5G E10: The Shifting Shape of Everything

Bonus Episode of the Award-Winning FIVE Podcast

In this bonus episode of FIVE, Jake Moskowitz and his guests take a fresh look at 5G in our changed world, discussing how COVID-19 and a changed economy are impacting the expectations and adoption of 5G, and what that means for marketers.

Michael Stich talks sectoral winners and losers as a result of the pandemic and economy.

Peter Linder shares the latest 5G implementation statistics and the “most surprising thing.” Peter goes much deeper on his Ericsson 5G blog.

Jeremy Lockhorn discusses some fascinating real world 5G uses and plans.

Plus, Jake shares a preview of the first episode of season 2: FIVE – AI for Marketers, and hits the FIVE list.

The FIVE List:

• Business in America: The COVID-19 pandemic has affected just about every industry and business in some way, shape, or form. What does that mean for 5G?
• Suddenly distributed workforce: Where does 5G fit into a socially distanced nation of remote workers?
• Complementary technologies: Much of the promise of a 5G world is dependent on other technologies and their ability to evolve together as part of an ecosystem. Is that ecosystem evolving or has it stalled like so many business sectors?
• 5G Devices: A year ago, unemployment was at record lows and the economy was in great shape, but there were very few 5G enabled devices on the market. Today, the conditions are dramatically different. Are people eager to buy 5G phones and devices?
• 5G adoption and deployment: Mobile operators were making big bets and big claims about 5G this time last year. How are those looking now?

Jake’s guests:

Michael Stich, Chief Business Officer, VMLY&R

Peter Linder, Head of 5G Marketing, Ericsson

Jeremy Lockhorn, Global head of partner solutions, Emodo

The Five podcast is presented by Ericsson Emodo and the Emodo Institute, and features original music by Dyaphonic and The Small Town Symphonette. This episode was produced by Robert Haskitt, Liz Wynnemer and Jake Moskowitz.

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Transcript of E10: The Shifting Shape of Everything

Our dog is done barking, should we keep going? Okay, let’s talk 5G. 

Welcome to FIVE, the podcast that breaks down 5G for marketers. This is a special bonus episode, The Shifting Shape of Everything. I’m Jake Moskowitz.

Wow! It’s been a while. The official final episode of season one came out late 2019. Throughout the season we featured lots of guests and covered lots of ground including AR, VR, IoT, 5G’s impact on retail, marketing data, programmatic advertising, and privacy, and how those shifts will forever change marketing and advertising. Also, since this is a forward looking show, we packed in lots of speculation and predictions for 2020 and beyond. In a nutshell, season one was about how 5G would roll out and ultimately how significantly it will impact marketing; that seems like a very long time ago. We’ve seen an enormous amount of change in a very short period of time. 

So what does 5G look like now? This special episode of FIVE takes a look at 5G in our changed world, and puts all that change and even some progress in perspective. Also, we’ve been putting together a really interesting new season of the FIVE podcast. This time we’ll be exploring the transformational impact of artificial intelligence in marketing. Stick around at the end of this episode for a preview of episode one. In the meantime, let’s talk about what we’re talking about.

A lot has transpired since we last talked about 5G. The covid-19 pandemic, the resulting shock to the economy, the silencing of once bustling gathering places wildly altered consumer plans and expectations, and the explosion of people working remotely; and all of that has changed the trajectory of 5G development and adoption. 

Our very first episode looked at the ways 5G will impact marketing. In this episode, we’re flipping that on its ear, and looking at the ways the market is impacting 5G. How many ways are we talking about? Well when you pack ‘em all down and count ‘em all up i’d say there are… five.

Business in America, the covid-19 pandemic has affected just about every industry and business in some way, shape, or form. Positively in some cases, negatively in others. What does that mean for 5G? That’s number one. 

Number 2 is the suddenly distributed workforce. Where does 5G fit into a socially distanced nation of remote workers? 

Then there’s complementary technologies. Much of the promise of a 5G world is dependent on other technologies and their ability to evolve together as part of an ecosystem. Is that ecosystem evolving, or is it stalled like so many other business sectors?

Number 4, devices. A year ago, unemployment was at record lows and the economy was in great shape, but there were very few 5G enabled devices on the market. Today the conditions are dramatically different, and with the first 5G iPhone coming very soon. Are people eager to buy 5G phones and devices?

And finally, 5G adoption and development. The mobile operators were making big bets and big claims about 5G this time last year. How are those looking now? Let’s start at the top, and try to put it all in a marketing context.

