AI and blockchain trends
By 2030, AI (artificial intelligence) may drive nearly $16 trillion US (ex. PwC) in added wealth creation through productivity enhancements and consumer personalization/higher quality services. In fact, the consumer impact will exceed the gains from productivity improvements over time. This represents more than $1 trillion in business value today. One example is JP Morgan Chase, one of the world’s largest banks, eliminating 360,000 hours spent in annual manual contract compliance checking, reducing it to seconds using AI.
Today there are more than 2,200 cryptocurrencies (with bitcoin as one example) with market value reaching nearly $1 trillion in 2018. High volatility is evidenced, with the value dropping well under $500 billion and growing regulation to protect consumers.
This has led the growth of ICOs/ITOs (initial coin/token offerings) where a cryptocurrency/token is offered to drive or fund a project. ICOs representing under $8 billion in 2017 could reach as much as $40 billion in 2018, and are receiving substantial investment from angel and seed investors. Examples are Telegram, raising more than $1.7 billion 2018, and EOS with more than $4 billion raised.
The underlying technology behind cryptocurrencies is often denoted as blockchain. Blockchain is ever expanding in capabilities with applications in more than 50 industries – it is the driver for new business models and innovation. This comes from transferring value via transactions between parties securely, quickly, and without intermediaries, thus lowering costs.
Blockchain is the new value-delivery internet. Examples are Samsung converting their supply chain to blockchain to drive down costs by 20%; Walmart using blockchain to track food shipments in seconds, instead of the week this used to take; and the use of blockchain in financial services to lower fees for payments, speed up transaction clearing and settlements to real time, lower borrowing costs, and provide alternates to representing securities and another means to raising funds (ICOs) – disrupting the $130+ trillion global market (ex. CBInsights).
Blockchain also offers the ability to provide or track national identities where consumers manage their own data, provide trackable identities to devices in the Internet of Things (hitting 40 billion devices and sensors by 2022), and deliver a new platform for services – a new internet.
There is even a combination of distributed AI or decentralized AI where blockchain provides the open platform for the sharing and consumption of AI services from anyone – an open crowdsourced AI marketplace. Singularity.net is one such example, raising $30+ million in under 60 seconds with their own ICO – see my recent chat with Ben Goertzel, CEO SingularityNET, in the ACM Learning Center.
What does this mean to Operators (Mobile and Mobile Virtual Network)?
Data and airtime are commoditized with the clear differentiators and higher margins in value added services to subscribers.
Operators can use blockchain for new financial technology services (fintech) where they can provide mobile banking services such as micropayments, loans, and cash-based transactions with security and authentication already built into the platforms. Beyond financial services, Deutsche Telecom’s City Pass is a good example of an operator providing community membership privileges and services offered by cities via blockchain. Announced this year, we have MoBee, creating a new mobile virtual network operator ecosystem combining blockchain and ICO/ITO offerings. Their 3 links structure consists of a platform for mobile operators, service experts and outsourcing providers; MoBee virtual operator as the hub; and a subscriber platform using crypto funds.
Combining big-data analytics, AI automation and augmentation provides real-time consumer insights and needs to operators and predicts future behaviour. Purchase decisions are guided towards consumer execution due to the close match of products and services to wants. Only AI has this data capability. This creates profits for operators and much better service to consumers.
We are in the midst of the 4th Industrial Revolution and Industry 4.0 (A Triple C–hyper: Automation, Compression, Convergence, Connectivity) where there is unprecedented innovation producing growth opportunities. AI and blockchain are at the forefront for tapping into new markets and existing markets – all with better personalization and higher quality services and at lower costs. The winner – everyone!
Stephen Ibaraki is speaking at the Forum session on “Digital finance: innovative economic solutions for all” as part of the Smart ABC Programme at ITU Telecom World 2018