So what is on the tech radar for 2017? Gartner has highlighted Artificial Intelligence (‘AI’), Machine Learning (‘ML’), and ‘Smart Things’ as key areas, promising an intelligent future for us all with the combination of the three elements becoming increasingly embedded into everyday things. These technologies are just beginning to break out of an emerging state and stand to have substantial disruptive potential across industry and our everyday lives.
Gartner is also clear that it’s about the connection of tech with people that is the emerging trend to tech innovation: It’s not about just Internet of Things, wearables or mobile device. It’s about all of that together. We need to put the person at the centre. We want systems that shift from people adapting to technology to having technology and applications adapt to people. Instead of using forms or screens, I tell the chat-bot what I want to do. It’s up to the intelligence built into that system to figure out how to execute that.
So following the Gartner predictions, what lies ahead for tech startups in 2017? Where will we see startups emerge in the next twelve months to address these opportunities? Here are the thoughts of Cake Invest.
- AI and ML
1. AI & ML
Technology has advanced to let startups take part in the AI revolution. Now that the true importance and impact of AI is understood, combined with the increased availability of data science talent, AI will become more accessible, allowing for startups to truly innovate in the space.
AI and ML, which include technologies such as deep learning, neural networks and natural-language processing, can encompass more advanced systems that understand, learn, predict, adapt and change future behaviour, leading to the creation of more intelligent devices and software applications. The combination of extensive parallel processing power, advanced algorithms and massive data sets to feed the algorithms has unleashed this new era.
We’re seeing this in Fintech startups disrupting the banking sector, with the application of AI and ML techniques to model current real-time transactions, as well as predictive models of transactions based on their likelihood of being fraudulent. This innovation evaluates a number of business scenarios in which AI and ML drive clear and specific business value based on intuitive understanding of customer behaviour.
AI and ML have thus reached a critical tipping point and will increasingly augment and extend virtually every technology enabled service, thing or application in Fintech. Creating intelligent systems that learn, adapt and potentially act autonomously rather than simply execute predefined instructions is the primary battleground for startups.
Startups will emerge that recognise the huge market need for blending human expertise with AI. AI systems that can be taught by human experts, and human experts that can be taught by AI systems, is what the hottest startups will focus on.
2. 'Intelligent things'
- ‘Intelligent things’
‘Intelligent things’ are at the intersection of AI and IoT, and fall into three categories: robots, drones and autonomous vehicles. Each of these areas will evolve to impact a larger segment of our lives and support a new phase of digital business, offering many opportunities to startups.
Gartner anticipate that IoT devices will become intelligent, delivering the power of AI enabled systems everywhere from the home, office, factories and medical facilities. As intelligent things evolve, they will shift from a stand-alone to a collaborative, integrated model in which they communicate with one another to deliver advanced behaviours, and interact naturally with their surroundings and with people in concert. This ‘collaborative intelligent things’ model will be an emerging market for startups in 2017 to focus upon.
Intelligent apps, which include technologies such as virtual personal and customer assistants, such as Alexa and Echo, have the potential to transform the home and the workplace by making everyday tasks easier and users more effective.
However, intelligent apps are not limited to new digital assistants. By 2018, Gartner expects most of the world’s largest companies to exploit intelligent apps and utilise the full toolkit of big data and analytics tools to refine their offers and improve customer experience. This is a space where startups with their agility can create and seize opportunity. Creating intuitive, intelligent customer interfaces can see startups create applications across many domains.
3. VR & AR
- VR & AR
In the aftermath of Niantic’s Pokémon Go phenomenon introducing augmented reality (AR) to a broad, worldwide audience, giving players a taste of how information and images can be superimposed on any kind of image or setting to add content and even video to the real world, AR is on many startup’s radar.
Virtual reality (VR) also offers exciting potential for startups, as in the coming twelve months, 30% of consumer-oriented Global 2000 companies are expected to experiment with AR and VR in their marketing initiatives.
Both VR and AR transform the way individuals interact with each other, the software creates an immersive environment. For example, VR can be used for training scenarios and remote experiences. AR, which enables a blending of the real and virtual worlds, means businesses can overlay graphics onto real-world objects, such as hidden wires on the image of a wall.
VR is a hot tech product, with the Oculus Rift, Google’s Daydream headset, HTC Vive and Sony’s PlayStation VR garnering much of the consumer attention, as people grapple with the very idea of strapping screens to their head. However, Gartner anticipate that VR will mostly be used in gaming over the near future. Apple CEO Cook said he believes AR is much more interesting to his company than VR. It would not be a surprise if AR were a big focus when Apple introduces its next iPhone in 2017.
For startups, the focus could be on transforming how people interact with each another and software around hyper-personalisation from relevant apps and services across multiple mobile, wearables and sensor-rich environments that extend immersive applications beyond isolated and single-person experiences. These interfaces are the essential gateway to customer engagement and they are evolving much faster than anticipated.
The lines between the digital and physical world continue to blur creating new opportunities for startup digital businesses to help create new business models and digitally enabled ecosystems.
