Article/Sina Financial Opinion Leader (WeChat official account kopleader) institutional column Templeton
Sukumar Rajah (senior managing director, portfolio management director, Franklin Templeton emerging market stock team) and Eric Mok (senior executive director of portfolio manager, Franklin Templeton emerging market stock team) of the Franklin Templeton emerging market stock team studied how cutting-edge development in Asia determines the pace of change in the AI market, And the importance of technological infrastructure to foster the development of artificial intelligence.
Artificial intelligence (AI) and automation offer huge investment opportunities. Asia is generally regarded as the "world factory", accounting for 65% of the total use of industrial robots in the world's manufacturing industry [1]. In our view, such a large-scale robot investment is used to drive an already mature industry, which indicates that change is already in progress. With further technological development, we expect that machines will take over more manufacturing in the near future. On the basis of the latest pioneering digital era, what some people call the "fourth industrial revolution" is taking place, integrating technology into almost every aspect of our lives.
But it will not only bring technological innovation. At present, we find that the speed of breakthrough is unprecedented, and we believe that it can provide Asia with sufficient opportunities to enter the artificial intelligence market, because we have seen that the region uses artificial intelligence technology in the manufacturing process of various industries - and faster than other parts of the world.
Beyond software
We believe that some Asian countries may be in the golden stage of taking advantage of technological progress. There is a widespread misunderstanding that the region is a combination of low-cost exporters, low-cost manufacturers and outsourcing tasks. In fact, some Asian economies have surpassed the common structure in developed economies, because there is little capital investment in traditional technology and infrastructure. This is very obvious in China, where mobile payment systems are rapidly developing. For example, people have become accustomed to paying with electronic wallets after meals, online orders or taking taxis. Residents, especially those in rural areas, can easily use the mobile phone to mobile phone payment function, so there is no need for the transaction parties to go to the physical bank outlets for processing. The penetration rate of these types of digital systems is far higher than what we see in developed countries. Interestingly, in Hong Kong, payment is still mainly in cash or by card.
Similarly, we believe that some technological advances cannot occur without physical support systems. Current hardware and infrastructure support today's technology. We believe that future technologies need better hardware and infrastructure. This includes better silicon chips. For example, for AI controlled autonomous vehicles, we need to develop and manufacture better silicon chips to support autonomous driving systems.
We are particularly excited about the prospects of hardware suppliers in the industry who are building and developing semiconductors and logic integrated circuits (ICs) to meet growing demand. This is one of the main downstream impacts that we pay close attention to, which may to some extent promote Taiwan's major semiconductor industry and China's emerging industries.
Computing power, speed and memory are also required to support AI. We believe that this can promote the exponential growth of computing power, so that it can handle a large number of data and algorithms. Some smart phones are already more powerful than PCs, and there are more technologies for smart phone applications. We think this is an area for further development.
How Asia prepares to turn science fiction into reality
• Artificial intelligence farms will change Vietnam's agriculture. Smartphone applications connected to sensors can send alerts when the water level in a particular area is too low, and can notify farmers of the type of fertilizer they need. An intelligent system is also introduced to measure the humidity in the greenhouse. If the humidity is too high, the exhaust fan will automatically open to absorb moisture.
• South Korea is in a favorable position in the implementation of artificial intelligence - the government tried to stimulate and encourage economic recovery after the 1997 Asian financial crisis, thus making the country's Internet infrastructure among the fastest growing in the world. South Korea has launched a nationwide Internet of Things network, which is called "Long Range Wide Area Network" (LoRaWAN). It is a cheaper and more energy-saving Wi Fi alternative.
• China has a three-step strategy and plans to become a world leader in artificial intelligence by 2030. This involves keeping pace with leading AI technologies, integrating AI into infrastructure, medicine, manufacturing and agriculture, and applying AI to national defense and social governance. Part of this ambitious roadmap is to move the country away from traditional export driven manufacturing and more in line with the consumption driven economy we see today.
Riding the Wave of Machine Learning
The Internet of Things is a network that allows devices to be super connected. The increase in the use of intelligent devices has triggered a global demand for the Internet of Things (IoT). However, we predict that the demand for AI technology will exceed that of the Internet of Things, robots and virtual reality.
Historically, the impetus for AI development came from the technology field, but now other fields are also using AI to transform their own industries. For example, healthcare departments are seeking to use AI in a variety of ways, including AI assisted robotic surgery, early diagnosis through the use of algorithms, and faster image analysis and scanning. Financial services, communications and media entertainment companies have traditionally used software to tailor their products to their customers. Companies in these industries are likely to use AI to process large amounts of customer data and predict customer needs. In a larger scope, we can monitor world environmental issues such as sustainability, pollution and climate change by using AI deployment equipment to monitor fishing activities, coral reef mapping, and ocean pH and temperature.
Finally, we believe that the availability of 5G connectivity for next-generation mobile Internet is very important. Different from its predecessor network, 5G itself has the nature of promoting and helping to implement new AI technology.
What is 5G?
5G is the fifth generation wireless technology, with faster response speed, more data processing, and the ability to connect multiple devices at the same time faster than currently. The first generation of wireless technology, 1G, could carry out wireless voice calls around 1982. Later, 2G was released, bringing text and picture SMS. 3G from 2000 to 2009 is the early stage of video call and mobile data, while 4G can realize online streaming media play, online games and video call through faster data transmission speed. 4G mobile networks currently use radio waves. However, 5G is much faster because it uses different frequencies in the electromagnetic spectrum.
Demand for infrastructure support
Finally, the technological progress in AI is exciting. However, we believe that AI cannot achieve its full potential without the support systems needed to drive innovation. We have seen the gradual development of technology around the world, but now we think we need to pay more attention to infrastructure and hardware itself – Asia is having a suitable engine to drive the development progress required by AI technology.
(The author of this article introduces that Templeton Investment Consulting Co., Ltd. is a securities company on Wall Street in the United States, with the full name of Franklin Templeton Investment Consulting Co., Ltd. It mainly invests in conservative stocks. The company was founded in New York by Rupert H. Johnson, Sr. in 1947.)
