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Two leading technology firms are co-authors of an Industrial IoT Consortium (IIC)Introducing the machine economy, a new frontier of IoT digital transformation that PwC says will contribute 70% of global Gross Domestic Product (GDP) over the next seven years.
In a convergence of artificial intelligence and blockchain technology, the machine economy could contribute up to $15 trillion to the global economy by 2030, according to a PwC report..
Research by IoTeX and Siemens explores why IoT and distributed ledger technology (DLT) such as blockchain will enable the growth of the machine economy and unlock new opportunities for IoT manufacturers and end users.
The report also outlines some of the disruptive business models the industry is witnessing and highlights examples of implementation. Quote Next Big Thing AGwhich defines the machine economy as a network of intelligent, connected, and economically independent devices and machines that act as autonomous market participants, executing economic transactions and other activities with little or no human intervention.
This definition illustrates the disruptive factors that the machine economy brings to the Internet of Things, according to Fan, Baudry, and Sing.
“On the one hand, the economics of machines addresses the traditional business and manufacturing processes in most companies and industries. On the other hand, it takes advantage of technologies that allow autonomous transactions between devices or machines,” they said.
Among the four essential use cases of the machine economy that the authors mention in the IIC article is the Industrial Metaverse, a hot topic that attendees of the Davos World Economic Forum (WEF) 2023 are also discussing.
“Industrial Metaverse is an emerging trend that aims to combine immersion, real-time data, and digital twins to create new business models and accelerate digitalization.” wrote IoTeX’s Dr. Xinxin Fan and Siemens co-authors Steven Baudry and Sourabh Narayan Sing.
The metaverse showed remarkable growth in 2022 despite the global economic slowdown, and experts believe it will continue to grow significantly. Deloitte believes that the size of the global Metaverse market could increase to between $1.5 trillion and $13 trillion.
The WEF predicts that the metaverse market will grow to $800 billion by 2024. McKinsey,
“With its potential to generate up to $5 trillion in value by 2030, the metaverse is too big for companies to ignore.”
However, while traditional companies and Web3 visionaries agree that the metaverse will continue to grow exponentially in the coming years, a VentureBeatquotes ABiResearch as saying, “there may be a lot more money to be made in the industrial metaverse.”
And in fact, he estimates that the Industrial Metaverse will outperform the consumer and enterprise metaverse sectors by at least three times.
“While technologists try to imagine what the metaverse will bring for businesses and consumers, the industrial metaverse is already transforming the way people design, manufacture, and interact with physical entities across industries,” says MIT Technology Review..
One of the critical applications of the industrial metaverse is digital twins, a virtual replica of a product or process that is used to predict how the physical entity will behave throughout its life cycle, as defined in the MIT paper . “The growing buzz around digital twins is fueling expectations for the industrial metaverse,” the MIT report says.
“BMW, for example, created a virtual twin of its production plant in Bavaria before building the physical facility. Boeing is using a digital twin development model to design its planes. And “virtual Singapore” is a digital representation of the Southeast Asian nation that the government created to support its political decisions and test new technologies,” the MIT review notes.
However, challenges remain, said Dr. Fan, Baudry and Singh:
One of the pieces of the Industrial Metaverse puzzle will be connecting edge devices and reliable data flow with digital twins to create near real-time simulation and prediction for real-world situations.
“Allowing edge devices to directly participate in the incentivization mechanism would create greater autonomy and highly efficient digitization use cases.”
In recent years, the convergence of artificial intelligence, blockchain, cloud computing, edge computing, the Internet of Things (IoT), 5G, computer vision, and virtual/augmented reality have supported the creation of even more digital twins. complex, they wrote.
While each advance in these technologies is bringing digital twins closer to their real-world counterparts, they are also powering the industry through the next wave of the digital revolution, the CII article says.
The introduction of blockchain and Web3, i.e. the third iteration of the Internet, brings new prospects and growth opportunities for IoT companies by realizing the so-called machine economy.