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#434260 The Most Surprising Tech Breakthroughs ...

Development across the entire information technology landscape certainly didn’t slow down this year. From CRISPR babies, to the rapid decline of the crypto markets, to a new robot on Mars, and discovery of subatomic particles that could change modern physics as we know it, there was no shortage of headline-grabbing breakthroughs and discoveries.

As 2018 comes to a close, we can pause and reflect on some of the biggest technology breakthroughs and scientific discoveries that occurred this year.

I reached out to a few Singularity University speakers and faculty across the various technology domains we cover asking what they thought the biggest breakthrough was in their area of expertise. The question posed was:

“What, in your opinion, was the biggest development in your area of focus this year? Or, what was the breakthrough you were most surprised by in 2018?”

I can share that for me, hands down, the most surprising development I came across in 2018 was learning that a publicly-traded company that was briefly valued at over $1 billion, and has over 12,000 employees and contractors spread around the world, has no physical office space and the entire business is run and operated from inside an online virtual world. This is Ready Player One stuff happening now.

For the rest, here’s what our experts had to say.

DIGITAL BIOLOGY
Dr. Tiffany Vora | Faculty Director and Vice Chair, Digital Biology and Medicine, Singularity University

“That’s easy: CRISPR babies. I knew it was technically possible, and I’ve spent two years predicting it would happen first in China. I knew it was just a matter of time but I failed to predict the lack of oversight, the dubious consent process, the paucity of publicly-available data, and the targeting of a disease that we already know how to prevent and treat and that the children were at low risk of anyway.

I’m not convinced that this counts as a technical breakthrough, since one of the girls probably isn’t immune to HIV, but it sure was a surprise.”

For more, read Dr. Vora’s summary of this recent stunning news from China regarding CRISPR-editing human embryos.

QUANTUM COMPUTING
Andrew Fursman | Co-Founder/CEO 1Qbit, Faculty, Quantum Computing, Singularity University

“There were two last-minute holiday season surprise quantum computing funding and technology breakthroughs:

First, right before the government shutdown, one priority legislative accomplishment will provide $1.2 billion in quantum computing research over the next five years. Second, there’s the rise of ions as a truly viable, scalable quantum computing architecture.”

*Read this Gizmodo profile on an exciting startup in the space to learn more about this type of quantum computing

ENERGY
Ramez Naam | Chair, Energy and Environmental Systems, Singularity University

“2018 had plenty of energy surprises. In solar, we saw unsubsidized prices in the sunny parts of the world at just over two cents per kwh, or less than half the price of new coal or gas electricity. In the US southwest and Texas, new solar is also now cheaper than new coal or gas. But even more shockingly, in Germany, which is one of the least sunny countries on earth (it gets less sunlight than Canada) the average bid for new solar in a 2018 auction was less than 5 US cents per kwh. That’s as cheap as new natural gas in the US, and far cheaper than coal, gas, or any other new electricity source in most of Europe.

In fact, it’s now cheaper in some parts of the world to build new solar or wind than to run existing coal plants. Think tank Carbon Tracker calculates that, over the next 10 years, it will become cheaper to build new wind or solar than to operate coal power in most of the world, including specifically the US, most of Europe, and—most importantly—India and the world’s dominant burner of coal, China.

Here comes the sun.”

GLOBAL GRAND CHALLENGES
Darlene Damm | Vice Chair, Faculty, Global Grand Challenges, Singularity University

“In 2018 we saw a lot of areas in the Global Grand Challenges move forward—advancements in robotic farming technology and cultured meat, low-cost 3D printed housing, more sophisticated types of online education expanding to every corner of the world, and governments creating new policies to deal with the ethics of the digital world. These were the areas we were watching and had predicted there would be change.

What most surprised me was to see young people, especially teenagers, start to harness technology in powerful ways and use it as a platform to make their voices heard and drive meaningful change in the world. In 2018 we saw teenagers speak out on a number of issues related to their well-being and launch digital movements around issues such as gun and school safety, global warming and environmental issues. We often talk about the harm technology can cause to young people, but on the flip side, it can be a very powerful tool for youth to start changing the world today and something I hope we see more of in the future.”

