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Tech insiders share what’s in store for 2018

ICTAM's recent Tech Mash Up event featured Deloitte's predictions for the coming year.

Expect more in the way of incremental, under-the-hood changes to your technology in 2018, and fewer game-changing breakthroughs.

That was the main theme at the Tech Mash Up hosted by the Information and Communication Technologies Association of Manitoba (ICTAM) on February 21, 2018 at the NRC building in downtown Winnipeg. The event featured Deloitte’s annual technology predictions, which include the trends expected to impact the growth and transformation of Canadian business over the coming year.

Speaking to a lunchtime audience of about 50, Deloitte Winnipeg’s Andrea Legary, Manager of Global Investment and Innovation Incentives, and Matthew Hlynsky, Manager of Financial Advisory, laid out what the company predicts will be key trends more specifically in the technology, media and telecommunications (TMT) sector in 2018.

“There are some milestones that will be reached this year and there will be exponential growth in some fields. However, in other areas there is just going to be imperceptible shifts to the technology which will improve our lives, but we might not necessarily be completely aware of the changes,” Legary said.

Photo-realistic AR on the rise

One technology for which Deloitte predicts growth and change is augmented reality — software that enables digital data and images to be superimposed on a real-world view. Think Pokémon GO or Snapchat with its face-swapping feature, or cartoon-like elements that can be added to your selfies.

Andrea Legary and Matt Hlynsky speak at ICTAM's Tech Mash Up

“We expect there will be over one billion smartphone users this year who create augmented-reality content on their smartphones during 2018, about 300 million creating monthly and tens of millions creating weekly,” Hlynsky said.

Hlynsky and Deloitte predict 2018 will be a year of increased AR adoption and experimentation, with the technology moving well beyond social media. “When we look at AR content in the past, over 95 per cent of it has been cartoonish, and proudly so,” Hlynsky said. “We expect over 50 per cent of the AR content created in 2018 will actually be photo-realistic. That extends the apps it can make sense for, but it also means, over time, we expect it would become a function built into smartphone camera capability.”

For example, ecommerce home goods retailer Wayfair’s website now allows you to ‘place’ a piece of furniture in your room using AR on your smartphone, allowing you to move around it to see how it looks and fits the space.

“We expect there will be tens of thousands of apps that come into the marketplace this year to further deploy the technology and allow people to explore it,” Hlynsky said. “It’s a technology that is improving and it could be something consumers start to expect more as they understand the implications and capabilities of it.”

Invisible innovation in smartphones

When it comes to our smartphones, don’t expect big, obvious changes. “Deloitte is calling it the ‘era of invisible innovation’ when it comes to smartphones,” Legary said. “Your phone likely won’t change that much visibly. And we’re likely going to stay around the same sizes.”

Legary says ‘invisible’ upgrades will include improvements to software, memory, connectivity, processors, cameras, artificial intelligence and sensors.

 Matt Hlynsky speaks at ICTAM's Tech Mash Up

“There will be improvements with field-programmable gate array chips, so those will become standard on phones and take a lot of the load off your main processor for tasks such as optimizing your reception on a cell network in a congested area,” she said.

One thing Deloitte is not predicting is any major upgrade to your smartphone’s battery. “It’s disappointing to hear (that) batteries aren’t on the fast-track to innovation,” she said. Other smartphone improvements will lessen battery drain, but lithium-ion battery technology is predicted to remain in our phones for a few years yet.

Legary says smartphones will continue to displace the PC as our favoured device for more and more tasks and pastimes, even replacing keys to our homes, vehicles and hotel rooms. “Each year we’ve seen a broadening of the areas where the smartphone is the preferred device for many activities,” she said.

After we hit the $1,000 mark for a smartphone last year, Deloitte predicts the market-share for high-end handsets will grow. “With the iPhone X, we saw the $1,000 price point,” Legary said. “Deloitte’s prediction is that by 2023, over 180 million units will be at that price point or higher. Users will want the increased capability and be willing to pay the price for the enhanced functionality.”

When it comes to how tethered we are to our smartphones, Deloitte sees more people looking for ways to reduce their usage, with one of the most common being the low-tech strategy of simply putting it away, out of sight and out of mind. “Deloitte predicts 45 per cent of adult global smartphone users will try to limit their usage this year, in various ways,” Legary said.

What about the tube?

When it comes an older piece of tech — our TV sets — Deloitte predicts the decline in traditional viewing will not be as drastic as you might expect.

“We’re not hitting a tipping point for the death spiral of TV viewing,” Hlynsky said. “Traditional TV viewing by 18-24 year-olds will decline by between five and 15 per cent per year for 2018 and 2019. Traditional TV viewing includes live TV and ‘time-shifted’ viewing of a live stream via PVR.

Andrea Legary speaks at ICTAM's Tech Mash Up

“What’s interesting here is that the rate of decline is similar to previous years,” Hlynsky said. “It’s not having the exponential drop like music sales or newspaper subscriptions. At this point, a lot of the TV alternatives have reached their points of saturation. People are using their smartphones more per day now than they’re watching TV — about 150 minutes compared to about 120 minutes on TV — but there are only so many media minutes in a day.”

