Beyond Buzzwords: Emerging Technologies That Matter

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1 Norm Rose President Beyond Buzzwords: Emerging Technologies That Matter Demystifying Emerging Technologies for the Global Travel Industry April 26, 2018

2 Overview otechnology Evolution and Hype oemerging Tech o AI o IoT o Blockchain o AR/VR o Hyperloop othe Hype versus Reality Index

3 The Accelerating Pace of Technological Change Technological Change AI IoT Social AR & VR Transparency Always-connected traveler Blockchain Hyperloop Technology is getting more mobile, distributed and smarter Source: Travel Tech Consulting, Inc.

4 4 The Gartner Technology Hype Cycle

5 AI The Machines are Here But What Can They Do?

6 6 General AI verses Narrow AI Most of today s AI is designed to solve specific problems. IBM Watson wins Jeopardy! Google s DeepMind AlphaGo Beats Lee Se-do Artificial intelligence can solve many problems, but it won t replicate the human brain anytime soon. Self-Driving Automobiles

7 Types of AI Neural Networks - inspired by the biological behavior of neurons Artificial Intelligence NLP=Understand Voice and Text Machine Learning = learn without explicit programming Knowledge Graphs making the semantic Web a reality Deep Learning = Expertise on specific subject Chatbots= human like automated messaging Smart Data= Actionable Intelligence

8 8 How AI is Being Used by Airlines AI Assistants: Responding to customer inquiries and responding to voice commands for domestic airline flight info and ticket availability through interactions using natural language processing. Smart Logistics: Machine learning algorithms are being applied to data to help automate airline operations. Facial Recognition: Facial recognition technology is being used to perform customer identity verification and to match passengers to their luggage through kiosks. Machine Learning: Predict flight delays. Google Flights will use historic flight status data to provide live updates and reasons for delays, such as weather or an aircraft arriving late. Sources: Tech Emergence and ZDNet

9 IoT Connecting the Physical World to the Net

10 Some Examples of an IoT Travel Ecosystem Monitoring health Smart luggage Turn on lights at home while traveling Automatic rebook when passenger won t make flight Security wait times Pre-order food is prepared based on location Ground transportation airport location Smart hotel services Enhanced tours logistics and content Smart cites

11 Blockchain Is Blockchain the Next Internet or an Overhyped Fad?

12 Bitcoin, Blockchain and Ethereum Bitcoin Blockchain Ethereum 1 st Widely Adopted Cryptocurrency Distributed Ledger Smart Contracts Industry Specific Platforms Sources: Coinbase, BlockGeeks and Ethereum

13 Centralized vs Decentralized Peer to Peer Ledger on Every Node Source: 123RF and BlockGeeks

14 Smart Contracts Code that Automatically Executes a Contract Smart Contract Agreement Smart contract created on the blockchain Triggering event and execution Source: Source: Adapted from Blockgeeks

15 Private Versus Public Private Public Maintains Control by the Middleman Eliminates the Middleman Users are not anonymous. Permission is required for users to have a copy of the ledger and participate in confirming transactions. Users are anonymous Each user has a copy of the ledger and participates in confirming transactions. o Source: BlockGeeks

16 Block Primary Areas of Impact for the Travel Industry Transparency Settlement Loyalty Fraud Identity IoT Overbooking Policy Sources: Travel Tech Consulting, Inc., Deloitte, NBC and 123RF

17 Barriers to Blockchain Blockchain is a Young Technology SPEED per Second 3 to 4 20 Lighting Network Plasma 2,000 Public Volatility Open Network Speculation vs. Utility o Sources: 123RF, Harvard Business Review, Ethereum WorldNews

18 Augmented and Virtual Reality Will VR Replace Travel? How can AR Enhance the Travel Experience?

19 AR and VR With companies such as Magic Leap receiving $2.3 Billion in investment, AR will emerge as a significant tech. Apart from gaming oriented AR applications, logical airline use includes maintenance, passenger navigation and special offers. Mass adoption of VR headsets is years away. VR has the potential to help sell new, off the beaten path, destinations. VR will likely become part of the dream, search, shop and buy travel life cycle. User generated VR will become a new form of social media influence. o Sources: Magic Leap, Crunchbase, Avionics, 123RF

20 VR and AR within The Travel Process Dream Contribute to Others VR Experience Share Search Explore new destinations Experience Shop Immersive Search Purchase Enhanced Experience Virtual Shopping Experience

21 Hyperloop Will Hyperloop Eliminate Short Haul Airline Routes?

22 Hyperloop A magnetic bullet train in a vacuum tube that transports passengers at over 700 mph. Los Angeles to San Francisco would take less than 30 minutes Concept introduced by Elon Musk in Currently there are five active hyperloop projects including one being pushed by Elon Musk s Boring Company. Challenges: Would require a large network of vacuum tubes. Must work with governments to obtain the space, especially above the ground in densely populated areas. If built underground, the high cost of tunneling will be a major factor. Given the significant capital investment and need to get governmental approvals, a hyperloop competitor impacting the airline industry is years away.

23 The Hype vs Reality Index What Emerging Tech Do Airlines Need to Focus on Today?

24 The Hype vs Reality Index Now Medium Term Long Term High AI IoT AR VR Blockchain Medium IoT Hyperloop Hyperloop Low Blockchain AR VR AI Now 1-3 Years 5+ Years 24

25 Summary o Emerging Tech is often over-hyped but often ends up having an impact. o AI is here today but needs to be positioned correctly. o Blockchain has the potential to improve efficiencies, increase passenger personalization and reduce the cost of transactions and fulfillment. Airlines should experiment now and plan for tomorrow. o Augmented Reality will likely emerge as an important tool to enhance the travel experience. o Virtual Reality could impact the entire travel purchase cycle, but mass adoption of VR gear is still years away. o Hyperloop which will require billions of dollars of infrastructure investment, may have major impact, but is probably years away from having a significant impact on the airline industry. Invest, Innovate, Experiment. It is essential that airlines explore emerging tech and integrate practical applications today! 25

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