BUSINESS STRATEGY
Pascal Finette | Chair, Entrepreneurship and Open Innovation, Singularity University

“Without a doubt the rapid and massive adoption of AI, specifically deep learning, across industries, sectors, and organizations. What was a curiosity for most companies at the beginning of the year has quickly made its way into the boardroom and leadership meetings, and all the way down into the innovation and IT department’s agenda. You are hard-pressed to find a mid- to large-sized company today that is not experimenting or implementing AI in various aspects of its business.

On the slightly snarkier side of answering this question: The very rapid decline in interest in blockchain (and cryptocurrencies). The blockchain party was short, ferocious, and ended earlier than most would have anticipated, with a huge hangover for some. The good news—with the hot air dissipated, we can now focus on exploring the unique use cases where blockchain does indeed offer real advantages over centralized approaches.”

*Author note: snark is welcome and appreciated

ROBOTICS
Hod Lipson | Director, Creative Machines Lab, Columbia University

“The biggest surprise for me this year in robotics was learning dexterity. For decades, roboticists have been trying to understand and imitate dexterous manipulation. We humans seem to be able to manipulate objects with our fingers with incredible ease—imagine sifting through a bunch of keys in the dark, or tossing and catching a cube. And while there has been much progress in machine perception, dexterous manipulation remained elusive.

There seemed to be something almost magical in how we humans can physically manipulate the physical world around us. Decades of research in grasping and manipulation, and millions of dollars spent on robot-hand hardware development, has brought us little progress. But in late 2018, the Berkley OpenAI group demonstrated that this hurdle may finally succumb to machine learning as well. Given 200 years worth of practice, machines learned to manipulate a physical object with amazing fluidity. This might be the beginning of a new age for dexterous robotics.”

MACHINE LEARNING
Jeremy Howard | Founding Researcher, fast.ai, Founder/CEO, Enlitic, Faculty Data Science, Singularity University

“The biggest development in machine learning this year has been the development of effective natural language processing (NLP).

The New York Times published an article last month titled “Finally, a Machine That Can Finish Your Sentence,” which argued that NLP neural networks have reached a significant milestone in capability and speed of development. The “finishing your sentence” capability mentioned in the title refers to a type of neural network called a “language model,” which is literally a model that learns how to finish your sentences.

Earlier this year, two systems (one, called ELMO, is from the Allen Institute for AI, and the other, called ULMFiT, was developed by me and Sebastian Ruder) showed that such a model could be fine-tuned to dramatically improve the state-of-the-art in nearly every NLP task that researchers study. This work was further developed by OpenAI, which in turn was greatly scaled up by Google Brain, who created a system called BERT which reached human-level performance on some of NLP’s toughest challenges.

Over the next year, expect to see fine-tuned language models used for everything from understanding medical texts to building disruptive social media troll armies.”

DIGITAL MANUFACTURING
Andre Wegner | Founder/CEO Authentise, Chair, Digital Manufacturing, Singularity University

“Most surprising to me was the extent and speed at which the industry finally opened up.

While previously, only few 3D printing suppliers had APIs and knew what to do with them, 2018 saw nearly every OEM (or original equipment manufacturer) enabling data access and, even more surprisingly, shying away from proprietary standards and adopting MTConnect, as stalwarts such as 3D Systems and Stratasys have been. This means that in two to three years, data access to machines will be easy, commonplace, and free. The value will be in what is being done with that data.

Another example of this openness are the seemingly endless announcements of integrated workflows: GE’s announcement with most major software players to enable integrated solutions, EOS’s announcement with Siemens, and many more. It’s clear that all actors in the additive ecosystem have taken a step forward in terms of openness. The result is a faster pace of innovation, particularly in the software and data domains that are crucial to enabling comprehensive digital workflow to drive agile and resilient manufacturing.

I’m more optimistic we’ll achieve that now than I was at the end of 2017.”

SCIENCE AND DISCOVERY
Paul Saffo | Chair, Future Studies, Singularity University, Distinguished Visiting Scholar, Stanford Media-X Research Network

“The most important development in technology this year isn’t a technology, but rather the astonishing science surprises made possible by recent technology innovations. My short list includes the discovery of the “neptmoon”, a Neptune-scale moon circling a Jupiter-scale planet 8,000 lightyears from us; the successful deployment of the Mars InSight Lander a month ago; and the tantalizing ANITA detection (what could be a new subatomic particle which would in turn blow the standard model wide open). The highest use of invention is to support science discovery, because those discoveries in turn lead us to the future innovations that will improve the state of the world—and fire up our imaginations.”