Gartner anticipate that within the next five years, billions of things will be represented by digital twins, a dynamic software model of a physical thing or system. Using data on how the components of a thing operate and respond to the environment, as well as data provided by sensors in the physical world, a digital twin will enable an increasingly detailed digital representation of the real world for simulation, analysis and control.
Digital twins function as proxies for the combination of skilled individuals (e.g., technicians) and traditional monitoring devices and controls (e.g., pressure gauges). Their proliferation will require a cultural change, as those who understand the functioning of real-world things collaborate with data scientists and IT professionals.
Separately to digital twins, Gartner foresees that enterprises will undergo further massive digital transformations enabled by the ‘Third Platform’ of cloud, mobile, big data and analytics, and social technologies. Every enterprise must become 'digital native' in the way it thinks, what they produce, and how they operate.
IDC believes the cloud will be a prime enabler of digital transformation, and it predicts that by 2020, 67% of enterprise IT infrastructure and software spending will be related to cloud-based technologies. During this transition, nearly every enterprise will be a cloud service provider of services to its own marketplace, making cloud capabilities a startup opportunity as well as a core business operations issue.
The ‘digital mesh’ - the dynamic connection of people, processes, things and services supporting intelligent digital ecosystems will evolve, and the user experience fundamentally changes. The supporting technology and security architectures and platforms will evolve too.
As the device mesh evolves, connection models will expand and greater cooperative interaction between devices will emerge, creating the foundation for a new continuous and ambient digital experience. For startups, the cloud and digital platforms offer significant opportunity in the near term to enable and support the customer experience.
Chatbots are automated services that interact with and offer information to humans, especially consumers, through a chat interface. AI is one of the technologies that's helping to make Chatbots mainstream and promote the growth of conversational systems (see below).
Chatbots enable devices to move beyond traditional computers and devices to encompass the full range of endpoints with which humans might interact with technology. Businesses will increasingly look to Chatbots to help reduce spending on customer service, with 85% of customer interactions not including a human being by 2020, and Chatbots will be the primary consumer application of AI.
More than 11,000 bots came online after Facebook released a bot-development platform for Messenger. Since then, bots have proliferated across other messaging media like WhatsApp, Slack, Snapchat, and Skype. The numbers are staggering, and with messaging apps already surpassing social-media networks in popularity, those figures will continue to climb.
NLP technology allows you to create custom bots that take on your brand's personality and voice by leveraging existing communication systems and your knowledge base to connect directly with customers in their everyday, informal language. You can use the bot for everything from helping a customer reset a password or getting an updated account balance to finding a specific discount item on a web site.
Providing customers with a personalised chat experience - even without a live agent on the other end - can help a business stand out and create new opportunities to transform repeat customers into influential advocates and evangelists. In 2017, expect a flurry of startups creating messaging platforms to open their platforms for Chabot integration.
6. Conversational Systems
- Conversational Systems
With the emergence of conversational systems such as Facebook’s Deeptext and Google Assistant taking on Amazon's Alexa, Apple's Siri and Microsoft's Cortana, 2017 is prepped to be a year when the accuracy and efficiency of voice control reaches a near-human level. The companies all want their voice-controlled AIs to power third-party products, and Amazon looks to have the head start.
Just as we’re just getting used to holding a smartphone, technology is rapidly transitioning towards touch-free interaction. Your phones, speakers and appliances will not only be able to listen to you, but understand you too, and be able to autonomously react to your requests.
Take Amazon’s Alexa enabled ‘echo’ smart speaker, a hands-free system you control with your voice. Aside from the now-banal feature of playing music, the device can read the news, order your groceries and request an Uber, and all you have to do is ask.
So that’s the potential for 2017. We saw some great innovation in 2016 from some of the tech giants, but it's been start-ups that have had many of the most catching reveals, thanks in part to crowdfunding supporting speculative developments.
We're still decades away from having the type of androids seen on TV shows such as Westworld, and the question remains whether wearable tech has a profitable future beyond health. Where things get more interesting is when tech genuinely makes lives simpler without requiring too much effort.
However, in the last twelve months, the conversation about security and privacy has moved from the tech pages to the front pages of newspapers. To make intelligent devices easy to connect and easy to use, some companies have hardcoded passwords or put no security measures in place, and that made them an easy target. Alongside this, tech innovators will need to be more transparent about what data is being collected, how it's being used and with whom it's being shared.
For me, while hardware may dominate the headlines, it will be user oriented content which determines which startup products are winners.
Picture this: it’s August 2017. You’re driving home from work. A surge of sticky, steamy hot air streams through the window. You pull over, and scroll through your smartphone and switch on the air conditioner in your house to a refreshing 16°c cool.
A text message arrives - your refrigerator reminds you that you’re out of oranges. You tell it to order you a couple more. From your in-home camera app, you see your wife shopping in a virtual retail environment on her VR helmet. ‘That dress looks great!’ you tell her, via Bluetooth-enabled voice transmission.
Your dog looks hungry, so you select its ‘treat cam’ to feed it a snack. You auto-water your smart wild flower garden that’s looking a little droopy. By the time your car pulls up to your home, facial recognition detects your presence, your garage door opens, and front door unlocks. You walk into your cool, connected home, the music playing is your favourite Joy Division track, and the fresh oranges arrive by delivery drone five minutes later…