Technological Breakthroughs

Technology has long been a measure of human advancement and power. Today, the next revolution is well underway, and the world is rushing to adapt to the rising speed of development. What feels like incremental change today is truly exponential compared with the past, and expectations continue to rise. Disruption is the new normal and will drive relentless change.  

How must we plan, invest and execute in a rapidly advancing world?

Technological breakthroughs - FACTS
  • Computing power is now doubling every 3.4 months (significantly faster than the two years of Moore’s Law). 
     
  • In 2019, while 58% of large companies reported adopting AI in at least one function or business, only 19% had addressed “explainability,” and only 13% had addressed systemic bias in underlying data.
     
  • 5G is expected to link 125 billion devices by 2030, spanning from consumer devices to industrial sensors. 

Instantaneous disruption

  • 1991 2G brings first wireless internet access
  • 1993 World Wide Web introduced, dial-up speeds limited to 56 kbps
  • 2001Broadband (cable/DSL) adoption increases 50% year on year. 3G wireless access launches
  • 2005 Unlimited data plans arrive. Amazon begins free two-day delivery via Prime in U.S.
  • 2006 4G wireless access launches
  • 2013 Google introduces Google Fiber at 10 MB/s
  • 2016 Half of U.S. households are Amazon Prime members
  • 2017 Industry leaders complete 5G NR standard
  • 2019 mmWave devices hit market, enabling 5G in mobile phones

Current events

5G investment. The last few years have seen a turning point in 5G networks as countries and companies accelerate the rollout of infrastructure. China, early to see 5G as a national strategic advantage, has deployed 10 times as many cell sites as the U.S., according to Deloitte estimates.112 The U.S. Federal Communications Commission became focused on 5G around 2018 and has since developed incentive schemes to encourage national carriers to develop the necessary nationwide systems and has been removing regulatory barriers.

In parallel, educational institutions, the military and large businesses have begun implementing private 5G networks. For example, BMW implemented a campuswide 5G network as it moves to implement the industrial internet of things (IIoT) in its factories. As an indicator of the industry’s rapid shift, the total global market for IoT sensors doubled from $7 billion in 2016 to $14 billion in 2018.113

Consumer demand for convenience. The concurrent increase of “busyness,” smartphone proliferation and 4G infrastructure have rapidly increased consumer expectations about the speed of services and expectations for convenience. In the U.S., more than half of consumers say they have a general interest in same-day delivery – despite their limited willingness to pay extra for it.114 Globally, Chinese e-commerce companies are ahead of U.S. and European companies in making same-day delivery the standard.115 China has also led the way in alternative models, like Freshippo’s, which offers grocery pickup while you eat.

Developing the connected consumer. Consumer technology that will be enabled by 5G infrastructure has also begun to emerge. Virtual-reality headsets became widely recognized, if not widely used. Google Home and Amazon’s Alexa laid the groundwork for what consumers are comfortable with in an interconnected smart home. A 2020 Super Bowl ad featured autonomous parking in Hyundai’s mainstream Sonata vehicles. As 5G infrastructure rolls out, this incremental groundwork to build consumer experience with next-generation technology will be instrumental in mainstream adoption of 5G-enabled technologies.

Future expectations

The history of human development could be traced by its perpetual search for more bandwidth. The current trend is a continutation. For companies, that creates two imperatives: build out the necessary infrastructure to deploy technology, and get ever closer to a quickly changing consumer who rapidly demands faster and more convenient services.

On the 5G front, infrastructure investment around 5G will continue to develop in two ways: via nationwide build-out as national carriers implement the technology, and through private networks for specific manufacturers. Ultimately, 5G is expected to link 125 billion devices by 2030, spanning from consumer devices to industrial sensors.116

As this infrastructure gets built out, 5G and AI-enabled technologies will begin to become standard operating practice. Industrial giants will likely lead in the IIoT space, developing and deploying sensors to enable machine-tomachine communication. Smart robotics will become standard in warehouses, and health care will deploy sensors to monitor outpatient health. The first fully autonomous vehicle ecosystems may appear in countries like Singapore, a country uniquely situated to execute smart-city infrastructure at scale.

For companies and governments, 5G represents the next dimension of potential as they race to deploy AI’s promised efficiency gains and insights, particularly for applications that require machine-to-machine communication like Industry 4.0 factories and autonomous driving. While some companies may opt to take a “wait and see” approach, the compounding benefit of AI algorithms and amassing data will provide early adopters a significant advantage in maintaining technological supremacy.

The benefit of 5G for consumers will lag company benefits. The biggest difference in the short term will be to communication, gaming and media streaming. Undoubtedly, as bandwidth and adoption expand, innovators will create novel applications with previously unattainable possibilities for consumers, but these will come gradually. In the meantime, in many places globally, the COVID-19 pandemic has accelerated the move toward e-commerce.

It has increased retailers’ fluency in new models like pickup-only locations and online grocery shopping in a way that is likely to dramatically change consumer expectations moving forward. For companies, these quickly changing consumer expectations require a renewed focus on the customer experience. The best-in-class companies will recognize the continued need for experimentation and create pilots to test how consumers respond. As retail transforms to offer consumers every option to purchase a product, brands will be competing for search result ranking rather than end-cap space. The brands that will win will offer compelling product photography, up-to-the-minute product supply information, and product data that the retailer can use to better understand consumer behavior and optimize their supply mix.