AR, machine learning, smarter smartphones and mobile-only connections dominate TMT Predictions 2018
- Over a billion smartphone users will create augmented reality content in 2018
- Enterprise machine learning pilots and deployments predicted to double this year, powered by new chips and better software tools
- Smartphone penetration set to surpass 90 percent globally by 2023 - Australia set to exceed 90 percent by end-2018
- China will likely remain the largest market for live streaming at $4.4 billion in 2018, an 86 percent increase from 2016
- By 2020, there will likely be over 680 million digital subscriptions.
06 February 2018 - Businesses will take the leap and embed augmented reality (AR) and machine learning into their business practices in 2018 according to Deloitte’s 2018 Technology, Media and Telecommunications (TMT) Predictions. And with invisible smartphone innovations opening up application opportunities, consumers will be more connected and more distracted by smartphones than ever before.
“We’re at the tipping point of widespread adoption of a number of technologies. In 2018 we will finally see business challenges being addressed by what has to date been consumer driven technology. But it will be a year of trial and error,” said Kimberly Chang, Deloitte Australia’s Technology, Media and Telecommunications leader.
Augmented Reality: on the cusp of reality
Deloitte predicts that over a billion smartphone users will create AR content at least once in 2018 and by 2020 AR will generate direct revenues of $1 billion USD.
Currently around half of AR uses are non-enterprise focused but Australia is on the precipice of mass adoption, with particular potential in industries such as mining, retail, training and marketing. AR also has a role to play in the future of work and job creation in Australia.
“We expect to see a lot of experimentation in 2018. But we don’t see AR becoming truly mainstream until internet speeds increase, the technology becomes cheaper and wearable and doesn’t overheat mobile devices or drain batteries,” said Chang.
“It’s the companies who identify ways of using AR technology to respond to specific business challenges and attract the right talent that will set themselves up for success in 2018 and potentially put the budding Australian AR industry on the world map.”
Machine Learning: when the chips are up
Machine learning is also set to hit its stride in 2018 with Deloitte predicting the number of implementations and pilot projects using the technology to double from 2017, with two-thirds of large companies having 10 or more implementations and a similar number of pilots. To date the uptake of machine learning in Australia has been slow, but Deloitte expects to see leaps in experimentation around machine learning applications in 2018, in particular in relation to consumer electronics, autonomous vehicles, finance, insurance, human resources and clinical operational diagnosis in healthcare.
“Machine learning is not a new concept, but it is about to revolutionise our daily lives. A game-changer in 2018 is the dramatically enhanced processing power of a new generation of chips which can be used in smaller devices, consume less power, are more responsive and capable,” said Chang.
“However, there is currently a skills gap in Australia around the application of machine learning. In order not to fall behind the rest of the world, Australia needs to ensure we are producing a future workforce that doesn’t just understand the algorithms but also how to apply machine learning and fine tune those algorithms to gain maximum impact for both the business and consumer in terms of value, cost savings and customer experience,” said Chang.
The smartphone: Australia to exceed global trends
With the smartphone predicted to be the primary device for AR content creation, Deloitte is predicting smartphone penetration will continue to increase, surpassing 90% by the end of 2023.
Australia is set to exceed this global prediction by the end of 2018, with the Australian cut of the Deloitte Mobile Consumer Survey 2017 (MCS 2017) already putting smartphone penetration at 88%. Amongst the highest in the world.
Australia is also likely to surpass the global prediction that 45% of adult smartphone users will worry they are using their phones too much, the MCS 2017 finding 41% of Australians are already at this point.
“For Australians 2018 will be about how smartphones are used. With invisible innovations such as Artificial intelligence (AI) chips likely to become standard across smartphones by 2023 and with better batteries and connectivity, we expect to see an increase in smartphone uses, including to interact with IoT devices and completing work-flow activities such as expenses and time sheets,” said Chang.
Mobile only: with data use skyrocketing will mobile-only take off?
Deloitte predicts that 20% of homes in North America will be mobile-only in 2018. Of the 20% of Australian households already without a broadband connection*, mobile-only or satellite may be the only option. But others may be actively choosing to consume all of their data via a mobile network.
Simultaneously, data usage is skyrocketing in Australia. While the Australian Communications and Media Authority (ACMA) reported that data consumption grew 43% in the year to June 2017, the Deloitte MCS 2017 found that almost half of Australians regularly exceed monthly mobile data limits.
“In the short-term we expect to see telcos reducing broadband prices, removing the incentive to go mobile-only. In the longer-term however, a population powered by mobile data is a real possibility as unlimited mobile data plans enter and compete in the market.
“And with 5G capability expected to be demonstrated by Telstra at the Commonwealth Games later this year and new technology such as mm-wave coming into play, fixed wireless may also become a viable alternative to broadband connections in some areas, most likely where there is a lack of fibre connectivity,” said Chang.
More TMT Predictions
Live thrives in a digital world
Live broadcast and events are predicted to generate $545 billion USD in direct revenues globally in 2018.
“It’s FOMO - the fear of missing out - as well as convenience, the need for shared experiences and the exclusivity that these events offer that will see ‘live’ continue to dominate in 2018,” said Chang.
Paying for content and #adlergic behaviour on the up
Deloitte predicts that 50% of adults in developed markets will have two online subscriptions in 2018, rising to four by 2020. Ad blocking is also predicted to become prevalent in 2018.
In Australia digital subscriptions have seen a renewed rise, but advertising remains the predominate driver of revenue.
“With Deloitte’s Media Consumer Survey 2017 finding one in three (31%) respondents use ad blocking software advertisers will need to focus on categories that are harder to block or avoid. Digital mobile, particularly in-app, out-of-home and social media are tipped to be the fastest growing categories for the next few years,” said Chang.
In-flight connectivity taking off in 2018
In 2018, 1 billion passenger journeys globally will be equipped with in-flight connectivity (IFC), enabling selfies to be taken in the sky and posted to social media before touching down on the tarmac.
“We expect the real impact of IFC in Australia to be on the media industry, with the potential to drive service discovery and subscriptions. In addition, we predict that add-on services like online shopping with purchases available upon arrival and the advertisement and ability to instantly book onward travel options, will be the key to generating additional revenue and retaining customers,” said Chang.
Notes for Editors
*ABS Internet Activity, Australia, June 2017 http://www.abs.gov.au/ausstats/abs@.nsf/mf/8153.0
Download the full report: www.deloitte.com/au/tmtpredictions