Will banks and blockbuster Bit Stew deal boost Canada’s AI sector?

Despite strong buy-in from its biggest banks – and GE’s move to buy Vancouver-based Bit Stew Systems – Canada is adopting artificial intelligence (AI)  more slowly than other countries so far.

That was the takeaway from a gathering of industry experts held Tuesday by the Information Technology Association of Canada (ITAC). The Toronto event got underway just hours after news broke that GE is acquiring Bit Stew for just over $200 million.

Bit Stew’s Mix Core platform works with Internet of Things applications to analyze millions of data points collected on remote devices by industrial clients such as utility companies and oil and gas firms. The platform uses machine learning algorithms to detect anomalies, create context and learn patterns within data.

Banks and other financial sector firms are leading the AI charge in Canada, says Wayne Thompson of SAS.

Although panelist Cindy Gordon hailed the Bit Stew deal as a “landmark” for AI in Canada, she said a recent trip to an AI conference in the U.S. left her with the feeling that Canada is lagging behind. She called for more collaboration between the business and academic clusters that are now spearheading the cognitive computing trend in Canada.

“The (Canadian AI) community ecosystem is fractured in terms of where the CEOs and data scientists are,” said Gordon, CEO of SalesChoice. The Toronto firm’s AI and predictive analytics sales forecasting tool is integrated into Salesforce and other CRM solutions.

Banks ‘get it’ 

Co-panelist Wayne Thompson of U.S.-based SAS agreed that silos persist around AI activity in many sectors (and many countries), usually featuring business analysts in one camp and IT staff in the other. He disagreed, however, with Gordon’s notion that Canadian enterprise is slower than the rest of the world in coming to the AI table.

“There are a lot of progressive companies here in Canada that I work with … They’re doing a great job at being able to run their businesses with an analytics focus,” said Thompson, chief data scientist at SAS.

Salesforce co-founders Marc Benioff and Parker Harris showcased the company’s new Einstein AI engine at the Dreamforce conference earlier this year.

Thompson cited Canadian banks and other financial sector companies as being particularly progressive in terms of AI investment and adoption. That sentiment was echoed by panelist Tanya Collier MacDonald, CEO of Orenda Software Solutions.

“The financial industry is ‘getting it’ more quickly – even more quickly than retail,” she said.

Biggest AI investors

In fact, banking leads all sectors in AI investment worldwide, said David Schubmehl, research director of content analytics, discovery and cognitive systems at IDC. He told Tuesday’s audience that banking accounts for 20 per cent of global AI investment, followed closely by healthcare at 18 per cent and retail at 17 per cent.

It may be too early to determine whether Canada is indeed an AI slowpoke; while IDC presented global investment figures, it did not provide any numbers specific to the Canadian market.

What is clear, though, is the flurry of support for AI shown by the Canadian financial sector in recent months. Manulife Financial Corp. is collaborating with American firms Nervana Systems and Indico Data Solutions on AI initiatives as part of the insurer’s Lab of Forward Thinking project in Toronto. In October, Montreal-based online lender Thinking Capital launched what it calls the first fintech chatbot in Canada.

IDC’s David Schubmehl.

Also last month, RBC pledged an undisclosed amount of funding for AI and machine learning startups at Creative Destruction Lab, which already houses 50 cognitive computing ventures at University of Toronto’s Rotman School of Management. In addition, RBC is launching the RBC Research in Machine Learning practice at U of T’s Banting Institute.

Although Canadian organizations reportedly adopt emerging technologies more conservatively than firms in other countries, Collier MacDonald said recent support for AI startups will help foster collaboration and innovation in the sector within Canada.

Her own company, Orenda, is part of the new IBM Innovation Space incubator that opened in Toronto in September. Orenda, which also has an office in Membertou, N.S., taps into IBM’s Watson AI platform to analyze the reputation of brands based on online sentiment.

IDC predicts the global market for AI and cognitive computing will hit $31 billion by 2019 and $47 billion in 2020, with a whopping 55 per cent CAGR between 2014 and 2019.

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Christine Wong
Christine Wonghttp://www.itbusiness.ca
Christine Wong has been an on-air reporter for a national daily show on Rogers TV and at High Tech TV, a weekly news magazine on CTV's Ottawa affiliate. She was also an associate producer at Report On Business Television (now called BNN) and CBC's The Hour With George Stroumboulopoulos. As an associate producer at Slice TV, she helped launch two national daily talk shows, The Mom Show and Three Takes. Recently, she was a Staff Writer at ITBusiness.ca and is now a freelance contributor.

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