The new year is only a few days old. And like probably many others, I have spent the last few days very intensively reviewing the last twelve months. And I came to the conclusion: from a technological point of view, 2020 has paved the way for much greater change and innovation.
Compared to the entire history of mankind, we have made a quantum leap in technology and thus social development over the last 10 years. However, due to the global impact of the coronavirus, 2020 has marked an unprecedented year in history and has once again accelerated the pace of change. The pandemic has brought about extraordinary changes in a short period of time and in several key areas: faster drug development, faster policy decisions, (corporate) infrastructures that support remote work, more efficient supply chains, etc. Students experience distance learning, take exams under remote and controlled surveillance systems through real-time identity verification and authentication. And in some places, remote monitoring mechanisms for home office employees have even been introduced to measure their performance. Technology stocks in particular saw a sharp increase in 2020.
These trends will continue in 2021 — perhaps at an even faster pace. 2020 paved the way for us in many areas. Companies around the globe are taking a giant leap to embrace artificial intelligence (AI), hybrid cloud approaches, quantum computing, and cybersecurity to embrace digital transformation and catch up with what they have often been too slow to tackle in recent years.
2020 has set a decisive course for quantum computing to solve very complex problems in the future. Together with IBM, Fraunhofer will put a quantum computer into operation in Germany in 2021. Analysts at Morgan Stanley predict that the market for high-end quantum computers will double to ten billion dollars per year by 2025. This paradigm shift in computing will lead to the emergence of unimaginable ways to solve existing business problems and imagine new possibilities. Better performance can thus be expected in the future in areas such as financial forecasting, weather prediction, drug and vaccine development, blood protein analysis, supply chain planning and optimization, etc. Even though we are still in the early stages of this project, this new year will be a decisive step towards the future, which will change in the following years.
Cloud computing can expect continued significant growth next, both in terms of the number of companies using cloud services and in terms of business numbers. Efficiency, security and adaptability are the advantages for which serverless and hybrid cloud computing are gaining acceptance among large companies.
What remains a challenge is the so-called “cloud waste”: Companies oversize their cloud scenarios and thus generate costs for cloud capacities they do not need at all. According to the market research company Gartner, the resulting unnecessary costs are expected to rise to 21 billion US dollars in 2021. Because existing server capacities are tied up uselessly, cloud operators also have to increase their resources, which causes additional costs. The consequences are not only financial, but also have a negative impact on energy requirements and the consumption of land and raw materials. A rethink is to be expected here, not least due to the increased awareness of sustainability and environmental protection.
Artificial intelligence will become mainstream in companies in 2021. According to a recent study by Algorithmia, the percentage of companies that have more than 5 use cases involving machine learning or other forms of AI has increased by 74 percent year-on-year. Eighty-three percent of companies have increased their AI budgets, with the average number of Data Scientists employed increasing 76 percent year-over-year.
Increasingly, the focus is on making the “black box” of AI transparent with explainable AI, enabling it to be used in sensitive areas of application such as banking or insurance. In this context, the demand for scalable AI solutions and machine learning operations (MLOps) is also growing.
AI and the Internet of Things along with edge computing, or data processing closer to the source, will usher in a new era for actionable insights from massive amounts of data. In-memory accelerated real-time AI will be needed, especially when 5G creates new opportunities for disruption. That’s because the COVID-19 pandemic has also ensured that network upgrades in many places are moving ahead more than originally planned.
Advancing digitization naturally also promotes the importance of cybersecurity. Hacking and cybercrime prevention are priorities for all companies. According to Forrester’s cybersecurity projections for 2021, funding for cybersecurity companies based outside the U.S. will increase by 20 percent.
Driven by financial sacrifice, many companies will evolve into efficient workplaces in 2021 and beyond, and will certainly establish new business models and strategies. I already see many companies making a strategy shift in 2021. It remains exciting whether the trend towards deglobalization will also intensify, for example through increased use of 3D printers or new supply structures. I’m also curious to see how behavior regarding business travel, collaboration and communication models will change in the long term.
All in all, it remains exciting to see where we will be at the end of 2021 in terms of digitization (and of course in the fight against COVID-19). What trend or technology do you see as being very important in 2021 in particular? I look forward to your opinion in the comments.