Key Developments and Trends
- While 5G Hits Mainstream, Initial Rollouts Are Underwhelming
- While Forbes predicts that 5G "will transform consumers live and how businesses interact with customers," it stops short of saying that the full transformation will happen this year or even next year. It projects that mass availability, even within the early adopting community, is still two to three years away.
- Many companies are currently paying for 5G connectivity despite the fact that, in practice, the connectivity they are getting is not much different.
- This is because 5G networks have only been lit up in a limited number of cities. This means it has not made any meaningful change to the vast majority of people.
- Currently, less than 1% of mobile devices is 5G enabled. While 60% of the United States is predicted to have 5G coverage by mid 2020, mobile devices are still struggling to catch up with less than 2% will be 5G enbabled, according to PwC. However, Gartner projects that global sales of 5G devices will be 489 million in 2021, more than double of the projected 221 million in sales this year.
- Around the world, a number of countries are racing to launch 5G services. See the figure below for countries/regions leading in 5G adoption.
Source
5G Driving Digital Transformation
According to Gartner, worldwide 5G network infrastructure revenues is projected to reach $4.2 billion this year, with 89% year-over-year growth. While rolling out is taking time, the 5G network will be capable of linking 100 billion devices simultaneously once fully rolled out.
Telecom companies are targeting enterprises for 5G applications in sectors such as education, healthcare, manufacturing, retail, transportation, and as an enabler for private networks.
Applications will rely on the ability of 5G technology to enable edge computing, allowing for "greater reliability, better use if bandwidth, and lower latency." International Data Corporation (IDC) projects that "45% of all IoT-generated data will be stored, processed, analyzed, and acted upon close to or at the edge of networks" in three years.
Forbes also predicts that together with articial intelligence, 5G will enable massive data transfers fueled by IoT, "animating the intelligent edge and bringing things like sentient infrastructure in cities closer to fruition."
The technology is also expected to drive the digital transformation in payment. For example, while mobile shopping is already on the rise, 5G technology is expected to accelerate the growth, with Vodafone projecting a £30 billion boost by 2030 in London's economy alone.
5G Driving Digital Transformation
According to Gartner, worldwide 5G network infrastructure revenues is projected to reach $4.2 billion this year, with 89% year-over-year growth. While rolling out is taking time, the 5G network will be capable of linking 100 billion devices simultaneously once fully rolled out.
Telecom companies are targeting enterprises for 5G applications in sectors such as education, healthcare, manufacturing, retail, transportation, and as an enabler for private networks.
Applications will rely on the ability of 5G technology to enable edge computing, allowing for "greater reliability, better use if bandwidth, and lower latency." International Data Corporation (IDC) projects that "45% of all IoT-generated data will be stored, processed, analyzed, and acted upon close to or at the edge of networks" in three years.
Forbes also predicts that together with articial intelligence, 5G will enable massive data transfers fueled by IoT, "animating the intelligent edge and bringing things like sentient infrastructure in cities closer to fruition."
The technology is also expected to drive the digital transformation in payment. For example, while mobile shopping is already on the rise, 5G technology is expected to accelerate the growth, with Vodafone projecting a £30 billion boost by 2030 in London's economy alone.
Key Players in 5G Technology
According to a 5G infrastructure market report by Markets and Markets, the major players in the 5G infrastructure market are Huawei (China)[getting banned], Ericsson (Sweden), Samsung (South Korea), Nokia Networks (Finland), ZTE (China)[getting banned], NEC (Japan), CISCO (US), CommScope (US), Comba Telecom Systems (Hong Kong), Alpha Networks (Taiwan), Siklu Communication (Israel), and Mavenir (US).
Verizon, AT&T and T-Mobile are also named among the key players in the market report. Note that the three companies are 5G carriers.
An analysis of the 5G infrastructure published on Forbes, on the other hand, separates leadership in 5G infrastructure into two categories: single-purpose and multi-purpose infrastructure providers. Ericsson and Samsung are named the leaders in the former category while Cisco and Hewlett Packard Enterprise/Aruba are named the leaders in the latter.
