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5G technology set for technological change and transformation of the global economy




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The rollout of the 5G network will transform the world economy, says BofAML. Image: Getty

Five core themes will shape the world over the next five years, fueled by an unprecedented increase in the pace of technological change, particularly the rollout of 5G mobile technology, according to Bank of America Merrill Lynch.

The financial service provider says in his report: Transforming World – The Next 5 Yearsthat the "the five most influential themes that should shape our world in the next five years" are big data and artificial intelligence; the rise of electric vehicles; demography; climate change; and privacy and cyber threats.

Because the amount of data doubles every two to three years, computing power becomes cheaper and the world becomes more and more connected, Big Data and AI create "enormous opportunities that extend across multiple sectors," according to the bank. "The amount of stored and analyzed global data could range from 1% today to 37% in 2025, which would amount to US $ 5 trillion in annual benefits.

"These trends, made possible by 5G as a foundation platform, will accelerate the rollout of next-gen technologies (autonomous vehicles, augmented reality, etc.)," ​​adds the report.

BofAML says 5G will support the fourth industrial revolution, "supporting a ubiquitous, connected world and accelerating the digitization of companies". By 2025 there will be more than 30 billion connected devices by 2025 and "5G will be the most important enabler and influencer in a transforming world".

These changes will increase the prospects of sectors such as technology, e-commerce and payments, along with capital goods and consumer durables, while the clothing, retail and old media sectors will face significant headwinds along with the energy sector.

"We believe that the world will transform in the fastest 5 years of human history," the bank adds, with disruptions arising from products and services ranging from blockchain, big data, medical marijuana to esports.

"The story of the coming years will be data," writes the bank's thematic investment team. By 2030, autonomous vehicles (AVs) could generate more data than the entire population of the earth does today. And a smart city generates even more data than all AVs together. But the current mobile networks can not support this. 5G has the potential to be the platform that needs this data, making it a cornerstone of our transforming world.

Big data and AI go hand in hand, according to the bank. "Together they are ready to make many future technologies possible, such as autonomous cars and mass adaptation of products", helped by drivers such as the internet of things, the growth of on-demand services, cloud computing, e-commerce and virtual / extensive reality. However, they will probably also lead to an increase in inequality.

And as the number of IoT devices today is rising from 7 billion to an estimated 21.5 billion by 2025 and the growth in smartphones, tablets and other devices continues, the world will become more connected, made possible by 5G. This "will bring considerable benefits, as well as inherent risks," the report said.

Material cyber and privacy risks result from the large vulnerabilities of IoT devices (IoT violence has increased by 600% in one year); the rise of speech technology (half of all searches will be on voice by 2020); the introduction of surveillance in homes (one in five American homes has smart speakers); and the increasing number of computers that communicate with each other.

"The cost of cybercrime will grow to around $ 6 trillion by 2021, compared to 3 trillion by 2015 as more people come online, threats are being attacked and online is further integrated into people's lives and daily activities." Cyber ​​security will be a crucial play a role in the protection of the global digital economy, with companies likely to face higher risk and compliance costs (infringements, regulations), "says the bank.

The shift from the internal combustion engine to electric vehicles will have effects far beyond the automotive sector in areas such as oil, utilities, mining, software and capital goods. BofAML says that by 2025 one fifth of the cars sold worldwide will be EVs and by 2030 EVs will represent 42% of sales. But at the same time, the sector will also be affected by the rise of ride-hailing, car-sharing, vehicle autonomy and multimodal travel. This will lead to changes in real estate, for example, as space is being released due to the downfall of filling stations and parking garages.

Demography will form the markets in the coming years, thanks to the aging of the population, the emergence of millennials, the start of Generation Z in the workforce and the shift of billions of emerging consumers to the global middle class.

"The rise of the Bottom Billions & # 39; stimulates the increasing demand for consumer durables & services, travel & tourism, entertainment, health, education and transportation," the report states.

At the same time, the idea of ​​peak ownership & # 39; and new technology-driven Sharing Economy models are transforming and disrupting the status quo for consumer-oriented companies, it adds.

With the evidence that climate change is taking place and is having serious consequences, the global energy transition to renewable energy and energy efficiency is in full swing, because technological improvements have reduced costs.

In the next five years, renewable energy sources will reach grid parity with, or become cheaper than, fossil fuels in most of the world. Other drivers away from fossil fuels such as higher carbon prices in Europe, improvements in energy storage, stricter government policy and a shift in company cultures to sustainability.