ROBOTICS
Pablos Holman | Inventor, Hacker, Faculty, Singularity University

“Just five or ten years ago, if you’d asked any of us technologists “What is harder for robots? Eyes, or fingers?” We’d have all said eyes. Robots have extraordinary eyes now, but even in a surgical robot, the fingers are numb and don’t feel anything. Stanford robotics researchers have invented fingertips that can feel, and this will be a kingpin that allows robots to go everywhere they haven’t been yet.”

BLOCKCHAIN
Nathana Sharma | Blockchain, Policy, Law, and Ethics, Faculty, Singularity University

“2017 was the year of peak blockchain hype. 2018 has been a year of resetting expectations and technological development, even as the broader cryptocurrency markets have faced a winter. It’s now about seeing adoption and applications that people want and need to use rise. An incredible piece of news from December 2018 is that Facebook is developing a cryptocurrency for users to make payments through Whatsapp. That’s surprisingly fast mainstream adoption of this new technology, and indicates how powerful it is.”

ARTIFICIAL INTELLIGENCE
Neil Jacobstein | Chair, Artificial Intelligence and Robotics, Singularity University

“I think one of the most visible improvements in AI was illustrated by the Boston Dynamics Parkour video. This was not due to an improvement in brushless motors, accelerometers, or gears. It was due to improvements in AI algorithms and training data. To be fair, the video released was cherry-picked from numerous attempts, many of which ended with a crash. However, the fact that it could be accomplished at all in 2018 was a real win for both AI and robotics.”

NEUROSCIENCE
Divya Chander | Chair, Neuroscience, Singularity University

“2018 ushered in a new era of exponential trends in non-invasive brain modulation. Changing behavior or restoring function takes on a new meaning when invasive interfaces are no longer needed to manipulate neural circuitry. The end of 2018 saw two amazing announcements: the ability to grow neural organoids (mini-brains) in a dish from neural stem cells that started expressing electrical activity, mimicking the brain function of premature babies, and the first (known) application of CRISPR to genetically alter two fetuses grown through IVF. Although this was ostensibly to provide genetic resilience against HIV infections, imagine what would happen if we started tinkering with neural circuitry and intelligence.”

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#434235 The Milestones of Human Progress We ...

When you look back at 2018, do you see a good or a bad year? Chances are, your perception of the year involves fixating on all the global and personal challenges it brought. In fact, every year, we tend to look back at the previous year as “one of the most difficult” and hope that the following year is more exciting and fruitful.

But in the grander context of human history, 2018 was an extraordinarily positive year. In fact, every year has been getting progressively better.

Before we dive into some of the highlights of human progress from 2018, let’s make one thing clear. There is no doubt that there are many overwhelming global challenges facing our species. From climate change to growing wealth inequality, we are far from living in a utopia.

Yet it’s important to recognize that both our news outlets and audiences have been disproportionately fixated on negative news. This emphasis on bad news is detrimental to our sense of empowerment as a species.

So let’s take a break from all the disproportionate negativity and have a look back on how humanity pushed boundaries in 2018.

On Track to Becoming an Interplanetary Species
We often forget how far we’ve come since the very first humans left the African savanna, populated the entire planet, and developed powerful technological capabilities. Our desire to explore the unknown has shaped the course of human evolution and will continue to do so.

This year, we continued to push the boundaries of space exploration. As depicted in the enchanting short film Wanderers, humanity’s destiny is the stars. We are born to be wanderers of the cosmos and the everlasting unknown.

SpaceX had 21 successful launches in 2018 and closed the year with a successful GPS launch. The latest test flight by Virgin Galactic was also an incredible milestone, as SpaceShipTwo was welcomed into space. Richard Branson and his team expect that space tourism will be a reality within the next 18 months.

Our understanding of the cosmos is also moving forward with continuous breakthroughs in astrophysics and astronomy. One notable example is the MARS InSight Mission, which uses cutting-edge instruments to study Mars’ interior structure and has even given us the first recordings of sound on Mars.

Understanding and Tackling Disease
Thanks to advancements in science and medicine, we are currently living longer, healthier, and wealthier lives than at any other point in human history. In fact, for most of human history, life expectancy at birth was around 30. Today it is more than 70 worldwide, and in the developed parts of the world, more than 80.

Brilliant researchers around the world are pushing for even better health outcomes. This year, we saw promising treatments emerge against Alzheimers disease, rheumatoid arthritis, multiple scleroris, and even the flu.

