Quick Quantum Quips: A call for quantum supremacy sends ripples through the market

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The quantum market changes rapidly, and the hype can often distract from the realities of the technological developments. In our new monthly newsletter, Quick Quantum Quips (Q3), TBR will brief readers on the latest market announcements, stripping that hype to dig deeper into how recent events will impact the market as a whole. To schedule a time to chat with Analyst Stephanie Long or another one of TBR’s quantum analysts about any of the insights below, contact her at [email protected].

October 2019 developments:

  1. Google claimed it achieved quantum supremacy in mid-October, sending ripples through the quantum community. Quantum supremacy is a key milestone many leaders in the quantum computing space have been working toward for years. If true, this milestone would mean that quantum theory has successfully been translated into practical applications, so such a claim has major implications for the industry overall. Google claims its quantum computer was able to perform a truly random number generation in 200 seconds — and that the task would have taken a supercomputer 10,000 years to complete. Further, truly random number generation is necessary for quantum-safe security solutions, making this announcement a multifaceted milestone in the quantum community. Critics of Google’s claim state that it is possible to achieve very similar results in 2.5 days on a supercomputer, although it would require 250 petabytes of storage to do so, potentially diminishing the size of Google’s “milestone” achievement but confirming it as an achievement nonetheless.
  • IBM has been in the news consistently during October for its strong claims against Google’s quantum supremacy claims. TBR believes that the strong opposition signifies the power being the first company to achieve quantum supremacy can hold as well as the damage to the industry an unrealistic claim can cause through false hyping of the technology. The industry already struggles with hype, which pushes C-Suite executives to invest in and expect quick results from a technology that is meant for the long game, and skewed claims only stand to increase the negative impacts of the hype. As such, IBM has made a significant effort to minimize the hype surrounding Google’s announcement to reveal the complete facts surrounding the achievement.
  • IonQ received its latest round of funding in October — to the tune of $55 million. Samsung and a sovereign wealth fund of the United Arab Emirates led the funding this round, while Google, Amazon and New Enterprise Associates re-upped their commitments from earlier funding rounds. The investments in IonQ are significant, as the list includes some potential competitors such as Google. TBR notes that Google is investing in superconducting quantum computing, which presently leads the charge in terms of advancements. However, IonQ’s theory of trapped ion quantum computing is unique in that it does not require cryogenically cold environments to function, making its approach seem more realistic in that it would have broader, more practical commercial applicability. TBR believes Google’s investment in IonQ demonstrates its strong cash position and focus on the applied uses for quantum over being wedded to any particular hardware structure. Google, like many enterprises, is more focused on application exploration rather than the sale of quantum systems.

  • In a true demonstration of the sheer power quantum computing can unleash, customers are jumping on the innovation train to accelerate the development of both the technology and related skills. Airbus announced that it has compiled a list of leading experts to act as judges for its quantum computing competition. The Airbus Quantum Computing Challenge launched earlier this year and is designed to encourage experts and those interested in quantum computing to tackle some of the more complex computational problems for aerospace. All proposals needed to be received by Oct. 31 and are now being reviewed by the team of judges that Airbus compiled. Jury members come from all geographies and from both industrial and academic organizations, including QC Ware, Horizons Quantum Computing, the University of Waterloo, the University of Technology Sydney, QuSoft, the University of California and more. The announcement is significant because a commercial enterprise is recognizing the value quantum can bring to its business and displaying an eagerness to contribute to the advancement of the quantum ecosystem.
  • QC Ware unveiled the list of speakers for its upcoming quantum computing event, Q2B. The event will take place in California in December. Program details can be found at the link provided.

If you would like your company’s announcement featured in an upcoming Q3, contact Geoff Woollacott to coordinate a conversation.

UiPath’s enhanced and expanded technology stack provides a solid foundation to reach scale

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In mid-October Senior Analyst Boz Hristov attended the annual UiPath Forward conference in Las Vegas, and recently, he published his thoughts on the event and UiPath’s role in the robotic process automation market.

He wrote, “UiPath’s position as one of the leading vendors defining the robotic process automation (RPA) market comes with responsibilities for managing expectations across stakeholders, and the company knows it. Enhancing its value proposition by adding the necessary layers of technologies and deploying business-led frameworks internally and with alliance partners helps it build use cases of scale, a necessary attribute to maintain growth momentum, as RPA is no longer a siloed, line-of-business-led initiative, but rather a node in an enterprisewide automation initiative.”

