A potential strike by casino workers in Las Vegas was averted, but their concerns over automation will likely remain. In addition, this week saw IBM laying off employees in its Watson Health division, and China launching facial recognition efforts in Africa.

Robotics Business Review has partnered with Abishur Prakash at Center for Innovating the Future to provide its readers with cutting-edge insights into recent developments in international robotics, AI, and unmanned systems. Are you ready to be updated?

Automation among concerns of Las Vegas casino unions

Robotics developments: On June 1, a deal between the Culinary and Bartenders Unions and several large hospitality companies in Las Vegas, including MGM, expired. The unions represent around 38,000 workers. During negotiations over a new deal, many workers threatened to strike unless protections against automation were included, among other things. To avert the strike, individual companies, such as Caesars and MGM, have formed new deals with the unions.

Geopolitical significance: As unions clash against automation efforts, this could slow down its adoption. In February, Canada’s Suncor Energy announced 400 workers would lose their jobs to self-driving cars. The union representing these workers bashed the decision and demanded that no full-time workers would be laid off.

A month earlier, the Teamsters Union, which represents 260,000 UPS workers, said it was in negotiations for UPS to not use drones and self-driving vehicles. And last year, in South Korea, workers at Hyundai went on a two-day strike over automation concerns.

The clash between unions and automation could result in one of two things: Automation will be put on the back burner, or unions will lose all their relevance and power. If the latter takes place, it might force governments to step in to protect workers with new policies.

At the same time, automation may lead to the rise of new unions. Last year, the European Union (EU) voted on (and rejected) a proposal to give robots the status of “electronic persons.” Part of this would have outlined the rights and responsibilities for companies deploying robots. If robots are “electronic persons,” could there be electronic unions or robot unions? If so, it could create confusion and complexity as to how companies deploy automation technologies.

For now, most of what unions are doing are temporary solutions. In 2016, the port of Rotterdam went on strike over automation. The deal they struck will protect jobs from 2016 till 2020. After that, nobody knows what will happen.

IBM Watson Health problems could signal AI bubble

Robotics development: IBM’s Watson Health Division, which was spun off from IBM Watson in 2015, is reportedly laying off 50% to 70% of its staff. This is affecting staffers across the U.S.. It is mainly affecting people in companies that Watson Health acquired, such as Truven, Merge and Phytel. Over the past few years, Watson Health has grown from a small number of employees to more than 7,000 people, spending more than $4 billion on acquisitions.

Geopolitical significance: While IBM may be “trimming the fat” around its core AI business, there is another explanation for the layoffs: AI isn’t providing a fast enough return on investment.

For instance, in February 2017, the MD Anderson cancer center, part of the University of Texas, put its Watson Health project on hold after an auditor said the project cost the company more than $62 million without reaching its goals.

This also reinforces the possibility that there may be an AI bubble, which I have written about previously. According to a leading venture capitalist in China, AI bubbles will start to “explode” by the end of this year. If AI bubbles begin to burst, from China to the U.S., it will change how governments view AI.

In the U.K. alone, AI is expected to add £630 billion ($844 billion) to the economy by 2035. If AI companies are going under, then the pace at which AI can grow economies will slow.

At the same time, different regional policies could affect automation adoption. For example, China, Singapore, South Korea, the United Arab Emirates, and Japan are all seeing growth in AI and healthcare. In May, South Korea announced it was investing $33.4 million to create an AI doctor named “Dr. Answer” that will be similar to Watson Health.

Meanwhile, in China, so much support is being given to the industry that AI healthcare services could be worth $930 million by 2022. In contrast, in markets like the U.S. and Western Europe, the infrastructure, adoption of technology, and demographics are different.

At the same time, another reason why IBM Watson Health may be having a tough time is because local solutions are being supported over foreign. In South Korea, the five biggest hospitals are not interested in IBM Watson — they would rather their own AI or work with one another to develop it.

China launches facial recognition project in Africa

Robotics development: CloudWalk Technology, a startup from Guangzhou (a port city located northwest of Hong Kong), signed a deal with the government of Zimbabwe to supply facial recognition technology on a mass scale. The technology will be used in security, policing, and other areas.

This is China’s first AI project in Africa and is part of China’s “One Belt, One Road” (OBOR) strategy. OBOR is a multi-trillion dollar plan to connect countries throughout Asia, Africa, the Middle East and Europe through Chinese infrastructure and technology.

Geopolitical Significance: What makes China’s deal with Zimbabwe so important is that it shows the pace at which facial recognition technology is being adopted around the world. Last year, Germany started testing facial recognition at a train station in Berlin to catch terrorists.

In South Korea, the government is looking to deploy facial recognition to all government buildings to strengthen security.

By the end of summer 2018, Dubai International Airport will have deployed its first virtual aquarium, a short “tunnel” with screens depicting deserts, oceans or other scenery. Through 80 facial recognition cameras, the aquarium will scan people that walk through it and either clear them for entry into the country or alert security.

As more countries look to facial recognition technologies, it creates a new opportunity for AI companies. However, it also creates a new ethical dilemma. Facial recognition could be viewed as a new kind of surveillance.

In China, for example, the city of Shenzhen will identify people who are speeding or driving without a proper license. Train stations throughout China are tracking faces to spot criminals, while intersections are tracking jaywalkers and identifying who they are to fine them. Even college exams are seeing facial recognition technology emerge to ensure the student taking the exam is the real person — not a friend.

All of this points to China using facial recognition technology to track its population in a new way. Will facial recognition companies be OK with governments using their technology like this?

In addition, if China is first to supply this technology abroad, such as in Zimbabwe, it changes how well non-Chinese firms can compete.

Will facial recognition firms from the U.S., Europe and other parts of Asia be able to sell to Zimbabwe? Through “first mover advantage” and OBOR, China could have a monopoly over facial recognition technology, not just in Zimbabwe, but other parts of Africa as well.