The deadliest disease of them all, cancer, is also being tackled. According to the American Association of Cancer Research, 22 revolutionary treatments for cancer were approved in the last year, and the death rate in adults is also in decline. Advancements in immunotherapy, genetic engineering, stem cells, and nanotechnology are all powerful resources to tackle killer diseases.

Breakthrough Mental Health Therapy
While cleaner energy, access to education, and higher employment rates can improve quality of life, they do not guarantee happiness and inner peace. According to the World Economic Forum, mental health disorders affect one in four people globally, and in many places they are significantly under-reported. More people are beginning to realize that our mental health is just as important as our physical health, and that we ought to take care of our minds just as much as our bodies.

We are seeing the rise of applications that put mental well-being at their center. Breakthrough advancements in genetics are allowing us to better understand the genetic makeup of disorders like clinical depression or Schizophrenia, and paving the way for personalized medical treatment. We are also seeing the rise of increasingly effective therapeutic treatments for anxiety.

This year saw many milestones for a whole new revolutionary area in mental health: psychedelic therapy. Earlier this summer, the FDA granted breakthrough therapy designation to MDMA for the treatment of PTSD, after several phases of successful trails. Similar research has discovered that Psilocybin (also known as magic mushrooms) combined with therapy is far more effective than traditional forms of treatment for depression and anxiety.

Moral and Social Progress
Innovation is often associated with economic and technological progress. However, we also need leaps of progress in our morality, values, and policies. Throughout the 21st century, we’ve made massive strides in rights for women and children, civil rights, LGBT rights, animal rights, and beyond. However, with rising nationalism and xenophobia in many parts of the developed world, there is significant work to be done on this front.

All hope is not lost, as we saw many noteworthy milestones this year. In January 2018, Iceland introduced the equal wage law, bringing an end to the gender wage gap. On September 6th, the Indian Supreme Court decriminalized homosexuality, marking a historical moment. Earlier in December, the European Commission released a draft of ethics guidelines for trustworthy artificial intelligence. Such are just a few examples of positive progress in social justice, ethics, and policy.

We are also seeing a global rise in social impact entrepreneurship. Emerging startups are no longer valued simply based on their profits and revenue, but also on the level of positive impact they are having on the world at large. The world’s leading innovators are not asking themselves “How can I become rich?” but rather “How can I solve this global challenge?”

Intelligently Optimistic for 2019
It’s becoming more and more clear that we are living in the most exciting time in human history. Even more, we mustn’t be afraid to be optimistic about 2019.

An optimistic mindset can be grounded in rationality and evidence. Intelligent optimism is all about being excited about the future in an informed and rational way. The mindset is critical if we are to get everyone excited about the future by highlighting the rapid progress we have made and recognizing the tremendous potential humans have to find solutions to our problems.

In his latest TED talk, Steven Pinker points out, “Progress does not mean that everything becomes better for everyone everywhere all the time. That would be a miracle, and progress is not a miracle but problem-solving. Problems are inevitable and solutions create new problems which have to be solved in their turn.”

Let us not forget that in cosmic time scales, our entire species’ lifetime, including all of human history, is the equivalent of the blink of an eye. The probability of us existing both as an intelligent species and as individuals is so astoundingly low that it’s practically non-existent. We are the products of 14 billion years of cosmic evolution and extraordinarily good fortune. Let’s recognize and leverage this wondrous opportunity, and pave an exciting way forward.

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#433954 The Next Great Leap Forward? Combining ...

The Internet of Things is a popular vision of objects with internet connections sending information back and forth to make our lives easier and more comfortable. It’s emerging in our homes, through everything from voice-controlled speakers to smart temperature sensors. To improve our fitness, smart watches and Fitbits are telling online apps how much we’re moving around. And across entire cities, interconnected devices are doing everything from increasing the efficiency of transport to flood detection.

In parallel, robots are steadily moving outside the confines of factory lines. They’re starting to appear as guides in shopping malls and cruise ships, for instance. As prices fall and the artificial intelligence (AI) and mechanical technology continues to improve, we will get more and more used to them making independent decisions in our homes, streets and workplaces.

Here lies a major opportunity. Robots become considerably more capable with internet connections. There is a growing view that the next evolution of the Internet of Things will be to incorporate them into the network, opening up thrilling possibilities along the way.

