Deloitte: Cognitive Tech, Machine Learning Will Define Tech Innovation

By Tara Seals January 15, 2016

There are plenty of disruptive trends in tech, but machine learning is likely to be the most prevalent of all cognitive computing technologies, given the breadth of its applications such as classification, anomaly detection, personalization and fraud detection.

Deloitte’s 15th edition of Technology, Media & Telecommunications (TMT) Predictions predicts that this year, 80 of the world's 100 biggest software companies will have integrated cognitive technologies, such as machine learning, natural language processing, or speech recognition, into their products.

That marks a 25-percent growth from the 64 of the top 100 companies who offered cognitive technologies in 2015.

The report also forecasts that natural language processing (NLP) will provide valuable applications in software, dealing with unstructured text, while speech recognition will grow in use for applications that may benefit from hands-free modes of operations.

"Advances in cognitive technologies such as speech recognition, natural language processing and machine learning – together with the emergence of platforms that are opening to the developer community – are contributing to a rise in commercial applications," said Paul Sallomi, partner at Deloitte Tax. "This year, cognitive technologies will continue to capture the imagination of industry giants and startups as they explore and monetize new areas within this emerging technology landscape. We see more and more consumers and businesses embracing the potential that cognitive technologies offer in a wide variety of applications including the Internet of Things."

Other TMT predictions point to a few ancillary trends. For instance, touch-based commerce on mobile devices is expected to increase 150 percent to reach 50 million regular users in 2016. Touch commerce enables retailers to exploit shoppers' increasing use of mobile devices to browse retail sites where transactions have remained scarce, due mostly to laborious payment processes.

Certain segments that can make use of cognitive technologies are also in the spotlight. For one, the firm expects 2.5 billion virtual reality headsets and 10 million game copies to be sold this year.

As such, Deloitte predicts that virtual reality will have its first billion dollar year in 2016, with about $700 million in hardware sales, and the remainder from content. The VR industry's growth will be attributed to the technology's use across multiple applications, both consumer and enterprise, with video gaming providing a core commercial activity being driven by tens of millions.

Also, mobile games are leading, but less lucrative. In 2016 mobile (smartphone and tablet) will become the leading games platform by software revenue, generating $35 billion in revenue, up 20 percent from 2015. This compares to $32 billion for PC games and $28 billion for console games, up only 5 and 6 percent respectively from the previous year. However, average revenue per game by platform will vary significantly.

And, perhaps contrary to what one would think, so-called “trailing millennials” will become the most pro-PC of any age group.

This age group is defined as those aged 18 to 24. While also reliant on mobile technology, this age group's ownership, intent to purchase and use of PCs will likely be higher than any other age group in 2016 and the population as a whole.

"It is truly amazing to witness the tenacity of companies and individuals to advance today's technology in anticipation of tomorrow's customers and realities," said Sandy Shirai, principal at Deloitte Consulting LLP. "Industry talent today is well on its way to unlocking new solutions and developing new products aimed at changing business processes and societies for the better. As public awareness grows through some of today's leading conferences and shows, businesses and leaders are in a better position to get to know their customers, their needs, and ultimately, how their technology is making a direct impact."




Edited by Kyle Piscioniere

Contributing Writer

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