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Blockchain, IoT and AI are foundational to the Fourth Industrial Revolution - why should you care?

This is my keynote session at Channel Live on 12 September 2019. It covers Blockchain explaining what it is and isn’t. I cover why it is so transformational relevant for any Business Model. I go through real world case studies, not just proof of concepts.
I touch on what implementations and frameworks exist and should be considered? I then talk about what the future look like?
Blockchain is significant and business systems will evolve because of it. I move on to IoT (M2M), Industry 4.0 and why are they important. I explain the underlying factors and what the opportunity is for a reseller. I go on to demystify AI. What is it and why should you be interested now? Lastly I talk through why you should you factor blockchain, IoT and AI into your plans.

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Blockchain, IoT and AI are foundational to the Fourth Industrial Revolution - why should you care?

  1. 1. Blockchain, IoT and AI are foundational to 4IR – why should you care? @DT & @BloorResearch on Twitter | 12 September 2019 David Terrar | Research Director, Digital and Strategic Advisor - Bloor
  2. 2. Why is everyone talking Digital Transformation?
  3. 3. Michael O'Hara Group Managing Director DataSolutions https://www.datasolutions.co.uk/ news-articles/five-ways-to-grow- a-world-class-it-reseller-business
  4. 4. Blockchain, IoT and AI are foundational to 4IR – why should you care? • Blockchain: – What Blockchain is and isn’t – Why it is so transformational and is it relevant for any Business Model? – Show me the money - real world case studies not just proof of concepts – What implementations and frameworks exist and should be considered? – What does the future look like? – Why this means business systems are evolving • IoT: – What is IoT (M2M), Industry 4.0 and why are they important – What are the underlyng factors and what is the opportunity? • AI: – What is it and why now? – Where are we and why should I care? • Should you factor blockchain, IoT and AI into your plans?
  5. 5. Let’s talk Blockchain (and cut through the hype)
  6. 6. Satoshi Nakamoto? • 2008 white paper • Peer-to-peer electronic transactions & interactions • Without financial institutions​ • Cryptographic proof instead of central trust​ • Put trust in the network instead of in a central institution
  7. 7. What happened next? • Bitcoin price: $3,850 • Bitcoin market cap of $67 billion • 12 digital currencies over $1 billion market cap • Hundreds of thousands of businesses accept • Over 30 industry consortia for blockchain • Things like Long Island Ice Tea changes name to Long Blockchain Corp • “Demand is off the charts for blockchain talent, and the capital is waiting to back it up.”
  8. 8. The technology of bitcoin is blockchain Law Firm A Client B Client D Shipping Firm C Future: Peer-to-peer trust Today: Trusted intermediaries
  9. 9. What Blockchain is and isn’t “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” Don & Alex Tapscott, authors Blockchain Revolution (2016) • Traditional Database technology always has an owner, usually centralised • Traditional Database is based on CRUD • Blockchain is always distributed, peer to peer, across a number of nodes/servers • Blockchain can only Create & Read • BC can be open, or permission less • Enterprise BC is usually a closed permissioned group, created as an ecosystem • BC and cryptography does 2 things - validates existing transactions, and the addition of new ones • All nodes/servers duplicate all blocks
  10. 10. Is it relevant for any Business Model? “less than 1/10 of 1% of corporate processes”.
  11. 11. Is it relevant for any Business Model? “less than 1/10 of 1% of corporate processes”.
  12. 12. Is it relevant for any Business Model? • How trustworthy is the person we are trading with? • Any certification or proof that they are who they are supposed to be? • Are the goods or services genuine (and not defective)? • Are the age and condition really as represented? • May be genuine, but what if they are stolen? • Any guarantees or warranties? • Can we buy insurance? • Does the marketplace itself offer us any protection? • Were the terms of our agreement fair? • Was the currency exchange rate valid? • Is the currency real or counterfeit? • How is the exchange between buyer and seller actually executed? Balancing Trust and Risk
  13. 13. Is it relevant for any Business Model? • The problem we are solving with Blockchain/DLT is trust. • Blockchain’s key advantage is that the parties or competitors can trust the digital ledger without the need for any intermediary like a bank or broker or lawyer or government being involved. How disruptive is that!
  14. 14. Show me the money • Maersk and IBM joint venture • International shipping industry is responsible for carrying around 90% of world trade • 12 month trial, now live • Around 100 ecosystem partners • Reduce transit time by 40% • Over 10 million shipping events every week
  15. 15. Show me the money • Growers, processors, distributors, and retailers • Visibility and accountability in the food supply chain • 18 months testing, now live • Carrefour, Smithfield, Nestle, Kroger, Tyson Foods, Unilever,… • Trace outbreak of E coli from 2 weeks to few seconds
  16. 16. Show me the money • Xbox video game content from publishers around the world • Blockchain solution that offers royalty information in near real time • Old process took 45 days • More transparent, greater trust, provides publishers with actionable business insights, and reduces process efforts by two-thirds.
