Teresa Escrig

News and oppinion about Cognitive AI & Robotics

Archive for September 5th, 2012

Reproducing the APP ECONOMY syndrome in the Robotics industry

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The Robotics Industry is definitely taking off. Many new corporations are being created in the area than ever before. According to a November 2011 report from the market research firm Metra Martech, the robotics industry will create one million new jobs over the next five years. Many organizations report that they are actually having trouble finding enough quality employees. We’re going to see more manufacturing come back to the United States, where robots will help us better control quality and intellectual property [1]. Service applications for robotics are growing faster in the United States than elsewhere but the competition is growing, spurred on by heavy investment in countries like South Korea [1].

Big acquisitions and investments are taken place in this industry. Examples are the significant investment in Aldebaran Robotics, and the more spectacular acquisition of Kiva Systems by Amazon for $750 M. The case of Kiva Systems is very remarkable because Amazon is one of the main players of the Cloud Computing industry and their ultimate goal is to have fully automated logistics for retail sells. Kiva Systems provide a scalable, very reliable robotics solution to transport items in a warehouse. At this moment, the only time where a person is touching an item is to grab it from the shelf that is brought to him and place it in the box to send it out. Amazon is now making investigations to acquire a company expert on grasping / arm manipulators to automated the last piece of the system. Soon we will be able to buy the book we want, from our iPad or iPhone (or similar) and see in our screen how a robot is finding our book, transporting it to the door of the warehouse where an arm manipulator is placing it in our box. We will receive the book the same day or the day after, depending on the distance from the warehouse to our home. This is a successful story that it is happening while we speak.

However, there are many other robotic companies struggling to arrive to the market. Although robotics is a very hot topic, robots still need to have “more intelligence”, the software needs to be hardware independent and reusable, and the components need to be less expensive, so that the balance between price and benefits goes by far to the side of the benefits.

A comparable example in our recent history has been the iPhone: “too expensive, nobody would buy it”, said the competition, and they were wrong. Now everybody “have to have” a smartphone, the benefits have override the cost. Most people do not think about the cost, they only think about the amount of benefits they are going to get from it.

The great advantage of a smartphone is that it provides so many tools in a single, readily available, relatively inexpensive package.

Almost a million apps have been created for the iPhone, iPad and Android alone, greatly augmenting the usefulness of mobile devices [1]. Want to play games, track your workouts, write music? There are a plethora of apps to choose from, many of them free. This analysis—conducted for TechNet by Dr. Michael Mandel of South Mountain Economics, LLC—shows that the App Economy now is responsible for roughly 466,000 jobs in the United States in the last four years, since 2007 when the iPhone was introduced. This total includes jobs at ‘pure’ app firms such as Zynga, a San Francisco-based maker of Facebook game apps that went public in December 2011. App Economy employment also includes app-related jobs at large companies such as Electronic Arts, Amazon, and AT&T, as well as app ‘infrastructure’ jobs at core firms such as Google, Apple, and Facebook. In additional, the App Economy total includes employment spillovers to the rest of the economy. Our results also suggest that the App Economy is still growing at a rapid clip, which shouldn’t be a surprise to anyone.

In order to provide users with a wider range of engaging experiences, social networks and mobile operating systems have opened their platforms to developers, transforming the creation, distribution and consumption of digital content. We refer to this as the “App Economy.” In the App Economy, developers can create applications accessing unique features of the platforms, distribute applications digitally to a broad audience and regularly update existing applications”

The App Economy is only one way technology creates jobs. As explained here there is other ways in which robots create jobs.

The combination of ease of development and ease of delivery makes possible a stunning variety of apps.

Our claim is that this App Economy phenomenon in the mobile industry can be reproduced again in the robotic industry to help that industry take off.

In order to do so, we need to provide in the robotics world the same breeding ground as it exists for mobile platforms: ease of development and ease of delivery.

We need to assign capital to do it!

References:

[1] Mandel, M., “Where the Jobs Are: The App Economy”, TechNet 2012.