Home Improvements
Even simple robots become useful when connected to the internet—getting updates about their environment from sensors, say, or learning about their users’ whereabouts and the status of appliances in the vicinity. This lets them lend their bodies, eyes, and ears to give an otherwise impersonal smart environment a user-friendly persona. This can be particularly helpful for people at home who are older or have disabilities.

We recently unveiled a futuristic apartment at Heriot-Watt University to work on such possibilities. One of a few such test sites around the EU, our whole focus is around people with special needs—and how robots can help them by interacting with connected devices in a smart home.

Suppose a doorbell rings that has smart video features. A robot could find the person in the home by accessing their location via sensors, then tell them who is at the door and why. Or it could help make video calls to family members or a professional carer—including allowing them to make virtual visits by acting as a telepresence platform.

Equally, it could offer protection. It could inform them the oven has been left on, for example—phones or tablets are less reliable for such tasks because they can be misplaced or not heard.

Similarly, the robot could raise the alarm if its user appears to be in difficulty.Of course, voice-assistant devices like Alexa or Google Home can offer some of the same services. But robots are far better at moving, sensing and interacting with their environment. They can also engage their users by pointing at objects or acting more naturally, using gestures or facial expressions. These “social abilities” create bonds which are crucially important for making users more accepting of the support and making it more effective.

To help incentivize the various EU test sites, our apartment also hosts the likes of the European Robotic League Service Robot Competition—a sort of Champions League for robots geared to special needs in the home. This brought academics from around Europe to our laboratory for the first time in January this year. Their robots were tested in tasks like welcoming visitors to the home, turning the oven off, and fetching objects for their users; and a German team from Koblenz University won with a robot called Lisa.

Robots Offshore
There are comparable opportunities in the business world. Oil and gas companies are looking at the Internet of Things, for example; experimenting with wireless sensors to collect information such as temperature, pressure, and corrosion levels to detect and possibly predict faults in their offshore equipment.

In the future, robots could be alerted to problem areas by sensors to go and check the integrity of pipes and wells, and to make sure they are operating as efficiently and safely as possible. Or they could place sensors in parts of offshore equipment that are hard to reach, or help to calibrate them or replace their batteries.

The likes of the ORCA Hub, a £36m project led by the Edinburgh Centre for Robotics, bringing together leading experts and over 30 industry partners, is developing such systems. The aim is to reduce the costs and the risks of humans working in remote hazardous locations.

ORCA tests a drone robot. ORCA
Working underwater is particularly challenging, since radio waves don’t move well under the sea. Underwater autonomous vehicles and sensors usually communicate using acoustic waves, which are many times slower (1,500 meters a second vs. 300m meters a second for radio waves). Acoustic communication devices are also much more expensive than those used above the water.

This academic project is developing a new generation of low-cost acoustic communication devices, and trying to make underwater sensor networks more efficient. It should help sensors and underwater autonomous vehicles to do more together in future—repair and maintenance work similar to what is already possible above the water, plus other benefits such as helping vehicles to communicate with one another over longer distances and tracking their location.

Beyond oil and gas, there is similar potential in sector after sector. There are equivalents in nuclear power, for instance, and in cleaning and maintaining the likes of bridges and buildings. My colleagues and I are also looking at possibilities in areas such as farming, manufacturing, logistics, and waste.

First, however, the research sectors around the Internet of Things and robotics need to properly share their knowledge and expertise. They are often isolated from one another in different academic fields. There needs to be more effort to create a joint community, such as the dedicated workshops for such collaboration that we organized at the European Robotics Forum and the IoT Week in 2017.

To the same end, industry and universities need to look at setting up joint research projects. It is particularly important to address safety and security issues—hackers taking control of a robot and using it to spy or cause damage, for example. Such issues could make customers wary and ruin a market opportunity.

We also need systems that can work together, rather than in isolated applications. That way, new and more useful services can be quickly and effectively introduced with no disruption to existing ones. If we can solve such problems and unite robotics and the Internet of Things, it genuinely has the potential to change the world.

Mauro Dragone, Assistant Professor, Cognitive Robotics, Multiagent systems, Internet of Things, Heriot-Watt University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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#433785 DeepMind’s Eerie Reimagination of the ...

