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Lux Take on News: Weekly Round-Up September 4, 2020

Lux Research
September 4, 2020

Every week our researchers go through the top tech innovation headlines and provide their analysis on important updates, trends, and developments across all industries. Our analysts evaluate news based on potential importance ranking the developments from Truly Disruptive to Ignore.

On Fridays we highlight our Lux Take on the news for the week. Check out our thoughts on the latest emerging technology and innovation news for the first week of September below.

Warren Buffett's Berkshire Hathaway invests in five of Japan's top trading companies, betting on business opportunities from integration

Mike Holman Lux Research

Michael Holman, Ph.D., VP, Research | @MichaelHolmanLR Ico twitter
Lux Take: Very Important


"The "Sage of Omaha" announced that his company has built a 5% stake in each of Mitsubishi Corp., Mitsui & Co., Sumitomo Corp., Itochu Corp., and Marubeni Corp., Japan's five leading sogo shosha. As others have noted, this move reflects ongoing Berkshire bets on energy and commodities in advance of expected COVID-19 pandemic recovery; however, Buffett's brief statement hints at more. He praises the companies' "joint ventures throughout the world" and anticipates "more of these partnerships" – calling out the value that can come from the integration of the different technologies that these large trading houses specialize in. Look for more on this theme at the upcoming Lux Genius 2020 event."

Emerson acquires OSI for $1.6 billion to tackle the digital transformation of power

Hernandez, Jessica

Jessica Hernandez, Analyst
Lux Take: Very Important

"Open Systems International (OSI) – not to be confused with OSIsoft – a provider of software solutions for transmission and distribution (T&D) utilities, is the latest in Emerson's series of strategic acquisitions aiming to complement the company's control and data management capabilities to service the power industry. Earlier this year, Emerson acquired American Governor, provider of hydroelectric turbine controls, and Verdant, provider of energy management solutions for the hospitality sector. OSI adds T&D management solutions to Emerson's existing generation expertise, making it a more attractive contender in the digital transformation of power; in return, Emerson will likely help OSI expand its business outside of North America."

U.S. announces $1 billion plan for creating AI and quantum research institutes

McCollum, ColeCole McCollum, Analyst | @cmccoco Ico twitter
Lux Take: Very Important


"The funding comes from a mix of public and private organizations and will be used to establish and fund seven AI research institutes and five institutes focused on quantum information sciences (including quantum computing) over a period of five years. With private organizations like OpenAI raising $1 billion and Google spending more than $500 million per year on AI research, the question remains: Given the critical importance of these technologies to both national security and economic activity, why not invest more? Although it is a good start, clients should recognize that this funding will need to only be the beginning for it to make a material impact, particularly as countries like China ramp up their investment in such technologies."

Swedish consortium opens 10,000 ton per year pilot facility for direct reduced iron production

Arij-van-Berkel-Lux-900px-squareArij van Berkel, Ph.D., Director, Research | @aivanberkel Ico twitter
Lux Take: Very Important


"
A Swedish consortium under the name Hybrit, consisting of LKAB (mining), SSAB (steel production), and Vattenfall (energy), has been working since 2016 on the production of carbon-free steel using direct reduction of iron ore with green hydrogen. The consortium reached a new milestone on August 31, 2020, with the opening of a pilot plant that will demonstrate the production of iron without the use of cokes. The blast furnace will be replaced by a reactor that uses hydrogen for the direct reduction of iron ore pellets to the raw iron. The pilot plant has a capacity of 1 ton to 2 tons per hour and will be used in the coming four years to test and validate the process. This should lead to a first-to-market 0.5 million ton per year unit in 2025."