Business in America; The Covid pandemic has obviously hit a lot of businesses really, really hard. Restaurants for sure, brick and mortar retailers of nearly every stripe, manufacturing, the list is long. Looking forward, what does recovery look like? To climb back, some of these industries are going to have to undergo a sort of reinvention. Does 5G play a role in that?

Michael Stich:

I think it’ll have to.

Jake:

That’s Michael Stich, Chief Business Officer at VMLY&R.

Michael:

There are sectoral winners and losers to covid. The winners are those that are enabling some of the work from home environments, and for that matter those that made an advantage from the virus itself. So, healthcare is a winner, technology is a winner. You have those inside of the healthcare technology, there are others that are sort of picking up and doing very well.

The e-commerce space is another great example of that. You know, you hear the head of Zoom show up on CNBC and say admittedly, we are the benefit out of a very terrible virus, and that’s true. So you’ve got various companies that are sort of enabling our ability to survive through this, at least virtually, and that being a strong sort of accelerant to what they’re doing. I fail to mention consumer goods, and the boom that they have seen, whether it be Procter & Gamble, General Mills, Unilever, others that are really doing well, not only in terms of stock up and people being able to eat from home and work from home but their ability to rely on especially more trusted brands, incumbent brands, within those categories is also a real accelerant to them. They’re seeing growth rates that they haven’t seen in years.

And yet there are also losers from this: the cruise industry, the airline industry, the concert industry, hotel industry. There are many other sectors that are, you know, the automotive industry, that are really hurting from this, energy obviously, and so as you look at those, then it comes to, okay; Which of those are going to come back, and resume as the world resumes? And which of those will not because it’s time for them to sort of enter into what was going to be a reinventive period for them anyway? So what am I talking about? 

Lets just talk about automotive, like this will accelerate the focus on electric cars. Let’s talk about the cruise industry, this will force them to think about reinvention, because people will get back on cruises together, but perhaps not as much as they had before. And so they have to think about what they can do to entice you to go onto a boat differently in the future. I’d say the same thing with air travel. With this new normal being us working from home, our ability to have a face to face conversation as a requirement, really does start to become diminished. And so what are new, good reasons for you to hop on planes, and then what is that plane experience, in the future as well, says that you’re compelled to do so even more than you have in the past. Relating that back to 5G, I think 5G is an enabler in both the winners and the losers. For the winners, 5G is an enabler of tele-health, 5G is an enabler of brands as a service within the consumer goods world because of the virtualized rich experiences it can create to everyone with broad coverage. And so, those sectors that those that can win will see 5G as an enabler towards them. Those that are facing headwinds as a result of covid. I think they will have to look at 5G as an enabler to them, and IoT, and augmented reality, you know, and machine learning. But they’ll have to reinvent their businesses in ways that they’re using those technologies to provide new value propositions to their customers, and that include those technologies I just described increasingly virtual services as well. 

We’re all sitting on our phones, we all have time sitting at home. Our ability to try something new through an Instagram post or a Reddit post, is at an all time high. But relative to the overall market, in terms of sales of these brands, we’re seeing the incumbents taking share back.

Jake:

It’s interesting, specific to your point, research found 60% of consumers are using their mobile phone more, and those 60% are twice as likely to be trying new brands more than they usually would.

One point I just want to get back on, on CPG, just want to capture a little bit more specifically. You mentioned CPG that 5G can be a real boon in terms of rich immersive experiences.

Michael:

Yeah.

Jake: 

Could you touch on that in a little bit more detail, what do you mean by that?

Michael:

Yeah, so back to marketing speak, 5G enables faster image recognition, 5G enables better augmented reality. It enables more customizable video, it allows for better geo-targeting by nature of contextual video. For me, a big one for 5G is IoT, massive expansion of data points that can then be recognized and acted upon on a much more real time basis. You combine that with the screen that serves up content and now you’ve got increased ways to act on what you can observe, whether it be industrial applications, rich media and events, or even the work from home experience for the smart home. It’s different environments but its content grows even more rich through those environments.

Jake:

Okay, one thing we’re really excited about here at Emodo, is since we interviewed Jeremy Lockhorn on an earlier episode of the podcast, he actually decided to join Emodo; and Jeremy is now a member of the Emodo team.

Jeremy Lockhorn:

My primary role is focused on strategic partnerships, managing the critical relationships we have with mobile operators around the world. So super excited to be here and thanks for having me back on the podcast.

Jake:

Jeremy, in earlier episodes we discussed the need for prominent retailers to be aggressive in investing in 5G inside their walls as a way to differentiate, and also to optimize the supply chain. Have we seen any examples?

Jeremy:

I think it’s super early days, of course, you know, we have this pandemic causing all sorts of disruptions around the world and in every business sector. But yeah, we are seeing some action in terms of retailers investing, and building 5G infrastructure inside their stores. I would consider them to be experiments at this point, but there’s some interesting momentum there. Two that caught my eye would be Walmart and Verizon, are in conversations about a potential partnership where Walmart will outfit a few test stores with 5G connectivity powered by Verizon, which would fuel primarily healthcare services that Walmart is planning to roll out as part of a broader suite of services that they’re exploring and compliment their core retail business. I think that’s really interesting for a lot of reasons. In addition to powering the healthcare services that is the primary target of this, you can totally imagine a 5G connectivity being used in other ways to, for example enhance the in-store experience for shoppers, the augmented reality, or whatever else it may be. But also to drive more efficient store operations, you think about security cameras and footfall analysis on those kinds of things that can be enhanced by 5G connectivity. 

Then, the other example which is a little bit more real world, and they’ve already got some tests going in different stores is a partnership between AT&T, a robot company called Badger Technology, and a chain of grocery stores called Giant Eagle. Essentially they’ve got these robots that are roaming the grocery store aisles with high-resolution cameras constantly on the lookout for items that are out of stock, or are one the wrong shelf, or have the incorrect price attached to them, or was there a spill in aisle four. So, as these robots are constantly cruising around, and they have these high-res cameras scanning every aisle as they go, it generates a tremendous volume of data that it was crushing the Wi-Fi networks. So when you bring 5G to the party, it relieves the pressure on the Wi-Fi networks, opens them up to do what they’re good at, and also can power in a much more robust way, this sort of computer vision coming from these robots.

Jake:

Of Course for so many companies and jobs, heading off to the office in the morning isn’t a thing anymore. Corporate America used to be a daily migration to and from office buildings. We used to stack vertically in the sky scrapers downtown, now were scattered horizontally across suburban neighborhoods. Where does 5G fit into a socially distanced nation of remote workers? In my view, this new era of the highly distributed workforce can benefit from 5G for sure, but also alter the expected course for 5G.

Michael:

I totally agree with that, and Jake, the way I look at it is the distribution of workforce is not only being able to create an IT environment that supports employees working from home in city, but as our expectations as employers and employees is more amenable to this virtual work experience, that means people can work from anywhere. You can see the national figures around the housing market being very, very strong right now. And then you combine that with an overlay of the biggest metro areas having the biggest suburban booms, you know, Connecticut is almost impossible to find a house right now. The suburbs of Los Angeles, same situation. I really am concerned for New York, and for that matter other large metropolitan areas, especially those that rely very heavily on public transportation to get in and out of cities. I don’t know how that comes back in the short term.

Jake:

When we think about 5G a lot of times people will think of urban cores and business districts, but one of the other potential benefits of 5G is also more rural with really good quality home internet and wireless coverage in further out places where people might be living. So, it sounds like covid-19 might have hastened the trend towards that to be even faster and sooner than it might otherwise have been.

Michael:

I totally agree and I think that’s especially true not only in terms of the work from home requirements, but also the corporate real estate that gets built out in suburbia. Like, I had mentioned office parts but you’ll want to get out of your house and go to a restaurant with a friend somewhere in your neighborhood as you’re working from home. That really invites the sort of local retail village, or you’ll want to have services that you used to be able to get when you were on your lunch break downtown available to you in other areas. The way I think about it is, 5G does long term get more accelerated by the boom in suburban working. At the same time in the short term because covid created such a macroeconomic shock that will slow some of the demand for the build out in the short term as well. We did expect that that would be based upon high concentrations of downtown areas. I look at it as now, no actually it’s probably still around cities but it’s probably more distributed around the suburbs around those cities. 

Jake:

Let’s talk about complementary technologies for a minute. Things like artificial intelligence and edge cloud computing, AR and VR, to name a few. It’s a key time to see if or how that ecosystem is continuing to evolve, especially since covid-19; or whether it is stalled like so many business sectors.

Peter Linder:

So I think that you could describe it in the following way.

Jake:

Here’s Peter Linder, Head of 5G Marketing at Ericsson.

Peter:

So the 5G ecosystem, the whole ecosystem moves a lot faster than the introduction of 4G did. If you look at how many networks that went live in the first year of 5G was 59 across the globe. In the same time period for 4G was 4 networks, so the difference between 59 and 4. The amount of subscribers we took on in the first year for 5G, and you can also look at the fact that today there are 135 different devices released for 5G and 300+ announced. So the whole ecosystem is a lot more like a coil, with a lot more power into it right now, so it’s the more things working in tandem and this pushed the envelope regarding first mover advantages. It’s difficult to say, hey I’m not sure about if the timing is right and perhaps wait a year or two. The only way I see you can approach 5G is moving in early, learning, but then working with smaller projects. You might go off to specific use places. We’re picking some of the things where I think 5G can provide the biggest advantage. You should move really, really fast, but you should also be selective in what you’re trying to do so it does not become a boil the ocean problem.

Jake:

Hey Jeremy on earlier episodes we talked about how 5G is dependent on complementary technologies. Have we seen anything happen in the ecosystem to make us feel more confident that it’s not gonna be a chicken or egg scenario, that these things are going to evolve simultaneously?

Jeremy:

It’s a fantastic point, and yeah, there’s been a ton of activity in this space over the last year or so. To point to just a few specific examples, there was an announcement just a few months ago from Qualcomm, 15 operators around the world are joining in their push for augmented reality glasses of various kinds, and there’s a bunch of manufacturers of the glasses who are what I sometimes refer to as ‘head mounted displays’ or ‘heads up displays.’ They are part of this program as well. The operators, you know again, are global operators and they’re committed to carrying these products once they become available, so that’s I think one interesting example. From the carriers themselves, another great example is T-Mobile, NASA, and Intel are all founding partners of this initiative they call the 5G open innovation lab, and it is specifically focused on building a 5G ecosystem. It’s a somewhat familiar model, in that they partnered with key enablers like cloud services from AWS and Google Cloud. They brought in consulting and systems integrator; companies like Avenade, which is part of Accenture, and they’ve just completed a 12 week accelerator program where they’ve mentored a handful of start-ups. It’s a really interesting model where they’re trying to equip these start-ups with all sorts of access to expertise and technology, 5G simulations and so forth. One great example of one of the start-ups that was part of that class that just wrapped up, is a company called Transparent Path, who are bringing together IoT, Blockchain, and artificial intelligence to solve supply chain challenges in food industry It’s just a great example of how 5G can get all of that together, and in a really robust way, and drive a better solution at the end of the day.

Jake:

Jeremy, thanks for joining again.

Jeremy:

Yeah, my pleasure. Thanks so much for having me.

Jake: 

A lot of the interest in 5G for marketers is dependent on the adoption of 5G amongst consumers, because reach is so critical for marketers. A year ago, there were very few 5G enabled devices on the market, today there are quite a few. But in this challenging economy, you have to wonder if there’s an appetite, or if there’s much demand at all for new 5G enabled devices.

Michael:

I think you are absolutely right that new phones have been, to some extent, disadvantaged relative to new computers, new laptops, new notebooks. My analogy is 2007 through 2009, we had 3G coming up 5 years before that in terms of mass roll out, but there wasn’t really a huge pickup in demand for 3G until the iPhone came out and you had, you know, they had apps for that but nothing was as well integrated together into a common mobile ecosystem that the iPhone pioneered. That really drove up a lot of demand for 3G, and for that matter, subsequently LTE and other solutions over time. I see the same challenge to 5G, where there will be a challenge as to what the killer app of what 5G will look like. What does it have to be that will then drive demand regardless of the economy. So the iPhone went gangbusters despite an economic downturn and people were able to move very quickly to very rapid adoption of that, despite the fact that 2008, 2009 were very tough years, economically. I should say the same thing about the iPad, it had a similar boom around that time frame. I would look at 5G having that same prospect. That they will need to have a vertically integrated solution that combines the device, artificial intelligence, content, and it would have to be I think specific to certain kinds of applications in the short term, certain kinds of audiences in the short term that will really just make 5G boom. Because you can’t not do it without 5G. I think we could see the same thing where the economic environment might not matter once that comes along.

Jake:

Good to talk to you again Michael.

Michael:

Take care, bye.

Jake:

This time last year, the mobile operators were making big bets on 5G. They were making some bold claims in bold type. How are those looking now? Has covid-19 slowed 5G progress, or diminished the promise from a network build out standpoint?