If a recent project using Google’s DeepMind were a recipe, you would take a pair of AI systems, images of animals, and a whole lot of computing power. Mix it all together, and you’d get a series of imagined animals dreamed up by one of the AIs. A look through the research paper about the project—or this open Google Folder of images it produced—will likely lead you to agree that the results are a mix of impressive and downright eerie.

But the eerie factor doesn’t mean the project shouldn’t be considered a success and a step forward for future uses of AI.

From GAN To BigGAN
The team behind the project consists of Andrew Brock, a PhD student at Edinburgh Center for Robotics, and DeepMind intern and researcher Jeff Donahue and Karen Simonyan.

They used a so-called Generative Adversarial Network (GAN) to generate the images. In a GAN, two AI systems collaborate in a game-like manner. One AI produces images of an object or creature. The human equivalent would be drawing pictures of, for example, a dog—without necessarily knowing what a dog exactly looks like. Those images are then shown to the second AI, which has already been fed images of dogs. The second AI then tells the first one how far off its efforts were. The first one uses this information to improve its images. The two go back and forth in an iterative process, and the goal is for the first AI to become so good at creating images of dogs that the second can’t tell the difference between its creations and actual pictures of dogs.

The team was able to draw on Google’s vast vaults of computational power to create images of a quality and life-like nature that were beyond almost anything seen before. In part, this was achieved by feeding the GAN with more images than is usually the case. According to IFLScience, the standard is to feed about 64 images per subject into the GAN. In this case, the research team fed about 2,000 images per subject into the system, leading to it being nicknamed BigGAN.

Their results showed that feeding the system with more images and using masses of raw computer power markedly increased the GAN’s precision and ability to create life-like renditions of the subjects it was trained to reproduce.

“The main thing these models need is not algorithmic improvements, but computational ones. […] When you increase model capacity and you increase the number of images you show at every step, you get this twofold combined effect,” Andrew Brock told Fast Company.

The Power Drain
The team used 512 of Google’s AI-focused Tensor Processing Units (TPU) to generate 512-pixel images. Each experiment took between 24 and 48 hours to run.

That kind of computing power needs a lot of electricity. As artist and Innovator-In-Residence at the Library of Congress Jer Thorp tongue-in-cheek put it on Twitter: “The good news is that AI can now give you a more believable image of a plate of spaghetti. The bad news is that it used roughly enough energy to power Cleveland for the afternoon.”

Thorp added that a back-of-the-envelope calculation showed that the computations to produce the images would require about 27,000 square feet of solar panels to have adequate power.

BigGAN’s images have been hailed by researchers, with Oriol Vinyals, research scientist at DeepMind, rhetorically asking if these were the ‘Best GAN samples yet?’

However, they are still not perfect. The number of legs on a given creature is one example of where the BigGAN seemed to struggle. The system was good at recognizing that something like a spider has a lot of legs, but seemed unable to settle on how many ‘a lot’ was supposed to be. The same applied to dogs, especially if the images were supposed to show said dogs in motion.

Those eerie images are contrasted by other renditions that show such lifelike qualities that a human mind has a hard time identifying them as fake. Spaniels with lolling tongues, ocean scenery, and butterflies were all rendered with what looks like perfection. The same goes for an image of a hamburger that was good enough to make me stop writing because I suddenly needed lunch.

The Future Use Cases
GAN networks were first introduced in 2014, and given their relative youth, researchers and companies are still busy trying out possible use cases.

One possible use is image correction—making pixillated images clearer. Not only does this help your future holiday snaps, but it could be applied in industries such as space exploration. A team from the University of Michigan and the Max Planck Institute have developed a method for GAN networks to create images from text descriptions. At Berkeley, a research group has used GAN to create an interface that lets users change the shape, size, and design of objects, including a handbag.

For anyone who has seen a film like Wag the Dog or read 1984, the possibilities are also starkly alarming. GANs could, in other words, make fake news look more real than ever before.

For now, it seems that while not all GANs require the computational and electrical power of the BigGAN, there is still some way to reach these potential use cases. However, if there’s one lesson from Moore’s Law and exponential technology, it is that today’s technical roadblock quickly becomes tomorrow’s minor issue as technology progresses.

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Posted in Human Robots

#433770 Will Tech Make Insurance Obsolete in the ...

We profit from it, we fear it, and we find it impossibly hard to quantify: risk.

While not the sexiest of industries, insurance can be a life-saving protector, pooling everyone’s premiums to safeguard against some of our greatest, most unexpected losses.

