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ASCM Insights

The Tech Trends that Will — and Won’t — Deliver in 2022

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As we kick off 2022, predictions abound on the technology advancements and innovations expected in the year ahead. In a new whitepaper, ABI Research analysts identify 35 trends that will shape the technology market and 35 others that, although attracting huge amounts of speculation and commentary, are less likely to move the needle over the next 12 months.

What will happen in 2022

Despite the extremely challenging industry backdrop of a global pandemic, geopolitical trade wars and chipset shortages, the smartphone market has been remarkably resilient. Although global smartphone shipments did drop in 2020, the growth of 5G during the year was stellar, and this is set to continue, although market uncertainties regarding component supply constraints and COVID-19 are likely to linger.

The onset of COVID-19 has seen demand for wearables and wireless headsets grow significantly as a result of changes in lifestyle and consumer behavior instigated by the pandemic. Smartwatches and fitness trackers have evolved into effective and reliable health and activity monitoring devices that have experienced an increase in demand as consumers become more health conscious, embracing a need to track and monitor health vitals. This demand is expected to continue, primarily due to the increasing number of use cases and their improved features tracking functions.

Enterprises have been leaning into artificial intelligence (AI) and machine learning (ML) to extract the maximum value from hardware, platforms, and services. Augmented reality/virtual reality (AR/VR) usage has missed some of this momentum due to its more nascent state, but that is changing rapidly. More than 20 million active users will leverage AI for augmented reality usage in 2022. AI for machine vision is in place but will grow in capability, increasing captured data and enabling greater analytics and insight potential for platforms. Prediction and automation are a significant value add for any organization, and the increased data flowing from and through AR/VR devices, combined with AI/ML, create a hotbed for both prediction and automation of worker-facing and backend systems.

Suppliers of industrial applications, such as simulation software and product life cycle management, are moving from providing only on-premises solutions and are making their solutions available via the cloud and offered on a software-as-a-service basis. Suppliers will emphasize the ability to work on projects regardless of location and the capability to ensure traceability of design changes to deliver a digital thread across teams, but also so that customers can open the solutions to collaborate with their technology partners and suppliers on designs.

Companies around the world provided sustainability plans on decreasing their carbon footprint that will come to action in the future decade. Meanwhile, suppliers are facing market changes. Growing competition in the market and rejection of governmental subsidies will force operations and maintenance teams to reduce expenses and improve the efficiency of their wind power plants and solar farms. We will see development in the sustainable energy and internet of things (IOT) domain in 2022, with the IOT continuing to transform the sustainable energy markets, such as wind, solar, biothermal, and nuclear power generation. IOT analytics will provide wind energy suppliers with real-time data on their power plants and storage assets, as well as their customers’ consumption, to ensure continuous energy generation and distribution.

Continued labor shortages, the desire for contactless purchasing and delivery, and expansive e-commerce with declining delivery windows will lead to the need to supplement human labor across the supply chain through autonomy and robotics. Cost also plays a role with more than 50% of shipping costs associated with last-mile delivery alone, putting further pressure on margins. Software automation is needed to address the complexities of fast-changing demand and omnichannel fulfillment. Robots, cobots and automation software will grow out of necessity across the supply chain.

Companies that have been putting it off will now make digital supply chain transformation a priority, primarily due to global supply chain disruptions. Many networks were left unprepared to react to significant disturbances that are occurring on a global scale. Demand uncertainty combined with supply volatility will continue to challenge companies in achieving targets and delivering business results. There is now a sharp awareness among executives that disruptions can happen at any time and that supply chains need digital solutions to make them agile and resilient, while providing end-to-end visibility.

What won’t happen in 2022

The automotive supply chain remains unable to meet pent-up demand, thanks to the shortage of critical semiconductors. Don’t expect new vehicle sales to return to the 90 million mark—last seen in 2018—until 2023 at the earliest. A reliance on outdated semiconductor process technologies with limited production capacity, proprietary designs and an opaque demand-signaling process have prolonged the semiconductor crisis in the automotive sector. There are no quick fixes for problems that have been years in the making. Therefore, the consequences of the decision made by automakers in 2020 to cancel their existing semiconductor orders will last beyond 2022.

A combination of factors is making it clear that 2022 will not see relief from the semiconductor shortage. It will take until 2023 to resolve shortage issues through additional capacity, verification of real demand (versus panic orders), and the inflationary impact on consumer spending on products. Continued risk factors include social and political risks, as well as the ability to bring new fabrication capacity online, on time, especially for tight engineering specified automotive and commercial vehicles. COVID-19 variants and the impact on nations without high vaccination rates also play a role in permitting staffing of facilities and transportation of finished goods and semiconductor supplies.

Edge computing will continue to increase in deployment numbers. However, the deployments in 2022 will be mostly critical ones made by early adopters, not the start of a boom. Edge computing use cases and financial viability are tightly coupled to 5G cellular networks, both public and private, and the availability of affordable 5G services is not yet a global reality. As a result, edge computing adoption will be slower than anticipated.

After several years of leading social robotics companies either shutting up shop or withdrawing their commercial offerings, 2021 saw renewed investment and focus on the market and its potential.  Amazon’s launch of its first social robot, the Astro, certainly sparked a great deal of attention. However, despite the enormous potential for social/companion robotics, 2022 will not be the breakout year the industry is hoping for, despite the scale, pricing, and awareness that a player like Amazon can bring to an emerging technology market.

See all 70 predictions by downloading the full report.

About the Author

Stuart Carlaw Chief Research Officer , ABI Research

Stuart Carlaw is chief research officer at ABI Research. He may be contacted through abiresearch.com/contact.

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