China is making huge efforts in robotics, but it has a lot of catching up to do

Half a century ago the first industrial robot, Unimate, was put to use at a General Motors plant, signifying the start of the third industrial revolution, and robots have been slowly replacing human workers in manufacturing operations ever since.

Global industrial robot sales have grown at about 9 percent annually for a decade, and now more than 1.5 million industrial robots work on production lines for industries ranging from automotive and auto parts to electrical machinery and electronics.

By contrast, service robots are still at an early stage of development, but have the potential for explosive growth in the near future. Service robots need to be smarter and more adaptable to environmental changes than industrial robots because they must perform a wider variety of tasks, make more varied decisions and interact with more foreign objects.

Service robots can be used for personal assistance or domestic applications such as vacuuming, floor and window cleaning, personal transport, home security and surveillance. They can also serve in dangerous professional situations such as defense or underwater inspections.

Beyond the physical, service robots can perform virtual tasks ranging from statistical processing and analysis to issuing reports, answering customer requests and carrying out financial transactions.

Last year Amazon put 3,000 robots to use at its fulfillment center in Tracy, California, picking up sold inventory and passing it to human workers. The center, which covers the space of 29 football fields, handles as many as 700,000 orders on the busiest online shopping day of the year.

Alibaba Group, China's largest e-commerce company, launched an initiative that put customer service robots in charge of identifying customer needs and answering online requests around the clock. The robots enable Alibaba's Taobao marketplace, which handles sales of $190 billion (170 billion euros) last year, to re-allocate few thousand service staff, employed by either the company or individual e-commerce stores, to other tasks.

The transition from industrial to service robotics is revolutionizing productivity in the home and in the workplace, and the potential impact of this shift exceeds even that of the transition from mainframe computers to personal computers.

Robotics integrates a wide spectrum of technological developments, incorporating advanced mechanics, electronics, control technology, sensors, machine vision, speech recognition and other artificial intelligence techniques. As the demand for service robotics evolves, hardware is increasingly giving way to software "brains" as the frontier for innovation. Strategically important steps for the future development of service robots can be summarized as follows:

Advances in artificial intelligence and deep learning to make robots smarter;

A software framework that allows for future upgrades;

Safety assurances in function and product design;

An open platform to integrate third-party open-source applications and Internet-based resources; and

Pricing that is accessible to society at large.

Today robots can mimic humans' capacity to see, listen and solve problems. The ability to learn will be critical in reaching the next stage of artificial intelligence, and projects such as Google Brain and Baidu Deep Image are seeking breakthroughs in this area. People may soon be able to wear smart technology, perhaps similar to Google Glass, that can recognize pictures, text and sounds and then access other Internet-based services based on that information. However, a robot could have that functionality built into its core systems.

The rapid development of robotics and related technologies has dramatically increased robots' potential to perform tasks that were once beyond them. Robots that can think and interact with humans, such as one that does all of the housework and even some of the parenting, have previously been confined to the realm of science fiction. Such robots may be just around the corner, as even now robots are changing the way we work and we live.

China is already the world's largest and fastest-growing market for industrial robots. According to study by the International Federation of Robotics, a quarter of industrial robot sales last year were to China. By 2017, China will have more industrial robots operating in manufacturing plants than the European Union or North America. This marks the country's first move in an ambitious game of catch-up.

The Chinese government has stepped up efforts to develop the robotics industry from 2016 to 2020, as part of its 13th Five-Year Plan. The government has also adopted supportive policies to promote robotics research and development, the production of key components and the establishment of commercial platforms to match supply with real-world demand.

Capital markets and the industry expect new innovations in robotics, especially following publication in 2013 of a blueprint to develop the sector and its prominent position in the Made in China 2025 initiative.

China is closing the gap with the leaders in robotics fastest in the service robot sector. Personal robot products, online and offline, have been put on the market by a multitude of new startups, and hundreds more have succeeded in obtaining financing from venture capitalists for further development. The share prices of Siasun, Harbin Boshi and Shenzhen Sanggu, the leading companies in China, all soared after they came up with laboratory robots with specialized medical applications. China is probably half century late in the industrial robot sector if compared with the leading robot manufacturing countries, but much closer in service robot sector.

The authors are senior partner and senior consultant at Roland Berger Strategy Consultants.

(China Daily European Weekly 06/19/2015 page9)