Monday, November 11, 2019

A Likely Change to ‘Business as Usual’

Ask The CFP® Practitioner


Several weeks ago we talked about the differences between 5G and 4G (4th and 5th generations) data transfer. That column sparked questions and interest in knowing more about how 5G may impact our lives. Today we’ll discuss ways this innovative and disruptive technology will likely change business as usual.

For a quick recap, 5G data transfer technology will require construction of massive data centers and additional cell towers. With *blazing speed, and *expansive broadband capabilities, 5G will be a game changer. Each generation of 5Gs’ predecessors from 1G to 4G, have built upon improving specific capabilities. The first iteration of wireless technology brought us mobile calling and flip phones, next was the painfully slow beginning of digital data transfer (remember video buffering) with 2G, then 3G brought us internet on the go, and we now have broadband at our fingertips is a result of 4G. The advancements 5G will provide are access to white-hot increases in speed, lower latency, which is the time it takes data to reach the receiver, and greater bandwidth.

The consistent and reliable transfer of data will give a boost to artificial intelligence (AI), virtual reality (VR), augmented reality (AR), three-dimensional video, and holographic imaging possibilities. Medical consultations will seem more like the house-calls of years past. AI’s ability to diagnose and prescribe for patients will improve with more data. According to Raymond James Research, financial institutions are embracing 5G as well. Approximately 81% of financial institutions have increased technology expenditures making a commitment to 5G and innovation.

The Internet of Things (IoT) connects smart devices such as smart phones, Echo’s, Alexa, security systems, fitness trackers, climate control, and energy management. Refrigerators can send your grocery list to a warehouse and the items could delivered by drone. Because of 5G capabilities, e-commerce will continue to evolve. Other areas impacted will be logistics and planning, waste management, transportation and even data-driven urban planning connecting your smart house to a smart city.


Our research shows that on average, we each have between 13-15 IoT devices. A report by Ericsson predicts that 5G will become the fastest adopted wireless generation, reaching 1.5 billion subscriptions worldwide by 2024.


As mentioned several weeks ago, it is expected that the IoT will connect 75 billion devices by 2025. With approximately 7.7 billion earthlings on our planet, it’s unlikely that each person around the globe will have their own devices. Changes in society and technology will however increase the number of internet devices consumers in developed and emerging markets will own.

To get a sense of this phenomenon, take a quick glance around your home and workplace to see how many IoT devices you already have in place. Our research shows that on average, we each have between 13-15 IoT devices. A report by Ericsson predicts that 5G will become the fastest adopted wireless generation, reaching 1.5 billion subscriptions worldwide by 2024.

This transition is already under way with certain networks like Verizon and AT&T already offering 5G service in select areas, and much wider access will likely be available as soon as 2020. You can already buy a 5G-enabled Samsung, with iPhones to follow in 2020. While it will take some time for the full power of 5G to unfold, it seems likely that as it does, we’ll be introduced to a whole new world of possibilities.

Innovation is often incremental in nature. But every so often, an invention or discovery disrupts entire industries and changes life as we know it. A few examples are the discovery of fire, electricity, printing presses, telephones, and the internet. Disruptive innovators are difficult to predict, and the next few decades will deliver on ideas we can’t yet imagine.

For perspective, on-demand car sharing first appeared as a technology app in 2009. Today there are two leaders in this space, and it could revamp the transportation industry as much as the wheel did when it was discovered in 3,500 BC. The healthcare field already uses AI and patients’ personalized DNA sequencing for predictive and preventative rather than reactive care.

The energy sector, according to GE, could power the entire global economy within twenty years as smart energy grid-storage methods become more competitive. Fossil fuel reliance is expected to lessen as renewables and energy storage are perfected.

Virtual reality experiences and holograms can provide previews of experiences influencing travel and tourism industries. Vacation Rentals By Owner (VRBO) and Airbnb are examples of our expanding shared economy which took hold in 2008. Transportation options are changing with ride-share providers like Uber and Lyft providing convenience for many, while reducing cost of full car ownership. Touchscreen fitting-rooms, augmented reality and 3D body imaging makes shopping for clothing a more user-friendly activity. These innovations are intended to provide user-friendly and personalized experiences for consumers.

Increased digital activity requires risk evaluation and enhanced security measures to protect us from cybercrime. Biometrics and AI can help identify fraud before it happens. The collection and analysis of intelligence obtained through data mining is a byproduct of 5G advancements which will drive content.

The data and information contained herein was obtained from Raymond James Research resources considered to be reliable, but accuracy and completeness are not guaranteed. Mention of specific companies’ names, information or any opinions expressed do not constitute a solicitation for the purchase or sale of any security referred to herein. Investors should discuss the risks inherent in bonds with their Financial Advisor. Risks include, but are not limited to, changes in interest rates, liquidity, credit quality, volatility, and duration. Past performance is no assurance of future results.

Information contained in this report was received from sources believed to be reliable, but accuracy is not guaranteed. All investments contain risk, including loss of principal. Views are as of May 15, 2019 and subject to change based on market conditions and other factors. “Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.”

This article provided by Darcie Guerin, CFP®, Vice President, Investments & Branch Manager of Raymond James & Associates, Inc. Member New York Stock Exchange/SIPC 606 Bald Eagle Dr. Suite 401, Marco Island, FL 34145. She may be reached at 239-389-1041, email darcie.guerin@raymondjames.com. Website: www.raymondjames.com/Darcie.

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