Palantir Used Within Turkey:
NHS Contract Politics:
Enlit Europe Event:
Minimally Viable Versus Alpha:
ARK Invest Analysis Of AI Software:
Palantir Used Within Turkey:
Recently Turkey was hit with multiple large-scale earthquakes, in which has caused true devastation across the nation. The death toll in Turkey and Syria from the quake has surpassed 28,000, and hope of finding many more survivors is fading despite some miraculous rescues.
Promptly after these earthquakes occurred, Palantir CTO Sankar said this on Twitter:
In response to a question, “Is it possible offering help to Turkey with satellites after the Earthquake?”, CTO Sankar responded by saying that, “We are on it. Also, Turk govt officials, DM me directly – Meta Constellation and Foundry are ready”.
Moreover, the CTO then Tweeted to the leaders of the nation, stating the following:
“Can we help with a community-wide relief coordination platform prioritizing recovery operations to maximize lives saved, managing donation supply chain, and coordination across govt + ngos?”
Whilst to date, it is unclear as to if Turkey is using Palantir, this does hint towards some further collaboration within the future. There is however one noticeable takeaway I want to ponder upon. This is the idea that within times of chaos and disruption, innovation thrives.
As popularised by ARK Invests Cathie Wood, she famously stated that within times of hardship, radical innovative technologies are adopted in order to solve issues and save time. Extrapolating from this, when observing hardship and chaos, it is wise to understand which technologies are being adopted and why.
Within the case of Palantir this highlights the superiority of the product, and indicates as to how the company truly is the only viable option when nations or companies are within challenging times.
Just to note some case studies that back up my thesis:
- Palantir adopted during COVID to distribute vaccines
- Palantir adopted during supply chain shortages & challanges
- Palantir adopted within Ukraine
The list really does go on.
Furthermore, I want to touch upon how large these contracts can become, once initial adoption is achieved:
There is major evidence to state that Palantir partnerships grow considerably over time. For example, within the DOD there was a recent expansion of the partnership with the Air Force. There was previously a small contract with the Air Force from 2010-2013, which consisted of four contracts wi $226K each. However, this scaled majorly within the past few years. The data shows that in April 2020, Palantir signed a contract to license Gotham platform to the Air Force for six months, costing over $2M. Following the pilot program Palantir signed two contracts with the Air Force worth nearly $20M to provide the agency with COVID systems. “By 2021, the partnership grew to a two-year, $91.5M contract in which PLTR was to provide a data platform for the Air Force to manage resources for its COVID-19 response and coordinate decisions for joint all-domain operations.”
The point being: if Palantir is adopted within Turkey initially for aiding rescue efforts, there is a high probability that the nation will extend the Palantir contracts substantially, as has been present within multiple other cases. This shows the true potential for radical growth.
The Palantir NHS contract is likely to be announced within the following days. In accordance with media outlet, Daily Mirror, it was stated that the announcement for the NHS contract shall be disclosed shortly.
“The procurement was launched on January 10 and the competition closes on Thursday, according to the Government’s online tender.”
Whilst commentators seem to be focused upon the idea that Palantir has basically solidified it’s place as the vendor whom is going to gain the contract, other companies such as C3AI are also now competing for the NHS contract too.
“The so-called NHS Federated Data Platform has attracted a bid from US artificial intelligence company C3.AI, founded by Thomas Siebel, The Sunday Telegraph can reveal, but he faces rival interest from Palantir, the tech giant founded by Peter Thiel.
C3.AI, a US-listed technology company worth $3bn, is working with consultants EY on a bid that Mr Siebel claims will transform the health service’s disparate collection of patient data across trusts and digital systems. The aim is to create a digital search tool, similar to Google, that will operate across the NHS, and provide high-level insights on healthcare crises and COVID while still maintaining patient privacy.”
It seems incredibly plausible that Palantir shall gain this contract, based upon the following reasons:
- Palantir prior work with the NHS, which led to a significant reduction within waiting times and patient backlog. In accordance with reports last year, it was noted that, at Chelsea and Westminster, Palantir’s software has enabled a 28% reduction in the inpatient waiting list through validation and better clinical oversight. It adds that booking lead times have tripled from six to 17+ days on average, meaning patients can be notified about surgery in a timelier manner and reducing the number of cancellations due to lack of staff or patient availability. Also, theatre utilisation has improved from 73% to 86%, over a three-month period.”