  17. 17. Show me the money • Everledger – high value asset tracking – 2.2 million diamonds • Wirecard AG – German fintech card payments - now has higher company valuation than Deutsche Bank • lifesdna - Blockchain, AI powered search engine, operating system and marketplace for healthcare, wellbeing and lifestyle information • Santander and Broadridge, with J.P. Morgan and Northern Trust – shareholder voting at Santander AGM • 90% of European and North American banks are exploring Blockchain
  18. 18. 200+ organizations – one of the largest blockchain consortia in the world © 2019 Integra, Inc. - Confidential 21
  19. 19. What implementations, consortia and frameworks exist and should be considered? •Hyperledger (Fabric) •Ethereum •Corda •Digital Asset •Multichain •HydraChain •BigChainDB •OpenChain •ChainCore •Quorum (Ethereum) •IOTA What implementations, consortia and frameworks exist and should be considered? •Hyperledger (Fabric) •Ethereum •Corda •Digital Asset •Multichain •HydraChain •BigChainDB •OpenChain •ChainCore •Quorum (Ethereum) •IOTA
  20. 20. Juniper Research - September 2018 • 65% of responding enterprises with over 10,000 employees are considering or actively engaged in blockchain deployment (up from 54%) • Significant interest in opportunities across diverse fields including logistics, authentication and smart contracts • IBM’s position cemented as the go-to company for deployment, with the tech giant ranked first by 65% of respondents, nearly 10 times that of second-placed Microsoft at 7%
  21. 21. What does the future look like? • Less talk of blockchain, more talk of DLT • More decent case studies as projects come out of POC • Some still in the Trough of Disillusionment • Blockchain today is like the Internet of the early 90s: – Current offerings are like Mosaic or Netscape browsers – Google was years away – Back then we couldn’t even conceive of Facebook, Spotify, Netflix
  22. 22. “ We believe blockchain will be one of the things that can actually transform how work is done everywhere. ” Ginni Rometty, Chairman, President & CEO of IBM
  23. 23. Evolution of Business Systems Before Now Next On-Premise Software, Hardware, Networks Software as a Service, Cloud infrastructure Marketplaces Ecosystems Public Data Services
  24. 24. Let’s talk IoT (and Industry 4.0)
  25. 25. • The Internet of Things (IoT) is made up of devices that talk to each other – From simple sensors to smartphones and wearables…from sensing to sensing and actuating • Combining these connected devices with automated systems – To gather information, analyse it and create an action – Help someone with a particular task – Learn from and improve processes • IoT is about networks, devices and data. What is the Internet of Things?
  26. 26. The idea is not new, but… • Not new – M2M • Liberated by the Internet and the Cloud • Generating data flood • Creating challenges for networks and transaction processing • And therefore the supporting infrastructure
  27. 27. 2.5 times as many IoT devices as people by 2020
  28. 28. What is Industry 4.0 • German government initiative • the strong customisation of products under conditions of highly flexible (mass-) production. • The automation technology needed is improved by the introduction of methods of – self-optimisation – self-configuration – self-diagnosis – cognition and – intelligent support of workers in complex work. “We must deal quickly with the fusion of the online world and the world of industrial production. In Germany, we call it Industrie 4.0.” — Angela Merkel, Chancellor of Germany
  29. 29. Why is it important? • Vertical industry use cases – Automotive – Manufacturing – Logistics/supply chain – Medical – Consumer/Home – Wearables • $3.8 trillion of additional value by 2028 • If we can solve the networking (and possibly the power) challenge
  30. 30. • The Internet of Things (IoT) • 5th Generation mobile networks (5G) • Machine Learning • Artificial/Augmented Intelligence • Big Data Analytics • Big Software • Cloud-based Edge Computing The key underpinning enablers of Industry 4.0
  31. 31. Where are we at with I4.0? • 99% of mid-market manufacturing executives are familiar with Industry 4.0, yet only 5% are currently implementing • Top 3 priorities: – Investing in upgrading existing machinery – Replacing fully depreciated machines with next-generation – Adopting real-time monitoring including Manufacturing Execution Systems • Most value out of orchestrating technologies for product quality, productivity, delivery dates, and control costs. • Real-time monitoring is gaining momentum https://www.bdo.com/insights/industries/industry-4-0/industry-4-0- redefining-how-mid%E2%80%91market-manufactur
