2019 Trends to Watch: Asia

摘要

The finalization of Release 15 of 3GPP standards in September 2018 will be a catalyst for 5Glaunches in 2019. Spectrum is already available in several markets, and operators are announcingplans for network investment, including sharing of infrastructure. Talk is turning to action.The Internet of Things (IoT) already has momentum in Asia, which dominates IoT rollout of verticalindustry applications. The launch of 5G will eventually provide a new and better platform for IoT, andallow for new industrial use cases to emerge. 5G is the basis of an ecosystem, not just a technology.It will support a host of industrial applications in agriculture, manufacturing, transport, and smart citymanagement that can help boost Asia's sluggish national productivity performance.The emerging threat to this ecosystem is the fragmentation of technology markets. Australia recentlyblocked Chinese vendors from participation in 5G, and Canada and India are rumored to beconsidering the same move. The risk here is that the global ecosystem for 5G industrial applicationscould ultimately be split, eroding economies of scale and other synergies. This would raise 5Gnetwork costs and make it harder to develop the new "Industry 4.0" applications needed to boostindustry efficiency.5G and IoT will be major platforms for the next generation of industrial innovation, and their progressin Asia are two of the trends to watch that we have selected for 2019. They are key elements of theemerging ecosystem for enterprise digitization that will drive productivity improvement through socalled"Industry 4.0" transformation. Asia's launch of 5G and its outsized presence in IoT development(especially in China) make Asia the epicenter of this change.Asia is also the epicenter of a potential fracture of this ecosystem. Rising concerns about nationalsecurity of networks have led Australia to effectively ban Chinese vendor participation in 5G networks,and it may not be the last country to take this step. This is a step back from the globalization that hasdriven efficiency and innovation in the global telecoms industry over the last few decades, and onethat may have significant and negative consequences for global technology development if notmanaged carefully.1. 5G rollout will begin at last. The finalization of standards and the resolution of spectrumaccess have laid the foundations for a 5G push in 2019 and 2020.2. Asia will retain and deepen its IoT leadership. Asia is a clear global leader on IoT, withChina alone accounting for around half of global machine-to-machine (M2M) cellularconnections. Scale and a head start will ensure Asia retains this lead.3. Security issues and geopolitics are putting pressure on the global technologyecosystem. Recent decades have seen the emergence of a global market for technology,which has lowered costs and accelerated innovation. This could be threatened if vendors areexcluded from supply chains.