CBA preparing for ‘machine-to-machine economy’

Envisaging a world where machines can hire their own maintenance workers

The Commonwealth Bank of Australia is gearing up for a future in which machines will have their own bank accounts and pay for replacement parts and engineers to service them.

As they become “increasingly autonomous market participants” machines will also evolve to sell their services autonomously on the Internet of Services, with businesses leasing them by the hour or to complete a set task, according to the bank’s Emerging Technology team.

The rise of the Internet of Things – with Gartner predicting there will be some 20 to 50 billion connected things will be in use worldwide by 2020 – and advances in artificial intelligence, are leading to a world where sensor devices and machines will operate autonomously and create new business models, the bank says in a white paper released this week.

As well as new business models, the M2M economy will also allow businesses to leave asset management and maintenance to the assets themselves.

“As a business, your real need isn’t for a truck, a bulldozer or a drone. It’s the ability to ship some goods, move some earth, or inspect a bridge. So why should you spend time overseeing maintenance and managing assets that could just as easily manage themselves?” said Andrew Despi, Manager, emerging technology at CBA.

The bank says it has identified 20 potential use cases for M2M economy experimentation across a number of sectors including manufacturing, logistics, resources, agriculture, energy and infrastructure. Chiefly these use cases arise from the fact many high value physical assets in business are under-utilised.

The bank says it is currently working with customers on use cases, while figuring out “the long-term implications of automation on the financial services industry”.

On the cusp

The M2M economy does raise societal and ethical questions, says Dilan Rajasingham, head of emerging technology at CBA.

“Businesses, regulators and financial institutions need to act now if we are to realise all the benefits the new economy promises to deliver. This is not a vision of the distant future –  most of the technologies needed to put it into action already exist,” he said.

“We’re standing on the cusp of something that is perhaps unexpected and possibly will come with unexpected consequences.”

There is a need for global regulatory guidelines to be incorporated into smart machines, and a method for them all to be authenticated.

“An elegant solution would be a single, global register based on a public certificate with a public–private key combination, although there are distributed alternatives,” Rajasingham said.

Regulation and business rules could initially be incorporated into intelligent machines via smart contracts. The bank is working with Ernst and Young’s Paul Brody to develop such a system.

Brody was a lead on IBM’s ADEPT (Autonomous Decentralized Peer-to-Peer Telemetry) project, which used blockchains as ledgers for transactions between devices.

Rajasingham added that as AI arrives at scale, “the question is whether these mechanisms will be enough”.

“That’s why it’s important for intelligent machines to learn about regulation and socially responsible behaviour, as well as about business. In the same way as we educate our children to follow social norms, we need to ensure our machines are not only smart, but ethical,” he said.

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Tags CBACommonwealth Bank of AustraliabankingM2MInternet of Things (IoT)MachineDilan Rajasinghammachine to machine economy

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