One of the most profitable in the world, the insurance industry exceeded $1.2 trillion in annual revenue since 2011 in the US alone.

But risk is becoming predictable. And insurance is getting disrupted fast.

By 2025, we’ll be living in a trillion-sensor economy. And as we enter a world where everything is measured all the time, we’ll start to transition from protecting against damages to preventing them in the first place.

But what happens to health insurance when Big Brother is always watching? Do rates go up when you sneak a cigarette? Do they go down when you eat your vegetables?

And what happens to auto insurance when most cars are autonomous? Or life insurance when the human lifespan doubles?

For that matter, what happens to insurance brokers when blockchain makes them irrelevant?

In this article, I’ll be discussing four key transformations:

Sensors and AI replacing your traditional broker
Blockchain
The ecosystem approach
IoT and insurance connectivity

Let’s dive in.

AI and the Trillion-Sensor Economy
As sensors continue to proliferate across every context—from smart infrastructure to millions of connected home devices to medicine—smart environments will allow us to ask any question, anytime, anywhere.

And as I often explain, once your AI has access to this treasure trove of ubiquitous sensor data in real time, it will be the quality of your questions that make or break your business.

But perhaps the most exciting insurance application of AI’s convergence with sensors is in healthcare. Tremendous advances in genetic screening are empowering us with predictive knowledge about our long-term health risks.

Leading the charge in genome sequencing, Illumina predicts that in a matter of years, decoding the full human genome will drop to $100, taking merely one hour to complete. Other companies are racing to get you sequences faster and cheaper.

Adopting an ecosystem approach, incumbent insurers and insurtech firms will soon be able to collaborate to provide risk-minimizing services in the health sector. Using sensor data and AI-driven personalized recommendations, insurance partnerships could keep consumers healthy, dramatically reducing the cost of healthcare.

Some fear that information asymmetry will allow consumers to learn of their health risks and leave insurers in the dark. However, both parties could benefit if insurers become part of the screening process.

A remarkable example of this is Gilad Meiri’s company, Neura AI. Aiming to predict health patterns, Neura has developed machine learning algorithms that analyze data from all of a user’s connected devices (sometimes from up to 54 apps!).

Neura predicts a user’s behavior and draws staggering insights about consumers’ health risks. Meiri soon began selling his personal risk assessment tool to insurers, who could then help insured customers mitigate long-term health risks.

But artificial intelligence will impact far more than just health insurance.

In October of 2016, a claim was submitted to Lemonade, the world’s first peer-to-peer insurance company. Rather than being processed by a human, every step in this claim resolution chain—from initial triage through fraud mitigation through final payment—was handled by an AI.

This transaction marks the first time an AI has processed an insurance claim. And it won’t be the last. A traditional human-processed claim takes 40 days to pay out. In Lemonade’s case, payment was transferred within three seconds.

However, Lemonade’s achievement only marks a starting point. Over the course of the next decade, nearly every facet of the insurance industry will undergo a similarly massive transformation.

New business models like peer-to-peer insurance are replacing traditional brokerage relationships, while AI and blockchain pairings significantly reduce the layers of bureaucracy required (with each layer getting a cut) for traditional insurance.

Consider Juniper, a startup that scrapes social media to build your risk assessment, subsequently asking you 12 questions via an iPhone app. Geared with advanced analytics, the platform can generate a million-dollar life insurance policy, approved in less than five minutes.

But what’s keeping all your data from unwanted hands?

Blockchain Building Trust
Current distrust in centralized financial services has led to staggering rates of underinsurance. Add to this fear of poor data and privacy protection, particularly in the wake of 2017’s widespread cybercriminal hacks.

Enabling secure storage and transfer of personal data, blockchain holds remarkable promise against the fraudulent activity that often plagues insurance firms.

The centralized model of insurance companies and other organizations is becoming redundant. Developing blockchain-based solutions for capital markets, Symbiont develops smart contracts to execute payments with little to no human involvement.

But distributed ledger technology (DLT) is enabling far more than just smart contracts.

Also targeting insurance is Tradle, leveraging blockchain for its proclaimed goal of “building a trust provisioning network.” Built around “know-your-customer” (KYC) data, Tradle aims to verify KYC data so that it can be securely forwarded to other firms without any further verification.

