It usually takes a minimum of around 10 years for pharmaceutical groups to discover and test a new drug before they bring it to market, which explains why the industry is devoting so much of its energy to quantum computing. Major companies are genuinely interested in the technology’s potential because it can theoretically solve very complex business problems that are far too advanced for sequential computer processing power to cope with.
Through the application of this technology, pharmaceutical giants, for example, hope to generate massive R&D cost savings and increase the rate at which they discover new medicines.
Banks are being urged not to miss a trick on quantum computing by a number of technologists. “It is time to jump into the boat and become part of the quantum computing revolution. There are huge benefits to be realised for those first-movers, and it is something – which as a start-up – we are very excited about,” said one expert at Sibos in Sydney.
Boston Consulting Group (BCG) is certainly convinced by the technology’s intrinsic worth predicting the quantum computing market could morph into a $50 billion industry by 2030.
A handful of banks are certainly exploring quantum’s potential and analysing possible, viable use cases for the technology.
A paper produced by Standard Chartered in conjunction with NASA and the Universities Space Research Association, a research group, said quantum computing could be applied to portfolio optimisation at asset managers.
Meanwhile, other financial services experts believe quantum could be used in derivative pricing, managing highly complex risks and improving operational inefficiencies in areas like clearing and trade reconciliations. The road to full quantum computing adoption is a long one, and the technology is clearly not going to disrupt banking immediately, evidenced by BCG’s analysis, which estimates the technology will not reach full maturity for another 25 years, raising questions as to whether the industry has enough patience to wait that long.
Technologists at Sibos, however, felt BCG’s forecasts were too conservative, suggesting that quantum’s impact could be felt in five to 10 years. Even so, a number of people believe the debate about quantum computer is premature. There is still ambiguity about whether the technology actually exists let-alone works.
The BCG study said a quantum simulation requires around 150 logical qubits, which has yet to be achieved although IBM created a 20-qubit quantum processor while Google managed to build a 72-qubit quantum processor.
Along with legitimate reservations about whether the technology is real or imagined, the costs of incorporating quantum computing (assuming it is real) into business activities are going to be high, and many banks are unsure if the economics make it worthwhile, particularly as many are facing margin pressures.
The technology is also hamstrung by the fact that current, early models cannot process that much data, according to one expert, further narrowing the technology’s applicability in financial services. While quantum is certainly a fascinating premise, more research needs to be conducted into the technology.