What Does a Ping-Pong Playing Robot Mean for the Future of Industry?

A much hyped showdown between a robot and one of the world's best table tennis players proved largely fictional, but the rise of robots remans very real. How will it shape the world and the workplace?

Mar 17, 2014 at 8:00PM

Screen Shot

Source: Kuka.com

The rise of robots has long been a popular subject for science fiction books and movies. Novels from authors like Isaac Asimov and movies like the "Terminator" series have painted bleak pictures of a time when humanity is overrun or made irrelevant by advancements in robotics technology. Humans can probably hold off on developing time travel devices and reversing the rise of the machines for at least another few years, but the robot revolution has already begun. Companies like Google (NASDAQ:GOOGL), Kuka, and iRobot are positioning themselves for a future where robots are a part of everyday life.

Robotics manufacturer Kuka AG recently hyped up and released a video featuring one of its creations squaring off against a high-ranking table tennis player. The advertisement-styled demonstration has proven very controversial, but it's undoubtedly the latest sign of a big transition that's looming. What does this table tennis playing robot mean for the future of the global economy?

A fictional presentation of an impending reality
Kuka's recently released video was billed as a match between top ranked German tennis table player Timo Boll and a robot created to give ping-pongers a run for their money. The ad was released on YouTube and is largely cinematic; it does not depict an actual match between man and machine. That said, billing it as such certainly helped the company build a massive audience and bring attention to its name and robotics offerings.

The video had racked up over 1.5 million views a day after its YouTube debut. A behind-the-scenes video designed to show how the largely embellished showdown was created gives a much more accurate depiction of the Kuka bot's capabilities. The machine's ping-pong prowess lags behind its fictive counterpart by a substantial degree, but the implications for the future of industry are not hugely diminished. Robots will not need to have the reaction times and accuracy necessary to compete with a world-class table tennis player to revolutionize multiple sectors of business.

Robots don't strike or need health insurance
Fast-food chain McDonald's (NYSE:MCD) has been one of the companies at the center of the debate regarding whether the minimum wage should be raised. Company employees have instituted strikes and demonstrations requesting a wage hike to $15 an hour. While the stated desire to approximately double the minimum wage likely represents an "aim-high" bargaining tactic, it blissfully ignores the downward pressure that increasing robitization is already exerting on wages and work force requirement.

Screen Shot

Source: Mcdonald's.com

A McDonald's that pays its workers $15 an hour is likely one with fewer employees and more robots. The capabilities of Kuka's ping-pong playing robot do not match the depiction seen in the company's YouTube video, but they are already advanced enough to take over many of the food preparation duties at fast food chains such as McDonald's.

The International Federation of Robotics projects that the use of industrial robotics will increase 6% annually through 2017. The use of commercial robotics could grow at an even faster clip and would almost certainly be pushed along by minimum wage increases. Legislation like Patient Protection and Affordable Care Act has already pushed employers to reduce full-time hours and restructure their work force; robotization offers companies and franchisees a way around increasingly demanding employment standards.

There's a storm coming in
Boston Dynamics, recently acquired by Google, has gained public attention for creating robots that bring to mind the post-apocalyptic scenarios seen in the "Terminator" films. The firm's Big Dog and Atlas robots were developed with military use in mind and received funding from the Defense Advanced Research Projects Agency. Google's push into robotics is a good indication that robotization is no flash in the pan and that it could provide the impetus for the next big industrial and military revolutions. It also shows that the company will have an increasingly close relationship with governmental institutions and continue to shape the progression of technology. Boston Dynamics is the eighth major robotics acquisition for the company in the last nine months.

Screen Shot

Source: BostonDynamics.com

No fate but what they make
The bump that Kuka's share price received in the immediate lead-up to the much hyped video reversed upon the revelation that the ping pong showdown was mostly scripted affair. Still, the company's price has approximately doubled since March of 2012, signaling that there is strong confidence in robotics pure plays. Fellow robotics pioneer iRobot has seen comparable growth over the last two years.

These companies both have relatively small market caps at approximately 1.2 billion, meaning that major advancements are more likely to come from big tech players like Google, but there are great investment opportunities to be found in robotics in the coming decade. Meanwhile, companies like McDonald's will be able to improve their bottom lines by shifting to an increasingly robotic workforce. 

Make robots work for you
Want to profit on business analysis like this? The key for your future is to turn business insights into portfolio gold through smart and steady investing ... starting right now. Those who wait on the sidelines are missing out on huge gains and putting their financial futures in jeopardy. The Motley Fool is offering a new special report, an essential guide to investing, which includes access to top stocks to buy now. Click here to get your copy today -- it's absolutely free.

Keith Noonan has no position in any stocks mentioned. The Motley Fool recommends Google and McDonald's. The Motley Fool owns shares of Google and McDonald's. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers