On October 17, 2018, ROBO Global, LLC (ROBO) hosted a panel on robotics, automation and artificial intelligence (AI) at the New York Stock Exchange prior to ringing the closing bell. ROBO is an index, advisory and research company focused on helping investors invest in the fields of robotics, automation and AI globally. The firm is an index provider with an ETF, under the ticker ROBO, that tracks the index and is traded on the NYSE. Panelists included experts on Robotics and AI from academia, investment banking and industry. The panel discussion is timely given the relatively recent explosion of big data, which ROBO cites as the fuel for AI, the big leap in machine intelligence capability, and its impact on multiple sectors of the global economy. The following are some highlights of the panel discussion.
Disruptive technology – should it be feared or embraced?
Overall, the panel had a positive outlook for the future of AI, robotics and human productivity. A lot has been written in the American press about machines taking over human jobs and fear about the dangers and related disruptions attributable to AI and robotics. According to the panel, this is counter to the attitude in Asia and Europe, which seem to embrace the emerging technologies. U.S. fears, while understandable, may not be realized fully. One of the panel experts noted that machines make a lot of mistakes by themselves and human workers tend to be error-prone as well. But when humans partner with machines, mistakes plummet and productivity improves.
Big data fuels AI and robotics
Big data is the fuel of AI and it is growing by billions of gigabytes daily. Given the massive growth of data, improvements in AI, automation and robotics technology, the outlook for a new era of productivity can be realized through these disruptive technologies across multiple sectors of the economy. Everything from defense and manufacturing to the medical field will be impacted. For example, Wyatt Newman, a professor of computer science at Case Western Reserve, sees a day when physicians will be elevated to become mainly supervisors… of robots. Already, physicians direct robots built by companies such as Intuitive Surgical to more accurately perform surgery. Long term, he believes there will be “home” robots far more sophisticated than Roomba, a vacuum cleaning robot, able to tackle many needed tasks.
What’s driving the evolution of this technology?
Dr. Newman noted that a fundamental change in the AI/robotics industry is happening due to a confluence of events. The cloud, big data and automation are all benefiting from technological advances in the gaming industry, where advances in hardware have helped Google and Intel innovate. He notes that reusable software for robots is bringing costs down while “deep learning” helps make robots function more effectively. Deep learning is part of a broader family of machine learning methods based on learning data representations. Specifically, deep-learning software attempts to mimic the activity of neurons in the brain where thinking occurs. The software learns to recognize patterns in digital representations of sounds, images, and other data as opposed to task-specific algorithms.
Asian and global juggernaut
Morton Paulson, head of research at CLSA Japan and an expert in the industrial sector, notes that while the U.S. fears AI and robotics, Europe, Asia and other countries broadly embrace the technology. China, India, Southeast Asia and Mexico are investing heavily in robot technology.
Panel members noted that China has been investing heavily in AI in recent years versus a relatively small investment just a few years ago. One panel member opined that the Chinese are investing five times as much in AI today compared to the U.S. China’s goal is to be on par with the U.S. by 2020 and to dominate the technology by 2030. While most Chinese investments are in China, some are in Silicon Valley and other places outside of China. China has a huge amount of data and more users of the data versus the West, which adds up to enormous revenue potential.
China and Europe step up STEM Education Investment while the U.S. falls behind
According to Raffaello D’Andrea, Professor at ETH Zurich and Co-founder of Kiva Systems (Amazon Robotics), China is investing heavily in STEM education – emphasizing computational analysis. The takeaway is that the U.S. is likely missing a big opportunity, especially when it comes to investing in educating the next generation; in comparison, China and Europe are trying to give students a leg up regardless of their socioeconomic class. As measured by standardized test scores, it’s no secret that many public schools in the U.S. fail to educate students adequately in the STEM subjects. If the U.S. neglects to properly educate a broader swath of students, it may miss out on a huge technological opportunity in the decades to come. The panel also noted that education must be life-long, instead of ending with four years of college, because technology is constantly changing and the pace of change is accelerating.
The catalyst for change
With regards to AI, Professor Newman noted that massive uses of data are still to come. Companies are collecting a huge amount of data but don’t know what to do with it yet. When data and AI connect, there will be a big explosion of innovation.
According to the panel, some potential catalysts for change in the AI industry include a China/U.S. trade war resolution and companies such as Apple getting on board with robotics and AI. Apple and other companies will need to invest massively in AI/automation/robotics ahead of the innovation wave, as Netflix did five years ago to create content.
This is just the beginning of a massive technological wave
Most aptly, in the marketing piece for its ETF, ROBO quotes technologist Pete Trainer regarding the next wave of AI, big data and robotics: “We are at the precipice of one of the most significant discoveries since we learnt how to light a fire.”