Additional assessments publishing this week from our analyst teams

“TBR’s quarterly full report on IBM highlights the strategic development in the hardware portion of IBM’s larger portfolio. In 3Q19 we discuss IBM’s quantum computing business as well as the positive implications of the September launch of the z15. Additionally, highlights of IBM’s more emerging capabilities such as around blockchain are also expanded on. IBM’s July finalization of its Red Hat buy has sent a wave of open source through the business, impacting Power Systems this quarter.” — Stephanie Long, Analyst

“IBM Services will continue to experience growth in business and technology transformation areas, such as advisory activities around cognitive technology, cloud application modernization and next-generation enterprise applications such as SAP Business Suite 4 HANA (S/4 HANA) and Salesforce. The growth will be driven by IBM Services’ portfolio realignment initiatives to deliver higher-value and higher-margin services that integrate technology and industry expertise and enable clients’ digital reinventions. Synergies with the Red Hat acquisition, which closed on July 9, will continue to generate application modernization deals for IBM Services involving the OpenShift hybrid cloud platform. However, lingering growth challenges in traditional IT service areas and ongoing transformation of the Global Technology Services business will stall IBM Services’ revenue growth and profitability improvement in 2019.” — Elitsa Bakalova, Senior Analyst

“While TBR expects T-Systems’ revenue growth to decelerate slightly in 3Q19, reorganization efforts combined with the company’s investments in cloud, IoT and security capabilities to align its portfolio with client demand will prepare the company to stabilize revenue in 2020.” — Kelly Lesiczka, Analyst

“Sprint’s 3Q19 performance highlights the necessity of the T-Mobile merger and the challenge of Sprint remaining a stand-alone company. Sprint continues to struggle to gain customers without aggressive pricing, while its elevated capex budget is limiting free cash flow and has yet to produce a significant improvement in network quality to lower churn rates.” — Steve Vachon, Analyst

UiPath amplifies the RPA’s value that comes from scale

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UiPath’s position as one of the leading vendors defining the robotic process automation (RPA) market comes with responsibilities for managing expectations across stakeholders, and the company knows it. Enhancing its value proposition by adding the necessary layers of technologies and deploying business-led frameworks internally and with alliance partners helps it build use cases of scale, a necessary attribute to maintain growth momentum, as RPA is no longer a siloed, line-of-business-led initiative, but rather a node in an enterprisewide automation initiative. 

UIPATH’S ENHANCED AND EXPANDED TECHNOLOGY STACK PROVIDES A SOLID FOUNDATION TO REACH SCALE

Solving the productivity paradox has become the guiding light for UiPath’s product development as the company seeks to gain broader stakeholder buy-in. RPA tools continue to be largely selected and utilized by business customers, but the need for democratizing data while addressing larger IT complexities is compelling UiPath to ensure ease of use of its offerings for the broader user community. Targeting new personas beyond RPA developers, including business analysts, citizen developers and testers, expands UiPath’s core platform addressable market but also raises expectations around ROI. By enhancing and adding features including design tools (e.g., Studio, Studio X, Studio T), management tools (e.g., Orchestrator, Cloud Platform, AI Fabric), apps (e.g., Forms, Tasks, Chatbots) and insights (e.g., RPA, Business Analytics), UiPath’s end-to-end automation suite captures the entire cycle of plan, build, manage, run, engage and measure.

While the build, manage and run stages are somewhat legacy capabilities, expanding into the plan cycle, which was accelerated through the acquisition of Netherlands-headquartered ProcessGold and enabled through the launch of UiExplorer, helps UiPath act as an arbitrator of the dilemma “Should a company automate a bad process or fix the process first?” by applying a scientific plan for implementing RPA one process at a time. TBR also sees the purchase of ProcessGold as an attempt for UiPath to increase its value proposition for higher-value design thinking workshops. While we do not expect UiPath to be a threat to its consulting partners’ core expertise, wrapping advisory frameworks with AI-enabled process mining tools could address the dilemma sooner. The engage and measure pillars of the UiPath Platform suite provide the connective tissue between the deeper collaboration between humans and robots as well as pave the way for the company’s pragmatic AI vision of building intelligent systems that provide the proper tools and skills. How to measure and report the true business impact of RPA implementation, however, remains up for debate, as enterprise buyers approach automation differently. As UiPath strives to reach scale, the inevitable question of “What’s next?” is rather loaded considering the hype around AI, the possibilities of automation and the future of RPA. During the conference UiPath released the AI Fabric solution in private mode, first announced in April, to address the barriers of AI and RPA working together including in operations, technology and processes. As the notion of AI fabric is breaking down siloes between RPA and data science teams through features such as intuitive interface, operationalizing AI models and closing the RPA-AI data feedback loop, AI Fabric is a timely response to buyers’ adoption of AI, which for many is still in a pilot phase.

For the second year in a row TBR attended the annual UiPath Forward conference, the focus of which has shifted dramatically from regionally oriented in 2018 to global in 2019, reflecting the company’s efforts to build a framework and portfolio offerings developed and delivered through integrated scale. And stories of scale were not lacking: The conference hosted close to 3,000 attendees this year — twice as many as last year — and demonstrated expanded capabilities of the core UiPath Platform. UiPath also announced two acquisitions and shared four dozen client stories onstage. Under the slogan “Reboot Work,” the conference amplified the broader need for rebooting customer experience and business overall, which in many cases is easier said than done, but client stories shared during the conference showed pain points are lessening, reflecting on UiPath’s Automation First vision with “automation is the application” framework at its core.