By requiring a certain number of parties to reuse pre-verified data, the platform makes your data much less vulnerable to hacking and allows you to keep it on a personal device. Only its verification—let’s say of a transaction or medical exam—is registered in the blockchain.

As insurance data grow increasingly decentralized, key insurance players will experience more and more pressure to adopt an ecosystem approach.

The Ecosystem Approach
Just as exponential technologies converge to provide new services, exponential businesses must combine the strengths of different sectors to expand traditional product lines.

By partnering with platform-based insurtech firms, forward-thinking insurers will no longer serve only as reactive policy-providers, but provide risk-mitigating services as well.

Especially as digital technologies demonetize security services—think autonomous vehicles—insurers must create new value chains and span more product categories.

For instance, France’s multinational AXA recently partnered with Alibaba and Ant Financial Services to sell a varied range of insurance products on Alibaba’s global e-commerce platform at the click of a button.

Building another ecosystem, Alibaba has also collaborated with Ping An Insurance and Tencent to create ZhongAn Online Property and Casualty Insurance—China’s first internet-only insurer, offering over 300 products. Now with a multibillion-dollar valuation, Zhong An has generated about half its business from selling shipping return insurance to Alibaba consumers.

But it doesn’t stop there. Insurers that participate in digital ecosystems can now sell risk-mitigating services that prevent damage before it occurs.

Imagine a corporate manufacturer whose sensors collect data on environmental factors affecting crop yield in an agricultural community. With the backing of investors and advanced risk analytics, such a manufacturer could sell crop insurance to farmers. By implementing an automated, AI-driven UI, they could automatically make payments when sensors detect weather damage to crops.

Now let’s apply this concept to your house, your car, your health insurance.

What’s stopping insurers from partnering with third-party IoT platforms to predict fires, collisions, chronic heart disease—and then empowering the consumer with preventive services?

This brings us to the powerful field of IoT.

Internet of Things and Insurance Connectivity
Leap ahead a few years. With a centralized hub like Echo, your smart home protects itself with a network of sensors. While gone, you’ve left on a gas burner and your internet-connected stove notifies you via a home app.

Better yet, home sensors monitoring heat and humidity levels run this data through an AI, which then remotely controls heating, humidity levels, and other connected devices based on historical data patterns and fire risk factors.

Several firms are already working toward this reality.

AXA plans to one day cooperate with a centralized home hub whereby remote monitoring will collect data for future analysis and detect abnormalities.

With remote monitoring and app-centralized control for users, MonAXA is aimed at customizing insurance bundles. These would reflect exact security features embedded in smart homes.

Wouldn’t you prefer not to have to rely on insurance after a burglary? With digital ecosystems, insurers may soon prevent break-ins from the start.

By gathering sensor data from third parties on neighborhood conditions, historical theft data, suspicious activity and other risk factors, an insurtech firm might automatically put your smart home on high alert, activating alarms and specialized locks in advance of an attack.

Insurance policy premiums are predicted to vastly reduce with lessened likelihood of insured losses. But insurers moving into preventive insurtech will likely turn a profit from other areas of their business. PricewaterhouseCoopers predicts that the connected home market will reach $149 billion USD by 2020.

Let’s look at car insurance.

Car insurance premiums are currently calculated according to the driver and traits of the car. But as more autonomous vehicles take to the roads, not only does liability shift to manufacturers and software engineers, but the risk of collision falls dramatically.

But let’s take this a step further.

In a future of autonomous cars, you will no longer own your car, instead subscribing to Transport as a Service (TaaS) and giving up the purchase of automotive insurance altogether.

This paradigm shift has already begun with Waymo, which automatically provides passengers with insurance every time they step into a Waymo vehicle.

And with the rise of smart traffic systems, sensor-embedded roads, and skyrocketing autonomous vehicle technology, the risks involved in transit only continue to plummet.

Final Thoughts
Insurtech firms are hitting the market fast. IoT, autonomous vehicles and genetic screening are rapidly making us invulnerable to risk. And AI-driven services are quickly pushing conventional insurers out of the market.

By 2024, roll-out of 5G on the ground, as well as OneWeb and Starlink in orbit are bringing 4.2 billion new consumers to the web—most of whom will need insurance. Yet, because of the changes afoot in the industry, none of them will buy policies from a human broker.

While today’s largest insurance companies continue to ignore this fact at their peril (and this segment of the market), thousands of entrepreneurs see it more clearly: as one of the largest opportunities ahead.

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