Blockchain hype dwindles as enterprises focus on Edge and AI

Enterprise interest in emerging technologies such as Edge services and artificial intelligence (AI) is accelerating as they look at ways to further optimise operational effectiveness and speed up decision making.

This is according to a survey of more than 150 companies undertaken by Omdia on behalf of London Tech Week, which found that while those technologies are hot topics, blockchain has slipped off the c-suite radar, with only 35 per cent of respondents considering it critical (22 per cent) or very important (13 per cent) to their digital initiatives.

“A large part of this could stem from the fact that blockchain was promoted as the ‘breakthrough’ technology capable of revolutionising the supply chain, increasing security and lowering risk but actual implementations proved to be costly and unable to couple well with legacy systems,” read the report.

While 90 per cent of respondents considered AI as critical or very important to their business strategy, 70 per cent believe that Edge services will play a crucial role in their business’ future.

For the uninitiated, Edge aims to bring computation and data storage closer to the location where it is needed, to improve response times and save bandwidth.

Actual adoption of Edge remains limited though, with nearly 72 per cent of survey respondents still evaluating the pros and cons of the technology or planning deployment. Of the remaining respondents, only two per cent were planning to significantly expand deployment.

Currently, about 38 per cent process 10 per cent or more of their data at the edge, although this is expected to nearly double to 70 per cent in the next two years, as 5G becomes a reality for a larger section of enterprises globally.

However, enterprise interest in blockchain has not moved beyond isolated implementations and pilots and there have not been enough large-scale, enterprise-wide implementations to fuel wider, mainstream adoption.

The top applications of blockchain in the enterprise revolve around data and digital payments, with enterprises anticipating these to provide benefits such as ability to create greater transparency, better security and fraud reduction. However, more than a 36 per cent of respondents were unaware of the metrics used to measure performance of these initiatives and only six per cent stated they have already realised benefits.

Around 20 per cent of respondents stated it will take between one to two years, another 21 per cent stated three to five years and 15 per cent stated that it would take over five years for them to see results. Meanwhile, 38 per cent stated that they either do not plan to ever invest in blockchain or have given up on ever seeing returns on their investments.

The survey was conducted before COVID-19 was declared a global pandemic and the optimism and views exhibited by the survey respondents will likely be different in a post-pandemic world.

“There is a probability that the global economy could enter a recession, which means consumers won’t upgrade their phones and service providers will certainly revisit their 5G rollout plans, maybe even freeze their 5G rollouts and cut their capex to preserve free cash flow,” read the report.

“Given that Edge services depend heavily on the ability to rollout 5G networks, the delays in such rollouts will negatively impact enterprise adoption of Edge services,” it noted, adding that blockchain could help researchers accelerate the way they share data and seek a vaccine for the virus.

For instance, researchers at the Villanova University are developing a permissioned blockchain that can be used by doctors to track infected patients and share that data, helping prevent future clusters of contagion.

German startup Spherity has also developed a decentralised identity system to help patients maintain social distance while getting medication, while Honduran authorities have deployed a blockchain-backed app to track and manage stay-at-home orders.

Meanwhile, AI in combination with robotic process automation (RPA) is “emerging as the hero” as the entire outsourcing industry workforce is under lockdown or at the least facing severe restrictions to movement.

The report suggested that companies will leverage AI to simulate live work environments and create on-demand labour forces, detect new consumption patterns and deliver hyper-personalised products and services.

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