Hlynsky says live sports and reality shows are the most popular content on traditional TV. “Digital platforms are getting into live events,” Legary said. “Amazon was streaming Thursday night NFL football and Twitter has live-streamed NFL games, so platforms we originally thought were consuming and taking over and replacing live, are actually seeing (that) we want the novelty of consuming something while it’s happening. So they’re getting in on that area of the market as well.”

When it comes to cable-cutting, Deloitte is predicting an increase in subscriptions to online-only media services, forecasting that 50 per cent of people this year will have at least two online-only media subscriptions. This includes services like Apple Music, Netflix, CraveTV or Amazon Prime. By the end of 2020, Deloitte predicts it will rise to an average of four per person.

“There’s a steady growth in the number of companies that are offering online media subscriptions or content libraries and there’s an increased willingness among us to pay for content online,” Legary said. “It’s becoming easier to do and we’re more willing to do it. We’re moving away from advertising-funded revenues.”

Old-school advertising

When it comes to watching advertisements, Deloitte predicts an increasing tendency for people to block ads across media. “We can skip ads on our phone apps, use the PVR to skip ads, subscribe to an ad-free video or music service, and obviously just change the channel during a traditional TV commercial,” Legary said.

 Matt Hlynsky speaks at ICTAM's Tech Mash Up

Deloitte predicts 80 per cent of viewers or tech-users will block ads this year in at least one manner, while 50 per cent will block in two or more ways. “Only 20 per cent of us, across all platforms, don’t block any ads,” Legary said.

Legary says 10 per cent of the population is using four or more of the methods to block ads.

“That’s the population we term ‘ad-lergic,’” she said. “They’re blocking more than half the ads they might see across both digital and traditional media.” Typically it’s younger, more well-off or more highly-educated viewers who block ads the most.

“These are very desirable targets for advertisers,” Legary said. “And they are the ones who are trying to avoid them, desperately. So we have to look at different ways of reaching our clients and consumers.” That may take the form of less-avoidable, more integrated social media advertising or a shift to old-school strategies.

“Nobody closes their eyes when they’re passing a billboard,” Legary said. “Companies who want to reach consumers with their message may need to look back to more traditional methods like sponsorship. It gives them face time in front of a market they want to reach.”

Staying connected in the air and at home

Deloitte is predicting changes this year in one of the final frontiers for constant connectivity: airline flights. The organization predicts one billion passenger journeys in 2018 will be on planes equipped with in-flight connectivity, which will mean somewhere around $1 billion in revenue for airlines from the service.

 Matt Hlynsky speaks at ICTAM's Tech Mash Up Connectivity has become an on-flight priority for passengers — ahead of food. “In one survey, passengers were asked what they would most value as an amenity to flights and 54 per cent said connectivity, while 19 per cent said the meal,” Hlynsky said. “It’s definitely a priority.”

When it comes to how we stay connected at home, Deloitte sees more and more people going mobile-only for their Internet needs.

Citing increases in mobile connection speeds and the size of data packages, Deloitte predicts this year that 20 per cent of homes will get Internet data access via mobile-only networks and forecasts that by 2022, 30 to 40 per cent of us will be connecting our homes to the Internet by mobile-only means.

Machine learning gets an upgrade

Diving deeper into our tech, Deloitte is predicting a jump in how many medium or large-size enterprises embrace machine learning — technology that allows computers to follow and learn through exposure to data rather than through explicitly programmed instructions. “The expectation is, the adoption of machine learning pilots and implementations will double in 2018, compared to 2017, and will double again by 2020,” Hlynsky said.

He says there are some key enabling technologies driving the growth. “The expectation is that rather than general purpose central processing unit (CPU) chips and graphics processing unit (GPU) chips, there will be more use of custom chips that are basically tweaked toward machine learning,” he said.

As previously mentioned with smartphone updates, Hlynsky pointed out that, “there will also be the machine-learning optimized field-programmable gate array (FPGA) chips. Basically, they’re programmable at the site in the field, so they’re more responsive to changes in machine learning. They are more flexible and tailored to the nuances and requirements of the technology.” Deloitte predicts annual sales of machine learning chips in global data centres to rise in 2018 to $800,000, up from $100,000 to $200,000 in 2016.

Andrea Legary and Matt Hlynsky speak at ICTAM's Tech Mash Up However, there are factors holding back the increased implementation of machine learning, especially the skills shortage in data scientists, a demand that is not being filled quickly enough. “The tools are young and evolving, so it requires a lot of sophistication and attention to stay on top of the capabilities,” he said. “Data can be costly to obtain.”

Deloitte is also predicting that machine learning will be deployed more locally — on our phones and other small devices, for example, instead of on central processing units. “Moving machine learning out to the edges, to make it more deployable on smartphones and in other Internet of Things devices allows the functionality to be done right where the users are,” Hlynsky said.

 

Sierra Systems and Norima Consulting were gold sponsors for the Tech Mash Up event.

ICTAM is an industry-focused association representing Manitoba’s information and communication technology sector. Not-for-profit and open to all businesses, ICTAM works to promote growth and sustainability in the ICT sector through programming, advocacy and collaboration.

 

Up Next: These are the top IT trends to watch in 2018.

Jason Halstead

Jason is a Winnipeg-based journalist and photographer who has been published across Canadian media.

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