Lux Research - Newsletter Research


Aveva gets whole PI in $5 billion OSIsoft acquisition, creating strong industrial analytics competitor but diminishing OSIsoft's neutrality

13815-thumb-squareMichael Sullivan, Analyst
Lux Take: Very Important


"Engineering, operations, and performance management firm Aveva is acquiring OSIsoft from its owners, founder J. Patrick Kennedy, SoftBank, and Mitsui, bringing together industrial analytics and applications for utilities, process industries, and manufacturers. This deal is an example of the integration of horizontal industrial analytics platforms with application-specific solutions to deepen penetration. The move strengthens Aveva but weakens OSIsoft's role as a de facto standard for data management, with partnerships in analyticsdigital twins, and PdM. The company will be tied to Aveva's applications. Those with investments in OSIsoft's PI System should check to make sure their solutions are not disrupted by Aveva's development plans."

Amazon receives FAA approval to operate delivery drones

Kern, Josh

Josh Kern, Analyst | @josh_kern_ Ico twitter
Lux Take: Average Importance


"The e-commerce giant is the third operator to receive delivery drone approval from the FAA after UPS and Wing. Amazon first announced its Prime Air drone delivery program back in 2013 and has made few announcements on the subject since. While the company has not detailed its testing plans with the new approval yet, clients should expect the company to first test its drones in rural areas, similar to what UPS and Wing have done. As we pointed out in our "Automating the Last Mile" report, drone delivery has significant barriers in cities, given concerns around noise and congestion. We still believe the last-mile automation market will be dominated by autonomous vehicles, especially in tandem with microfulfillment centers in cities."

Seventh Generation launches powder-based cleaning products in plastic-free packaging

drishti masandDrishti Masand, Research Associate | @DrishtiMasand Ico twitter
Lux Take: Average Importance

"This new sustainable product line from Seventh Generation has two innovations – changing liquid products to powder form and replacing plastic packaging with steel canisters. The switch in materials is driven primarily by the ability to reuse or recycle steel canisters once empty. However, replacing single-use plastic with steel is challenging due to extra capital expenses for Seventh Generation and a potential increase in cost for the consumer. With a price premium for sustainability, the success of this line will depend on a change in consumer behavior. The company is launching a pilot test for the products through Grove Collaborative; clients should monitor to see if consumers care enough about sustainability to front the extra cost."

In a nod to ingredient informatics, Climax Foods raises $7.5 million seed round

10085-thumb-squareThomas Hayes, Analyst
Lux Take: Average Importance


"Notable investors include S2G Ventures and At One Ventures. Climax Foods is leveraging data science and machine learning to develop plant-based products with equal or superior sensory profiles to their animal-based counterparts, similar to NotCo. Climax Foods looks to first develop plant-based cheese, thereafter expanding to other product categories. Those interested, food companies, both small and large, are embracing digitally enabled innovation. Given NotCo's success to date, we anticipate a similar trajectory for Climax Foods."

Amazon announces WorldForge, a simulation platform for robotics

Miraj

Miraj Mainali, Research Associate
Lux Take: Average Importance


"
One of the main barriers to developing robotic systems is the lack of training data and simulation and testing environment. AWS RoboMaker, Amazon's cloud solution for robotic developers, announced integration with open-source project WorldForge that allows developers to simulate and test robots' performance in synthetically created indoor 3D worlds. This benefits robotic application developers and QA engineers in terms of simplicity, cost, and time. Although simulated platforms have been in use already, the integrations offered by AWS will make it easier for developers to scale their projects. However, the actual performance of robotics depends on how closely the simulated platforms resemble the features of the real-world scenarios."

Conagen enters the human milk oligosaccharides space for infant nutrition applications

Harini Venkataraman Ph.D. Lux ResearchHarini Venkataraman, Ph.D., Analyst
Lux Take: Average Importance


"Conagen has developed an enzymatic biotransformation route to produce 2′-fucosyllactose (2′-FL), the most abundant human milk oligosaccharide (HMO), building on its existing methods for making stevia-based sweeteners. The production method is patent pending, and the company is awaiting GRAS approval from the FDA. While Conagen claims differentiation in its "non-GMO" approach to producing HMOs, it is entering the space at a rather late stage, facing stiff competition from other established players like Inbiose, Glycom, Jennewein, Glycosyn. Companies should monitor upcoming developments from Conagen related to other complex HMOs beyond 2′-FL."