- We understand that Palantir too, has been fundamental for the UK vaccination rollout, in which by many was labelled as the swiftest and fastest vaccination rollout to date. “The issue essentially is how do you get it into the right arm in the right place,” said Louis Mosley, head of Palantir UK, who works on the programme. “You’ve got a huge number of logistical constraints, because the vaccine expires . . . [and] you often don’t know until the last minute how much you’re going to get.”
- On top of this, current Prime Minister, Rishi Sunak, also noted the use of Palantir Technologies within his commentary of improving the NHS, and their ingrained issues as an organisation. Speaking at the Confederation of British Industry (CBI) conference in Birmingham, Sunak said: “We need to embed innovation in our public services, especially our NHS.”4
Whilst the procurement and competition for this contract is expected to end this week, the chosen vendor is likely to not be disclosed instantaneously, and this may take some time.
Enlit Europe Event:
There are a few important insights that I want to share in relation to this video.
- Firstly, as mentioned is this fact that many of the most important institutions within the West, despite advancement within general technologies, these institutions are failing to adopt and grapple with new software solutions.
There are new technological advancements occurring, yet many important institutions failing to adopt and adjust to these new technologies.
Enterprise software fails to transform these organisations – it is either too narrow, or too ridged. This is most notably seen within a geopolitical perspective, specifically within the Ukrainian conflict. What one can see is that, through the use of transformative technologies and software, one is leveraged into having juggernaut-like-capabilities. I have predicted multiple times, this theory that what we are seeing now within the Ukrainian conflict, shall be witnessed too within a commercial context soon. In other words, there is a necessity for commercial organisations to utilise software solutions in order to thrive, just as we have witnessed from a geopolitical perspective too.
- Effective technology is paramount for security of the West.
A simplistic quote to successful highlight the role Palantir plays in actually in relation to biology: “it is not the strongest species that survives, nor the most intelligent; it is the most adaptive to change (Darwin)”. Through the Ontological model, and the Operating System of Palantir, organisations have the ability to predict, prevent, and simulate outcomes and events, thus leading to a tremendous advantage.
Fundamentally, traditional software is static, and requires standardisation in order to function. However, this produces no-to-little alpha. Traditional software makes institutions more alike, whereas transformative software makes organisations more differentiated. This is key in order to succeed.
Palantir Ontology Web Services (OWS):
What Is The Ontology:
Palantir this week, at FoundryCon, just launched their Ontology Web Service product. This product consist of a substrate of Palantir Foundry – specifically and solely the Ontological Model. The word Ontology refers to a breathing, moving, and alive piece of code, or object, thus transforming your business into a 3D digital twin.
As mentioned within my Palantir Deep Dive, the Palantir Ontology is a fundamental part of the software. This piece of software turns ones company into a 3D living creature, in which consists of living and breathing objects and models.
The future of software is not a static 2D analytical dashboard, in which provides some utility, yet fails to transform the company. Instead, the future of software is a 3D ontological model, that allows for simulations, predictions, and thus optimal outcome decisions.
This new product roadmap for the Ontology Web Services, reminds me of the launch of AWS by Amazon. AWS is a phenomenal product that allows for organisations to simply purchase compute, and accessibility to the cloud.
Since inception, AWS has grown into the most successful cloud infrastructure company on the planet, garnering more than 30 percent of the market.
One can picture a similar event occurring for the Ontology, in which as within the case of AWS – in which organisations purchased compute – for the Ontology, companies purchase a digital twin representation for their company.
As with every innovation and unique, early stage idea, often these early stage ideas need nurturing, before mass adoption. Fascinatingly with all new technological products, before these products actually collide with reality, it is hard to tell as to if these products shall be viable and therefore experience mass growth.
I like to think of investing and business within a similar manner to surfing waves. Usually as a surfer, one is required to exert periods of patience, before picking a wave, and thus riding that specific wave towards completion. The same is actually true with business. To grapple with this idea, and therefore to benefit from this, one is required to think deeply about the future, the issues of today, and therefore think probabilistically as to if this product in question shall succeed.
Why The Ontology Is Valuable:
The same is likely true for the Ontological Web Service iteration, that allows for organisations to transform their static business dashboards, into kinetic and alive organisational digital twins. This has tremendous utility.
Within a world of increased complexity, both from a very real deglobalisation perspective, but also in regards to the mass levels of data being collected, it is necessary for companies to utilise a digital twin technology, in order to save costs, and choose the most optimal decision procedures.