  32. 32. Where do I process transactions and store data? • Some transactions require very low latency • Much IoT Data has a short shelf-life • Some data is only required locally • IoT will be a significant driver of edge data centre growth
  33. 33. Edge data centre requirements • Due to the high cost of building out the 5G infrastructure, edge data centres will need to be – Highly automated – Modular/containerised – Software defined – With equipment potentially based on OCP designs
  34. 34. Let’s talk AI (hey Alexa, Google, Siri)
  35. 35. “AI is the science of making machines smart, using algorithms to allow computers to solve problems which used to be solved only by humans”
  36. 36. Why now? https://www.nttdata.com/mm/en/digital/ai/2018/september/what-is-ai 1950
  37. 37. Why now? • 2017 Accenture Research and Frontier - by 2035 AI could improve productivity by 40% • 2018 PwC and CB Insight - VC investment in AI start-ups soared by over 72% to a record-breaking $9.3 billion • PwC study of 1000 businesses - 20% said their organizations plan to implement AI enterprise-wide in 2019
  38. 38. What’s what? • AI is the overall technology which understands natural language and mimics human actions and cognitive functions such as learning and problem solving • RPA is an automation technology, which is used to automate rules-based, repetitive tasks. • Machine Learning is the study of algorithms and statistical models that computer systems use to perform a specific task without using explicit instructions, relying on patterns and inference instead • Deep Learning is machine learning based on artificial neural networks to help refine computer vision, speech recognition, natural language processing, audio recognition, social network filtering, machine translation, bioinformatics, drug design
  39. 39. What’s what? AI cannot understand all things especially human cognitive abilities, common sense, or emotions Don’t get hung up on the terminology Go google IBM’s Project Debater
  40. 40. https://www.bloorresearch.com/ research/blockchain-hotreport/ http://Bloor.tv
  41. 41. Should you fit Blockchain, IoT, and AI into your planning? • Ignore the hype, but in spite of the noise, we believe blockchain will change or disrupt all sectors of business over the next 20 years • IoT presents a big opportunity in more devices, more networking, more compute and storage, and edge computing • AI in all of its forms applies to your customers and to you • You need to skill up and start planning them in to your strategy now • Get ahead of the curve and be the expert for your customers
  42. 42. References Not for presenting – just for reference https://www.datasolutions.co.uk/news-articles/five-ways-to-grow-a-world-class-it-reseller-business H ttps://www.amazon.co.uk/dp/B00NE6MG0Y/ref=dp-kindle-redirect?_encoding=UTF8&btkr=1 https://www.ibm.com/events/think/watch/playlist/468124/replay/120138988/ https://bitcoin.org/en/bitcoin-paper https://www.enterpriseirregulars.com https://hackernoon.com/asia-is-going-to-take-over-the-world-economy-with-blockchain-heres-why-you-should-care-e5a58ab051e4 http://www.theagileelephant.com/is-blockchain-relevant-for-any-business-model/ https://pixels.com/featured/medici-bank-15th-century-granger.html https://en.wikipedia.org/wiki/Medici_Bank https://en.wikipedia.org/wiki/Luca_Pacioli https://www.tradelens.com https://www.ibm.com/uk-en/blockchain/solutions/food-trust https://customers.microsoft.com/en-us/story/insurwave-insurance-azure https://customers.microsoft.com/en-gb/story/microsoft-financial-operations-professional-services-azure https://www.everledger.io https://www.bloomberg.com/news/articles/2018-08-14/meet-the-german-fintech-that-s-now-worth-more-than-deutsche-bank https://www.lifesdna.com https://www.santander.com/csgs/Satellite/CFWCSancomQP01/en_GB/Corporate/Press-room/Santander-News/2018/05/17/Santander-and-Broadridge-Complete-a-Fir st-Practical-Use-of-Blockchain.html https://legalconsortium.org https://integraledger.com/integration/ https://www.juniperresearch.com/press/press-releases/nearly-two-thirds-of-large-enterprises-currently https://www.ibm.com/blockchain/platform#1635596 https://www.bdo.com/insights/industries/industry-4-0/industry-4-0-redefining-how-mid%E2%80%91market-manufactur https://www.nttdata.com/mm/en/digital/ai/2018/september/what-is-ai https://www.bloorresearch.com/research/blockchain-hotreport/ http://bloor.tv
  43. 43. David Terrar Bloor Research | Agile Elephant p: +44 (0)1727 866309 m: +44 (0)7715 159423 e: dt@d2c.org.uk & dterrar@Bloor.eu w: http://theagileelephant.com w: www.Bloor.eu | www.BloorResearch.com skype: david_terrar twitter: http://twittter.com/DT @DT linkedin: http://www.linkedin.com/in/davidterrar blog: http://theagileelephant.com/blog & http://medium.com/@DT