If you’ve made it through the first 20 years of this century without having your industry turned upside down, that doesn’t mean it’s safe to rest on your laurels. 5G will usher in the next wave of business disruption.
Consider self-driving cars—just one example of 5G-enabled technology. Munu Gandhi, vice president of core infrastructure services at Aon, a global professional services firm focusing on risk, retirement and health solutions, expects autonomous vehicles to force insurance companies, automakers, taxi services, construction businesses and the trucking industry to rethink the way they operate.
“Think about cybersecurity, which is now a huge part of what every organization spends significant resources and focus on. It’s a board-level conversation,” says Gandhi. “5G is going to be that.”
The obstacles—as well as opportunities—differ from industry to industry, and even from business to business. But there are universal things every organization should consider to determine how 5G might affect it.
Understand The Transformative Potential Of 5G
Consider how technologically ancient it now seems to have waited patiently as your desktop’s modem slowly screeched its way onto the internet. 5G could make many things we do today seem just as quaint—and that also applies to the services we offer as businesses. For instance, consumers may never have to ask for a business’s Wi-Fi password. They’ll use 5G for every device, wherever they are.
The same is expected for connectivity inside each business: There will be less local networking inside offices and fewer closets full of servers. The question of “Why Wi-Fi?” will become commonplace.
“This is an existential question for a networking company,” says Gandhi. “[At Aon], we have a road map that says we will, in five years or less, not have networking hardware in our offices. None.”
That’s not a guess. Aon ran a field test that validated the concept of a totally wireless office. That may be surprising news for most businesses, but for the companies that provide those in-office networking services now, that’s an ominous forecast.
“They need to ask, ‘Where will new business models and value creation occur?’ and alternatively, ‘Where will the destruction of legacy business models happen?’” says Gandhi.
Learn The Components Of 5G
To understand how 5G could affect each company, business leaders have to know what it actually is. The increased speed gets most of the attention, but it’s far more than a bandwidth boost.
- Bandwidth: Some high-band demonstrations have shown 5G bandwidth reaching 10 gigabits per second—more than 100 times the speed of 4G—but limited to short-range outdoor coverage. Low-band 5G spectrum enables a much farther signal, indoors and out, with reliably higher bandwidth than 4G.
- Latency: Latency is how long it takes data to get from one point to another. High latency means there’s a delay between pushing a button and the desired result. 5G could reduce latency by 50 to 100 times.
- Edge computing: Edge computing in 5G will allow services to execute at a cell site level. By reducing the distance data must travel, this could provide advantages for certain applications—from real-time predictive and prescriptive analytics to IoT technology.
- Scale: 5G may be able to support 10 to 100 times more devices per square kilometer than current technologies, including both standard mobile devices used today and the IoT sensors that experts expect to proliferate in the 5G era.
- Battery efficiency: Thanks to lower latency and edge computing, 5G is expected to dramatically expand battery life—think IoT sensors that last for years, enabling faster data transmission, analysis and insights that will help businesses be even more agile.
The opportunities and disruption will emerge from the collective impact of these multiple factors, explains Gandhi. “It’s the way all of these components intertwine that creates the exponential value that begins to enable the fourth industrial revolution—the experience economy.”
Map Out Every 5G Touchpoint
With an understanding of the scope and components of 5G, businesses can begin the process of evaluating how next-generation networks could disrupt their operations or offerings.
First, says Gandhi, business leaders need to map out their organization’s touchpoints. Examples could include the consumer experience, the enterprise experience, shipping and so on. “You have to consider the full value chain of whatever product or service you’re thinking about—end to end.”
Once those touchpoints are mapped out, evaluate each for how 5G might enable or destroy current operations or offerings.
An auto insurance company, for example, might identify a threat in one of its major touchpoints: collisions. As 5G enables autonomous vehicles, Department of Transportation researchers anticipate there will be fewer collisions, injuries and fatalities. That will lower risk, which will in turn lower premiums, which will lower revenue.
“If I’m an insurer, the negative impact to revenue through these advancements in technology is significant, potentially forcing companies out of business,” says Gandhi. And once business leaders identify these opportunities and obstacles, it’s time to get creative. “If 5G is going to enable me, how do I bring in the right leadership to think through the strategy? If it’s on the destruction side, what do I need to do to change my model so that I can be on the right side of what survives?”
Find Solutions Through Partnerships
Though the answers will be different for every business, Gandhi thinks forging new partnerships will be universally key.
“You won’t be able to do this alone,” says Gandhi. It’s only by building relationships and fostering ecosystems of innovation that businesses will be able to survive the potential disruption of 5G. But those survivors will have a green field of opportunities to innovate and capitalize on what’s next for their industries.
In education, for example, 5G could enable the delivery of high-quality teaching resources to classrooms in remote locations—as long as collaborative partnerships are in place. “[5G] will democratize education,” says Gandhi.
This principle will likely hold across industries—though the partnerships will be as varied as the array of business challenges and opportunities that emerge with 5G.