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The top 10 innovations that could shape the next decades: Citi

Ethan Wolff-Mann
Senior Writer
FILE PHOTO: A self-driving GM Bolt EV is seen during a media event where Cruise, GM’s autonomous car unit, showed off its self-driving cars in San Francisco, California, U.S. November 28, 2017. REUTERS/Elijah Nouvelage/File Photo

There is a lot of hype when it comes to innovation, and sometimes it’s best to have an unexcitable, rational entity judging what sounds legit or not. A bank may be the perfect venue for that task, and Citigroup’s (C) comprehensive report on disruptive innovations points to 10 key trends to watch for in the coming decades.

In introducing the report, Citi Ventures’ Chief Innovation Officer Vanessa Colella cautions not to overlook an important part of forecasting: evaluating slow, large-scale change, which is a key component in viewing technological innovations.

“Large-scale societal, economic, and technological trends that emerge gradually and continuously over time can be all too easily overlooked,” she wrote. “That is because ‘slow change’ often occurs outside of an organization’s line-of-sight and can arise from the merger of many disparate developments, each of which may be lost in the day-to-day ‘noise.’”

A classic example, she cited, was Microsoft’s blindspot that allowed the iPhone to develop and take over the smartphone. The area of disruption was primed by both technology, and social trends.

Here are the 10 areas of disruption to watch.

All-solid state batteries

Batteries are the weakest link many technological systems, and especially for electric cars. “So far, there is no [battery electric vehicle] capable of meeting consumer needs the same way an internal combustion engine vehicle can,” writes Arifumi Yoshida, Citi’s Japan Auto & Auto Parts analyst. “We believe all-solid-state batteries have the potential to overcome these problems. All-solid-state batteries have a long history.”

Most batteries today have liquid inside, and this presents challenges of reliability and safety that all-solid versions can potentially overcome.

The number of English-language journal articles about all-solid-state batteries have skyrocketed over the past few years, an auspicious sign, according to Yoshida, and Toyota announced a target by mid-2020s. If Toyota is followed by competitors and this technology takes off, it would have the potential to dramatically transform the auto industry. Citi says it could precipitate a long-awaited watershed moment for electric cars, as it would finally bring the benefits of gas cars to the benefits of electric cars.

Anti-aging medicines

Medical breakthroughs, coupled with humans’ battle with aging, could result in a strong non-cosmetic anti-aging market for drugs. According to Citi’s biotech team, more is now known about the aging process than ever, and has “advanced dramatically in recent years to a point where effective anti-aging drugs may soon become a reality.”

Promising research targeting specific age-stricken cells called “senescent cells” thought to be behind many age-related problems may be able to be targeted and products developed. Citi’s analysis says that if this turns out to be successful in a therapeutic drug, it could disrupt the market for treatments of diseases like arthritis and macular degeneration. Citi says the first “senescent” treatment could be approved as soon as 2023.

Autonomous vehicle networks

Citi analysts say that driverless cars will “transition the car from a consumer product towards more of a network.” This may not be for every type of car or person, but it has strong potential to change the automotive market in a significant way.

Optimized by artificial intelligence, big data, and — perhaps most importantly — electrification, much more can be squeezed out of cars, from more use to data.

Citi analysts see it happening in stages, starting with “robo-taxis” from Waymo and GM in 2018-2019, which serve local areas. Next, in 2020-2021, highway autopilot features being popular, affordable, and widespread. (These exist today somewhat, already). Then subscription networks of automated vehicles and autonomous cars people own.

Big data and health care

Electronic health records produce an enormous amount of data, which is currently not used to its potential as medicine faces a doctor shortage and aging population. Big data, artificial intelligence, and machine learning might be able to tame some this wild amount of raw data, turn it into something useful, and most of all, manage health care costs.

While big data will likely accelerate medical discoveries by crunching these large stores of information and accomplish the “holy grail” of robot diagnosis, Citi considers using this data and analysis to help physicians diagnose as realistic near-term possibilities.

Dynamic Spectrum Allocation

This one has an impenetrable name, but Citi likens it to Airbnb/Uber in terms of magnitude of disruption. Most wireless communications are regulated and licensed fiercely by governments to ensure security and reliability of service.

Dynamic spectrum allocation might be able to address these problems of security and reliability, and enable new opportunities that work outside of the traditional licensed framework. Potential uses are nearly endless, as it would turn a not-particularly-exciting space into something much more innovative and competitive.

Esports

Interest in esports is exploding. Games are played and viewed on platforms like YouTube and Twitch, and plenty of esports championships have already passed “real” sports in terms of the prize pool. The gamer population has aged, but in a good way: Gamers aren’t growing out of it. Citi views monetization of gaming and esports as key challenges, but the interest is there and the phenomenon is in its infancy, with kinks to work out and opportunities ahead.

5G

5G standardization was competed in June, and carriers are getting ready to upgrade. Citi does not view this as particularly meaningful for smartphones, but rather something big for “commercial and industrial users that have not significantly benefited from wireless technologies to date.”

The benefits — lower latency, higher speed, for example — may be what kicks off the internet of things in earnest, and provide key applications for technology like self-driving cars and AI. Faster wireless connectivity is often the weakest link hypothetical systems, so there may be a slew of use cases that emerge to harness the technology that was promised by the internet of things.

Floating offshore wind farms

Low oil prices and other factors may have stifled green innovation, but floating offshore wind farms are a potential goldmine when it comes to clean energy. Currently, wind farms cannot operate in water deeper than 50 meters, but big opportunities would be unlocked if they could float. This, as Citi notes, would solve the not-in-my-backyard problem that even affected President Donald Trump, who has opposed wind turbines for aesthetic reasons. It would also benefit from more wind and thus operate at a higher capacity than on-shore versions.

The first floating offshore wind farm was set up in 2017, around 15 miles off the coast of Aberdeenshire, Scotland, which coincidentally was where Trump fought wind turbines near his golf course.

Real estate market disruptors

The real estate industry’s traditional brokerage model may be upset by fintech players looking to lower costs, time and stress. Citi’s analysis identified several innovations, most of which work with a larger company taking care of the transaction in cash and speeding it up, essentially buying for a person who then secures financing. A smaller-level innovation would be a fixed broker fee as opposed to a percentage, with better data analysis and volume making the business model possible.

Smart voice-activated assistants

Citi’s last area of innovation to watch out for is in voice assistants, which has already taken off with Apple’s Siri and Amazon’s Alexa. Citi predicts a rise in this sector, especially as tech advancements enable more than Siri setting alarms and Alexa reordering paper towels.

Ethan Wolff-Mann is a writer at Yahoo Finance focusing on consumer issues, retail, personal finance, and more. Follow him on Twitter @ewolffmann.

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