In 1997, the world had its own pandemic scare with the first human cases of the Avian Flu, The Titanic and The Lost World: Jurassic Park were both released, and the first Harry Potter book was published.(1) Yet, the most meaningful event of the year may have come when a man named Vic Hayes created the standards for what we know today as wireless internet, or Wi-Fi.(2) The impact this had on life as we know it can’t be overstated. The World Bank estimates at that time about 2% of the world population was using the internet. A jump to over 50% by 2018 was made possible by wireless access.(3) Consequently, similar growth has been seen in the number of devices connected to the internet creating a network of data-exchanging technologies we know today as ‘The Internet of Things’ (IoT). A Cisco study estimated that about 500 million devices were connected to the internet in 2003.(4) This number has exploded to over 20 billion in 2019 and rather than slowing down, the rate of growth in connected devices is expected to accelerate to an anticipated 41.2 billion devices connected by 2025 (Figure 1).(5)

Even before Hayes introduced his wireless internet standards, work was being done elsewhere to accomplish mobile device networking. The first generation of mobile networks (or what we know now as 1G) was covering the entire country of Japan by 1984 after being launched in 1979 in Tokyo. While this was an outstanding feat of innovation, there were plenty of flaws related to connectivity, compatibility, cost, and a lack of encryption.(6) The subsequent generations of mobile networks focused on solving these issues and establishing the means and methods of which global connectivity occurs today. From SMS text and multimedia messages to international roaming and video conferencing, these feats of innovation had a dramatic impact on society and business. They brought us into an age of immediate response and set us on a path towards a digital future. The iPhone has certainly been one of the most groundbreaking technologies invented in the modern era, however, it is difficult to imagine its success without the continued drive to improve and perfect the mobile network. Increased speed requirements allowed for higher quality video, as well as internet gaming and the explosion of the “app-for-everything” movement. Streaming and digitization capabilities brought to life new business models and forced existing companies to adapt old ones to remain competitive (as seen in the mass adoption of Netflix and the introduction of Disney+).

Despite all the progress made from 4 generations of mobile networks over 40 years, we are only at the cusp of what has been considered the ‘Internet of Things’ (IoT) era. Definitions of what is included in the ‘Internet of Things’ category vary. Gartner seems to describe it best as “the network of physical objects that contain embedded technology to communicate and sense or interact with their internal states or the external environment.”(7) IoT Analytics narrows this further to devices like connected cars, smart home devices, and connected industrial equipment rather than smartphones, laptops, and computers. Their studies show that 2020 was the first year that connected IoT devices outnumbered non-IoT devices, and it is believed that this dispersion will only grow due to the enhancements made possible by 5G.(5) In order for an ‘Internet of Things’ environment to thrive, there needs to be complete trust in the internet connectivity and real-time responses that 4G cannot provide. Even as early as 2008, South Korea and NASA launched separate initiatives designed around developing a fifth-generation network capable of handling such a stretched capacity.6 With max speeds being reported at around 20Gbps, the potential for technologies that operate with virtually no noticeable lag is endless (Figure 2).(8)

So, the question is who is poised to benefit from the introduction of this new paradigm? Speed doesn’t come without its cost. One Bloomberg report estimates that it could cost companies about $200 Billion a year in research and development.(9) While 5G’s speed is certainly higher, the connectivity range of the stations is not as wide. More emitters are required to be placed closer together which leads to higher upfront costs associated with the 5G rollout (specifically infrastructure development). This is a cost that is typically carried by network providers. These companies will likely try to offset that cost and grow profits by capitalizing on the network’s speed. Internet speed is all about data transfer. The new devices will require more data transferred faster and, as a result, will require that the subscribers increase their data plan thresholds. With unlimited data plans already introduced, the consumer’s willingness to absorb price increases remains to be seen. More meaningful growth may be found in the communication equipment providers (those in direct benefit of the wireless provider’s increased capex) and end-user applications.

