Taking the steps to a truly digital world

Written by BT on 14 December 2017 in Sponsored Article
Sponsored Article

BT talks with the futurists and visionaries preparing the UK for a digital future

The future, as many imagine, will be glistening with intelligent robots, smart machines and data, lots of data.

We will communicate with machines, while they communicate with other machines, generating and collecting data to be analysed by more machines.

There’s no set date for this future, it won’t happen overnight. Instead, it is already permeating through our lives, simplifying daily tasks and offering new digital services.

Perhaps one of the biggest drivers of this digital transformation is the internet of things (IoT), where machines and objects are given life by becoming connected to the internet. This connection feeds into an ecosystem of devices where their status is monitored to capture valuable data to be used in software applications.

It is IoT that enables you to switch the washing machine on through a smartphone app, and it is also IoT that allows driverless cars to navigate their way through traffic.

The nano-technology that enables this, roughly doubles in power every year and as the cost of silicon chips and sensors drops, more devices will become part of this ecosystem.

“That doubling of power gives us unlocked capabilities we didn’t have before,” says Ben Hammersley, Los Angeles based ‘futurist’ and principal at consultancy Hammersley Futures who is in town to speak at BT’s ‘Turning big ideas into business advantage’ IoT event.

What these capabilities are exactly and how they will transpire remain to be seen, but before the full potential of IoT can be realised, we need the right infrastructure in place.

The key to connectivity - Infrastructure

According to Ben, the UK currently lacks the infrastructure required to support and navigate the world of IoT and digital transformation. The £500 million recently allocated from the budget to fund investments in artificial intelligence, 5G networks and driverless cars to name a few, is a step in the right direction, but more is needed.

“There are two ways of looking at this: Will the UK be a leader in producing these technologies? The answer is no,” says Ben. “Is there space for the rest of the UK industries to adopt these technologies and make themselves more competitive? The answer is yes.”

The economic and political uncertainty around Brexit, an ageing population and the impact of climate change require a fast solution to maintain global competitiveness. Already the country’s transport system, utilities and the National Health Service (NHS) are under strain and adopting a new approach to delivering these services is the only way to ensure their survival in the future.

“There is a national debate and narrative that needs to happen,” says Tom Baker, CIO Major Corporate, Business and Public Sector at BT. “We need to make some changes if we want quality of life.”

These changes are pretty substantial – strong leadership, overhauling of legacy systems and a cultural shift both among the business community and the wider public. A continued and accelerated debate on data is needed between the government and the business community to determine how data will be collected, stored and used in order to safeguard the public and ensure a viable route for transformation and service delivery, according to Tom.

“There are some countries of similar size that have seized these opportunities, especially in France and South Korea, which gives me the view that the UK can have a real role to play in IoT,” says Guillaume Sampic, Director of IoT strategy, BT.

BT is investing in its national network to help fuel this digital transformation and recently launched a 5G proof of concept testing phase with Nokia and the University of Bristol, which is yielding positive results.

“With all the investment we’re doing in mobile and fixed networks, we will have one of the best 4G networks in the world, which will unlock a massive number of new IoT applications,” says Guillaume.

BT is optimising its network and ensuring more connectivity in more places than ever before. Even rural areas across the country will be able to have access to 4G connectivity, which would be a boom for innovation outside of the main hubs.

Investment needed from all quarters

But a fast-speed network alone is not enough to see the country through the digital transformation. Investment in the power grid, new IoT networks delivering connectivity for a fraction of the price and with 10 years battery life is also required to keep pace with the millions of devices set to come online. Regulation and guidance will also be needed, so too will the skills.

“There needs to be a point where the government says ‘this is what we’re doing and here is money to do it’,” says Ben who also believes that investment should come from all quarters. Leaving it entirely up to the private sector will likely result in delayed adoption, incompatible systems and inefficiencies in the long term.

“We need to use government investment wisely to support the generation of new businesses and the adoption of new infrastructure and to support the competitiveness of the UK,” says Tom. “Therefore we need more leadership from government and from industry as we look to transform the UK together.”

BT’s experience in Milton Keynes is a case study that can be replicated on a wider scale. Working with Open University and the city council, BT developed an information hub to collect real-time data from different sensors across the city, which was relayed to build smart and more innovative applications. Tom adds, “by sharing this data in a controlled manner new applications or business models have been created. What could be done here around other industries, manufacturing, automotive, utilities? Embracing the digital world means opportunities to work together – we must grasp these.”

“The application of digital capabilities to the physical world gives you a whole new series of super powers with which you can go onto solve business problems in new and exciting and efficient ways,” says Ben.

The super power syndrome is in fact driving much of the innovation, “expectations surrounding IoT are racing ahead, says Colm O’Neill, managing director Business and Public Sector, BT speaking at the ‘Turning big ideas into business advantage’ IoT event. “People see the power and capability of technology as having an almost magical quality to read our minds and do things that we never thought possible. This is putting the pressure on businesses to make the unimaginable, imaginable.” 

Data - Getting value from the new currency

From monitoring water leakages in a utility provider’s network to an RFID tag on consumer goods set for export, IoT can better service the business community with valuable data on which decisions can be made. Having better insight can lead to greater profits or expanding to offer new services.  

“Not adopting it puts you at a disadvantage over local rivals, and also puts you at a disadvantage over potential international rivals,” says Ben. “If the UK doesn’t implement these technologies for a decade, then everybody else has a ten-year head start in terms of the adaption curve. British companies will look like easy victims.”

According to McKinsey the potential economic impact of the IoT could reach $11 trillion per year in 2025, equivalent to 11 per cent of the global economy, with up to 50 billion connected devices, driven largely by manufacturing, transportation, logistics and utilities. 

“When you talk to GE, Hitachi or Bosch, their customers want to buy industrial machines together with software and data to optimise performance. That is a trend we have seen in manufacturing, and we see coming to other industries now,” says Guillaume. 

Demand from consumers is likely to continue, who stand to become better informed about their daily life and choices through IoT, whether it is tracing the origins of their food, or the air quality of their route to work.

“You will understand more about your health, how much water you’re using at home, how much electricity and gas, the impact of your journey to work on air quality,” says Tom. “And the reason why, is that things are becoming more challenging for us – more demand on the  NHS, higher levels of pollution. As a citizen, the future is about being more informed. There will be more understanding of your impact on the world and that, is a powerful thing.”

Organisations that use digital and IoT to drive actionable intelligence to improve their efficiency, improve services and reduce their impact on the planet will prosper in an increasingly informed and aware society.

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About the author

BT’s purpose is to use the power of communications to make a better world. It is one of the world’s leading providers of communications services and solutions, serving customers in 180 countries. Its principal activities include the provision of networked IT services globally; local, national and international telecommunications services to its customers for use at home, at work and on the move; broadband, TV and internet products and services; and converged fixed-mobile products and services. BT consists of six customer-facing lines of business: Consumer, EE, Business and Public Sector, Global Services, Wholesale and Ventures, and Openreach.

For the year ended 31 March 20161, BT Group’s reported revenue was £19,012m with reported profit before taxation of £2,907m.

British Telecommunications plc (BT) is a wholly-owned subsidiary of BT Group plc and encompasses virtually all businesses and assets of the BT Group. BT Group plc is listed on stock exchanges in London and New York.

1The results for the period have been revised to reflect the outcome of the investigation into our Italian business. Detail of which is set out in our third quarter results announcement published on 27 January 2017. This financial information is unaudited.

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