It’s a new year, full of possibilities – especially when thinking about the ways in which current and emerging technologies have the potential to change how we live, work, and play this year and beyond. Jacques Bughin, Portulans Institute Advisory Board member and CEO of MachaonAdvisory, shares some observations around technology trends we may see emerge in 2023.
What do you think 2023 will look like in terms of technology evolution and adoption?
“Going through [prediction] lists (over 35 of them), the usual tech suspects remain: The most common “three” (those are apparent put on at least 80% of the lists reviewed) are: a) extended reality/metaverse ; b) quantum computing, and c) artificial intelligence/machine learning. Beyond those three high buzz suspects, come intelligent robotics, IOT and the cloud – these are not really new, but keep evolving and are the foundations of frontier tech. Close to all the above, but less frequently quoted are cybersecurity technologies, then blockchain/cryptos.”
Was there anything on these lists that surprised you?
“If you take the list as “the one” and aggregate the market size around each of those technologies, the total amount to a market of more than 1,5 trillion USD yearly, growing at 13% for next year. While I would have thought the implied growth could have been at 20% a year, it is because some tech markets are maturing (e.g. IOT), some have limits to spend (cybersecurity) and some are yet to expand (quantum computing). Given size and growth, the cloud remains king. This of course has to do with the massive adoption of the cloud by the business community, but it also clearly shows that our society cannot go backwards and will continue to virtualize.”
While we can speculate on the possibilities, it’s difficult to make concrete predictions. What are some of your general observations on where these technologies might be heading?
“By looking too broadly at technology and by putting a separate list, analysts and the media are probably missing the real substance.
- The first issue is granularity. As said above, metaverse is not a game changer per se in 2023. But it is becoming one in the digital twins segment. Likewise, AI has had a major breakthrough with generative AI.
- The second issue is that techs are especially crucial given their disruptive nature, not because of the size of spend. While generative AI (DALL-E 2 and OpenAI) has seen many advances, what is being overlooked is the versatility of content generation powered by deep learning algorithms, whether it’s images, text or video. These developments are game-changing because they would fuel the metaverse, change media and FAANGs, and disrupt the recent thinking on the Future of Work, where manual tasks will be done by generative tools.
- The third issue is that a “falling technology angel” does not mean the tech will die, -rather it will consolidate. A case in point? the crypto-currency world. If it is in the midst of a downturn, it is also at a classic tipping point which portends a major consolidation phase ahead.
- The fourth and final issue is that all those technologies are strategic complements. For example, what happens with digital twins may revolutionize synthetic data and AI.
However, a series of breakthroughs seen lately, may reveal a tipping point by 2023 and thus even more hypercompetition. One may imagine that a rebalancing is to come where a centralized internet may be challenged once more towards a more democratization of the Internet”.
Read Dr. Bughin’s LinkedIn article “What will be the game changing Internet technologies by 2023?”
Dr. Jacques Bughin is a senior advisor to Fortino Capital, a VC firm specializing in B2B Saas, the CEO and owner of MachaonAdvisory, and a venture partner at Antler. He is currently teaching business strategy at Solvay Business School and serves as a member of the Portulans Institute Board of Advisors. Dr. Bughin was a director in McKinsey’s Brussels office and supported clients in their Media and Entertainment, Corporate Finance, and Strategy Practices, in addition to co-leading the Digital Economy Initiative. He also acted as director of the McKinsey Global Institute (MGI), the firm’s business and economics research arm. He worked for McKinsey for 28 years. Dr. Bughin received a PhD in economics, operations research, and strategy from Université Catholique de Louvain in Belgium.