Making Sense of Sustainability

Google teams up quantum and classical computing for chemical simulation

mike holman

Michael Holman, Ph.D., VP, Research | @MichaelHolmanLR Ico twitter
Lux Take: Average Importance

"The quantum mechanical nature of chemicals means that quantum computing has tantalizing potential to deliver improved molecular simulations. This research represents a step toward that potential, but not its realization. The researchers used Google's quantum computer to run a Hartree-Fock simulation, which can be run on a classical computer, so this work itself doesn't represent improved quantum capabilities. However, it does demonstrate a method for using the quantum computer in conjunction with a classical computer for error checking, which could prove to be a successful way to make quantum computer chemical calculations practical in the future – keep watching this space."

Saga Robotics raises $11 million for its modular autonomous agriculture solution, Thorvald

Haslun, JoshJoshua Haslun, Ph.D., Senior Analyst | @JHaslun  Ico twitter
Lux Take: Average Importance

"Led by Nysnø and joined by ADM Capital, Rabo Food, Agri Innovation, and other Norwegian investors, this round follows the progressive trend in European agriculture. Thorvald provides harvesting, phenotyping, and cultivation capabilities through modularity but uniquely treats fruit and vegetables with ultraviolet light for pesticide-free fungal protection. Robotics platforms aimed at pest control and harvesting are beginning to see real farm use; at the Ag Innovation Showcase, FarmWise indicated that it now services growers with seven bots in the U.S. While challenges with scaled applications remain, companies must monitor for early success, as progressive fruit and veg growers provide more opportunity to ground-truth these platforms."

Researchers tout fluorine-free coating with anti-smudge and self-healing properties

Gee, Cecilia

Cecilia Gee, Analyst
Lux Take: Low Importance


"Fluorine-free formulations are of increasing importance in order to comply with existing fluorine bans and improve global product/market fit. This work takes a sensible approach to multifunctional coatings by creating an offering that is easily incorporated into existing PU, as opposed to niche formulas that cannot be used as a drop-in additive. However, its "self-healing" function is not truly autonomous and should instead be considered a heat-activated, healable coating. Those interested in multifunctional coatings should approach materials development with ease of integration, sustainable formulations, and targeted markets and applications in mind."

QuantumScape goes public via SPAC at $3.3 billion valuation as EV bubble continues to grow

Robinson, ChristopherChristopher Robinson, Senior Analyst | @CRobinsonLux Ico twitter
Lux Take: Low Importance


"QuantumScape is the latest startup to go public via a special purpose acquisition company (SPAC); while most have been electric vehicle companies, this marks the first battery company to jump on the trend. There are a number of red flags about the announcement. The CEO claims the company has eliminated the "science risk," but further examination of investor presentations suggests the company still has yet to make a multilayer cell – a crucial step for commercializing its technology. The company does not appear to be on track to meets its aggressive targets, which include an incredible 91 GWh of production capacity by 2028 at 30% gross margins. Those interested should view this as yet more evidence of the bubble growing around electric vehicles."

QuantumScape goes public via SPAC at $3.3 billion valuation as EV bubble continues to grow

Katrina WesterhofKatrina Westerhof, Director, Research
Lux Take: Low Importance


"The document outlines security best practices for consumer IoT devices and is written without jargon to be accessible to consumers. Its recommendations are a mix of security and data privacy recommendations, including some that support adoption of emerging technology solutions, such as ensuring firmware integrity and monitoring for anomalies in telemetry data. As a completely voluntary standard, this isn't a mandate like California's 2018 consumer IoT security bill, but mandates so far have proven to be vague and toothless. Companies shouldn't expect this document to drive substantial change but should look toward Australia's new standard and other resources like UL's ratings and the CTIA's certifications when developing consumer IoT devices."

 

 
 

FURTHER READING:

- Free Access to our COVID-19 Resources

- Blog: Lux Take on News: Weekly Round-Up August 28, 2020

- Blog: Don't Worry About Whether or Not Google Achieved Quantum Supremacy

- Executive Summary: Automating the Last Mile (Free Download)

- Executive Summary: Preparing for Quantum Computing

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