The direction and parameters of this disruption will be defined by skilled labor shortages, looming recession, growing cybersecurity threats and increased nationalism around data security, these were the key takeaways from the recent RBC Capital Markets Australia Technology Conference.
Pace of change accelerating
Over the past couple of years, the rate of digitization accelerated rapidly as the COVID-19 pandemic closed workplaces and forced many to work from home. In the process, the rules of engagement in daily life were rewritten in everything from travel and commuting to grocery shopping.
On a consumer level, this led to the unprecedented take up of mobile wallets. It also helped sustain the rise of software companies that offered solutions to remote working and travel bans. The rate of change was supported by high levels of capital, with 2020 (429) recording the highest number of US-based IPOs since 1999 (431), until both years were surpassed by 2021 (951).
Panelists reflected on the past few years and noted that COVID created very specific tailwinds, this led to many tech businesses going public - even at a relatively early stage - and attracting high levels of investment and share turnover.
However, many more of the companies that changed the digital landscape over the past couple of years - such as Apple Pay and Google Pay - had been around for some time. It was simply that the conditions were ripe for them to flourish.
A different focus
Today we face a very different economic landscape, with high inflation, skilled labor shortages and the potential for a global recession. But many panelists believed that the same factors that may lead to economic downturn, could actually encourage the global uptake of technology.
Much of the change is expected to be at the enterprise level, where automation, made possible by a combination of AI, machine learning and Cloud computing, has the potential to address labor shortages and make workplaces - from professional services to manufacturing - more efficient and productive.
Financial services and software are also likely to take center stage, especially as ‘traditional’ digital players scramble to meet the challenge of new market entrants. In Australia, this has led to the largest banks and payment providers working together to create a uniquely Australian online payment system that can take on global tech giants. It has also led to new innovations in ‘tokenization’ technology to improve security and potentially digitize an even greater range of transactions.
Cybersecurity and data both growing concerns
The audience heard that the current wave of change is also addressing many of the challenges that rapid digitization has brought about. Chief among these is the growing threat of cybersecurity and the related issue of data sovereignty.
As a result, the number of domestic data centers is growing, as they can hold cloud-based data securely in ‘safe’ locations rather than offshore. There is also growing uptake of new technologies such as blockchain as a solution to protect civilians and enterprises.
Panelists agreed that the emphasis on cybersecurity will only become more important and industry is looking to quantum computing for solutions. Recent developments in this sector have the potential to make the current digital security system obsolete. With many in the field suggesting that quantum computing will offer a gold standard when it comes to security and inscription.
