Gartner has made some predictions for the state of technology over the next few years, Chris Skinner adds his IT prediction into the mix.

I just spotted that Gartner has made a series of 10 bold predictions for IT 2018 and beyond. They are summarised nicely by Forbes and are:

  1. By 2021, early adopter brands that redesign their websites to support visual- and voice-search will increase digital commerce revenue by 30%. Gartner has found that voice-based search queries are the fastest growing mobile search type. Voice and visual search are accelerating mobile browser- and mobile app-based transactions and will continue to in 2018 and beyond. Mobile browser and app-based transactions are as much as 50% of all transactions on many ecommerce sites today. Apple, Facebook, Google and Microsoft’s investments in AI and machine learning will be evident in how quickly their visual- and voice-search technologies accelerate in the next two years.
  2. By 2020, five of the top seven digital giants will wilfully ‘self-disrupt’ to create their next leadership opportunity. The top digital giants include Alibaba, Amazon, Apple, Baidu, Facebook, Google, Microsoft and Tencent. Examples of self-disruption include AWS Lambda versus traditional cloud virtual machines, Alexa versus screen-based ecommerce, and Apple Face ID versus Touch ID.
  3. By the end of 2020, the banking industry will derive $1bn in business value from the use of blockchain-based cryptocurrencies. Gartner estimates that the current combined value of cryptocurrencies in circulation worldwide is $155bn (as of October 2017), and this value has been increasing as tokens continue to proliferate and market interest grows. Cryptocurrencies will represent more than half of worldwide blockchain global business value-add through year-end 2023, according to the Gartner predictions study.
  4. By 2022, most people in mature economies will consume more false information than true information. Gartner warns that while AI is proving to be very effective in creating new information, it’s just as effective at distorting data to create false information as well. Gartner predicts that before 2020, untrue information will fuel a major financial fraud made possible through high-quality falsehoods moving the financial markets worldwide. By the same year, no large internet company will fully succeed in its attempts to mitigate this problem. Within three years, a major country will pass regulations or laws seeking to curb the spread of AI-generated false information.
  5. By 2020, AI-driven creation of ‘counterfeit reality’, or fake content, will outpace AI’s ability to detect it, fomenting digital distrust. AI and machine learning systems today can categorise the content of images faster and more consistently accurate than humans. Gartner cautions that by 2018, a counterfeit video used in a satirical context will begin a public debate once accepted as real by one or both sides of the political spectrum. In the next year, there will be a tenfold increase in commercial projects to detect fake news according to the predictions study.
  6. By 2021, more than 50% of enterprises will be spending more per annum on bots and chatbot creations than traditional mobile app developments. Gartner is predicting that by 2020, 55% of all large enterprises will have deployed (used in production) at least one bot or chatbot. Rapid advances in natural-language processing (NLP) make today’s chatbots much better at recognising user intent than previous generations. According to Gartner’s predictions study, NLP is used to determine the entry point for the decision tree in a chatbot, but a majority of chatbots still use scripted responses in a decision tree.
  7. By 2021, 40% of IT staff will be versatilists, holding multiple roles, most of which will be business- rather than technology-related. By 2019, IT technical specialist hires will fall by more than 5%. Gartner predicts that 50% of enterprises will formalise IT versatilist profiles and job descriptions. 20% of IT organisations will hire versatilists to scale digital business. IT technical specialist employees will fall to 75% of 2017 levels.
  8. In 2020, AI will become a positive net job motivator, creating 2.3 million jobs while eliminating only 1.8 million jobs. By 2020, AI-related job creation will cross into positive territory, reaching two million net-new jobs in 2025. Global IT services firms will have massive job churn in 2018, adding 100,000 jobs and dropping 80,000. By 2021, Gartner predicts AI augmentation will generate $2.9tn in business value and recover 6.2 billion hours of worker productivity.
  9. By 2020, IoT technology will be in 95% of electronics for new product designs. Gartner predicts IoT-enabled products with smartphone activation emerging at the beginning of 2019.
  10. Through 2022, half of all security budgets for IoT will go to fault remediation, recalls and safety failures rather than protection. Gartner predicts IoT spending will increase sharply after 2020 following better methods of applying security patterns cross-industry in IoT security architectures, growing at more than 50% compound annual growth rate (CAGR) over current rates. The total IoT security market for products will reach $840.5m by 2020, and a 24% CAGR for IoT security from 2013 through 2020. Combining IoT security services, safety systems and physical security will lead to a fast-growing global market. Gartner predicts exponential growth in this area, exceeding more than $5bn in global spending by year-end 2020.

Very good. So here’s my top IT prediction:

By 2025, banks that fail to embark on an enterprise data rationalisation project, and who didn’t refresh their core systems in the 2010s, will fail.

This is one of my core comments that I keep coming back to, and I feel the clock is ticking to midnight for many banks that fail to address their rotten core systems. 92% of banks are stuck on IBM mainframes from the last century, running systems written in languages from the 1960s. They must change.

For me, the biggest change in the next decade is that the financial market leaders will be based on their data mining and analytics capabilities. This is a must for AI and machine learning, and data is going to be the heartbeat for banks to retain and gain customers. Those banks that have dirty data spread across multiple fragmented legacy systems will go into cardiac arrest within the next 10 years.

Nuff said.

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– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Image by Ana Aguirre Perez, Shutterstock.com

About the author

Chris Skinner

Chris Skinner is an independent commentator on the financial markets through the Finanser, and chair of the European networking forum the Financial Services Club, which he founded in 2004. He is an author of numerous books covering everything from European regulations in banking through to the credit crisis, to the future of banking.

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