Within the talk at FoundryCon, Sankar noted an example of a trucking business, in which uses the Ontological Web Service product, to gain a digital representation of their company. The Ontology captures information ranging from driving trucks, inventory, and other important form of metadata.
This exampled allowed this small trucking company to utilise the Ontological System in order to change business logic building blocks, resulting in ease of governability, and optimal decision making processes.
Future Of AI Software:
The future of AI Software is the use of MaaS – a new term used to describe to democratisation of artificial intelligence applications and tools.
Chat GPT has clearly highlighted the fact that artificial intelligence is here, and will likely accelerate further, changing the dynamics of business applications and tooling. As noted within recent writings, code is become a commodity, whereas the area in which clear differentiation is present is within the data sets that enable these algorithms.
For companies, the strategic asset is something that enables differentiation against competitors. As more and more software shifts towards AI software, the vector differentiation shifts to data, from code, and the access of data in which one has availability to.
In the future, there will be AI algorithms for:
- Customer recommendations
- Economic transactions
- Ontological models for certain industries
- Financial modelling applications
And so on.
The point being is that the future of AI algorithms is likely centred upon this idea of Model As A Service, or MaaS. Based upon the complexity of creating an AI solution, or tool, per industry, the use of MaaS shall democratise the ability for purchasing and utilising these models in order to solve a set issue within an organisation.
Network Effect Creation:
The utility of an App Store format for Palantir is no trivial feat, specifically if the company is able to gain traction, and thus generate substantial network effects of this specific store. Actually, a similar feat was apparent within the case of Microsoft, whom also created a democratised method for developers to collaborate, and build applications. This led to the generation of indirect, and direct network effects.
There are two main network effects in which can predict the innovative success of a company:
Indirect network effects occur when the value of a network increases as a result of one type of node benefitting another type of node directly, but not directly benefitting the other nodes of its same type. Within the context of eBay, the addition of a new seller does not directly benefit other sellers. In fact, another seller just means more competition for all the other eBay sellers. However, due to the expanded inventory of goods, this makes the marketplace as a whole more attractive to buyers. Additional sellers end up indirectly benefitting other sellers because of the total increase in potential customers.
OS platform like Microsoft Windows is a good example. New Windows developers do not directly benefit each other, however with an increased library of Windows programs, the number of Windows users will grow. Thereby, a greater number of windows users are beneficial for all developers because it increases the pool of potential customers for their program.
The same shall be true with the Palantir App Store, as new developers do not directly benefit one another, however as more individuals and companies create new applications, this leads to the overall increased library of Palantir applications, therefore making the overall number of Palantir users grow. Thus, this leads to the increased numbed of Palantir users being beneficial for all developers, as this increases the potential pool of customers for their programs. This leads to a dramatic flywheel, in which eventually shall develop into a substantial competitive moat.
Direct network effects is when the value of the service simply rises in value when the number of users increase. Within the context of a social media platform, this is revealed most clearly. As more members join the platform within your community, this results in more connectivity and interlinking, thereby resulting in more utility of that set platform.
Palantir shall act as the underlying base infrastructure for organisations to build applications, and thus purchase these applications too.
Minimally Viable Versus Alpha:
Within a recent talk by Shyam Sankar at Palantir FoundryCon, Sankar noted the distinction between minimally viable, versus alpha. This is a distinction to represent the deepness and robustness of software solutions, some being thin – yet backed by large sales teams, whereas other are thick – but disregard mostly the necessity for a sales team.
As I commonly note, Snowflake I believe is a perfect example of minimally viable software – in which produces some utility – however is fundamentally not transformative for organisations.
Commonly criticised of Palantir is the fact that the company has been developing their products for over 20 years, without yet turning a profit. In response to these claims, I am drawn towards a contrarian line of thought, that I believe is necessary to understand:
Within a world of conventionality, the greatest enemy is an unprofitable company, that invests within the future, and has opinions.
For many conventional thinkers, the idea of an unprofitable company that takes a long term vision of the future is a dreadful thought. Yet, I believe that this is key for a good investment. As investors, we must understand that Palantir is centred upon a vision of monopolisation, and having – not a marginal improvement over competitors – but a substantial and overwhelming improvement upon competitors. This is true differentiation and proprietary technology.
It seems to hold true that all successful companies tend more towards monopolisation, in comparison to perfect competition. Palantir seems to be following this idealistic trajectory.
