Future is Faster With Quantum Technology as CXOs Evaluate ROI
The Rise of Quantum Technologies
Quantum Technologies have been spoken about for ages, but solutions that create a difference have not yet made their mark. Why would Quantum Technology trigger a revolution in technological development in the coming years? What makes it so unique is there is the possibility that we would need to reimagine every aspect of our life and the way we do things.
The wave-particle of quantum systems is what gives it uniqueness and needs to be exploited to gain a technological advantage. It has the potential to solve many complex scientific and engineering problems that otherwise are not possible with traditional technologies that are widely used now.
It is said that the second quantum revolution is here, and this will bring a plethora of new technologies that will be explored, exploited, and leveraged. Every advancement in areas like Blockchain, Internet of Things (IoT), Edge computing, Machine Learning, and Artificial Intelligence (AI) is leading and paving the way for this second quantum revolution. These technologies form the ecosystem for quantum technologies to expand their wings.
The quantum impact is being felt in every quarter right from governments, private businesses, and industries across domains. Governments and private entities across the world are recognizing the plethora of benefits that quantum technologies offer. The fact that it can provide solutions to environmental issues like resource depletion, energy consumption, reaching net-zero or minimal carbon emissions, and bringing a positive climate change, are only a few areas that countries are looking to invest in heavily.
To understand why quantum technology is essential and why enterprises should care about it, we must first understand the key technologies that come under it.
Quantum Technologies can broadly be categorized into four key technologies: Quantum Computing, Quantum Communication, Quantum Sensing, and Quantum Materials.
Quantum Computing
Quantum Computing has the potential to solve problems exponentially faster than traditional computers involving large data sets and extensive computational needs. This exponential speed will play a significant role in several issues involving database search, drug discovery, etc. Quantum Computing is one of the most vital areas where innovation is happening fast in the field of computation. A completely new class of computers will be used with high computational capabilities that work on the principles of quantum physics.
A quantum computer executes tasks with super speed by simultaneously operating on all variables, providing a quantum advantage. The advantage of classical computers is the quantum advantage, exponentially increasing the speed of solving hard and lengthy problems.
Quantum Communication
The most significant advantage of Quantum Communication is that it can help us achieve secure communication with a level of security that is not present in current-day information transfer methods. These developments in Quantum Communications can create quantum Internet in the future where there is a global exchange of information through newer security protocols and better cryptography.
Quantum Communication depends on two main quantum features – entanglement and superposition for information transmission. Quantum Communication increases communication speed because traditional communication uses electromagnetic waves traveling with the velocity of light, which is the universal maximum information transfer speed.
Quantum Communication enables securing the means of communication, ensuring eavesdroppers are unable to hear anything by securing transmitted messages.
Quantum Teleportation is another promising technology that involves generating an entangled state of qubits and distributing it to two different locations.
Quantum Cryptography is one of the most promising methods for encryption since it uses quantum states to send the keys for encoded messages. Secure communication is something that shows high commercial potential for governments, businesses, and consumers because in this world of open data, secure communication is becoming extremely important.
Quantum Sensing
Quantum sensors are next-gen sensors built using quantum mechanics. Quantum sensing taps into quantum features of the physical system to design highly-sensitive sensors. Hence, they have the potential to become incredibly sensitive measuring instruments, which can also lead to the development of new industries.
Quantum Materials
Quantum materials show properties that cannot be described in terms of semi-classical physics as well as elementary quantum mechanics. It can be used in the development of quantum technology devices. This means a deep study supported by strong research and learnings would be needed to accelerate the quantum ecosystem’s adoption and development.
Why should enterprises care about this revolution?
Exponential market potential
Quantum Computing today shows the highest market investment share and has the most significant number of active players with multiple solutions. Quantum Communication and Quantum Sensing follow this. According to McKinsey, in terms of estimated market share by 2040, Quantum Computing’s market share would be in the range of $9 Bn to $93 Bn. In comparison, Quantum Communication’s market size would be in the range of $1 Bn to $6 Bn, and Quantum Sensing’s market share would range from $1 Bn to $7 Bn.