The digitization movement is far from over. A study conducted by BrainStation found that 92% of organizations plan to increase digital transformation activities.(10) The pandemic, and resulting quarantines, furthered the entanglement of life and technology. It forced individuals to adopt technologies that they previously may have avoided. While there is certainly an urgency to return to some level of normalcy, there is also some level of comfortability found in those new experiences. Gartner completed a survey that showed over 80% of company leaders plan to allow employees to work remotely at least some of the time.(11) With a more reliable internet connection, it is reasonable to expect that companies related to software applications, streaming, video chatting, etc. will continue to see solid growth (albeit not the levels of growth seen during the pandemic adoption) as the quality of the digital environment improves. It may also be reasonable to assume that the quarantine experience will make it easier for individuals to adopt new technologies in the future, especially for individuals who aren’t typically technologically savvy. These adoption trends are likely to be sticky as a survey completed by Mobiquity found 88% of Baby Boomers claimed that they will continue to “use digital technology to make daily life easier” once the pandemic ends.(12) Finances and healthcare are areas that individuals (especially older demographics) have been reluctant to invite technology to be a part of. That same study found dramatic increases in the willingness of Baby Boomers to order and make payments for curbside groceries and food from restaurants (+431% and +300% from pre-COVID levels, respectively). It uncovered that over 50% of the generation now made digital payments, transferred money, and performed other traditional banking activities using mobile applications. This transition is likely a large contributing factor to the expected 83% growth predicted in digital wallets by 2025 as an estimated 50% of total spend is anticipated to come from contactless & eCommerce transactions.(13) Faster and more reliable internet connections should mitigate a lot of frustrations created during previous customer experiences that may have prohibited individuals from adopting more digital transactions thus far.

Regarding healthcare, 48% of respondents used a version of telemedicine, which was up from 10% pre-pandemic. This type of comfort with healthcare technologies could give rise to adoption rates of innovations in similar areas, like vital signal monitoring or remote surgeries. A study done pre-COVID reported that in 2018 15.1% of all general surgeries were robot-assisted, up from just 1.8% in 2012. Due to a global suspension of elective surgical procedures (an estimated 28 million were cancelled or postponed), the robotic surgery market will likely decline in 2020, but is estimated to accelerate by an annual growth rate of 21.8% between now and 2027.(14) During pandemic conditions, robotic surgeries have reduced the amount of contact between patients and surgeons in an environment where the risk of transmission can be higher. Beyond the pandemic, robotic surgeries can reduce the number of individuals required for certain operations, can benefit from machine learning and data analysis, centralize the display of important information for the surgeon, and allow for operational flexibility through voice and eye-tracking technology.(15) All of this is made possible by 5G internet and sensor improvements that overcome signal transmission lag.

Increased internet capacity and enhanced sensor device technology puts the IoT theme at the center of disruption for several other business trends:

Smart Homes: Consumers like to establish their own ecosystems and, as such, the adoption of smart home devices and appliances should accelerate. Statista’s outlook finds that the household penetration rate will hit 12% in 2021 and is expected to increase to over 21% by 2025.(16)
Smart Cities: Urban areas of tomorrow will use utility sensors and electronic methods to manage resources and services more efficiently and effectively. The global smart grid market, measured to be almost $24 billion in 2018, is anticipated to grow to over $61 billion by 2023.(17)
Big Data: Faster internet means increased data throughput and storage. In 2019, data generated from IoT devices was 18.3 ZB (1 ZB is 1 trillion GB). The International Data Corporation (IDC) anticipates this to explode to 73.1 ZB by 2025.18 Prescient & Strategic Intelligence predicts that the global data warehouse market will grow from $1.4 billion in 2019 to $23.8 billion by 2030.(19)
AI & Machine Learning: Greater adoption and more data capture leads to faster rates of training for artificial intelligence. Grand View Research sees the global machine learning market expanding from $6.9 billion in 2018 to almost $90 billion by 2025.(20)
Robotics: The increased artificial intelligence usage should allow for more advanced robotics solutions and bring some practicality to autonomous vehicles. Mordor Intelligence reported that the robotic market was valued at $39.72 billion in 2019 and is expected to grow at an annual rate of 25.38% over the next 5 years.(21)
Cyber Security: With the growing sensitivity to personal data capture and the increased points of vulnerability from added devices, cybersecurity is an industry poised to indirectly benefit from the growth of 5G and the Internet of Things. Grand View Research valued the cyber security market at $156.5 billion and is anticipating an annual growth rate of 10% over the next 7 years.(22)

Innovation has always been at the core of the world’s success. When push comes to shove, humans thrive upon creative problem solving to progress through adversity. This has been ever so clear recently during these quarantine periods. In order for businesses and lives to continue, there had to be a massive ‘coming together’ of individual agendas. That movement continues for the ‘Internet of Things’ era. The success of the industry is woven into the success of many other themes, resulting in a convergence of ideas that reinforces its potential success (Figure 3).(23)