The Best Technology Does Not Always Win:
It is important to understand too that the best technology does not always win, and history has proven this to be the case. One of my favourite stories to highlight this point is the story of Polariod, and their CEO Edwin Land, whom created a technological superstar, yet failed to appeal towards the commercial market.
Historical events have proven that the sole obsession of loonshot, or radical innovation after radical innovation, is often not sufficient. Instead, one must carefully balance the dynamics between radical innovations, in conjunction with the necessity for commercial appeal.
A similar fate occurred for Polaroid back in the 1900s. The company was at the forefront of technology, creating breakthrough after breakthrough. But, similarly to Pan Am, something suddenly changed, and the company failed.
Edwin Land, the CEO at the time, began with a hidden property of light. He built an empire, in which innovations led to growing franchises, that then fed more loonshots. This cycle continued for many years.
Edwin Land built the Polaroid Corporation by inventing a new remarkable use for this hidden property of light.
Land got his first major deal with the military, in whom snapped up the polarized products and innovations to eliminate glare from the sun. This was part of the invention that led to the domination in the camera industry soon after.
For Polaroid, their reign ended in late 1978. The crash was sudden, dramatic, and very unexpected. This was after the launch of the new product, namely the world’s first Polavision player that could product instant video. Even today, one must appreciate this product. The fact that back in the 1970s, Polaroid invented the use of a video recorder, that within 90 seconds could appear on a TV screen.
The media labelled the new product as “magical”. Technology magazines stated that: “the company that seems to specialise within turning the impossible into real hardware have done it again”. Others noted that this new product was the “highlight of the company”.
You may at first assume that this radical new innovation would have inevitably resulted into drastic sales. But, it did not. In fact, within a year the product was dead. Customer were not buying it. Despite the resolution and quality being superior, and the aesthetics of the products far outpacing those of other products. customers were not interested.
Customers did not need the extra resolution for home movies. And, customers deemed that the elegant design could not overcome the convenience of other products. Other video tapes, such as the Super 8 Film, were easier, cheaper and erasable.
Wall Street analysts stated that: “this is a product that has much more scientific and aesthetic appeal, than commercial significance”.
Soon after, the company were losing money rapidly. A door of revolving CEOs came through, but it was too late. The company found themselves in a dire situation, solely based on the obsession of a leader for newer, bigger, better and more, whilst totally disregarding other vital aspects of the company.
Palantir Is Different:
This story is not to suggest that minimally viable software shall succeed, however it is to highlight the common misconception in which is focused upon this idea that the best technology wins – in itself – within a vacuum. History has proven this not the be the case, therefore concluding the necessity for a coupling of commercial appeal, in conjunction with the focus on radical technological breakthroughs.
For Palantir, notably the company has understood – it seems – that the best technology in itself is likely not sufficient, specifically for the commercial enterprise software realm, and therefore have taken strides towards ramping up the sales force in order to garner superior results.
ARK Invest Analysis Of AI Software:
Cathie Wood actually recently went upon an interview with Yahoo Finance, highlighting her vision for the future of software in which she labelled as, “astounding and shocking”. There is one major factor that we must understand when it comes to the future of AI Software, leading to a competitive lead:
- Proprietary data sets
Proprietary data describes the use of untapped, or hard to access data, in which can lead to a substantial competitive advantage. Most notably, according to Cathie Wood, is the example of Tesla, whom within their vehicles are constantly collecting and recording data. This data then feeds back into the neural network, or brain, in which experiences automatic and manual labelling, therefore increasing the utility of the FSD platform overall. This means that, for other car companies, the ability for gaining an advantage within FSD becomes increasingly unlikely as Tesla gains more data for their vehicles upon the road.
The bottom line is, sitting upon valuable data is necessary for development of true AI Software, leading to exponentially larger competitive leads.
Whilst Tesla is sitting upon the largest set of real world data, Facebook is sitting upon the largest set of user data, Palantir Technologies is sitting upon the largest pool of organisational data, including that of Governments and companies of all size.
It is important to state that – whilst Palantir benefits from this data via learning the methods and connections in which the data is connected and utilised – the company does not store, or sell user data to third parties. However, the main point to take away is that fact that, Foundry and Gotham sit upon this large pool of organisational, and therefore the platform increases within utility as the products learn from the methods and connections between the data sets.
Specifically for the Governmental sector for the company, Palantir has been battle testing their software for over 18 years, thus leading towards a substantial competitive lead within access to proprietary data. Moreover, the same is true for commercial enterprises too.