Quantum Technologies have the power to give enterprises a competitive edge since it has the strength to topple and disrupt most traditional business models. Start-ups and investment activities in Quantum Technologies exceeded $700 Mn in 2020 and showed a definite exponential upward trend in the years ahead.
Quantum technology investments are led by various entities such as VCs, Corporates, Public entities, Private players, accelerators, and angel investors. VCs account for more than 50% of the investments, and the majority of the investments have been allocated to hardware manufacturers. In 2021 alone, companies have raised funds in excess of $ 2.1 Bn.
Quantum Technologies are transitioning from science fiction to reality; with new technology development, these advancements indicate that Quantum Technology may become a reality, yet
scientific growth timescales are difficult to predict.
Rising global interest in Quantum Technologies
North America is expected to be the most profitable market worldwide, with maximum income potential for Quantum technology services and solutions.
North America
North America is the most dominant player in the Quantum Technologies market. According to McKinsey analysis, 10 out of the 12 biggest hardware players are based in North America. Research has indicated that the United States will remain one of the most appealing markets in Quantum Technology in the future.
Some key points are:
- The United States of America to invest $1 Bnfor developing Quantum Computing in upcoming years
- Demand for Quantum Cryptography in Canada is predicted to grow at a CAGR of roughly 26% by 2031
Asia Pacific
China has made significant achievements in the Quantum Technology industry. China has already adopted Quantum Technology by constructing a 2000 km-long Quantum Key Distribution (QKD) network that connects four metropolitan area networks in eastern China, and it has also added a satellite link spanning 2600 km between two observatories. India is not behind China regarding the development of Quantum Technology. ISRO has successfully demonstrated free-space quantum communication over 300 meters. Companies in India are making considerable investments to speed up Quantum Computing research activities.
Demand for cloud-based Quantum Computing solutions has expanded fast in different banking and financial businesses in critical South Asian and Pacific nations such as India and Australia, creating significant growth prospects for market participants.
Some points of interest include:
- India is predicted to become a desirable location for quantum research and development, software development, and component and equipment production
- By 2030, the application of Quantum Technology across industries is anticipated to add $310 Bnto the Indian
- The market in China is predicted to grow at 38.5% CAGR and reach a valuation of $5.41 Bn by 2027.
Europe
France, Spain, Russia, and Germany have been identified to control a substantial portion of the European Quantum Technology sector. Key firms have chosen methods such as alliances with other quantum services providers and regional development to boost their sales growth. Germany is taking the lead, and some of the points of interest are:
- German Quantum Technology market valuation by 2027 will be $3.6 Bnat 1% CAGR
- Demand for Quantum Technology in Germany is predicted to grow at nearly 28% CAGRover the upcoming decade
Key Use cases
Quantum Technologies have use cases across industries. Some of them witnessing traction are mentioned below:
- Financial services firms are exposed to credit risk, and classical simulations are a big computation problem and require significant time and hardware resources. Quantum computing can reduce the expected runtime of such risk analysis.
- Government organizations are realizing the business impact of Quantum communications, as it protects the government’s sensitive and mission-critical data during transmission by providing high-performance multilayer encryption.
- With Quantum Computing, companies can predict and simulate the structure and behavior of molecules more effectively and hence aid them in drug development.
- Quantum encryption has been used to secure data backups done by businesses and organizations in their remote data centers.
- Companies are employing techniques such as QKD (Quantum Key Distribution) and QRNG (Quantum Random Number Generation) for protecting sensitive client information and safeguarding critical business data in the banking and financial services industries.
- With the emergence of trends such as ADAS (Advanced Driver Assistance System), Vehicle-to-Everything (V2X), and sensor fusion, the adoption of Quantum Sensors is increasing.
Conclusion
Although Quantum Technologies may be at a nascent stage, they have the potential to impact every aspect of the industry, and hence waiting for the technology to mature should not be an option. It is critical to begin exploring potential Quantum solutions, forming partnerships, and assessing ways to bridge the skills gap as soon as possible.
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