Peter:

Low-band spectrum is where we’ve seen the largest coverage today, because that is essentially about upgrading radios with software, and then you can switch it on very rapidly. So for example, this week Deutsche T-Mobile in Germany announced that they will switch on 15,000 radios in a single week. So, to anything that is related to a software upgrade of existing infrastructure, it goes fairly quick. So whenever you hear something that’s talking about nationwide coverage or very large coverage, it’s low-band spectrum that has happened. If you look at high-band spectrum, you build out in different zones in a city or a suburban area, and it is partial coverage in the cities where it has launched. In the big discussions, there is about for which type of purposes, and which cities are suitable to expand to in the next way. In between these ones we have what’s going on in the mid-band spectrum, and the things that are happening there is essentially all those assets that Sprint had, have become element of what the new T-Mobile is going to do, and the service provider will be able to get access to more spectrum in the middle, and that is perhaps noble territory, so not a whole lot is built in that area yet. The low band spectrum is reaching half the U.S. population right now. And if you look at the high-band spectrum, the leading operators covered a little bit more than 30 cities last year, and that is one doubling this year. 

Jake:

If you were to go back a year and talk to yourself from a year ago, and surprise yourself with something about 5G that you never would have expected a year ago, what would that be?

Peter:

I think it’s the momentum. If I look at some of the numbers for the first year, the fact that we had roughly 20 million subscribers worldwide and 59 operators launching networks, that has grown right now to 75 operators having live networks. I think the biggest number that stands out to me is the 190 million 5G subscribers which we project worldwide for this year. Getting from 20 million by the end of last year, to 190 million at then end of this year, even with covid going on. I could not have imagined such a significant ramp up, but I think it’s very much driven by the fact that there’s so much focus on this, there’s so many operators that want to be first out and getting first mover advantages, and there’s so many device providers. The announcement made today has been for 16 different types of devices, not 16 devices, but different types. With 135 already launched and 317 announced, that is, like, it’s so much. I had a lot of belief in the momentum, but not that it was going to be that strong.

Jake:

Hey, if you want to dive even deeper into 5G, check out Peter’s 5G blog. You’ll find the link in our show notes, it’s great stuff Peter Linder.

Before we go, i’d like to tell you a little bit about our upcoming second season. One of the key benefits of 5G is the ability to aggregate tons of metadata in real time and perhaps the greatest impact from that is the ability to use that metadata to make decisions in real time and to make predictions. That’s what AI is all about. AI may be the part of 5G’s complimentary ecosystem that affects marketing the most. It extends well beyond 5G, and will have a more profound impact even sooner. Hopefully, you found that this show has helped demystify murky and complex stuff, because we’ve decided to do it again. We’re launching season two, this time focused on AI. AI is core to the future of marketing, and to the career prospects of up and coming marketers. But while many vendors toss around the term AI like pizza dough, most marketers aren’t equipped to challenge their vague, often spurious claims. The second season of FIVE will put you in the driver’s seat regardless of how technically inclined you consider yourself to be. Up your AI game with season two of FIVE, the AI podcast for marketers. Here’s a short clip from episode one of the new season:

In your business, you may have noticed the growing trend of vendors touting their proprietary artificial intelligence of their super smart algorithm. So understanding AI means opportunity, or put another way, not understanding AI is likely to mean lost opportunity.

Here’s Rishad Tobaccowala:

Nobody actually looks at the spreadsheet, only crazy people look at the spreadsheet. What we always look at are the results or the summary that someone did of the spreadsheet, which by the way is a strange form of AI. It’s called humans.

Michael:

There’s a lot of people selling a lot of stuff, but no, we are on day zero. The algorithms that ultimately will get to perfect one to one don’t even exist yet.

Shelly Palmer:

There are two kinds of executives in the world, those who think AI is this magical black box that will do their work for them, and then those who know that that’s just completely stupid.

Jake:

If you don’t know much about AI, you might not even know why things went south, or even that they went south at all. 

Be sure to listen to episode one of FIVE: AI for marketers, featuring Rishad Tobaccowala, Shelly Palmer, Michael Stich, an amazing array of guests. The new season begins September 16th. Don’t miss season two. And thanks again, for being a part of season one.

The FIVE podcast is presented by Ericsson, Emodo, and the Emodo Institute and features original music by Dyaphonic and the Small Town Symphonette. This episode was produced by Robert Haskitt, Liz Wynnemer, and me. I’m Jake Moskowitz.

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