Trends 2018

E-Sports have arrived. This year, about 191 million people worldwide are expected to watch an e-Sports competition at least once a month, more than double the number in 2012, according to Newzoo BV, a global market research and predictive analytics firm with a primary focus on games. By 2020, the research firm expects that viewership to climb to 286 million. The International Dota 2 Championship, the richest e-Sports tournament in the world, had a total purse for the event of over $20 million, nearly double the total payout of The Masters.

The global games industry, according to several forecasts, is on course to exceed $100 billion in annual revenues this year and continues to grow faster than the broader entertainment sector. Some are even pushing to have e-Sports as an Olympic event by 2024. Alex Lim, secretary-general of the International e-Sports Federation, explains, “One generation grew up kicking a ball in the back yard, the next grew up with choices that included video games. We live in a digital culture that most people accept is redefining a whole range of things: sport is one of them.”

Most of the e-Sports trend is evolving out of Asia, as 57% of e-Sports viewers come from China. Advertisers are constantly looking to get in front of younger demographics, especially as the media industry continues to move away from traditional forms of entertainment. Companies are taking note; according to Jefferies & Co., media rights for e-Sports are expected to increase from $95 million in 2017 to $340 million in 2020 and 600 sponsorship deals have been struck since the beginning of 2016, including major advertisers such as Red Bull and Coca-Cola.

With traditional sports leagues such as the NFL encountering ratings declines for the first time in their history, expect more companies to capitalize on the rapidly growing e-Sports trend.

The auto industry and passenger economy are experiencing paradigm-shifting changes not seen since the birth of the automobile. Today the industry looks like this: the current auto industry produces approximately 80 million cars per year at an average price of approximately $19,000 for a total addressable market of $1.5 trillion dollars. Toyota has the largest market share globally at 13%, sells approximately 10 million cars and generates about $250 billion in annual revenue (a milestone that took the company over 70 years to achieve).

As autonomous driving and electric vehicles are gaining relevance, the business model for the auto industry is transforming and technology companies are taking a fresh approach with the idea of shared mobility. The future auto market, from their perspective, looks like this: approximately 10 trillion miles globally are driven annually at a cost of approximately $1 per mile for a total addressable market of $10 trillion dollars. A ride sharing model company with a nominal 1.7% market share globally would be traveling 170 billion miles a year at a price of $1.50 per mile, generating approximately $255 billion in revenue (some companies view this milestone as achievable in less than 7 years).

The average car is only used 4% of the day, massively under-utilized. The theory goes that by increasing the utilization rate of the car through shared mobility, the cost per mile goes down significantly. With the addition of autonomous driving the cost per mile goes down even further. As the cost per mile goes down many believe that miles driven will increase exponentially.

A study, prepared by Strategy Analytics, predicts autonomous vehicles will create a massive economic opportunity that will scale from $800 billion in 2035 (the base year of the study) to $7 trillion by 2050. An estimated 585,000 lives could be saved due to autonomous vehicles between 2035 and 2045, the study predicts.

Even as reclaimed parking spaces may fuel a downtown building boom, autonomous vehicles will encourage builders to push deeper into the suburban fringe, confident that homebuyers will tolerate longer commutes now that they don’t have to drive, according to the report, sponsored by a unit of Capital One Financial Corp. The potential impacts are profound for the auto, insurance, technology, media, airline , retail, real estate and energy industries.

What started as a trend in the Military decades ago (needing to ensure power reliability in a decentralized system) has spread to remote communities such as Alaska, that are far off from the traditional grid. New technologies, such as fuel cells and battery storage systems (to store extra power produced by renewables), along with more sophisticated software, have led to “nanogrids,” which Walmart and other megastores have begun to adopt. Now, “picogrids” are becoming increasingly common in places such as university campuses and hospitals. The falling cost of renewable energy in some areas is helping fuel this trend and transforming the electricity markets. Wind and Solar account for almost 30% of the power in Germany; in Hawaii, its 25%. Utility companies in particular may face challenges in evolving their businesses. In Texas, among many other places, prices occasionally turn negative when the wind is blowing hard, meaning companies are paying customers to use the electricity they generate.

As more and more people rely less on the traditional grid for power (while still interconnecting with it to help ensure reliability), policymakers and companies will need to create new regulatory systems and business models. Some states, such as New York, have embraced these changes, aggressively promoting decentralization by rewarding companies that invest in decentralized systems. But no one has yet worked out a detailed plan for how to integrate new grids with traditional power systems.

The long-term implications of nanogrids and picogrids could be significant from a global political, economic, and environmental standpoint.

In traditional silicon computers, data is represented in binary bits that are always in one of two states: either a 1 or a 0. However, in a quantum computer each quantum bit, or “qubit,” can represent both a 1 and a 0 at the same time through a principle called superposition. What this means is that a quantum computer can perform multitudes of calculations simultaneously; harnessing millions of qubits could, in a matter of minutes, process data and solve problems that would tie up today’s fastest supercomputers for a century.

Since 2016, when we first began tracking successful experiments of quantum computational operations executed on a very small number of quantum bits, more companies (such as Alphabet, IBM, Microsoft, and Nokia Bell Labs) have been moving from the lab to engineering development and even commercial experiments. The implications of large-scale quantum computers will be staggering. With such orders of magnitude improvement in computing power expect to see leaps forward in machine learning, artificial intelligence, and simulation modelling. At the same time, quantum computing could pose a threat to traditional encryption security measures that operate on the fundamental assumption that the encryption is too complex to break in a reasonable amount of time given prevailing computing speeds.

While it’s still early days and many challenges exist in the development of Quantum Computing, we cannot help but imagine the possibilities which could have a fundamental disruptive impact on the current technology market as we know it.