An analysis of the 5G infrastructure published on Forbes, on the other hand, separates leadership in 5G infrastructure into two categories: single-purpose and multi-purpose infrastructure providers. Ericsson and Samsung are named the leaders in the former category while Cisco and Hewlett Packard Enterprise/Aruba are named the leaders in the latter.
Impact of 5G on the Advertising Industry
Key Findings by Consumer and Advertiser Surveys
54% of consumers are most excited about consistent and better-quality video streaming delivered by 5G.
47% of advertisers will use new or additional creative formats via 5G.
85% of consumers believe 5G will benefit augmented reality (AR).
33% of advertisers are already planning for 5G.
Better Reach Accross Channels
- With the high speed expected of 5G, advertisers will reach audiences much faster across all devices. Because of the fast connection, devices will offload processing into the cloud, with power-consuming processors no longer draining batteries. This means better connection and better experience on all 5G-enabled devices.
- The possibility of connection is endless as 5G can turn any device into a channel to reach customers. For example, connected fridges, cars and DOOH displays.
- Once 5G is fully adopted, everything will be connected from consumer devices to infrastructure, meaning every device is mobile in the world of IoT. The smartphone can be used as a remote controller for all things with IoT potential, which will be made more efficient by 5G technology. This will result in more demand and supply, "scaling the number of integrations between IoT and 5G."
- Consequently, advertisers will have to "serve content and engage customers with multiple formats across various devices."
- With the massive data involved, this requires advertising infrastructures to be improved to deliver sophisticated advertisements. This means "data repositories will need a redesign; the programmatic auction process will have to be optimized to take advantage of better speeds and the amount of data processing involved; and advertising platforms such as digital billboards will evolve to cater to the real-time needs of the on-the-go customer."
Possibilities of Content
- Because of its speed, 5G is predicted to have the most impact on video content. By enabling "users to stream large, high-quality videos faster than ever before," 5G will lead to a new high in video consumption.
- Since advertisements and landing pages will load faster, the number of visitors terminating because of loading delays will also significantly decrease. This will also open up opportunities for "compelling, creative, and high-resolution ads to engage consumers." For instance, interactive content such as live-streaming, 4K video.
- As mentioned in the initial research, 5G will likely take voice assistants to another level: voice conversations. Advertisers are expected to "explore formats and ways to tap into the realm of voice-based advertising."
- Furthermore, AR adoption is expected to be accelerated by 5G, which will create more advertising opportunities. For example, a mobile device may used as a projector or a car’s dashboard may be used to advertise a nearby establishment.
- Another important aspect is personalization with better data. With 5G expected to generate "an unprecedented amount of data," advertisers can targer consumers at right time and the right place with the right content.
- With all the possibilities of creativity in advertisement brought about by 5G, consumers are predicted to have high expectations of advertising, leaving no room for "clunky, backward ads."
Examples of Usage
As previously mentioned, less than 1% of current devices in used are 5G enable; thus, there has not yet been a real case of brands leveraging 5G in advertising--although as highlighted above, 33% of advertisers are already making plans. This section will provide examples of how 5G could be used in advertising in the future.
Know When Customers Need a Product/Service
When 5G matures and 5G-enabled devices are widely used, the unprecedent data available can create "in-depth, granular, hyper-targeted, and advanced location-based advertising" that is more personalized than ever.
For example, a 5G-enabled, smart refridgerater collects information on items stored it in. It can report when a certain product is running low. With this information, advertisers can send a notification or an ad to the customer right when they need to restock the product.
In this case, the advertising strategy can go even as far as showing the customer the closest or most convinient locations for the cutomer to pick up the product.
Another example of how 5G and IoT can be used is a smart car notifying or reminding the customer of a product/service in need while driven by a location where the product/service may be acquired. The car's dashboard notification system alerts the customer (the driver), for instance, that they are in need of a bike rack while the car is driving by a REI. If the customer stops by the store, their mobile device tells them where the product may be found in the store. REI can further enhance their marketing stratgy by
While driving by an REI, your car’s dashboard notification system reminds you that you are in the market for a bike rack; it suggests that you can stop into the store within five minutes. Once inside, your mobile device highlights where the items are in the store, and steers you towards bike racks that connect to a trailer hitch. Your phone “knows” that’s what you’re in the market for. As you’re mulling your purchase, REI sweetens the deal by offering a $50-off coupon.