CES 2019: How IBM's Approach Could Ensure U.S. Tech Dominance

NEWS ANALYSIS FROM CES 2019: IBM--largely because it is pushing the envelope in a lot of areas with emphasis on mature artificial intelligence and quantum computing--is one of the few U.S. corporations playing the long game in IT innovation.

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LAS VEGAS--The Consumer Electronics Show is a fascinating one, and one of the most interesting companies there is IBM—largely because it is pushing the envelope in a lot of areas with emphasis on mature artificial intelligence and quantum computing. Ginni Rometty is one of the strongest CEOs I cover, because everything she does is focused on making IBM and the world a better place. Many of the CEOs I’ve interviewed, in contrast, seem more interested in their compensation or creating unnecessary drama. 

During Rometty’s keynote at CES 2019 in Las Vegas on Jan. 8, she brought up the company’s deep data, broad AI and quantum computing initiatives. Following is what she covered, my thoughts on her speech, and a bit of my interview with the quantum computing executives at IBM.

Deep Data

Deep data is data that is not yet collected or analyzed, and it represents the majority of data in the world. One example of deep data that is often overlooked is the analysis of fingernails, which can reveal a lot about a human's health. IBM has partnered with the Michael J. Fox Foundation to develop a fingernail sensor that can detect the early onset of Parkinson’s disease. This analysis of deep data resulted in an app, Sugar.IQ, that can forecast a sugar imbalance in a diabetic patent hours in advance of it creating a problem for that user.

One of the most critical areas where experts are applying this deep data analysis is with weather forecasting. They are rolling out a system that is so advanced that it can accurately predict a weather event impacting an airplane flight path hours in advance of the plane entering that area. Planes should be able to far more effectively avoid turbulence.  

In support of this effort, Delta Airlines CEO Ed Bastion was on stage talking about how critical the tools IBM provides for them have become. Delta believed it couldn’t become the best airline in the U.S. without better understanding the data that surrounded it. So the company set a goal to end cancellations; it then went from more than 5,000 maintenance cancellations all the way down to 55. They first had to fix the information architecture, and part of that was fixing the cultural transformation, which was very difficult for a 90-year-old company. 

Bastion is predicting a near-term future in which Delta will know every flyer’s preferences and be able to better meet those preferences on flights. For frequent flyers, particularly, they will be able to know drink and food preferences due to past flights and will be able to better equip the planes to meet those needs. Also, for frequent flyers, they plan to provide far greater options for using their frequent-flyer miles, have a better upgrade experience and improve bag handling significantly. 

They are working to use facial recognition to massively improve the TSA experience in airports, resulting in shorter, faster lines and far less aggravation in terms of getting passengers to their airlines. As a side note, people in the old days used to simply walk unimpeded to board their planes. With biometrics, we could get back to those far less-aggravating--and more fun--travel times. 

Currently, I’m an Alaska Airlines frequent flyer and don’t fly Delta that much. After watching Bastion’s presentation, I’m really tempted to change. 

Rometty then introduced Charles Redfield, Executive Vice-President of Food at Walmart, to talk about food safety. Walmart has one of the most successful food-sales businesses in the U.S. Food is fascinating as an AI problem, because even minor changes in refrigeration can significantly change the taste and perceived quality of many products. With sensors and properly applied AI, I’ve seen reports that indicate that buyer satisfaction goes up and vendor costs go down (due to returns and spoilage) significantly.

According to IBM, about 30 percent of the world’s food is wasted. Blockchain is used in Walmart’s solution to ensure the veracity of its supply chain and to cut waste; IBM is a huge supporter of blockchain.

For the record, blockchain is a type of database structure that enables identifying and tracking transactions digitally and sharing this information across a distributed network of computers, creating a trusted network. The distributed ledger technology offered by blockchain provides a transparent and secure means for tracking the ownership and transfer of assets.

Before Walmart implemented its blockchain solution, it took a week to trace fruit back to its source; now it takes 2.2 seconds. Walmart is now driving all of its suppliers to embrace and use blockchain. When there’s a recall, this is particularly critical both to prevent unneeded destruction of safe produce and to get the unsafe produce off the shelf far more quickly. Suppliers have shown very little pushback, because this type of system lowers their risk and increases profits.  And, of course, the consumer gets higher-quality, safer food to eat. It makes me wonder if we should ever buy produce from stores that haven’t implemented blockchain. 

Broad AI

Rometty then moved to discuss the birth of broad AI and bought up one of the IBM thought leaders on the technology.   Currently, we mostly see narrow AI, or a tool that is tightly focused on a single problem. General AI can be applied to a variety of tasks and is potentially more capable and powerful. As AI becomes more powerful, it also needs to become more trusted, because a mistake at a high level of production can do a lot of damage. It should be noted that the holy grail of AI is general AI, which is basically in the class of human intelligence. 

Project Debater is one of IBM’s leading examples of applied broad AI. This application can debate a human on a topic of the human’s choice. The human presents an argument, and the system has four minutes to create and communicate a well-founded and researched counter position. 

The World’s First Quantum System

One of the big announcements of the show is the first integrated commercial quantum computer system: the IBM Q System One. It has IBM’s latest quantum technology, and now the world needs to learn how to program it and get on track to build solutions. Currently there are 44 institutions, including ExxonMobile, working to bring practical quantum computing to the world through the IBM Q Network.

At CES, I met with Bob Sutor, Vice-President of IBM Q Strateg and Ecosystem, and Bob Wisnieff, CTO of IBM Quantum Computing. They indicated this new computer had a fourth-generation, 20-qubit quantum processor that has twice the accuracy and half the two-qubit quantum gate variability as its predecessor. By mid-year, IBM plans to upgrade to a 50-qubit chip, incorporating the advances in the 20-qubit edition. The degree of difficulty in adding more high quality and low error qubits goes up with the square of the number of total qubits.

IBM is taking both a bottoms-up approach to creating optimal processors and components while also demonstrating an advanced systems engineering approach. These advances are moving quantum computing from the research labs to data and computation centers for commercial use. IBM is still predicting it will take two to five years to  demonstrate real quantum advantage for business solutions over classical approaches.

This is the kind of strategic effort that most companies won’t undertake today but that will likely define who, in terms of company or country, will dominate this century. IBM is playing a critical long game. 

Wrapping Up:

I used to work for IBM, and every time I see them do something this strategic, it brings a warm feeling to my heart because this is what IBM was designed to do. Most companies are excessively focused on the present, quarterly performance and their competition. IBM is one of the few companies that get that you have to play critical long games if you want to survive for centuries. Sears, for example, forgot this, and they appear to be about to go under, which is by far the more common result of a lack of long-term strategy. If you think about it, Sears should have become Amazon because Amazon is basically a Sears catalogue in the cloud. 

It is efforts like this that ensure IBM will not only be around in a century, but that it has a strong path to again be dominant. Rometty and her folks are doing nice work, and, if the U.S. remains a technology leader this century--which right now is doubtful--it will be because of efforts such as IBM’s Watson, deep data and quantum computing that takes us there.  

Oh, I’m still thinking it may be time to switch from Alaska to Delta as a frequent flyer.