By Pete Singer

In a keynote talk on Tuesday in the Yerba Buena theater, Dr. John E. Kelly, III, Senior Vice President, Cognitive Solutions and IBM Research, talked about how the era of Artificial Intelligence (AI) was upon us, and how it will dramatically the world. “This is an era of computing which is at a scale that will dwarf the previous era, in ways that will change all of our businesses and all of our industries, and all of our lives,” he said. “This will be another 50, 60 or more years of technology breakthrough innovation that will change the world.  This is the era that’s going to power our semiconductor industry forward. The number of opportunities is enormous.”

Dr. John E. Kelly, III, Senior Vice President, Cognitive Solutions and IBM Research

Kelly, with 40 years of experience in the industry, recalled how the first era of computing began with mechanical computers 100 years ago, and then transition into the programmable era of computing. In 1980, Kelly said “we were trying to stack two 16 kilobis DRAMs to get a 32 bit stack and we were trying to cram a thousand transistors into a microprocessor.” Microprocessors today have 15 billion transistors. “It’s been a heck of a ride,” he said.

IBM’s Summit is not only the biggest computer in the world, this is the smartest computer in the world, according to Kelly.

Kelly pointed to the power of exponentials, noting that Moore’s Law represented the first exponential and Metcalf’s Law — which says the value of the network increases as the square of the number of connected devices to the network – is the second exponential. Kelly said there’s no end to this second potential, as devices such as medical connected devices and Internet of thing devices get connected.

A third exponential is now upon us, Kelly said. “The core of this exponential is that data is doubling every 12 to 18 months. In fact, in some industries like healthcare, data is doubling every six months,” he said. The challenge is that the data is useless unless it can be analyzed. “Our computers are lousy in dealing with that large unstructured data and frankly there aren’t enough programmers in the world to deal with that explosion of data and extract value,” Kelly said. “The only way forward is through the use of machine learning and artificial intelligence to extract insights from that data.”

Kelly talked about IBM’s history of AI – teaching early system 600 machines to play checkers, beating chess grandmaster Gary Kasparov with Deep Blue, Watson’s Jeopardy wins and most recently, Watson Debater. That can “not only can answer questions but can listen to a person’s argument on something, reason and counter-argue in full natural language against that position in a full dialogue, continuously.”

What’s changed? “We continue to make advances in artificial intelligence, machine learning and deep learning algorithms that are just stunning,” Kelly said. “We are now able to learn over smaller and smaller amounts of data and translate that learning from one domain to another to another to another and start to get scale. Now is the time when this exponential is going to really explode.”

How does that equate to opportunity? Kelly said that on top of the existing $1.5-2B information technology industry, there’s another $2 trillion of decision support opportunity for artificial intelligence. “Literally every industry in the world, whether its industrial products, financial services, retail, every industry in the world is going to be impacted and transformed by this,” he said.

Quantum computing, which Kelly describe as a fourth exponential, is also coming which will in turn dwarf all of the previous ones. “Beyond AI, this is going to be the most important thing I’ve ever seen in my career. Quantum computing is a complete game changer,” he said.

The bad news? During his talk, Kelly sounded one cautionary note: “Companies that lead exponentials win. Companies that don’t lead, or even try to quickly follow, fail on exponential curves. Our industry is littered with examples of that,” he said.