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The rollout of the 5G network will transform the world economy, says BofAML. Image: Getty

Five core themes will shape the world over the next five years, fueled by an unprecedented increase in the pace of technological change, particularly the rollout of 5G mobile technology, according to Bank of America Merrill Lynch.

The financial service provider says in his report: Transforming World – The Next 5 Yearsthat the "the five most influential themes that should shape our world in the next five years" are big data and artificial intelligence; the rise of electric vehicles; demography; climate change; and privacy and cyber threats.

Because the amount of data doubles every two to three years, computing power becomes cheaper and the world becomes more and more connected, Big Data and AI create "enormous opportunities that extend across multiple sectors," according to the bank. "The amount of stored and analyzed global data could range from 1% today to 37% in 2025, which would amount to US $ 5 trillion in annual benefits.

"These trends, made possible by 5G as a foundation platform, will accelerate the rollout of next-gen technologies (autonomous vehicles, augmented reality, etc.)," ​​adds the report.

BofAML says 5G will support the fourth industrial revolution, "supporting a ubiquitous, connected world and accelerating the digitization of companies". By 2025 there will be more than 30 billion connected devices by 2025 and "5G will be the most important enabler and influencer in a transforming world".

These changes will increase the prospects of sectors such as technology, e-commerce and payments, along with capital goods and consumer durables, while the clothing, retail and old media sectors will face significant headwinds along with the energy sector.

"We believe that the world will transform in the fastest 5 years of human history," the bank adds, with disruptions arising from products and services ranging from blockchain, big data, medical marijuana to esports.

"The story of the coming years will be data," writes the bank's thematic investment team. By 2030, autonomous vehicles (AVs) could generate more data than the entire population of the earth does today. And a smart city generates even more data than all AVs together. But the current mobile networks can not support this. 5G has the potential to be the platform that needs this data, making it a cornerstone of our transforming world.

Big data and AI go hand in hand, according to the bank. "Together they are ready to make many future technologies possible, such as autonomous cars and mass adaptation of products", helped by drivers such as the internet of things, the growth of on-demand services, cloud computing, e-commerce and virtual / extensive reality. However, they will probably also lead to an increase in inequality.

And as the number of IoT devices today is rising from 7 billion to an estimated 21.5 billion by 2025 and the growth in smartphones, tablets and other devices continues, the world will become more connected, made possible by 5G. This "will bring considerable benefits, as well as inherent risks," the report said.

Material cyber and privacy risks result from the large vulnerabilities of IoT devices (IoT violence has increased by 600% in one year); the rise of speech technology (half of all searches will be on voice by 2020); the introduction of surveillance in homes (one in five American homes has smart speakers); and the increasing number of computers that communicate with each other.

"The cost of cybercrime will grow to around $ 6 trillion by 2021, compared to 3 trillion by 2015 as more people come online, threats are being attacked and online is further integrated into people's lives and daily activities." Cyber ​​security will be a crucial play a role in the protection of the global digital economy, with companies likely to face higher risk and compliance costs (infringements, regulations), "says the bank.

The shift from the internal combustion engine to electric vehicles will have effects far beyond the automotive sector in areas such as oil, utilities, mining, software and capital goods. BofAML says that by 2025 one fifth of the cars sold worldwide will be EVs and by 2030 EVs will represent 42% of sales. But at the same time, the sector will also be affected by the rise of ride-hailing, car-sharing, vehicle autonomy and multimodal travel. This will lead to changes in real estate, for example, as space is being released due to the downfall of filling stations and parking garages.

Demography will form the markets in the coming years, thanks to the aging of the population, the emergence of millennials, the start of Generation Z in the workforce and the shift of billions of emerging consumers to the global middle class.

"The rise of the Bottom Billions & # 39; stimulates the increasing demand for consumer durables and services, travel and tourism, entertainment, health, education and transportation," the report said.

At the same time, the idea of ​​peak ownership & # 39; and new technology-driven Sharing Economy models are transforming and disrupting the status quo for consumer-oriented companies, it adds.

With the evidence that climate change is taking place and is having serious consequences, the global energy transition to renewable energy and energy efficiency is in full swing, because technological improvements have reduced costs.

In the next five years, renewable energy sources will reach grid parity with, or become cheaper than, fossil fuels in most of the world. Other drivers away from fossil fuels such as higher carbon prices in Europe, improvements in energy storage, stricter government policy and a shift in company cultures to sustainability.


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