is a- as an organization, you need to have a strategy. You need to have a strategy that is where are we going with AI and how do we apply AI in our organization?
[00:52:51] Jens Heitland: But on the other hand, you need to have a strategy, how do we protect us with and, and yeah, in, in a, in a way that AI cannot harm us. Because every organization that I have worked in which is bigger than, let's say, 5 billion turnover, they all have tech debts like tremendously, and they know what's not working, but they have just pushed it forward.
[00:53:20] Jens Heitland: They have just pushed it like, "Yeah, we can do this in two years, in five years." And then they, they build programs where they said, "Okay, we divide the whole pie over the next five years, and we do every year a little bit." It's not going to work anymore. So y- I, I think it's, it's, it's the whole strategy stack
[00:53:39] Jens Heitland: and then looking into how do we do this profitable
[00:53:42] Jens Heitland: in our organization that we work on all the things at the same time, as difficult as it is.
[00:53:48] Stewart Guenther:
[00:53:48] Jens Heitland: Stuart?
[00:53:49] Stewart Guenther: all have touched base with uh the bounty system but those of you who are listening and yourselves if you've got uh kids or friends or nephews and nieces who are thinking about getting into cybersecurity this isn't only up and to the right business It is transforming but it is only up and to the right And I would predict that we're gonna see the bounty system which is known within that industry is gonna become a lot more public over the coming quarters and that we're gonna see a whole series of businesses and a whole series of professional opportunities where you will be managing bot swarms to try and capture the bounties that in turn help strengthen the system This is And this isn't a temporary We'll see a gold rush in the interim and then we'll see a consistent theme of leveraging bounties on a go-forward basis How does this apply to
[00:54:38] Stewart Guenther: the five billion dollar company that Jens is describing At what point does your own insurance company work with you to start encouraging bounties of your own infrastructure where you are going to pay out folks who in turn help pay patch or fix your own infrastructure I think this is gonna become a meaningful approach because what would you rather do Put some bounty into an escrow account that helps keep things secure and then keep refreshing that or continue to negotiate your risk premium with your insurance company because you've had the latest breach
[00:55:14] Jens Heitland: Yeah. May- maybe explain quickly simple,
[00:55:17] Jens Heitland: what the bounty system is for those that don't
[00:55:21] Jens Heitland: don't know about it
[00:55:22] Stewart Guenther: thing What a lot of Microsoft Google what they do is they will put out, different size perceived risks and say If you can solve for X or you can find this exploit and then provide us either a solution or provide us a direction that allows us to provide that solution we will pay you money And the, the bounties are not the same amount The higher the risk the more spread out the risk the more acute the damage the higher the bounty is Essentially think of it as like it's almost like a risk premium You're putting out there you're saying Hey you come and find these things and you demonstrate to us in a repeatable way that our folks inside can actually demonstrate it and then resolve it we're gonna cut you a check And that never ends So zero-day exploits PHP hacks, all these different things are constantly being refreshed
[00:55:26] Stewart Guenther:
[00:56:19] Stewart Guenther: and this is still kind of a side activity Within the industry it's a known activity But because this is now hitting the public consciousness that is only gonna create more demand to address it and therefore more capital to support it
[00:56:35] Stewart Guenther: it
[00:56:36] Jens Heitland: No, agree.
[00:56:38] Jens Heitland: Interesting business model.
[00:56:40] Jens Heitland: I'm thinking entrepreneurial. Steven, that's your world.
[00:56:44] Stephen Brooks: I'm just thinking
[00:56:45] Stephen Brooks: somebody needs to start an agency that can bring all these people together with their expertise
[00:56:49] Stephen Brooks: people together with their expertise
[00:56:51] Jens Heitland: I, think it's already existing.
[00:56:56] Stephen Brooks: a
[00:56:56] Jens Heitland: Okay, we, we covered everything, gentlemen. Was fun again to... We should do this way more often, but I know it's difficult to get us in- into a call. Thank, thanks a lot. Was fun. Um, looking forward to the next recording
[00:57:12] Stewart Guenther: Thanks guys Thanks guys
[00:57:14] Stephen Brooks: Good to see you both