The machine economy is coming, and whoever captures it will control the future

2022-05-04 0 By

The machine economy evolved from years of rapid social development and transition to new manufacturing processes.The first Industrial Revolution (1760s) saw the advance of mechanization and the shift of society from an agricultural model to an industrial model.The second industrial Revolution (1870s) took us a step further when electricity made mass production possible.The third Industrial Revolution (1990s) saw the invention of computers and the Internet bring about digitisation, automation and connectivity.Today, the convergence of emerging technologies is accelerating the pace of change and bringing us to the brink of the fourth industrial Revolution — where the physical and digital worlds meet.Thanks to the convergence of the Internet of Things, information physical systems, people and machines, digital information is constantly materializing from the real world.As we move toward a new automated future, the machine economy will affect our daily lives in many ways and unlock trillions of dollars in business value.Networked machines will be able to rent themselves, hire maintenance engineers and pay for replacement parts.Each machine has a different function, but there is a common thread that connects them — producing and consuming goods and services with each other.An Equation about the Machine Economy To understand how the machine economy works, we need to grasp its underlying core technology.Machines are able to transact through a convergence of three developing technologies: Internet of Things (IOT) Blockchain Machine learning (part of artificial intelligence) By 2025, the number of IOT devices will reach 75 billion, providing the necessary network connectivity capabilities for machine-to-machine communication (M2M) between smart sensors and devices.Projections show that M2M connections will increase from 33 percent in 2018 to 50 percent (14.7 billion) by 2023.Combined with real-time data generated by the Internet of Things, blockchain, and ML, applications are disrupting B2B companies in industries ranging from healthcare to manufacturing.Together, these three basic technologies create an intelligent system in which connected devices can “talk” to each other.However, transactions between machines are still not possible.This is where distributed ledger technology (DLT) and blockchain come in.Cryptocurrencies and smart contracts — self-executing contracts between buyers and sellers on decentralized networks — make it possible for autonomous machines to trade with each other on the blockchain.Equipment participating in M2M transactions can be programmed to be purchased according to the needs of individuals or businesses.In the past, human error was a cause for concern;Machine learning algorithms provide reliable and trusted data, constantly learning and improving — getting smarter every day.As we move into an era of radical automation with billions of connected machines, businesses can improve operational efficiency by eliminating human processes, enabling them to focus on value-creating services.By collecting, analyzing and storing vast amounts of data through the Internet of Things, companies turn information into actionable insights and make smarter decisions to build and maintain competitive advantage.The machine economy opens the door to new business opportunities, but it comes down to harnessing data as a valuable asset.In the context of the machine economy, four important stages of creating a new business order are taking shape.Machines are becoming multifaceted, with sensors, self-monitoring tools and highly sophisticated communication functions.Our everyday tools are becoming highly connected, from consumer goods like refrigerators and smart locks to self-driving cars.Self-monitoring machines can perform services such as maintenance, arrange their own insurance and make decisions without human intervention.In the third step towards intelligent services, companies will no longer buy machines directly.Instead, we will see the emergence of a sharing economy, subscription models and real-time rentals, where self-managed assets will share their services in a decentralized ecosystem.In the final stage, machines will become increasingly autonomous market players, with their own bank accounts and payment systems that are built and programmed to support humans on a survival level.Benefits of the machine Economy The machine economy promises significant benefits for people, businesses and the wider economy in the following ways: reducing costs and increasing revenues: For example, the Internet of Things enables industrial equipment manufacturers to implement process automation, just-in-time (JIT) manufacturing, remote monitoring and predictive maintenance.Improved operational efficiency: M2M sensors enable organizations to monitor and track assets directly from inventory throughout the supply chain.Create new value: New markets, industries and business models (e.g. “as a service” business models) will emerge.Reduce the risk associated with owning assets: Reduce the need for an enterprise to own, maintain, and manage assets.Results in positive gains across the sales channel: as shared machine utilization increases, this results in cheaper products and services as unit costs decrease.Transition from capital expenditure to operating expenditure: Companies can rent/lease equipment based on specific needs and planned production cycles.By saving on the large upfront investment costs of buying machines directly, new businesses can participate because of lower barriers to entry.Strengthening workforce and output: With skilled workers in short supply and increasing complexity, the Internet of Things and complementary technologies can support employees working on machines.Transparency through Data: The adoption of smart sensors enables companies to enhance their domain knowledge to meet consumer needs and improve sustainable business practices.The future of the world’s machine economy can be divided into two upcoming scenarios.DAO addresses the age-old problem of governance and is designed to operate without human oversight by using a model based on a network of smart contracts on blockchains such as Ethereum.On the commercial side, we’re likely to see more DAOs in smart property management, self-driving cars, and financial services, enabling companies to automate parts of their operations to achieve fast scalability without sacrificing quality of service.With automation taking over production systems, entire factories will be driven by machines that will self-optimize, communicate with each other, and respond through root cause analysis (RCA), identifying the root cause of problems and developing a way to solve them without the need for people on the ground.Over the next few years, we will see profound shifts in industrial processes.There is increased synchronization between different components in the value chain, with machines making decisions and reacting independently to their surroundings.As we transition to a machine economy, in order for businesses to truly take advantage of the opportunities that exist, we need machines to do more than automate everyday tasks.We need to add another layer to the business solution to create more value from machine services.Powered by disruptive technologies, machines will be able to make their own decisions, buy and sell services, and actively participate in the economy as a whole new class of market participants — the machine economy is on its way, I judge: whoever catches it first will control the future…Thanks for reading!Please pay attention and don’t get lost!!